Buying Water Rights: How is it done?
Buying water rights in Colorado can be a complex process; so complex, in fact, that it oftentimes requires a water attorney as well as a water resource engineer to ensure the transaction is properly completed. This article is not intended to replace the advice of an attorney or water professional, but rather provide you with an overview of the process of buying water rights to help you become better informed.
Water usage in Colorado falls under the system of allocation called the prior appropriation doctrine. This means that the first person to put the water to beneficial use, or the appropriator, has the senior right to the water, and that person’s water rights must be satisfied before any subsequent, or junior water rights holders, can receive water.
The Division of Water Resources, or the State Engineer’s Office, which falls under the Colorado Department of Natural Resources, is empowered to administer surface and groundwater rights throughout the state and ensure that the doctrine is enforced. The State Engineer oversees this process, assisted by seven field offices located throughout the major river basins in Colorado. These division offices employ water commissioners who go out into the field to review water allocations, issue water shut-down orders in case someone is illegally appropriating water, collecting water use and diversion data, and enforcing the decrees and water laws of the state.
The State Engineer’s Office also uses engineers and geologists to collect and analyze data on water supply to help ensure the water that is being requested for appropriation by someone buying water rights is actually available. They forecast streamflows, determine diversion requirements, review stream transit losses, determine evaporation losses, and calculate historic use and current conditions. They also operate a statewide monitoring system linked by satellites to provide real-time data on streamflows as part of flood monitoring.
All of this information is related to who can use what water where and how much, which is one of the reasons why buying water rights in Colorado is such a complex process.
The first step to buying water rights, also called appropriating water, is to demonstrate your intent to divert water, put it to a beneficial use, and show how you are going to divert the water in an open, physical manner. A physical demonstration of your intent, such as a field survey, a posting at your intended point of diversion, or a filing for a well permit application is usually enough notice to other water rights holders that you are in the process of buying water rights.
The next step in buying water rights is to file a water right application with the water court in the river basin in which you would like to divert water for your use. This application will verify your place in line behind other senior water rights holders. Water courts are District Courts comprising judges appointed by the Colorado Supreme Court. The judges in these courts hear matters exclusively related to water and are often involved when someone is buying water rights.
Once you file your application, you must publish a legal notice advising of your desire for buying water rights. Anyone who is against your application for buying water rights has two months to file a statement of opposition.
In the meantime, the Division Engineer of the water division in which you filed your application will review your request for buying water rights. That person will review your claims and make a recommendation for or against your petition for buying water rights to the water court.
If there is no opposition to your application for buying water rights, your case then goes before the presiding water court’s water referee. This person rules on most cases before their final review by the water judge. The referee will review your application for buying water rights, ask you for any clarifying information, and review the recommendation made by the Division Engineer. The referee then makes a ruling in the case, either approving or denying your application for buying water rights. There is still opportunity for someone to disagree with the referee’s ruling and file a protest. If no one files a protest and the ruling was in favor of your buying water rights, the case goes to the judge, who signs the ruling and makes it a decree of the court.
In the situation that someone protests your application or the ruling made by the referee, the case can go before the water judge for trial, similar to a criminal trial, unless the parties in disagreement can settle their differences. If the case does go to trial, the judge will make the final determination whether your application for buying water rights should be approved. Anyone involved in this case who is dissatisfied with the judge’s final ruling can appeal directly to the Colorado Supreme Court. This process can take up to two years to resolve.
If your application for buying water rights is approved, then you receive a permit to use the appropriate the amount of water as described in your application. For more information on buying water rights, please talk to the experts at Water Colorado.