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Concerning Application For Water Rights of County of Boulder

Supreme Court of Colorado, En Banc

March 21, 2016

Concerning the Application for Water Rights of County of Boulder in Boulder County County of Boulder, a body corporate and politic, Applicant-Appellant
v.
Boulder and Weld County Ditch Company, Water Users Association of District No. 6, The Farmers Reservoir and Irrigation Company, City of Boulder, Town of Erie, and City of Lafayette, Opposers-Appellees and State Engineer and Division Engineer for Water Division No. 1. Appellees

Appeal from the District Court Weld County District Court, Water Division 1, Case No. 10CW320 Honorable James F. Hartmann, Water Judge

Attorneys for Applicant–Appellant: Gilbert Y. Marchand, Jr., P.C. Gilbert Y. Marchand, Jr. Boulder, Colorado

Attorneys for Opposer–Appellee Boulder and Weld County Ditch Company: PC Johnson Attorney at Law, LLC Peter C. Johnson Denver, Colorado

OPINION

HOOD JUSTICE.

¶1 Boulder County is developing a property known as the Bailey Farm into a public open-space park which will feature several ponds formed when abandoned gravel pits filled with groundwater. Because two of the pits-turned-ponds exposed groundwater after January 1, 1981, the County must replace out-of-priority stream depletions caused by evaporation from those ponds. See § 37-90-137(11)(a)–(b), C.R.S. (2015). To meet this obligation, the County filed an application for underground water rights, approval of a plan for augmentation, a change of water rights, and an appropriative right of substitution and exchange. The water court dismissed the application without prejudice, and the County now appeals that judgment.

¶2 The components of the County's application were interdependent, such that approval of the application as a whole hinged on approval of the plan for augmentation, which in turn hinged on approval of the change of water rights. The change of water rights involved the Martha M. Matthews Ditch water right ("MM water right"). The County sought to change the use of 50 inches of the MM water right historically used to irrigate the Bailey Farm ("Bailey Farm Inches") from irrigation to augmentation. To ensure this change would not unlawfully expand the Bailey Farm Inches, the County conducted a parcel-specific historical consumptive use ("HCU") analysis of that right.

¶3 The water court found this HCU analysis inadequate for several reasons and therefore concluded that the County failed to carry its burden of accurately demonstrating HCU. Because the County could not show an absence of injury to other water users without a reliable HCU analysis, the water court denied the change of use of the Bailey Farm Inches. The water court then dismissed the County's application without prejudice.

¶4 The pivotal consideration in this case is whether the County carried its burden of proving HCU. Like the water court, we conclude it did not. We therefore affirm the water court's judgment on that basis.

I. Facts and Procedural History

¶5 The Martha M. Matthews Ditch ("MM Ditch") was an approximately one-mile-long conduit situated south of and roughly parallel to Boulder Creek.[1] The ditch took water from a headgate on a south-reaching branch of Boulder Creek and carried it in a northeasterly direction. The MM Ditch was completed sometime before June 1, 1861; however, Martha Matthews did not own land near the ditch until 1871, when she purchased 160 acres in that area.

¶6 In 1881, Ms. Matthews petitioned the Boulder County District Court for the adjudication of water rights for the MM Ditch. After conducting a hearing to establish the water right, a referee entered findings that the MM Ditch was capable of carrying 4.6 cubic feet of water per second ("cfs") and that the water would be used to irrigate 120 acres lying below the ditch. In 1882, the district court granted Ms. Matthews a decree authorizing diversion of 4.6 cfs from Boulder Creek for the irrigation of 120 acres, with a priority date of June 1, 1861. Neither the referee's findings nor the decree identified the location of the 120 acres to be irrigated with the MM water right.

¶7 Although Ms. Matthews owned 160 acres near the MM Ditch when the 1882 decree entered, only 47 of those acres lay downslope of the ditch-i.e., between the ditch and Boulder Creek. The rest of her land was located either on the opposite side of Boulder Creek or above the elevation of the ditch. See Appendix. However, there were approximately 240 additional irrigable acres lying under the MM Ditch that were not owned by Ms. Matthews.

¶8 In 1903, Ms. Matthews contracted with Boulder and Weld County Ditch Company ("BW Ditch Co.")-a mutual ditch company that operates the Boulder and Weld County Ditch ("BW Ditch") and delivers the BW Ditch water right to its shareholders-to carry 2.5 cfs of her water right through the BW Ditch to another downstream water user.[2]

¶9 In 1907, Ms. Matthews sued BW Ditch Co., alleging the company was interfering with her right to divert the MM water right through the company's headgate. The original point of diversion for the MM Ditch had been destroyed by a flood in 1875, and, pursuant to an agreement with BW Ditch Co., the MM water right had been diverted through the BW Ditch headgate since that time.[3] The court found in favor of Ms. Matthews and issued a decree authorizing her to change her point of diversion to the BW Ditch headgate and to carry her water a short distance through the BW Ditch to a point where the water would be transferred into the MM Ditch. The decree referred to this short stretch of BW Ditch as the "cutoff ditch."

¶10 Every year since 1907, the entire 4.6 cfs of the MM water right has been diverted at the BW Ditch headgate. At some point, however, the MM Ditch ceased being used, and the MM water right was instead diverted at headgates located farther down the BW Ditch, past the cutoff ditch portion. The MM Ditch is no longer visible on the ground.

