"Cracking the Adjudication Nut"- 09-Aug-01


Special Feature



	Thursday August 09, 2001 "Cracking the Adjudication Nut" Comments by Tom Turney New Mexico State Engineer Water controls the future of NM. No longer can a day pass without either one or more newspaper articles or TV reports carrying some aspect of New Mexico's water supply. Water issues are not just local to New Mexico. People throughout the world are recognizing the value of water. Wars are being fought in the Middle East. Water is at the core of the current confrontations between Syria and Israel. The New York Times carried an article on its front-page this year saying that water in Texas has replaced oil as the new liquid gold. The recent 2000 census confirmed that the State of New Mexico is growing. Among the western states, New Mexico now ranks 8th in growth. As the State grows and water becomes more and more scarce, water availability will ultimately define the future of New Mexico. Because of this growth, the state's water resources, by necessity, will have to be become actively managed. We must do so to insure that the water goes where and to whom it is supposed to go to. There is one thing many people easily forget. New Mexico is basically a desert. We forget this simple fact because when we turn on a faucet, water flows. And when the water flows, most people simply forget the reality that New Mexico's available water resources for people to use are finite. And in a desert, not everyone can have all the water they want. This basic principal was recognized 400 years ago when the Spanish government settled New Mexico. This concept is reflected in the State Constitution which established a prior appropriation system of water administration. Simply stated this system is based on the principle of "first in time, first in line", that is those who first put water to beneficial use have the first right to its continued use. The date of that first use --or initiating the first step necessary for the completion of the appropriation--establishes the priority date. The earlier the right--the better the right. People that have senior water rights--that is the earliest priority dates--have the right to use the available water supply first. They get the water in a time of drought and junior appropriators get cut off. The state's statutes require the state engineer to conduct hydrographic surveys for the purpose of initiating adjudications. Adjudications are judicial determinations of who owns what water rights. Completed adjudications are key to NM's future as they are integral to the efficient management of the state's water resources. My office has done adjudications since the beginning of statehood. I am afraid that at some point in the past century the importance of completing adjudications was forgotten. It certainly was not detectable when I began as State Engineer. It was my impression, which seemed to be shared by both office staff and the outside world, that the decades old adjudications were statutory judicial oddities without any readily identifiable relevance to the agency's mission. Each year a small portion of the agency's budget was allocated for staff and court costs to continue with its work. They definitely were not a hot issue. Forgetting the importance of completed adjudications is understandable. The state engineer was confronted with "hot issues" beginning in the 1930's, with the initiation of the interstate river compact process, followed by years of interstate water issues and river litigation. Then evolved the complex litigation involving Native American claims to water and the state's adjudication jurisdiction. I suspect that the ever-present hot issues and the snail's pace of progress on the numerous adjudications filed during the 1950's, 60's and 70's, most of which continue today, combined to dull any real consideration of the utility, if not the importance, of completing the adjudication of all water rights. Certainly, no one in my office, including me, really understood that adjudications have to be completed if the State is to be successful in the active management of its water resources. Because New Mexico's water resources are finite, I have been talking about Active Water Resource Management for the last two years. The Denver Post recently carried a projection that anticipates that New Mexico's population will grow by almost 85% over the next 50 years. Adjudications are a cornerstone of active management of the state's water resources. Adjudications allow the State to systematically meet this inevitable growth in population. For whatever reason, NM has become a very popular place to live. The majority of the state's water resources, close to 80 %, are appropriated for agricultural use. Municipal and industrial use is about 8%. It is inevitable that as the state's population grows, agricultural water rights will have to move to municipal and industrial uses. There simply is no more free water available. Whether people want it to or not, the existing water right market is going to grow and mature. For the market to be viable, the state must be prepared to provide a level of certainty to the market. Adjudications are key to providing a level of certainty because they define the elements of valid water rights. Ultimately, as water markets grow, only those rights that have certainty will be marketable. But for adjudications to contribute to a viable water market, they must be completed. The 1909 annual report of State Engineer shows that the waters in the Alamogordo area were then being adjudicated. Since statehood, final decrees have been entered for waters on the Dry Cimarron, the Canadian River, the Mimbres River, the non-Indian portion of San Juan, and parts of the Pecos River system. Just this past year partial final decrees were entered on Red River as well as for the non-Indian rights on the Jemez River. In almost a hundred years, we have adjudicated