BILL ANALYSIS                                                                                                                                                                                                    



          SENATE COMMITTEE ON NATURAL RESOURCES AND WATER
                             Senator Fran Pavley, Chair
                                2015 - 2016  Regular 

          Bill No:            SB 226          Hearing Date:    April 14,  
          2015
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          |Author:    |Pavley                 |           |                 |
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          |Version:   |April 6, 2015                                        |
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          |Urgency:   |No                     |Fiscal:    |Yes              |
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          |Consultant:|Dennis O'Connor                                      |
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           Subject:  Sustainable Groundwater Management Act:  groundwater  
                                       rights


          BACKGROUND AND EXISTING LAW
          Last session the Legislature enacted the Sustainable Groundwater  
          Management Act (SGMA).  Among other things, SGMA requires that  
          each high- and medium-priority groundwater basins be managed  
          pursuant to a groundwater sustainability plan, with the goal of  
          achieving sustainability within 20 years.

          Many basins will be able to achieve sustainability through more  
          active and deliberate management.  In some basins, however, to  
          avoid undesirable results, some groundwater uses may need to be  
          reduced or otherwise changed.  SGMA states in several places  
          that it does not determine or change groundwater rights.  To  
          define, reduce, or otherwise change groundwater rights one must  
          use the common law process of adjudication.

          An adjudication of groundwater rights is initiated by a law  
          suit.  The impetus for such a suit is usually some alleged harm  
          purportedly caused by excessive groundwater depletion. These  
          harms could include chronic lowering of groundwater levels;  
          subsidence; misallocation of storage; water quality; seawater  
          intrusion; well interference; shortages; or water rights  
          disputes.  

          In basins where a lawsuit is brought to adjudicate the basin,  
          the groundwater rights of all the overliers and appropriators  







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          are determined by the court. The court also decides: 1) who the  
          extractors are; 2) how much groundwater those well owners can  
          extract; and 3) who the Watermaster will be to ensure that the  
          basin is managed in accordance with the court's decree. The  
          Watermaster must report periodically to the court.

          Given the different kinds of groundwater rights and the  
          relationships between them, coming to a determination is a  
          complex task, often taking well over a decade of judicial  
          activity - the Antelope Valley adjudication has taken 15 years  
          and counting.

          It will be difficult, if not impossible, for some basins to  
          comply with the requirements of SGMA if they have to wait 15+  
          years for a final determination of rights pursuant to existing  
          law.

          On November 20, 2014, this committee held an informational  
          hearing, titled "Resolving Disputes Regarding Groundwater  
          Rights: Why Does It Take So Long and What Might Be Done to  
          Accelerate the Process?"  At that hearing, witnesses identified  
          a number of items that cause unnecessary delay.  These included  
          issues of basin boundaries, notice and service, discovery, and  
          expert testimony.  
          PROPOSED LAW
          This bill would add a new Chapter 12 to SGMA titled  
          Determination of Rights to Groundwater.  Specifically, this bill  
          would:
        Find and declare that it establishes a timely and comprehensive  
            method for determining rights to groundwater. 
        Provide that a court shall use the Code of Civil Procedure for  
            determining rights to groundwater, except as provided by the  
            special procedures established in the bill. 
        Require the process for determining rights to groundwater to be  
            available to any court of competent jurisdiction. 
        Deem an action requesting a court to determine water rights under  
            this chapter to be provisionally complex within the meaning  
            provided in the California Rules of Court.
        Direct a court, in making its determination of rights to  
            groundwater, to avoid undesirable results as defined in SGMA
        Provide that it applies to Indian tribes and the federal  
            government to the extent authorized by federal and tribal law.  
             
        Require the boundaries of a basin to be as identified in Bulletin  








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            118, unless other basin boundaries are established pursuant to  
            SGMA.
        Authorize the Department of Water Resources and the Department of  
            Fish and Wildlife to intervene in an action or proceeding if  
            they claim an interest relating to the action or proceeding. 
        Specify service and notice procedures. 
        Require a party to provide specified initial disclosures to the  
            other parties, including, among other disclosures, information  
            relating to expert witnesses.

          The bill would also make other conforming and technical changes  
          to the Water Code.

          ARGUMENTS IN SUPPORT
          According to the author, "Under current law, groundwater rights  
          adjudications take an extraordinarily long time and are  
          extraordinarily expensive.  As we were working last year to  
          enact the Sustainable Groundwater Management Act (SGMA) two  
          things became clear: 1) there will almost certainly be more such  
          adjudications, and 2) it will be difficult, if not impossible,  
          for some basins to comply with the requirements of SGMA if we  
          don't speed up the adjudication process."

