GCDs from A to Z

GCDs from A to Z Stacey A. Steinbach and Kathy Turner Jones

Texas Alliance of Groundwater Districts

Texas A&M University

AWRA Student Chapter

October 4, 2012

Topics for Discussion

• Evolution of Groundwater Management

– GCDs

– Joint Planning

• Evolution of Groundwater Ownership

– Previous cases

– Senate Bill 332/EAA v. Day

• Lone Star GCD as an example of groundwater management

Starting Point: Rule of Capture

• Adopted as Texas law in 1904 East decision

• Landowners have right to capture an unlimited amount of

groundwater beneath their property

• Called “law of non-liability” and “law of the biggest pump”

• Exceptions: trespass, malicious or wanton conduct, waste,

contamination, subsidence due to negligent overpumping

Groundwater Conservation Districts

History of GCDs

• 1917: Conservation Amendment to Texas Constitution

• 1949: Statutory framework for creation of GCDs

• 1997: GCDs are the “State’s preferred method of groundwater management” (SB 1)

• 2012: 96 confirmed GCDs; three awaiting confirmation

What is a GCD?

• Political subdivision of the state of Texas

• Creature of the Legislature, powers expressly granted

• Granted specific legal authority related to the management of

groundwater; may regulate well spacing and groundwater

production

• Created to protect and balance private property interests

What isn’t a GCD?

• Municipal water provider

• Water/wastewater treatment provider

• Groundwater owner

Freedigitalphotos.net

How are GCDs created?

• By the Texas Legislature, pursuant to Article XVI, Section 59 of the Texas Constitution

• By TCEQ, pursuant to a a local petition

• By TCEQ, pursuant to the Priority Groundwater Management Area provisions

**Confirmation elections are held to confirm creation or tax authority

GCD Facts

• More than half of water used in Texas is groundwater, 85% is within GCDs

• Oldest/largest GCD: High Plains (10,000 sq. miles, 16 counties)

• Smallest GCD: Red Sands, Hidalgo County (31 sq. miles)

• Some GCDs have additional powers

• Cover all or part of 174 counties

0

5

10

15

20

25

30

35

< 10,000 10,001 -50,000

50,001 -100,000

100,001 -500,000

> 500,000

Nu

mb

er

of

GC

Ds

Population Size n=76

Population Per GCD

Number of Counties Per GCD

0 10 20 30 40 50

Five or More

Four

Three

Two

One

Number of GCDs

Nu

mb

er

of

Co

un

tie

s

n=77

Type of Community

15%

84%

1%

Suburban

Rural

Urban

Largest Groundwater User in GCD

Agriculture 36%

Domestic/ Livestock

16%

Industrial/ Commercial

1%

Municipal Water Supply

36%

Oil & Gas 8%

Combination 3%

n=74

Number of Board Members per GCD

0 10 20 30 40 50

5

6-7

8-9

10-11

> 11

Number of GCDs

Nu

mb

er

of

Bo

ard

M

em

be

rs

n=76

Elected v. Appointed Board Members

70%

23%

7% Elected

Appointed

Both

n=77

Tax-Based v. Fee-Based GCDs

25%

66%

9%

Fee

Tax

Both

n=76

How Do GCDs Regulate?

• GCDs regulate/issue permits in the following ways:

– Well spacing

– Acreage-based regulations

– Use-based regulations

• Some wells are exempt from permitting requirements

– Wells specifically exempted by the board

– Certain domestic and livestock wells

– Certain wells related to oil and gas or mining activities

Joint Planning

Joint Planning

GCD

GMA

DFC TWDB

MAG

Joint Planning

OMG

GCD

GMA

DFC TWDB

MAG

GCD = Groundwater Conservation District

GMA = Groundwater Management Area

DFC = Desired Future Condition

• Quantifiable future groundwater metric (what aquifer will look like at

specified time in future; average drawdown should not exceed __ after __)

• Process amended in 2011; in establishing DFCs, GCDs must consider:

Aquifer Uses or Conditions

State Water Plan

Hydrological Conditions

Private Property

Rights

Impacts on Subsidence

Socioeconomic Impacts

Environmental Impacts

Feasibility of achieving DFC

Any other relevant

information

DFC Balancing Test

Conservation, preservation, protection, recharging and

prevention of waste of groundwater and control of subsidence

Highest practicable level of groundwater

production

New DFC Adoption Process

TWDB = Texas Water Development Board

• Texas state agency; generally not regulatory in nature

• Provides loans and funding for state water projects

• Oversees the State Water Plan

• Provides groundwater expertise in the form of modeling

(GAMs, MAGs), groundwater quality monitoring, and

groundwater level monitoring

• Approves GCD management plans

MAG = Modeled Available Groundwater

• Amount of water that may be produced on an average annual basis to

achieve a DFC

• In issuing permits, GCDs must manage total groundwater production on a

long-term basis to achieve an applicable DFC and consider :