¶11 Over time, the MM water right was divided and transferred to other owners in fractional interests described in inches rather than cfs. The parties agree that the 4.6 cfs MM water right amounts to 185 inches. Presently, the County owns 100 inches (the 50 Bailey Farm Inches, plus 50 inches associated with the Alexander Dawson Farm); the Sandlin Farm owns 50 inches; and the Anderson South Farm owns the remaining 35 inches.[4]

¶12 Through a series of transactions in the early 1990s, the County acquired the Bailey Farm and, with it, the Bailey Farm Inches and a half-share of the BW Ditch water right.[5] The Bailey Farm is a 290-acre property that encompasses the location of the MM Ditch and much of the 160 acres of land originally owned by Ms. Matthews. The entirety of the Bailey Farm lies north, and downslope, of the BW Ditch. See Appendix. After the MM Ditch ceased being used, water used on the Bailey Farm was diverted from a headgate on the BW Ditch (the "Bailey Farm headgate"). Historical land uses on the Bailey Farm consisted of irrigated agriculture and, later, gravel mining.

¶13 The County is developing the Bailey Farm into a public open-space park which will feature several ponds formed when abandoned gravel pits filled with groundwater. Two of the pits-turned-ponds exposed groundwater after January 1, 1981, and the County therefore must obtain approval of a plan for augmentation to replace out-of-priority stream depletions caused by evaporation from those ponds. See § 37-90-137(11)(a)–(b).

¶14 In December 2010, the County filed an application in the District Court for Water Division No. 1 seeking to fulfill its replacement obligation.[6] In addition to underground water rights for the two ponds, the County sought approval of a plan for augmentation to replace the evaporation depletions with the Bailey Farm Inches and, when needed, water leased from the City of Lafayette. To secure these replacement supplies, the County sought to change the use of the Bailey Farm Inches from irrigation to augmentation and sought an appropriative right of substitution and exchange to use the leased water when the changed Bailey Farm Inches proved insufficient. BW Ditch Co. opposed the County's application, claiming injury in connection with the County's requested change of use.[7]

¶15 At trial, the County submitted a parcel-specific HCU analysis for the Bailey Farm Inches using a study period of 1950 to 2000. The first version of that analysis estimated the amount of water delivered to the Bailey Farm using a proration formula based on diversions of the entire MM water right at the BW Ditch headgate. Because all 185 inches of the MM water right were diverted each year from 1950 to 2000, the analysis assumed delivery of the full 50 Bailey Farm Inches at the Bailey Farm headgate for the entire study period, less 20-percent ditch loss. Subsequently, the County obtained BW Ditch Co. records of actual water deliveries to the Bailey Farm headgate from 1973 to 2000; these records showed that the County's proration formula overestimated the amount of water delivered during that twenty-seven-year period by 37 percent. The County then revised its HCU analysis to reflect the actual deliveries from 1973 to 2000 and reached a lower HCU quantification. However, the County did not reduce its prorated estimates for the years 1950 to 1972.

¶16 The County's analysis also accounted for the half-share of BW Ditch water appurtenant to the Bailey Farm by assuming that water was used only when the irrigation water demand on the Bailey Farm was not fully satisfied by the Bailey Farm Inches. The County adopted this methodology because the Bailey Farm Inches are senior to the BW Ditch half-share.

¶17 The analysis was based on an assumption that the Bailey Farm Inches were historically used to irrigate 101 acres on the Bailey Farm. The claimed 101 acres consisted of two parcels-one approximately 31 acres in size, [8] the other approximately 70 acres in size. The 31-acre parcel is located within the area downslope of the MM Ditch; the 70-acre parcel is located upslope, and to the east, of that ditch. See Appendix. The County based its claimed acreage figure on six aerial photographs of the Bailey Farm taken between 1949 and 1973-which show the 31-acre and 70-acre parcels in irrigation-and on interviews with neighboring landowners and a former BW Ditch Co. ditch rider.

¶18 BW Ditch Co. argued that the County overstated the number of acres historically irrigated with the Bailey Farm Inches and asserted that using the County's HCU calculation for the change of use would lead to an expansion of the Bailey Farm Inches and cause injury to other water users farther down the BW Ditch. The BW Ditch is a large structure that carries the MM water right, the 59.3-cfs BW Ditch water right, and several others. The company claimed the County could not ignore historical use of the remaining 135 inches of the MM water right on the Dawson, Sandlin, and Anderson South Farms ("Other Farms")[9] and pointed out that a water court decree confirming historical use of the Bailey Farm Inches on 101 acres would leave the Other Farms with only 19 acres among them.[10] The County responded that it did not have to consider use on the Other Farms because, in its view, the Other Farms are outside the lawful place of use of the MM water right. It maintained that the claimed 101 acres, on the other hand, are within the lawful place of use of that right.[11]

¶19 After the trial, the water court issued a written decision. The water court perceived several fatal flaws in the County's HCU analysis: first, the County inaccurately calculated the amount of water used pursuant to the Bailey Farm Inches; second, the County failed to prove that the 70-acre parcel, which comprised over two-thirds of the County's claimed acreage, was historically irrigated with the Bailey Farm Inches; and third, the County ignored historical use of the remaining portions of the MM water right on the Other Farms and should have conducted a ditchwide HCU analysis instead of a parcel-specific one.

ΒΆ20 In light of these flaws, the water court rejected the County's HCU analysis and concluded that the County had failed to carry its burden of proving HCU. The water court determined that the County could not carry its primary burden of showing the absence of injury to other water users without an accurate HCU analysis, and the court therefore denied the change of use of the Bailey Farm Inches. Next, the water court considered the County's requested appropriative right of substitution and exchange, which would have allowed the County to use water leased from the City of Lafayette as an additional source of replacement water for its augmentation plan. The court concluded that the County had not established that the water from the exchange was sufficient, without the changed Bailey Farm Inches, to satisfy the County's replacement obligations on a year-round basis. Thus, because the court had ...


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