When the Well Runs Dry: Groundwater Policy and Sustainability Post-Agua Caliente.

• Author: Tyra, Alec D.

TABLE OF CONTENTS INTRODUCTION I. PASSAGE OF THE SUSTAINABLE GROUNDWATER MANAGEMENT ACT II. COMMON LAW PRIOR TO SMGA A. Historical Changes and Reasonable Use Regime B. Appropriators and Overlying Owners: Prescriptive Rights in Groundwater III. THE AGUA CALIENTE LITIGATION A. Agua Caliente I 1. Aboriginal Title 2. Winters Rights B. Agua Caliente II 1. Quantification 2. Quality 3. Other Proceedings and Agua Caliente III IV. ARIZONA AS A MODEL A. Groundwater Management B. Gila III and the Arizona Water Settlement Act CONCLUSION INTRODUCTION

In 2014, then-governor of California, Jerry Brown, declared a state of emergency. (1) California was at the height of one the worst droughts in the history of the State. (2) A high pressure ridge off the coast of the Pacific Ocean that alerted the jetstream and diverted rain away from California caused the drought. (3) While this type of pressure system is a common cause of drought in California, (4) the drought between 2011 and 20195 was particularly severe due to the higher-than-average temperatures which more quickly depleted soil moisture and snowpack. (6) The State Water Project (SWP) and Central Valley Project (CVP) are California's two water projects. At certain points in the drought, each project was unable to deliver water to some water contractors. (7) California's agricultural production was upended by drought. To offset the reduction of reliable surface water deliveries, farmers turned to increased groundwater pumping. (8) This increased groundwater pumping supplemented unavailable surface water deliveries contributed to a significant loss of groundwater from the aquifer system. (9) These practices lowered the water table to the point that some towns' wells ran completely dry and were subsequently left without a reliable water source. (10) Increased groundwater pumping also caused permanent loss to the overall storage capacity of the Central Valley aquifer system. (11) The loss of groundwater and aquifer storage capacity presents two problems for western states like California: 1) land subsidence; (12) and 2) the potential loss of critical resources in water management. (13) The severity of this particular drought was the impetus for major changes in water policy in California and the western United States.

1. PASSAGE OF THE SUSTAINABLE GROUNDWATER MANAGEMENT ACT

   The severity of the drought in California served as a catalyst in passing groundwater regulation. (14) Governor Brown's emergency declaration was issued at the height of the California drought and called for mutual collaboration between stakeholders to craft comprehensive groundwater regulation. (15) The resulting legislation was the Sustainable Groundwater Management Act (SGMA). (16) Notably, California treats groundwater and surface water distinctly under the law. (17) There are three types of water that are "in the ground": subflow of surface streams, definite underground streams that run in definite channels, and water that percolates through the soil. California classifies and regulates the two former categories as separate from groundwater water. (18) This categorization means that the only legally defined "groundwater" in California is water that percolates in an aquifer. (19) Before the enactment of SGMA, groundwater was largely left out of any statewide regulatory system and was instead controlled by common law doctrines. (20) California was also the last state in the West to pass statewide groundwater regulation, passing it after Texas passed its own groundwater management act in 2008. (21)

2. COMMON LAW PRIOR TO SMGA

   1. Historical Changes and Reasonable Use Regime

   Historically, California followed absolute capture, a legal principle carried over from old English common law. (22) Several early and influential cases in California, such as Hanson v. McCue, (23) recognized the English common law rule of absolute capture as the rule for groundwater. (24) The State of California at its inception codified the English common law, and as a result the rule of absolute capture and other water law principles like riparian rights, were all incorporated into state law. (25) In 1903, the California Supreme Court, during the Katz era, rejected absolute capture rule for a "reasonable use" regime for landowners overlying a basin. (26) The "reasonable use" regime in California was later codified by an initiative that amended the State Constitution. (27) Section 2 of Article X of the California Constitution stated in part that

   The right to water or to the use or flow of water in or from any natural stream or water course in this State is and shall be limited to such water as shall be reasonably required for the beneficial use to be served, and such right does not and shall not extend to the waste or unreasonable use or unreasonable method of use or unreasonable method of diversion of water. (28) B. Appropriators and Overlying Owners: Prescriptive Rights in Groundwater

