BILL ANALYSIS Ó
SB 226
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Date of Hearing: July 7, 2015
ASSEMBLY COMMITTEE ON JUDICIARY
Mark Stone, Chair
SB
226 (Pavley) - As Amended May 5, 2015
SENATE VOTE: 23-14
SUBJECT: Sustainable Groundwater Management Act: groundwater
rights
KEY ISSUE: Should procedures for SEEKING AND obtaining a
basin-wide groundwater ADJUDICATION BE streamlined, especially
as to the early and time-consuming phase of such adjudications
in which basin boundaries are identified, Parties are identified
and served, and pre-trial discovery is conducted?
SYNOPSIS
Last year, when Governor Brown signed the historic package of
bills constituting the Sustainable Groundwater Management Act
(SGMA), he noted that the Legislature still needed to find ways
to streamline the determination of groundwater rights because
the process remains notoriously costly and time-consuming.
Although a number of bills introduced during the current session
are follow-up measures to SGMA, two bills, in particular, seek
to streamline the process of groundwater adjudication: AB 1390
(Alejo), which this Committee heard earlier in the current
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session, and the bill now before the Committee: SB 226 (Pavley).
While both AB 1390 and SB 226 will streamline adjudication,
there are three important differences between the bills. First,
SB 226 is placed within SGMA's statutory framework in the Water
Code, while AB 1390 adds a chapter to the Code of Civil
Procedure, independent of SGMA. Second, SB 226 is more limited
and focuses on streamlining the early phase of litigation,
including the process of identifying of basin boundaries,
identifying and serving parties, and making required disclosures
prior to discovery. AB 1390 addresses these issues and many
others, setting forth detailed procedures that cover the entire
course of litigation, from commencement to the appointment of
special masters. Third, SB 226 expressly authorizes the
Department of Water Resources and the Department of Fish and
Game to intervene as parties. This bill is supported by several
environmental, conservation, and water recreation groups. It is
opposed by several farm and grower associations that prefer AB
1390 to the bill under consideration. However, it should be
noted that both bills serve the same goal of streamlining
adjudication and are fully consistent with each other in that
regard. Despite the suggestions of some opponents, this bill
does not alter any existing statutory or common law rights.
Both AB 1390 and SB 226 streamline the procedure for
adjudicating rights; neither bill alters existing groundwater
rights or remedies. This bill recently passed out of the
Assembly Water, Parks, and Wildlife Committee on an 8-5 vote.
SUMMARY: Establishes special procedures for court adjudication
of groundwater rights. Specifically, this bill:
1)Establishes special procedures for timely and comprehensive
procedures by which any court of competent jurisdiction shall
determine groundwater rights and requires a court to use
procedures codified in the Code of Civil Procedure, unless
otherwise provided. Specifies that nothing in the provisions
of this bill shall be deemed to repeal or preclude an action
to determine rights to groundwater in accordance with the
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common law.
2)Specifies that the provisions of this bill will only apply to
rights claimed by an Indian tribe or the federal government to
the extent authorized by federal and tribal law.
3)Provides that an action requesting a court to determine water
rights under this bill shall be deemed provisionally complex
as provided in Rule 3.400 Title 3 of the California Rules of
Court.
4)Requires the boundaries of a basin to be identified by using
Bulletin 118 of the Department of Water Resources, unless
other basin boundaries are established pursuant to SGMA.
5)Authorizes the Department of Water Resources and the
California Department of Fish and Wildlife to intervene in an
action or proceeding if they claim an interest relating to the
action or proceeding.
6)Requires all known defendants to be served by personal service
in the manner provided in Chapter 4 (commencing with Section
413.10) of Title 5 of Part 2 of the Code of Civil Procedure.
7)Requires all unknown defendants to be served by publication as
provided in Section 415.50 of the Code of Civil Procedure.
Specifies that, in addition to other requirements required
under this section, the publication shall describe the
groundwater basin, as specified, the Internet address for a
map depicting the basin, and any other identifying information
the court deems appropriate.
