HB0095ENS

HOUSE ENERGY, ENVIRONMENT AND NATURAL

RESOURCES COMMITTEE SUBSTITUTE FOR

HOUSE BILL 95

55th legislature - STATE OF NEW MEXICO - first session, 2021

AN ACT

RELATING TO WATER; PROVIDING FACTORS FOR THE STATE ENGINEER TO CONSIDER IN ASSESSING WHETHER A WATER USE WILL BE CONTRARY TO THE CONSERVATION OF WATER OR DETRIMENTAL TO THE PUBLIC WELFARE OF THE STATE; REQUIRING THE STATE ENGINEER TO PUBLISH FINDINGS IN SUPPORT OF APPROVING OR DENYING AN APPLICATION; DIRECTING THE STATE ENGINEER TO ADOPT RULES TO ADDRESS THE IMPACTS OF DROUGHT AND CLIMATE CHANGE ON THE ADMINISTRATION OF THE STATE'S WATERS; AMENDING AND ENACTING SECTIONS OF THE NMSA 1978.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:

SECTION 1. Section 72-5-6 NMSA 1978 (being Laws 1907, Chapter 49, Section 27, as amended) is amended to read:

"72-5-6. HEARING--APPROVAL--PERMIT.--

A. Upon the receipt of the proofs of publication, accompanied by any statutory fees required at this time, the state engineer shall determine, from the evidence presented by the parties interested, from such surveys of the water supply as may be available and from the records, whether there is unappropriated water available for the benefit of the applicant. [If so]

B. If there is unappropriated water available for the benefit of the applicant and if the proposed appropriation is not contrary to the conservation of water within the state and is not detrimental to the public welfare of the state, the state engineer shall endorse [his] approval on the application, which shall become a permit to appropriate water, and shall state in [such] the approval the time within which the construction shall be completed and the time within which water shall be applied to a beneficial use; provided that the state engineer may, in [his] the state engineer's discretion, approve [any] an application for a less amount of water or may vary the periods of annual use, and the permit to appropriate water shall be regarded as limited accordingly. The time allowed by the state engineer for completion of works or application of water to beneficial use shall be governed by the size and complexity of the project, but in no case shall exceed five years from the date of approval within which to complete construction, and four years in addition thereto within which to apply water to a beneficial use; provided that the state engineer shall have the power to grant extensions of time for completion of works or application of water to beneficial use as provided in Section 72-5-14 NMSA 1978.

C. The state engineer shall publish specific findings to support the state engineer's approval or denial of an application, which shall include the factual and legal rationale for the state engineer's decision."

SECTION 2. Section 72-5-7 NMSA 1978 (being Laws 1907, Chapter 49, Section 28, as amended) is amended to read:

"72-5-7. APPLICATION--REJECTION--NONCOMPLIANCE WITH RULES--CONSERVATION AND PUBLIC WELFARE.--

A. If, in the opinion of the state engineer, there is no unappropriated water available, [he] the state engineer shall reject [such] an application. [He]

B. The state engineer shall decline to order the publication of notice of [any] an application [which] that does not comply with the requirements of the law and rules. [and regulations. He]

C. The state engineer may also refuse to consider or approve [any] an application or notice of intention to make application or to order the publication of notice of [any] an application if, in [his] the state engineer's opinion, approval would be contrary to the conservation of water within the state or detrimental to the public welfare of the state. In making the determination as to whether approval would be contrary to the conservation of water within the state, the state engineer shall consider the impacts of drought and climate change, and in making the determination as to whether approval would be detrimental to the public welfare of the state, the state engineer shall consider the impacts on health, safety, recreational, cultural and environmental interests."

SECTION 3. Section 72-5-23 NMSA 1978 (being Laws 1907, Chapter 49, Section 44, as amended) is amended to read:

"72-5-23. WATER APPURTENANT TO LAND--CHANGE OF PLACE OF USE.--

A. All water used in this state for irrigation purposes, except as otherwise provided in [this] Chapter 72, Article 5 NMSA 1978, shall be considered appurtenant to the land upon which it is used, and the right to use it upon the land shall never be severed from the land without the consent of the owner of the land, but, by and with the consent of the owner of the land, all or any part of the right may be severed from the land, simultaneously transferred and become appurtenant to other land, or may be transferred for other purposes, without losing priority of right theretofore established, if such changes can be made without detriment to existing water rights and are not contrary to conservation of water within the state and not detrimental to the public welfare of the state, on the approval of an application of the owner by the state engineer.

