Administrative Rule Review Report #AR11-042
Legislative Service Office
24-Aug-11
AGENCY: State Engineer, Board of Control
DATE SUBMITTED: 8/23/2011
SUBJECT: Chapter I, Introduction to Wyoming Water Administration; Chapter V, Petition Information; Chapter VI, Contested Case Procedures; and Appendix A, Sample Petitions and Forms.
NATURE OF RULES: Legislative interpretive and procedural
STATUTORY AUTHORITY: W.S. 41-2-211
DETERMINATION OF PROCEDURAL COMPLIANCE BASED UPON INFORMATION SUBMITTED BY THE AGENCY TO LSO: Apparently complete to date. The agency did receive a number of comments regarding the rules and made various changes in response to the comments. The changes which were incorporated pursuant to the comments are indicated in the strike and underline version of the rules, provided by the agency.
SUMMARY OF RULES:
The revised rules provide new and updated forms for use by the public in filing petitions and other documents with the Board of Control. Minor substantive and clerical corrections were made to Chapters I, V and VI.
Chapter V also contains substantive additions intended to compliment the handling of water rights when subdivisions are created pursuant to the subdivision permitting process contained in W.S. 18-5-306. W.S. 18-5-306(a)(xi)(A) requires subdivision permits to indicate the intended disposition of water rights within a proposed subdivision by one of three methods: 1) relinquishment of the water rights (see W.S. 18-5-306(a)(xi)(A)(I)); 2) change of use, place of use or point of diversion to provide for beneficial use of the water rights outside the subdivision (see W.S. 18-5-306(a)(xi)(A)(II)); or 3) a plan for distribution of the water rights within the subdivision with appropriate applications for change of use, change of place of use, change in point of diversion or means of conveyance (see W.S. 18-5-306(a)(xi)(A)(III)). The agency's existing rules accommodate these three statutory requirements. (See Chapter V, Section 6.) The revised rules create a new method for satisfying the requirements of W.S. 18-5-306 by means of an "Authorization to Detach Water Rights ("ADWR")." (See Chapter V, Section 6.) The ADWR process allows a subdivision applicant to submit to the Agency an ADWR form which, after acceptance, "generally" cannot be withdrawn. Pursuant to the rules, the ADWR is held by the Agency for 5 years. During this time, the applicant can petition to move or change the subject water rights so that the water rights may continue to be utilized elsewhere. If no petitions are filed within 5 years after an ADWR is accepted by the Agency, the water rights are deemed voluntarily abandoned. During the 5 year period, "the grantor or their successors" (the parties owning the lands subject to the ADWR) are responsible for providing notice to new land purchasers about the status of the water rights and their potential abandonment within 5 years. The new rules impose a $10 fee for filing an ADWR and require ADWR forms to be notarized.
FINDINGS: Except as noted below, the rules appear to be within the scope of statutory authority and legislative intent.
As described above, W.S. 18-5-306(a)(xi) establishes the requirements for subdivision permitting and states three alternatives for addressing water rights within a proposed subdivision: 1) relinquishment, 2) change in use, place of use or point of diversion, and 3) distribution within the subdivision. See W.S. 18-5-306(a)(xi)(A). County boards of commissioners are responsible for determining if the mandates of W.S. 18-5-306 have been met. See W.S. 18-5-301.
The Agency's revised rules state that the ADWR process "may be used in conjunction with [the change in use or place of use statutes] to satisfy Title 18 (W.S. 18-5-306(a)(xi)) requirements to the State Engineer" (see Chapter V, Section 6(d)). To the extent this language suggests that a board of county commissioners must find that an ADWR meets the subdivision statute's requirements, LSO has found no authority which would allow the Agency to make this determination. Rather, it appears to be a determination which is reserved to the counties.
LSO also is concerned that the Agency' ADWR process may not satisfy any of the three alternatives for addressing water rights established in W.S. 18-5-306(a)(xi). First, the ADWR may not constitute a "relinquishment." Although the rules do provide that an ADWR, once accepted, cannot be withdrawn, the ADWR's main purpose appears to be to grant the applicant 5 years to decide whether he wants to relinquish/abandon his water rights or otherwise alter them. W.S. 18-5-306(a)(xi)(A)(I) requires evidence that the subdivider has submitted "documentation necessary to relinquish the water rights." An ADWR appears to be, at most, a conditional or contingent relinquishment. With regard to the other two alternatives in W.S. 18-5-306(a)(xi), the ADWR process does not purport to distribute water rights within a subdivision or change the use, place of use or point of division or water rights. The ADWR process appears to simply preserve the decision to take such action until a later date. Although the ADWR process undoubtedly provides a useful tool for subdivision applicants, it does not appear to be contemplated by W.S. 18-5-306.
LSO has several other concerns with the rules.
1) As indicated above, the rules state that, once accepted by the agency, an ADWR cannot "generally" be withdrawn. (See Chapter V, Section 6(d)(1)(b).) The rules do provide an example of when an ADWR can be withdrawn: if a county does not approve the subdivision permit to which the ADWR is connected. Even with the example, LSO is concerned that the word "generally" does not provide sufficient notice from which a person could reasonably be expected to know when an ADWR can and cannot be withdrawn.
2) The rules and attached forms uniformly require and refer to documents which are notarized by a notary public. The Wyoming Statutes have been amended and now refer to notary publics as notarial officers. Notarial officers, which include traditional notary publics, have the authority to perform the traditional notarization of a document. See Wyoming Statutes, Article 34, Chapter 26.
LSO counsel did consult with counsel for the State Engineer in formulating this review. The State Engineer's counsel informed LSO that the ADWR process has been developed over the last approximately 4 years and has proved a valuable tool in allowing subdividers to comply with Wyoming's subdivision statutes. Apparently, the process was initially created in response to considerable demand by the public for a workable means of applying the subdivision permitting process to the administration of water rights in Wyoming.
STAFF RECOMMENDATION: That the Council recommend that the Governor direct the Agency to rescind the rules or amend the rules to address the concerns raised in the rule review report.
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Ian Shaw
Staff Attorney
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Lynda G. Cook
Staff Attorney
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