Marc Stilson, from the State Division of Water Rights, gave an informational power point presentation to the public lands council at their recent meeting. He said this presentation was originally done by State Engineer Jerry Olds at a water users workshop in Moab last March.
Water companies own the water rights in an area, shareholders own the company, and the water is used by the shareholders. Each company decides the amount of water to be used per share, and those shares are used within the company.
In 2000, a legislative study determined a partial forfeiture of water shares existed. An ad-hoc committee was formed in 2001 to make the determinations about correction to the problem. Two bills were introduced into the legislature in 2002 that dealt with forfeiture.
House bill 57 (73-1-4.5) deals with forfeiture of water shares. House bill 58 (73-1-4) deals with water rights forfeiture.
Abandonment or forfeiture for nonuse is addressed in 73-1-4. This statute states that a person who is entitled to the use of water has a continuing responsibility to use all of the water beneficially. In the event that all of the water is not used beneficially, according to the use listed on the share, that water, all or part, will be forfeited.
The statute goes on to say that if the shareholder, or his successor, ceases use of all or part of a water right for a period of five years, that water right ceases and reverts to the public (the state). The only way to avoid forfeiture in this case is to file, before the five year period is finished, a nonuse application with the state engineer. In the event that this nonuse application is approved, it is good for five years.
There are provisions in this statute which do not apply to the forfeiture law. One is that the water source fails to yield sufficient water to satisfy the water right, or when groundwater is not available because of a sustained drought. Another is when a water user has beneficially used substantially all of a water right within a five year period, or the water is being stored in reservoirs for future use.
In 73-1-4.5, the statute states that if a water company, which holds title to the water, has losses due to the forfeiture of an individual in the company, and the bylaws of that company state they can, the company can apportion the loss to each stockholder whose failure to make beneficial use caused the loss of the water right.
Nonuse applications may be applied for before the nonuse has occurred. If a water user has not used the water right for nearly five years, he may file for a nonuse applications to avoid forfeiture. That nonuse application will last for a five year period. In the nonuse application, the reasons for the application must be stated. Reasons may vary from financial hardship to legal proceedings, to future requirements. The state engineer will consider any other reasonable cause that may apply to the nonuse application.
Once a water right has been legally forfeited, through the judicial system, it may be applied, by the state, to cover the appropriations of water to other rights in order of priority. In areas of open appropriation, the water becomes available for appropriation by others.
Stilson stated in an actual case, a landowner was irrigating 100 acres of alfalfa. He released 50 acres of the farmland to the building of a business. Twelve years later, it was determined that the water right used for that 50 acres was lost due to not using the water beneficially according to the water right.
"A person must inventory their water rights and know what you have and how it is being used. If you are not using your water right, file a nonuse application or lease the water right. Leasing water rights is one of the best ways to protect those rights. Filing a change of use application does not protect the underlying perfected right," stated Stilson.
Stilson went on to add the Division of Water Rights does not go out looking for people who are not using their water right. Most of the cases that come to their attention have been submitted by a third party. "Turning in someone for nonuse, does not entitle that person to the water. The water reverts to the ownership of the state for disposition," said Stilson.