8)Requires a party, without awaiting a discovery request, to
provide specified initial disclosures to the other parties,
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including, among the other things, the name and contact
information of persons likely to have discoverable
information; a copy or description, by category and location,
any documents or tangible things that the disclosing party has
in its possession and which the party may use at trial to
support claims or defenses; and a quantification of claims to
water in the basin, as specified. Specifies the timelines and
manner for making these initial disclosures.
9)Provides that, in addition to other initial disclosures
required by this bill, a party shall disclose to the other
parties the identity of any expert witness that it may use at
trial to present evidence. Unless otherwise stipulated or
ordered by the court, this initial disclosure shall be
accompanied by a written report, prepared and signed by the
expert witness. The report shall contain specified
information, including, among other things, a complete
statement of all opinions, facts, and exhibits that the expert
witness will present at trial, and a summary of the expert's
qualifications, including publications and a list of all cases
in which the witness has offered expert testimony over the
previous four years.
EXISTING LAW:
1)Declares that because of the conditions prevailing in this
State the general welfare requires that the water resources of
the state shall be put to beneficial use to the fullest extent
to which they are capable, and that the waste or unreasonable
use of water be prevented, and that the conservation of such
waters is to be exercised with a view to the reasonable and
beneficial use thereof and in the interest of the people and
the public welfare. (California Constitution, Article X
Section 2.)
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2)Requires local agencies, under the Sustainable Groundwater
Management Act (SGMA), to form Groundwater Sustainability
Agencies (GSAs) by June 30, 2017, in all high and medium
priority basins that have not been adjudicated. Requires GSAs
in all high and medium priority basins, as defined, to develop
and adopt Groundwater Sustainability Plans (GSPs) that provide
for the sustainable management of the groundwater basin by
January 31, 2020, or January 31, 2022, as specified. Allows
the State Water Resources Control Board to impose an interim
plan for groundwater management if no GSA is formed by the
deadline, no GSP is adopted by the appropriate deadline, or a
GSP is adopted which the Department of Water Resources deems
insufficient. (California Water Code Section 10720 et seq.)
FISCAL EFFECT: As currently in print this bill is keyed fiscal.
COMMENTS: For the past 100 years, California has had a water
commission (currently called the State Water Resources Control
Board) that uses a permit system to regulate surface waters.
However, the state lacked a comprehensive regulatory approach
for groundwater regulation until the passage of the Sustainable
Groundwater Management Act (SGMA) last year. Instead of
creating a state board or commission, as the Legislature did in
1913 to regulate surface waters, SGMA requires local agencies to
develop "groundwater sustainability agencies" (GSAs) that
conform with state standards, with the additional caveat that if
the locals fail to develop a groundwater plan, the State Water
Resources Control Board (SWRCB) will do it for them. SGMA
applies to those water basins designated as either "high" or
"medium" priority basins subject to a chronic overdraft. As
such, SGMA applies to only 127 of the state's 515 water basins.
Under the timeline established by SGMA, designated local
entities in a given basin must create Groundwater Sustainability
Agencies (GSAs) by June 30 of 2017, and the GSAs in turn must
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develop Groundwater Sustainability Plans (GSPs) by January 31,
2020, or January 31, 2022, depending upon the severity of their
overdraft problem. If the local agencies fail to form a GSA, if
the GSA fails to adopt a GSP, or if the state does not approve
the plan, then SWRCB will step in and develop and implement an
interim plan. The primary purpose of the GSP is to ensure
groundwater sustainability, whether by limiting pumping, or
requiring more efficient use of groundwater, so that the amount
of water pumped out of the basin is less than, or equal to, the
rate of water returned to the basin by natural or artificial
recharge.