less than 15% of the states agricultural waters. At the rate we are progressing with adjudications, we still have another 600 years before we complete adjudicating the entire state. This is clearly unacceptable. The process of completing adjudications must be revisited. They must be completed timelier to have meaning. But the next question is how? Part of the answer lies in prioritizing existing adjudications and improving the efficiency of the adjudication process. In 1996, a status conference, with the various ongoing adjudication courts, was held and timely completion of adjudications was discussed. Two common threads emerged; everyone agreed that to complete the ongoing adjudications they had to be prioritized but unfortunately there was a caveat--everyone also agreed that their respective adjudications should have the highest completion priority. One of the lessons we have learned about adjudications is that they can be completed if people in my office work continuously towards completion. Adjudications cannot be completed if people work on this adjudication for a while, then move over and start working on a different adjudication six months later. But the hard decision is deciding which adjudication to complete. Prioritizations must be set. Further, to do what needs to be done, adjudications must have enough attorneys and engineers assigned in my office to complete them. The State doesn't need to take on any new adjudications at this time. We already have more than enough on our plates. On the Zuni River, in the waning days of the Clinton Administration, the United States filed an adjudication suit. I have traveled twice to Washington D.C. to find out the motivation behind this suit. I also discussed the importance of prioritization. The Feds say that prioritization of adjudications in NM is a great idea. But they plan to go ahead with their Zuni suit immediately. As it stands now, it appears that the United States' plan is to spend $200,000 to do some sort of partial hydrographic survey over the next couple of years. Then they will dump the rest of the work in my lap-finish the hydrographic surveys, negotiate with the Zuni Pueblo, and spend years in court pursuing individual claimants. Indian adjudications take years. The United States often claims it lacks the personnel to diligently work on the active adjudications involving Native American claims, in fact they are shuttling the lead attorney from Washington, DC to New Mexico. The United States, for some reason wants to start yet another one. Its logic is baffling, because its ill-timed strategy only dilutes my staff and will prolong the completion of earlier adjudications. The whole State needs to be completely adjudicated. But to do so, adjudications need to proceed in an orderly fashion. We need to finish up the adjudications of the tributaries to the main stem of NM's upper Rio Grande. This is necessary to protect San Juan Chama Diversions that are in the process of being fully developed by Santa Fe and Albuquerque. We need to complete the lower Pecos River below Fort Sumner, as the State is facing serious consequences as a result of United States Supreme Court decree, should NM under deliver water to Texas. There is a possibility of that actually happening at the end of this year. We need to complete adjudication of the Lower Rio Grande. This must be done for a number of reasons. The area is undergoing rapid growth. The Texas Legislature this year appropriated $6.2 million to vigorously represent Texas interests below Elephant Butte Dam. One way to protect NM is for NM to adjudicate this area to improve our capability to actively manage the river to insure that we continue to meet our obligations to Texas. The number of claimants in this lawsuit is startling-somewhere between 15 and 25 thousand. Turning to improving the efficiency of the process. About six years ago, Steve Hubert questioned me at a Water Resources Conference in Las Cruces. Why was the State Engineer refusing to complete a hydrographic survey of the Lower Rio Grande-EBID had been waiting over ten years. From Las Cruces to El Paso, an area that was rural 30 years ago, was now seeing almost continual development. The100 years of water wars over the Rio Grande between NM and Texas was legendary. These fights continue to this day. El Paso is growing by leaps and bounds and Texas is responding to its need for additional water-possibly New Mexico's water if Texas feels it is cheaper than that water available elsewhere in Texas. Apparently, from NM's Las Cruces area's perspective, the Lower Rio Grande had to be adjudicated to protect New Mexican's water supply. It didn't take a genius to figure out that the State appeared unresponsive to the Las Cruces area's concerns. We began to search for ways to fund the adjudication of the Lower Rio Grande. General Fund monies were not an option as budget requests to expand the adjudication budget were routinely cut. The legislature, however, approved, the use of OSE/ISC Ferguson Act trust funds that receive income from 600,000 acres of land, amounting to about 1% of the income that that is generated by the State's permanent fund. These funds were budgeted to perform the large scale hydrographic surveys of the Lower Rio Grande and portions of the Pecos River using contractors which had the latest mapping technology. In so doing, the major sections of the LRG were completed in a relatively short time compared to the time required to do so with the dated practices and technology available to and used in my office at that time. Now we have adopted and adapted that same technology within my office. Today, we place the completed hydrographic surveys on the Internet, which has proved to be enormously popular. People like being able to see both their own irrigated lands and their neighbor's. But even though we were now performing hydrographic surveys faster, adjudications still take