May 05, 2021

Interstate groundwater allocations: New challenges ahead

Alyssa Moir, Molly Barker, and Natalie Reid

The November 5, 2020, Special Master’s report in Mississippi v. Tennessee may open the door for a new era of disputes over groundwater distribution between states, thanks to the key finding that immense underground aquifers spanning multiple states may be regarded as interstate resources, similar to interstate surface water resources such as rivers. State of Mississippi v. State of Tennessee, City of Memphis, Tennessee, and Memphis Light, Gas, & Water Division, No. 143 Original. While surface water has long been apportioned via interstate compact, little precedent exists for apportioning vast groundwater resources between states. This report sets the stage for a new allocation structure that could precipitate a period of conflict between states over the equitable allocation of increasingly scarce groundwater resources.

The catalyst for addressing a diminishing natural resource

As described in “Special Master’s Report Sets Stage for Supreme Court to Rule in Long-Standing Dispute between States over Groundwater in Aquifer” in this issue of Trends, the conflict between Mississippi and Tennessee arose over whether Mississippi “owned” groundwater found below Mississippi but contained within the larger Sparta-Memphis Aquifer.  While the Special Master rejected Mississippi’s ownership theory, the Special Master’s reframing of groundwater as—potentially—an interstate resource raises questions about a water supply that has traditionally been managed at a more local level than surface water. This question, as well as the recent evolution of some states’ groundwater management regimes, casts groundwater management in a new light, especially as population growth and climate change increase demand on the resource. The Supreme Court’s final verdict on this matter will confirm whether groundwater resources, which have historically been regulated at the state level, may be regulated by interstate compact if the aquifer itself is considered an interstate resource.

Overhauling traditional regulatory regimes and approaches in the face of climate change

While some states, such as Washington, have enough overlap between surface water and groundwater codes that they are treated as essentially the same resource, other states, including California and Texas, have only recently begun managing groundwater at a broader state level. Moreover, these states still have vastly different management regimes that involve riparian rights (surface water rights to those who possess adjacent land) or correlative rights (groundwater rights distributed in reasonable shares from a common source). As a result, treating groundwater as an interstate resource may require future courts or water allocators to weave together a patchwork of local groundwater management regimes to resolve interstate conflicts, or require states to overhaul their groundwater management systems to provide an interstate framework that will lead to more predictable allocations. The question then becomes, did the Special Master’s report demand such an overhaul across all state lines? Or is this decision a pointed invitation to rethink groundwater resources from an interstate regulatory perspective?

Does the Special Master’s report demand, or at least invite, systemic change?

If the Special Master’s approach demands an overhaul to interstate groundwater allocation, several questions follow. First, how will states reliably delineate the extent of interstate groundwater resources? Groundwater resources take far more technical assessment to fully delineate than surface water resources. Next, how will states account for all the groundwater use within their borders that could potentially impact apportionment amounts? For many states, the amount of groundwater permits are fixed, and often no “new” groundwater rights are available. If existing groundwater rights become subject to an interstate water compact, individual water rights holders could see their water allocations reduced. Notably, interstate allocations will also need to consider federally reserved rights for tribes, per the U.S. Court of Appeals for the Ninth Circuit case of Agua Caliente v. Riverside County, 849 F.3d 1262 (9th Cir. 2017), which held for the first time that federally reserved rights apply to groundwater as well as surface water. Finally, how will water allocators assess the ecological impact of allowing multiple states to deplete interstate groundwater resources when unified monitoring and use is difficult to govern? As we have seen not only in Mississippi v. Tennessee, but also with depletion of other vast interstate aquifers such as the Ogalla and the Odessa, identifying the full scope of impacts to interstate aquifers is notoriously difficult.

Cooperation versus courts

Ultimately, regardless of the outcome in Mississippi v. Tennessee, resolving these questions will require increased cooperation between states that share interstate groundwater resources. In the absence of cooperation, the scientific and legal uncertainty surrounding interstate groundwater apportionment may lead to increased reliance on the U.S. Supreme Court to resolve disputes between states over this resource. While we expect some clarity as to whether groundwater can be apportioned as an interstate resource following the verdict on Mississippi’s appeal of the Special Master’s recent report, groundwater users in all sectors of the economy will benefit from paying close attention to and engaging in emerging policies, regulations, and court decisions focused on governing the use of groundwater.

Entity:
Topic:

Alyssa A. Moir, Molly Barker, and Natalie J. Reid

----

Alyssa A. Moir is a partner and Molly Barker and Natalie J. Reid are associates in KL Gates LLP’s Seattle office.