Existing Adjudication Procedures. Prior to SGMA, groundwater
rights were regulated, if at all, by "Watermasters" appointed by
the courts to oversee a court-ordered adjudication. According
to the testimony offered last year by Court of Appeal Judge
Ronald Robie during the Senate Natural Resource hearings, an
adjudication begins when a person brings a court action, often
to quiet title in his or her groundwater rights, and asks the
court to either limit pumping, or impose a "physical solution"
that will allocate and manage water use in order to prevent an
overdraft. As Judge Robie noted, bringing a lawsuit can be a
long and complicated process because there may be thousands of
rights holders within a basin, each with a different kind of
right. Under California groundwater law, a person can have
"overlying rights" (by virtue of owning land over the
groundwater), "appropriative rights" (by appropriating surplus
groundwater and transferring it to non-overlying lands), or
"prescriptive rights" (by adversely appropriating non-surplus
water for a specified period of time without a rights holder
taking action to stop it). Regardless of the type of right that
is claimed, the amount of water is generally based upon the
right holder's historic usage. Determining such rights depends
upon any number of factual questions, which may or may not be
well-documented, such as how much water a person put to
reasonable and beneficial use in past years; the timing of an
appropriation; whether the water appropriated was surplus or
non-surplus; and whether one claiming a prescriptive right
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actually appropriated the water "adversely" and met the
statutory time period. To help the court determine these
rights, the parties usually must first engage in extensive
pleading and discovery.
SB 226 would expedite this adjudication process. The bill will
establish special procedures for courts to use in determining
the rights to groundwater within a groundwater basin.
Specifically, the bill will do the following: streamline
disputes over basin boundaries by relying on the Bulletin 118 of
the Department of Water resources; facilitate notice and service
requirements, in part by allowing for notice and service by
publication for unknown defendants; require initial disclosure
of discoverable information, including information pertaining to
expert witnesses, without awaiting a discovery request; and
permit the Department of Water Resources and the Department of
Fish and Wildlife to intervene as parties.
SB 226 and AB 1390 Comparison: As noted, this Committee already
heard and passed AB 1390 (Alejo), which like this bill sought to
streamline groundwater adjudication. The authors of both bills
contend that they are responding to the Governor's call, upon
signing the SGMA legislation last year, to address the problem
of prolonged groundwater litigation, which in some cases can
drag on for a decade or more. While both AB 1390 and SB 226
seek to streamline adjudication, there are some important
differences between the two bills:
SB 226 amends SGMA's statutory framework in the Water Code,
while AB 1390 adds a chapter to the Code of Civil Procedure,
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independent of SGMA. When AB 1390 was heard before this
committee, there was much discussion of the relationship
between AB 1390 and SGMA. SB 226 highlights the essential
compatibility of its streamlined adjudication process by
placing its provisions within SGMA and expressly declaring
that the procedures it establishes for determining groundwater
rights must be "in furtherance of the objectives of this part
[i.e. SGMA]." SB 226 also provides that, in making its
determination of rights to groundwater, a court shall avoid an
"undesirable result," as defined in SGMA. (SGMA generally
defines an "undesirable result" as one that leads to chronic
lowering of groundwater levels, degradation of water quality,
land subsidence, or depletion of surface water.) AB 1390 only
provides that where the adjudication occurs in a basin that is
subject to SGMA, the court should "encourage the parties to
cooperatively develop a groundwater sustainability plan that
may serve as the basis of a stipulated judgment setting forth
a physical solution for management of the basin."
SB 226 is more limited in that it focuses on streamlining the
earlier phases of litigation, including identification of
basin boundaries, identification and service of parties, and
requiring initial disclosures prior to discovery. AB 1390
addresses these issues and many others, setting forth detailed
procedures that cover the entire course of litigation, from
commencement of the action to the appointment of special
masters.
SB 226 expressly authorizes the Department of Water Resources
and the Department of Fish and Game to intervene as parties to
the extent that either agency claims an interest relating to
the action or if the resolution of the action could impair or
impede the ability of the agency to protect its interest. AB
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1390 does not contain any such express provision, though it is
not clear whether AB 1390 would necessarily preclude either
agency from intervening.