extraordinary lengths of time to complete. This timeline must be shortened. I believe we will do so. Three years ago, the Legislature enacted the Government Accountability Act. This act required the office to do major items-first it required performance based budgeting, secondly it required strategic planning. Strategic planning is anything but easy. Most organizations, whether they are government or private sector, do not like to change the way they have been doing business. It undermines the very notion that everything you have been doing for years is the best way to accomplish that function. Strategic planning forces everyone in the office to sit down around a table, discuss the goals, the visions, the future of the office, the general public's and water right stakeholders' expectations of us, and how we will meet these expectations. As you have heard, adjudications will be prioritized through our strategic plan. We are looking at ways to change the adjudication system so that a massive adjudication endeavor can be efficiently managed. We have retained a retired Supreme Court Justice and a retired Appeals court judge, to examine issues relating to these lengthy adjudications. Are existing rules and procedures of the adjudication Court being fully utilized to streamline these adjudications? How should the priority of an adjudication be set--recognizing the need for agreement among the courts, the governor, and the legislature? What resources does the Court system need, if any, to improve its ability to efficiently handle these massive lawsuits? Would the State best be served by setting up a court that deals specifically and only with adjudications? Based on the State's experience in Alternative Dispute Resolution in the Lower Rio Grande, does ADR have a meaningful place in future adjudications? We are engaged in major discussions with the Navajo Nation on potential settlement of their water right claims. Can these discussions be a shortcut to a lengthy adjudication process? Both the emerging water market and adjudications have been identified in our long range strategic planning. On the back table is a copy of a White Paper. This paper describes in more detail the water issues NM is facing and how the OSE/ISC will change to meet these water challenges. If you can't get a copy, just ask anyone here this afternoon from my office for a copy, and we will e-mail one to you. Because of the State's growth, within the next 20 years, the State must complete the major portion of ownership determination of the majority of the waters of the State. The cost is going to be high-we have completed a preliminary cost estimate which shows that we will need approximately $170 million to completely adjudicate non-Indian water rights throughout the state. This is a lot of money. As I get ready to wind up, I want to touch briefly on making the market place more viable. This past legislative session, there was discussion about additional public notification when the transfer of a water right is going to occur. Such a bill was actually passed but was vetoed after opposition came from the New Mexico Acequia Commission and the New Mexico municipal league. The number of transfers is steadily increasing. On one side, water rights are private property rights, able to be bought and sold as a commodity. There is no question that water rights must be transferred if the State is going to continue to grow. As this will impact on the state's historically pastoral lifestyle, there is the desire, by some, to have the public know by whom as well as what water rights are being transferred. These people may wish to file a protest concerning the proposed transfer. Five years ago, protests were hardly ever received. Now it is the norm. 30 or 40 protests on an individual application are routinely received. My office is in the process of updating rules and regulation relating to administration of surface and ground waters. Additional public notification will likely be included in these rules and regulations. In this same vein, one issue relating to surface water rights is being debated internally in my office. Although a water right is itself attached to a piece of land, after a water right is moved off this land, we typically condition a transfer permit to require that the moved from land be dried up. This water is supposed to remain in the river to serve the new user. To allow the water to remain in the river is going to require the State Engineer to require the distribution system manager, whether it is an acequia or an irrigation district, to curtail their diversions at the river diversion point. Therefore, we are examining the appropriateness of including the acequia or the irrigation district as a co-applicant on any surface water right diversion. This will mean that acequias will have to modify their by-laws that will describe under what condition such a transfer might occur. This too will be reflected in our new surface water regulations. One issue that has been discussed recently in the news is the requirement of our office to install meters on domestic wells in what we call critical management areas. Part of the reason is related to adjudications. Currently the practice of our office is to adjudicate these 72-12-1 wells based on a diversion right "not to exceed historical beneficial use not to exceed to 3 acre-feet per annum". In the future, where water meter readings are available, these readings will form a basis for the amount of water offered by the State Engineer in an adjudication proceeding. In closing, adjudications take an inordinate long time to complete. The way that adjudications have been undertaken in the past is no longer acceptable and will have to be changed. New innovative methods are going to have to be discussed. New Mexico must position itself so that it can most efficiently manage its meager water resources as pressures increase as the state's population grows.