Montana Legislature

Lawmakers Grapple With Smith River Decision

By Dan Testa, 2-10-07

The crowd that tried to cram into a tiny room on the fourth floor of the Montana capitol building Friday overflowed out into the hallway, where security guards set up folding chairs so people could watch the proceedings on a monitor.

The small room could only accommodate a limited number of people, and the situation mirrored the subject at hand: Montana’s finite supply of water.

There’s only so much to go around.

Rep. Walter McNutt, R-Sidney, introduced two bills to the House Natural Resources Committee that set forth how water permits can be obtained in the wake of last year’s Supreme Court decision on the “Smith River case.”

The Court’s April decision raised the stakes in an already tense competition among farmers, ranchers, developers and recreationists for the state’s most precious resource.

The court ruled that, in much of Montana, rivers and streams depend on groundwater for part of their flows. New wells in such areas could effectively siphon water from those streamflows – and from those who own the rights to such surface water.

In recognizing the “connectivity” between surface and groundwater, the court’s opinion prevents the state Department of Natural Resources and Conservation from issuing any permits for ground or surface water in the Upper Missouri – a so-called “closed” drainage because all available water rights have been claimed. The Upper Clark Fork and Upper Bitterroot River basins are also closed.

Although the two bills up for hearing oppose each other in fundamental ways, McNutt said he agreed to carry both because it is imperative that the legislature provide some guidance to the DNRC on how to issue groundwater permits.

“It’s time we rise to the occasion and say we all have vested interests,” McNutt said, introducing the bills. “My hope is that we’ll get some positive things to think about and things that this committee can make some decisions on.”

House Bill 138, backed by the DNRC and Trout Unlimited, would require that anyone in a closed basin seeking a groundwater permit do a hydrologic study first, a step not currently necessary. If the study shows a new well would take water from senior surface-water rights holders, then the applicant must explain how that water would be replaced – a process known as augmentation.

Speaking in support of the bill, DNRC Director Mary Sexton noted new amendments recognize that if a well pulls from a confined aquifer, no augmentation would be necessary.

“This brings consistency to basins and deals with some exceptions,” Sexton said. “I think we need a reasonable solution that protects senior water rights.”

HB138 is the product of a 16-month DNRC working group, composed of Trout Unlimited, the Montana Stockgrowers Association, the Montana Farm Bureau Federation and other parties.

But in November, the Stockgrowers and Farm Bureau peeled off from the DNRC bill, saying it imposes a “one size fits all” standard on the entire state for “connectivity,” and forces augmentation when it may not be necessary.

A better approach, they say, is House Bill 373, which would require that new groundwater users replace the water they use only when it has an immediate and harmful impact on senior water rights.

John Bloomquist, an attorney for the Stockgrowers Association said HB373 attempts, “to get away from this notion that depletion in and of itself is adverse effect.”

The committee heard testimony for both bills simultaneously, as opponents for one were generally in favor of the other. But that procedure made for hours of confusion with landowners, scientists and attorneys sometimes forgetting to make clear which bill they favored, or if they opposed both.

“I don’t think either one of these bills is going to get through unscathed,” said Holly Frantz of PPL Montana, adding that the DNRC bill sticks more closely to accepted science on groundwater-surface water connectivity.

The Stockgrowers and Farm Bureau bill, Frantz said, “maintains the legal fiction that groundwater withdrawals only affect surface water if water is induced directly from the stream.”

“I’m not really sure what we accomplish by maintaining that legal fiction,” she added.

But one of the next speakers, David Schmidt, a scientist with the consulting firm Water Rights Solutions Inc., said the Stockgrowers and Farm Bureau bill is more inline with accepted science.

“I don’t think either bill does it, however, today, if I had to choose I would choose 373,” Schmidt said.

Many landowners and farmers from the Gallatin Valley spoke in support of the DNRC bill.

Mick Sieberg of Gallatin Agricultural Irrigators said the Stockgrowers and Farm Bureau bill fails to recognize senior water rights.

“It is not reasonable to reduce the discharge taken from the aquifer and claim no adverse effect,” Sieberg said. “373 is one interest group’s vision of how to take a concept to protect and turn it in to a path of destruction.”

Friends and foes of the DNRC bill agree that if it becomes law, it will create a Montana water market in which new water users forced to augment will have to buy water rights, thereby driving up prices.

Glenn Oppel of the Montana Association of Realtors said his organization is not opposed to augmentation in closed basins, but he is concerned over the rise in the cost of housing in such basins that will inevitably happen as a result.

“Augmentation will make the water rights permitting process even more complex and costly for the DNRC,” Oppel said. “It is more practical to base augmentation on actual scientific determination on adverse effect.”

Stan Bradshaw, an attorney for Trout Unlimited acknowledged that the DNRC bill sets the bar high for the agency to issue new groundwater permits.

“Well, it should be pretty high,” Bradshaw said. “It’s a bit simplistic to suggest that depletion does not equal adverse effect when you talk about a closed, fully appropriated basin.”

As is the case with many bills that tackle the same issue, a subcommittee will be set up to attempt to combine the two bills.

But time is short. At the end of February the legislature breaks for the transmittal period, where bills from the House go to the Senate and vice versa. Any legislation that doesn’t make it through by then is dead.

So if the House doesn’t pass some version of one bill or another in the next two and a half weeks, the DNRC and Montana could face another two years of uncertainty on the issue. 

Like this story? Get more! Sign up for our free newsletters.