Despite these differences, it should be noted that both bills
serve the same goal of streamlining adjudication and are fully
consistent with each other in that regard. Despite the
suggestions of some opponents, this bill does not alter any
existing statutory or common law rights. Both AB 1390 and SB
226 streamline the procedure for adjudicating rights; neither
bill alters existing rights or remedies.
ARGUMENTS IN SUPPORT: This bill is supported by several
environmental, conservation, and water recreation groups. These
supporters believe that SB 226 will create a streamlined process
for judicial adjudication of groundwater basins in a manner that
protects individual rights, ensures the prevention of
"undesirable results" as defined by SGMA, and allows agency
intervention where environmental concerns necessitate it.
Supporters add that "until the implementation of plans under
SGMA, individuals with their groundwater rights being infringed
upon do not have easy access to relief through the courts.
Final decisions only deal with water rights, ignoring the
numerous other problems that can occur within a groundwater
basin that SGMA addresses." Supporters add that this bill helps
ease the burden on individuals and the courts by standardizing
and expanding service of process requirements, and allowing DWR
and DFW to intervene in an adjudication, should their interests
need to be addressed. Supporters conclude that, finally, "any
decision a court issues will attempt to avoid an undesirable
result as defined under SGMA" which "creates a better process
for adjudication of groundwater rights holders and the
environment."
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ARGUMENTS IN OPPOSITION: Many of the opponents of this bill do
not seem to object to its provisions so much as preferring AB
1390, which they claim will add "a new chapter to the Code of
Civil Procedure making improvements to the judicial proceedings
of comprehensive adjudications of groundwater rights in a
basin." Opponents state that AB 1390 will reduce the burden of
groundwater adjudications on both the courts and claimants
without altering the law of groundwater rights and without
disruption to the [SGMA] planning process. Opponents add that
while they appreciate this author's "interest in the issue of
adjudication we respectfully prefer the approach offered in AB
1390." Other opponents support "aligning streamlined
adjudications process with SGMA objectives," but do not support
this bill's approach of including streamlined groundwater
adjudications within SGMA, as SGMA is a law that "already
includes significant groundwater reforms" focused on improving
the sustainability and reliability of California's groundwater
basins. Opponents therefore believe SGMA "should be given time
to be implemented and that it is premature to make significant
policy changes to the Act at this time."
REGISTERED SUPPORT / OPPOSITION:
Support
All Outdoors
American River Conservancy
American River Touring Association Inc. (ARTA)
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American Whitewater
California Canoe and Kayak
California Outdoors
California Sportfishing Protection Alliance
California Water Impact Network (C-WIN)
Clean Water Action
Community Water Center
Delta Kayak Adventures
Foothill Conservancy
Friends of the Eel River
Friends of the River
Friends of the San Francisco Estuary
Merced River Conservation Committee
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North Coast Rivers Alliance
Northern California Council of the International Federation of
Fly Fishers
Planning and Conservation League
Restore Hetch Hetchy
Restore the Delta
Rivers for Change
Rose Foundation for Communities and the Environment
Sacramento River Preservation Trust
Save the American River Association
Sierra Club California
Sierra Nevada Alliance
Smith River Alliance
South Yuba River Citizens League
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The Nature Conservancy
Tuolumne River Trust
Winnemem Wintu Tribe
Opposition
African American Farmers of California
Agricultural Council of California
Almond Hullers and Processors Association
Association of California Egg Farmers
California Association of Wheat Growers
California Bean Shippers Association
California Cattlemen's Association
California Chamber of Commerce
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California Citrus Mutual
California Cotton Ginners Association
California Cotton Growers Association
California Dairies Inc.
California Farm Bureau Federation
California Floral Council
California Fresh Fruit Association
California Grain and Feed Association
California Pear Growers Association
California Seed Association
California Tomato Growers Association
Kings River Conservation District
Kings River Water Association
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National Hmong American Farmers
Nisei Farmers League
Pacific Egg and Poultry Association
Southwest California Legislative Council
Western Agricultural Processors Association
Western Growers Association
Western Plant Health Association
Analysis Prepared by:Thomas Clark / JUD. / (916)
319-2334