          "SB 226 tackles head on the various time sinks witnesses  
          identified at this committee's hearing last November on  
          groundwater adjudication.  SB 226 addresses these issues as  
          follows:
 Basin Boundaries - boundaries shall be as identified in DWR's Bulletin 118, unless modified as  
            provided in SGMA.
 Notice & Service - notice to known parties is as provided in the Code of Civil Procedures  
            (CCP).  Unknown parties would be served by publication.
 Discovery - follows the Federal procedures, which require disclosure of specific items without  
            awaiting a discovery request.
 Expert Witness - follows the Federal procedures, which require an expert witness to provide a  
            written report on opinions the witness will express and the  
            basis and reasons for them."

          "With these changes, SB 226 will reduce needless delays while  
          still protecting due process rights."
          
          ARGUMENTS IN OPPOSITION
          The California Farm Bureau Federation writes, "When Governor  
          Brown signed the Sustainable Groundwater Management Act (SGMA)  
          bill package last year, interest in improving the groundwater  








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          adjudication process was expressed by the Administration and  
          authors of the bill package.  The Farm Bureau has worked with  
          many others since the SGMA was signed into law and has  
          introduced a comprehensive bill (AB 1390 - Alejo) to address the  
          issues by adding a new chapter to the Code of Civil Procedure  
          making improvements to the judicial proceedings of comprehensive  
          adjudications of groundwater rights in a basin.  These changes  
          will reduce the burden of groundwater adjudications on both the  
          courts and claimants without altering the law of groundwater  
          rights without disruption the Sustainable Groundwater Management  
          Act planning process.  While we appreciate [Senator Pavley's]  
          interest in the issue of adjudication we respectfully prefer the  
          approach offered in AB 1390."

          "SB 226 makes changes to the SGMA that already includes  
          significant groundwater reforms which focuses on improving the  
          sustainability and reliability of California's groundwater  
          basins.  We believe that the SGMA should be given time to be  
          implemented and that it is premature to make significant policy  
          changes to the Act at this time."

          COMMENTS
           Everyone Agrees The Current Process Needs Improvement.   At this  
          committee's hearing last November, no one argued that the  
          current adjudication process couldn't be improved.  Indeed, all  
          agreed that adjudications took much too long and all were able  
          to identify a number of areas of the process that could be  
          streamlined.  
           
          Appellate Court Justice Ronald Robie described the real problem  
          best at the November 2014 hearing when, commenting on the decade  
          plus time to complete an adjudication, he observed "That's good  
          for the lawyers, but you know that when you do have that many  
          lawyers working, you're also costing a lot of money to the  
          people who have the rights, so groundwater adjudications at the  
          common law can be expensive to the parties."

           There Is A Question Of Where To Put The Improvements.   This bill  
          proposes to put the changes to the groundwater adjudication  
          process in SGMA to ensure that any future adjudication is done  
          so "in furtherance of the objectives" of SGMA.  The Farm Bureau  
          prefers to put such changes in the Code of Civil Procedure  
          instead.  This is an issue that perhaps is better addressed by  
          the Judiciary Committee.








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           There Is A Question Of How The System Should Be Improved.   There  
          seems to be broad agreement on what things slow down the  
          adjudication process.  These include things like determining  
          basin boundaries, notice and service of affected parties,  
          discovery, relitigation of previous determinations of fact or  
          law, identification of and testimony of expert witnesses, and  
          challenging judges for alleged bias.  There is less agreement on  
          which aspects of the adjudication can be addressed and how they  
          can be addressed without compromising due process  
          considerations.  This too is an issue that perhaps is better  
          addressed by the Judiciary Committee.

           Protection Of Environment.   At the November 2014 hearing, in  
          response to a question regarding whether it would be helpful to  
          clarify in the law how to address, for example, areas where  
          there is a very clear surface-groundwater interaction, Justice  
          Robie observed that groundwater adjudications are "a common law  
          proceeding and common law doesn't provide for protection of  
          ecosystems. In other words, when you have a groundwater  
          adjudication, protection of ecosystems or environmental factors  
          of that type are not currently covered in what you normally  
          raise in an adjudication ? subsidence and things like that, they  
          haven't dealt with ?but you get to that frequently in practical  
          matter through CEQA where mitigation is required, but an  
          adjudication of course is not subject to CEQA, so I think you  
          pointed to something that could be added to it. In an  
          adjudication, you only have the right holders present. There's  
          no place for intervention by public interest groups or anybody  
          else that I'm aware of."  

          This bill would authorize the Department of Water Resources and  
          the Department of Fish and Wildlife to intervene in an action or  
          proceeding if they claim an interest relating to the action or  
          proceeding.

           Double-Referral.  The Rules Committee referred this bill to both  
          the Committee on Natural Resources and Water and to the  
          Committee on Judiciary. Therefore, if this bill passes this  
          committee, it will be referred to the Committee on Judiciary,  
          which will consider the issues within their jurisdiction.

          SUGGESTED AMENDMENTS: None
          








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          SUPPORT
          Sierra Club California

          OPPOSITION
          California Farm Bureau Federation

          
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