B. Publication of notice of application, opportunity for the filing of objections or protests and a hearing on the application shall be provided as required by Sections 72-5-4 and 72-5-5 NMSA 1978.

C. In making the determination as to whether approval would be contrary to the conservation of water within the state, the state engineer shall consider the impacts of drought and climate change, and in making the determination as to whether approval would be detrimental to the public welfare of the state, the state engineer shall consider the impacts on health, safety, recreational, cultural and environmental interests.

D. The state engineer shall publish specific findings to support the state engineer's approval or denial of an application, which shall include the factual and legal rationale for the state engineer's decision."

SECTION 4. Section 72-5A-6 NMSA 1978 (being Laws 1999, Chapter 285, Section 6) is amended to read:

"72-5A-6. STATE ENGINEER--POWERS AND DUTIES--PERMIT--MONITORING REQUIREMENTS.--

A. The state engineer shall issue a permit to construct and operate a project if the applicant has provided a reasonable demonstration that:

(1) the applicant has the technical and financial capability to construct and operate the project;

(2) the project is hydrologically feasible;

(3) the project will not impair existing water rights or the state's interstate obligations;

(4) the project will not be contrary to the conservation of water within the state;

(5) the project will not be detrimental to the public welfare of the state;

(6) the applicant has completed applications for all permits required by state and federal law;

(7) the applicant has a valid water right quantified by one of the following legal processes:

(a) a water rights adjudication;

(b) a consent decree;

(d) a contract pursuant to 43 USC 620 et seq.; or

(e) an agreement with an owner who has a valid water right subject to an application for a change in purpose, place of use or point of diversion; and

(8) [that] the project will not cause harm to users of land and water within the area of hydrologic effect.

B. A permit for a project shall include:

(1) the name and mailing address of the person to whom the permit is issued;

(2) the name of the declared underground water basin in which the project will be located;

(3) the capacity and plan of operation of the project;

(4) any monitoring program required;

(5) all conditions required by or [regulations] rules adopted pursuant to the Ground Water Storage and Recovery Act; and

(6) other information the state engineer determines to be necessary.

C. The permit shall not become effective until the applicant obtains all other required state and federal permits.

D. The state engineer shall adopt [regulations] rules to carry out the provisions of the Ground Water Storage and Recovery Act, including monitoring the operation of projects and their effects on other water users in the area of hydrologic effect, including an Indian nation, tribe or pueblo. In determining monitoring requirements, the state engineer shall cooperate with all government entities that regulate and monitor the quality of water, including the department of environment.

E. In making the determination as to whether approval would be contrary to the conservation of water within the state, the state engineer shall consider the impacts of drought and climate change, and in making the determination as to whether approval would be detrimental to the public welfare of the state, the state engineer shall consider the impacts on health, safety, recreational, cultural and environmental interests.

F. The state engineer shall publish specific findings to support the state engineer's approval or denial of an application, which shall include the factual and legal rationale for the state engineer's decision."

SECTION 5. Section 72-6-5 NMSA 1978 (being Laws 1967, Chapter 100, Section 5, as amended) is amended to read:

"72-6-5. APPROVAL.--

A. The state engineer shall approve the application if the applicant has reasonably shown that [his] the applicant's proposed use and location of use is a beneficial use and:

(1) will not impair any existing right to a greater degree than [such] the right is, or would be, impaired by the continued use and location of use by the owner; and

(2) will not be contrary to the conservation of water within the state or detrimental to the public welfare of the state.

B. In the case of annual allotments of project water leased to a special water users' association from an irrigation district organized pursuant to Chapter 73, Article 10 NMSA 1978, if the state engineer determines that the proposed changes in place and purpose of use and point of diversion comply with the rules established pursuant to Subsection G of Section 73-10-48 NMSA 1978, the board of directors of the irrigation district may approve the application in accordance with the provisions of Section 73-10-48 NMSA 1978.

