Water Leasing Laws Under Scrutiny

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Cities and entities are acquiring water rights from agriculture to satisfy development and growth.  In some instances, these entities have permits to divert water and have to meet conditions of their permit by acquiring water rights and transferring them.  Usually, these transfers are out of agriculture to municipal use.

In one recent example, the Village of Ruidoso has been acquiring water rights.  While the village has a long history of water rights acquisition, their most recent applications have been emergency applications or water leases.  Some local acequia advocates questioned the use of emergency transfers for an entity that has known is supply gap for several years.  Most recently, the village filed an application for a water lease from agricultural land on an acequia to the municipal water supply.

Water leases generally have been treated like any other type of water transfers in that an applicant has to file for a change in point of diversion, purpose of use, or place of use.  That application can be protested and the State Engineer holds administrative hearings to assess impairment of existing water rights, conservation, and public welfare.

The Village of Ruidoso filed three applications for water leases in July and over three hundred protests were filed by local irrigators, acequias, a mutual domestic, and Lincoln County.  The application sought to transfer water from xx acres on the xx community ditch.  The protestants from the Upper Hondo raised concerns about the proposed lease because the diversion of water from the river would impair downstream senior water rights.  They have also raised concerns that river flows are so impaired that any additional diversions will essentially dry up the river.

Although the protestants expected full consideration of their protest through an administrative hearing process, the State Engineer granted “immediate use” to the Village of Ruidoso.  Although it is not certain whether these diversions are occurring, the State Engineer approved immediate use by the village.  This has raised the issue of whether due process is being followed in the water lease application process.

The protestants to the Village of Ruidoso application secured the services of a legal team and have defended their protest.  The village attorneys filed a motion to dismiss and the Upper Hondo protestants have had to respond.  Aside from the ongoing protest, local leadership and the NMAA have engaged in some policy analysis and have scrutinized the decisions of the State Engineer on this particular application.

In a resolution passed by the Congreso de las Acequias, the NMAA raised concerns about the interpretation of statute used by the State Engineer to grant “immediate use” without due process for the protestants.  Additionally, Upper Hondo leaders and the NMAA are working on an analysis of state statute to identify possible statutory changes to clarify that water leases should be subject to the same due process protections of other water transfers.

In 2015, two separate and parallel tracks will proceed.  In the first, the Upper Hondo protestants will continue their protest against the application filed by the Village of Ruidoso and their legal challenge of the decision of the State Engineer to grant immediate use.  Secondly, the Upper Hondo leadership and the NMAA, along with other allies, will pursue a legislative campaign to change state statute to clarify that water leases such that a lease will only be effective after hearings and consideration of public welfare, conservation, and impairment of water rights.

The granting of immediate use circumvents the protest process and the ability of anyone affected by a proposed transfer to raise concerns about an application for a water transfer or water lease.  This has statewide implications because it affects the due process rights of existing water right owners and the general public. 

If anyone is interested in supporting the Upper Hondo Water Protest, contact the NMAA to contribute to the Upper Hondo Legal Defense Fund.  The purpose of this fund is to help defray the cost of the legal defense team.  Donations can be sent to the NMAA to the attention of the Upper Hondo Legal Defense Fund at 805 Early Street, Suite 203B, Santa Fe, NM  87505.