   The California Supreme Court clarified that Section 2 of Article X applied to groundwater as well as surface water (29) and that overlying landowners have correlative rights with each other. (30) Those who are not overlying the basin may pump any surplus of groundwater out of the aquifer following a prior appropriation system of rights. (31) The appropriation framework in groundwater follows the same principles as in appropriation in surface water: senior appropriators have superior rights to that of junior rights holders. (32) When a basin does not have surplus water available, any further pumping is considered adverse and may lead to the formation of a prescriptive right, or rights acquired through adverse possession. (33)

   In City of Pasadena v. City of Alhambra, the California Supreme Court recognized the theory of mutual prescription, whereby overlying landowners and appropriators gained prescriptive rights against each other. (34) The Court found that adverse conditions necessary to form a Prescriptive right were created when the groundwater basin was in overdraft, as defined by groundwater extractions exceeding the basin's safe yield. (35) Further, the Pasadena Court held that the lowering of the water table was sufficient to satisfy the notice requirement for a groundwater pumper to perfect a prescriptive right. (36)

   The California Supreme Court readdressed mutual prescription in groundwater basins in the landmark case of City of Los Angeles v. City of San Fernando. (37) The San Fernando Court altered the rule of mutual prescription in three ways. (38) First, the Court found that municipalities were immune from prescription. (39) This puts private pumpers at a disadvantage because while a municipality may gain a prescriptive right against a private pumper, a private pumper is unable to gain a prescriptive right against a municipality. (40) Second, the San Fernando Court expanded the definition of overdraft to mean safe yield plus any additional surplus and, therefore, recognizing the variability of groundwater due to fluctuating rainfall. (41) Lastly, the San Fernando Court clarified that the notice requirement for a prescriptive right was a notice-in-fact standard. (42) A groundwater pumper seeking to perfect a prescriptive right must make all other rights holders on notice that the basin in in overdraft. (43)

   Additionally, The San Fernando Court criticized the theory of mutual prescription as creating a "race to the pumphouse." (44) The measure of a prescriptive right under the doctrine of mutual prescription is the highest level of pumping during any five-year period of overdraft that can be put to a beneficial use. (45) This structure incentivizes increased pumping in overdrafted basins. San Fernando also added an additional complexity in groundwater disputes by recognizing the distinction between native and imported water and the right of an appropriator to use their produced water even when it has percolated into the basin. (46) The complexity of groundwater rights in California is only further muddled by the State's long history of neglecting to regulate groundwater users in the same way it has regulated surface water users. (47)

   This discussion of California common law as it relates to groundwater is necessary for a meaningful discussion of SGMA. SGMA seeks to achieve sustainable groundwater management by mitigating or eliminating six identified undesirable results: chronic lowering of groundwater levels, (48) significant and unreasonable reduction of groundwater storage, (49) significant and unreasonable seawater intrusion, (50) significant and unreasonable land subsidence, (51) and depletions of in0terconnected surface water. (52) It provides that groundwater is still subject to Section 2 of Article X of the California Constitution (53) and that groundwater rights may still be determined through adjudication. (54) It neither changes nor modifies existing common law. (55) However, the California Legislature passed a companion law to SGMA that slightly alters the basin adjudication process to better coordinate with groundwater regulation planning. (56) This companion law regulates groundwater at a local level by giving local agencies (57) the ability to become Groundwater Sustainability Agencies (GSAs), (58) and delegates rulemaking authority to GSAs. (59) The GSAs are required to draft Groundwater Sustainability Plans (GSP) to outline how the basin is to achieve sustainable groundwater management by a required statutory deadline. (60) For basins in critical overdraft-designated with high or medium priority-the deadline for submitting a GSP is 2020, meaning the highest priority basins have already submitted their GSPs. (61) Other, lower priority, basins have until 2022. (62) SGMA's longterm goal is to achieve sustainable groundwater management within a twenty-year period--2040 for high or medium priority basins and 2042 for all other basins. (63)

   GSAs can regulate groundwater in many ways, including through issuing...