SECTION 6. Section 72-12-3 NMSA 1978 (being Laws 1931, Chapter 131, Section 3, as amended) is amended to read:

"72-12-3. APPLICATION FOR USE OF UNDERGROUND WATER--PUBLICATION OF NOTICE--PERMIT.--

A. [Any] A person, firm or corporation or any other entity desiring to appropriate for beneficial use any of the waters described in Chapter 72, Article 12 NMSA 1978 shall apply to the state engineer in a form prescribed by the state engineer. In the application, the applicant shall designate:

(1) the particular underground stream, channel, artesian basin, reservoir or lake from which water will be appropriated;

(2) the beneficial use to which the water will be applied;

(3) the location of the proposed well;

(4) the name of the owner of the land on which the well will be located;

(5) the amount of water applied for;

(6) the place of the use for which the water is desired; and

(7) if the use is for irrigation, the description of the land to be irrigated and the name of the owner of the land.

B. If the well will be located on privately owned land and the applicant is not the owner of the land or the owner or the lessee of the mineral or oil and gas rights under the land, the application shall be accompanied by an acknowledged statement executed by the owner of the land that the applicant is granted access across the owner's land to the drilling site and has permission to occupy such portion of the owner's land as is necessary to drill and operate the well. This subsection does not apply to the state or any of its political subdivisions. If the application is approved, the applicant shall have the permit and statement, executed by the owner of the land, recorded in the office of the county clerk of the county in which the land is located.

C. No application shall be accepted by the state engineer unless it is accompanied by all the information required by Subsections A and B of this section.

D. Upon the filing of an application, the state engineer shall proceed in accordance with the provisions of Section [1 of this 2019 act] 72-2-20 NMSA 1978 regarding notice of the application. [Any] A person, firm or corporation or other entity objecting that the granting of the application will impair the objector's water right shall have standing to file objections or protests. [Any] A person, firm or corporation or other entity objecting that the granting of the application will be contrary to the conservation of water within the state or detrimental to the public welfare of the state and showing that the objector will be substantially and specifically affected by the granting of the application shall have standing to file objections or protests. [provided, however, that] The state or any of its branches, agencies, departments, boards, instrumentalities or institutions, and all political subdivisions of the state and their agencies, instrumentalities and institutions, shall have standing to file objections or protests.

E. After the expiration of the time for filing objections, if no objections have been filed, the state engineer shall, if the state engineer finds that there are in the underground stream, channel, artesian basin, reservoir or lake unappropriated waters and that the proposed appropriation would not impair existing water rights from the source, is not contrary to conservation of water within the state and is not detrimental to the public welfare of the state, grant the application and issue a permit to the applicant to appropriate all or a part of the waters applied for, subject to the rights of all prior appropriators from the source.

F. If objections or protests have been filed within the time prescribed in the notice or if the state engineer is of the opinion that the permit should not be issued, the state engineer may deny the application without a hearing or, before the state engineer acts on the application, may order that a hearing be held. The state engineer shall notify the applicant of the action by certified mail sent to the address shown in the application.

G. In making the determination as to whether approval would be contrary to the conservation of water within the state, the state engineer shall consider the impacts of drought and climate change, and in making the determination as to whether approval would be detrimental to the public welfare of the state, the state engineer shall consider the impacts on health, safety, recreational, cultural and environmental interests.

H. The state engineer shall publish specific findings to support the state engineer's approval or denial of an application, which shall include the factual and legal rationale for the state engineer's decision."

SECTION 7. Section 72-12-7 NMSA 1978 (being Laws 1931, Chapter 131, Section 7, as amended) is amended to read:

"72-12-7. CHANGE OF LOCATION OF WELL--CHANGE IN USE ON

APPLICATION--TEMPORARY CHANGE.--

A. The owner of a water right may change the location of [his] the owner's well or change the use of the water, but only upon application to the state engineer and upon showing that the change will not impair existing rights and will not be contrary to the conservation of water within the state and will not be detrimental to the public welfare of the state. The application may be granted only after such advertisement and hearing as are prescribed in the case of

original applications.

B. When the owner of a water right applies for a temporary change [of] not to exceed one year for not more than three acre-feet of water to a different location or to a different use, or both, the state engineer shall make an investigation and, if the change does not permanently impair any vested rights of others, [he] the state engineer shall enter an order authorizing the change. If [he] the state engineer finds that the change sought might impair vested

rights, [he] the state engineer shall order advertisement and hearing as in other cases.