MAG Exempt Use Estimates

Previously Authorized

Withdrawals

Actual Production Estimates

Yearly Precipitation

& Production

Patterns

Regional Planning

RWPG GCD

GMA

DFC TWDB

MAG

DFC Appeals

• Person with a “legally defined interest in groundwater,” a GCD (in or adjacent to), or a RWPG in the GMA can file petition with TWDB to challenge reasonableness

• First round: appeals filed in 7 of the 16 GMAs; all resolved

• Two separate concepts floated last session: – “Affected person” files petition with GCD; SOAH hearing; PFD; GCD

final order; appealable to district court in GMA

– GCD’s adoption of DFC may be challenged in district court in local venue in same manner as GCD rule (substantial evidence)

Evolution of Groundwater Ownership

Important Cases

• Houston & Tex. Cent. R.R. Co. v. East

• Pecos County WCID No. 1 v. Williams (Comanche Springs)

• Friendswood Development Co. v. Smith-Southwest Industries, Inc.

• City of Corpus Christi v. City of Pleasanton

• Sipriano v. Great Spring Waters of America, Inc. (Ozarka)

• Barshop v. Medina County UWCD

• City of Del Rio v. the Hamilton Trust

Senate Bill 332

• “Recognizes that a landowner owns the groundwater below the surface of

the landowner's land as real property”

• Landowner is entitled to drill for and produce groundwater, but not a

specific amount

• GCDs may limit or prohibit drilling based on spacing or tract size and

regulate the production of groundwater as provided in the Water Code

• GCDs are not required to implement a correlative rights approach

• Does not affect ability of EAA or subsidence districts to manage groundwater

EAA v. Day and McDaniel

Facts

• 1956: irrigation well drilled on property; in use until 1970s

• Prior to 1983: well casing collapsed/pump removed; well continued to produce water that was stored in holding tank and used for irrigation and recreation

• 1993: Edwards Aquifer Authority created; historic use period ends

• 1994: Plaintiffs purchase property at issue

• 1996: Plaintiffs timely request 700 acre-feet of Edwards water; EAA denies full amount due to failure to satisfy historic use requirements

Issues

• Did the EAA err in limiting plaintiffs’ permit to 14 af?

• Do plaintiffs have a constitutionally protected interest in the groundwater beneath their property?

• Did the EAA’s denial of a permit in the amount requested by the plaintiffs constitute a taking?

• Are plaintiffs’ other constitutional arguments valid?

Holding

• Did the EAA err in limiting plaintiffs’ permit to 14 af? No

• Do plaintiffs have a constitutionally protected interest in the groundwater beneath their property? Yes

• Did the EAA’s denial of a permit in the amount requested by the plaintiffs constitute a taking? Don’t know

• Are plaintiffs’ other constitutional arguments valid? No

Analysis

• Reasonable to determine that the groundwater became state water when discharged to the lake

• Applied common law ownership of oil and gas to groundwater; held that rule of capture and ownership in place are not mutually exclusive

• Landowner has a property interest in the groundwater under his property, subject to the rule of capture and reasonable regulation by a GCD (police power)

Analysis

• Not enough information in record to determine whether taking occurred

• Trial court will conduct a Penn Central (regulatory taking) analysis:

– economic impacts

– extent of interference with reasonable investment-backed expectations

– nature or character of the regulation

What We Know

• Land ownership includes a constitutionally-protected interest in groundwater in place that cannot be taken for public use without adequate compensation

• EAA acted in complete accordance with state-mandated regulatory scheme

• Some regulation of groundwater production does not constitute a compensable taking

What We Don’t Know

• How much regulation is too much?

• Is there a distinction between EAA and Chapter 36 GCDs when it comes to a takings claim?

• How will different “uses” be affected?

• Unintended consequences?

What’s Next?

• District court will decide whether taking occurred as to plaintiffs Day and McDaniel

• Legislative response?

• Wait and see; business as usual

© Larry D. Moore

Questions?

Stacey A. Steinbach Texas Alliance of Groundwater Districts

P.O. Box 152169 Austin, Texas 78715-2169

[email protected] (512) 809-7785

www.texasgroundwater.org