Montana Court Recognizes Impact Of Prestream Capture On Senior Water Rights
April 11, 2006

Since 1973, Montana has been in the process of quantifying existing water rights claims. All holders of claims were required to file those claims with the Montana Department of Natural Resources and Conservation (DNRC). The DNRC was charged with determining the priority dates and reviewing conflicts involving claims. Water courts were established to adjudicate disputed claims. Appropriators seeking new claims must file applications with the DNRC.

In some basins, the amount of water claimed exceeded the amount of water available, so the Montana legislature closed those basins. The basin closure law included the Upper Missouri River Basin. Because the Basin is closed, the DNRC may not, as a matter of law, process or grant applications for permits to appropriate water within the Basin until final decrees have been issued. The basin closure law, however, excepts out new groundwater applications, unless the groundwater is “immediately or directly connected” to the Upper Missouri River Basin’s surface water. The DNRC interpreted the statute to mean that a groundwater well that pulled surface water directly from a stream, i.e. by “infiltration,” could not be permitted, but others could.

Because the DNRC processed new applications before determining whether the applicant sought to appropriate water in violation of the basin closure law, Trout Unlimited and others went to court seeking an order prohibiting DNRC from processing groundwater applications in the Upper Missouri River Basin until a determination had been made that the groundwater sought to be appropriated was not “immediately or directly connected to surface water.” Trout Unlimited also challenged DNRC’s interpretation of this language.

While the parties were able to resolve the first issue by stipulation, DNRC stood by its interpretation of the statutory language. In fact, while suit was pending, the agency adopted a rule to that effect. The rule ignored “prestream capture of tributary groundwater,” the name given to the circumstance where groundwater is not directly pumped out of a stream, but where pumping intercepts groundwater that might otherwise end up in nearby streams.

The Montana district court, which originally addressed the matter, deferred to the DNRC’s discretion and granted judgment to the DNRC without a trial. Trout Unlimited appealed to the Montana Supreme Court. In a 4-3 decision, that court reversed, finding first that it was not necessary for Trout Unlimited to exhaust administrative remedies because those remedies might be futile.

The court further held that the DNRC’s interpretation of the statutory language failed to recognize the impact of prestream capture of tributary groundwater. It only took into account “infiltration,” or the fact that pumping might pull surface water from a stream toward a well. Since the law was enacted to protect senior water right holders and since it makes no difference to those individuals whether their water right is limited by infiltration or prestream capture, the court found that the DNRC incorrectly interpreted the statutory language.

Click hereto view a PDF of the court decision.