C. If objections or protests have been filed within the time prescribed in the notice or if the state engineer is of the opinion that the permit should not be issued, the state engineer may deny the application or, before [he acts] acting on the application, may order that a hearing be held. [He] The state engineer shall notify the applicant of [his] the action by certified mail sent to the address shown in the application.

D. In making the determination as to whether approval would be contrary to the conservation of water within the state, the state engineer shall consider the impacts of drought and climate change, and in making the determination as to whether approval would be detrimental to the public welfare of the state, the state engineer shall consider the impacts on health, safety, recreational, cultural and environmental interests.

E. The state engineer shall publish specific findings to support the state engineer's approval or denial of an application, which shall include the factual and legal rationale for the state engineer's decision."

SECTION 8. Section 72-12B-1 NMSA 1978 (being Laws 1983, Chapter 2, Section 1, as amended) is amended to read:

"72-12B-1. APPLICATIONS FOR THE TRANSPORTATION AND USE OF PUBLIC WATERS OUTSIDE THE STATE.--

A. The state of New Mexico has long recognized the importance of the conservation of its public waters and the necessity to maintain adequate water supplies for the state's water requirements. The state of New Mexico also recognizes that under appropriate conditions, the out-of-state transportation and use of its public waters is not in conflict with the public welfare of its citizens or the conservation of its waters.

B. [Any] A person, firm or corporation or any other entity intending to withdraw water from any surface or underground water source in the state of New Mexico and transport it for use outside the state or to change the place or purpose of use of a water right from a place in New Mexico to a place out of that state shall apply to the state engineer for a permit to do so. Upon the filing of an application, the state engineer shall proceed in accordance with the provisions of Section [1 of this 2019 act] 72-2-20 NMSA 1978 regarding notice of the application. Any person, firm or corporation or other entity objecting that the granting of the application would impair or be detrimental to the objector's water right shall have standing to file objections or protests. [Any] A person, firm or corporation or other entity objecting that the granting of the application will be contrary to the conservation of water within the state or detrimental to the public welfare of the state and showing that the objector will be substantially and specifically affected by the granting of the application shall have standing to file objections or protests. [Provided, however, that] The state [of New Mexico] or any of its branches, agencies, departments, boards, instrumentalities or institutions and all political subdivisions of the state and their agencies, instrumentalities and institutions shall have standing to file objections or protests. The state engineer shall accept for filing and act upon all applications filed under this section in accordance with the provisions of this section. The state engineer shall require notice of the application and shall thereafter proceed to consider the application in accordance with existing administrative law and procedure governing the appropriation of surface or ground water.

C. In order to approve an application under this [act] section, the state engineer must find that the applicant's withdrawal and transportation of water for use outside the state would not impair existing water rights, is not contrary to the conservation of water within the state and is not otherwise detrimental to the public welfare of the citizens of New Mexico.

D. In acting upon an application under this [act] section, the state engineer shall consider [but not be limited to] the following factors:

(1) the supply of water available to the state of New Mexico;

(2) water demands of the state of New Mexico;

(3) whether there are water shortages within the state of New Mexico;

(4) whether the water that is the subject of the application could feasibly be transported to alleviate water shortages in the state of New Mexico;

(5) the supply and sources of water available to the applicant in the state where the applicant intends to use the water; [and]

(6) the demands placed on the applicant's supply in the state where the applicant intends to use the water; and

(7) the impacts of drought and climate change.

E. By filing an application to withdraw and transport waters for use outside the state, the applicant shall submit to and comply with the laws of the state of New Mexico governing the appropriation and use of water.

F. The state engineer is empowered to condition the permit to insure that the use of water in another state is subject to the same regulations and restrictions that may be imposed upon water use in the state of New Mexico.

G. Upon approval of the application, the applicant shall designate an agent in New Mexico for reception of service of process and other legal notices.

SECTION 9. A new section of Chapter 72 NMSA 1978 is enacted to read:

"[NEW MATERIAL] RULEMAKING--CLIMATE CHANGE IMPACTS.--No later than July 1, 2023, the state engineer shall adopt rules to identify and assess the impacts of drought and climate change in the administration of the surface and ground waters of New Mexico. The rules shall be based on reliable scientific projections and data."

SECTION 10. EFFECTIVE DATE.--The effective date of the provisions of this act is July 1, 2021.

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