0001| SENATE BILL 342 | 0002| 43RD LEGISLATURE - STATE OF NEW MEXICO - SECOND SESSION, 1998 | 0003| INTRODUCED BY | 0004| SUE F. WILSON | 0005| | 0006| | 0007| | 0008| | 0009| | 0010| AN ACT | 0011| RELATING TO WATER RIGHTS; ENACTING THE NEW MEXICO WATER | 0012| BANKING ACT AND AMENDING SECTIONS OF THE NMSA 1978 TO CREATE | 0013| AN AUTHORITY AND BOARD TO REGULATE WATER BANKING OF CONSERVED | 0014| AND SURPLUS WATER AND TO ESTABLISH A FUND; MAKING AN | 0015| APPROPRIATION. | 0016| | 0017| BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO: | 0018| Section 1. [NEW MATERIAL] SHORT TITLE.--Sections 1 | 0019| through 16 of this act may be cited as the "New Mexico Water | 0020| Banking Act". | 0021| Section 2. [NEW MATERIAL] LEGISLATIVE PURPOSE.--The | 0022| purposes of the New Mexico Water Banking Act are to: | 0023| A. make better and more extensive use of water | 0024| resources in the state; | 0025| B. encourage the conservation of water and ensure | - 1 - 0001| that conserved and surplus water is available for other uses | 0002| and users through transfers administered by the New Mexico | 0003| water bank authority; | 0004| C. permit greater access to known resources of | 0005| available water to water users who need additional supply; | 0006| D. amend water forfeiture statutes to delay their | 0007| application to water rights deposited in the water bank for | 0008| use by others who have current needs for water resources; | 0009| E. permit public uses of unused, conserved or | 0010| surplus water rights for the benefit of the public interest; | 0011| F. provide a market conduit for unused, conserved | 0012| or surplus water rights and resources; | 0013| G. provide an alternative to forfeiture for | 0014| unused, unneeded or conserved water rights by permitting | 0015| transfers administered by the New Mexico water bank board; and | 0016| H. promote economic development in the state by | 0017| providing alternative water availability solutions for | 0018| agricultural, environmental, municipal, industrial, | 0019| commercial, recreational and residential interests in the | 0020| state. | 0021| Section 3. [NEW MATERIAL] DEFINITIONS.--As used in the | 0022| New Mexico Water Banking Act: | 0023| A. "authority" means the New Mexico water bank | 0024| authority; | 0025| B. "board" means the New Mexico water bank board; | - 2 - 0001| C. "deposit" means the placement of a water right | 0002| or portion of a water right in the New Mexico water bank for | 0003| transfer; | 0004| D. "depositor" means the owner of a water right | 0005| who deposits the water right or a portion of the water right | 0006| in the New Mexico water bank; | 0007| E. "transfer" means the conveyance of a water | 0008| right or a portion of a water right by sale or lease; | 0009| F. "water bank" or "bank" means the New Mexico | 0010| water bank; | 0011| G. "water right" means a right acquired or | 0012| authorized pursuant to the laws of this state to impound, | 0013| divert or use surface water or ground water to the extent | 0014| authorized by law; and | 0015| H. "withdrawal" means the removal of a deposit in | 0016| the water bank by the depositor. | 0017| Section 4. [NEW MATERIAL] NEW MEXICO WATER BANK BOARD- | 0018| -CREATION--APPOINTMENT--QUALIFICATIONS--TERMS--EX-OFFICIO | 0019| MEMBERS.-- | 0020| A. The "New Mexico water bank board" is | 0021| established to administer the New Mexico Water Banking Act | 0022| through the New Mexico water bank authority. | 0023| B. The board shall be composed of seven public | 0024| members appointed by the governor for four-year terms whose | 0025| service on the board shall be without compensation except for | - 3 - 0001| expense reimbursement made in accordance with the Per Diem and | 0002| Mileage Act. For initial terms, two members of the board | 0003| shall be appointed for four-year terms, two members shall be | 0004| appointed for three-year terms and three members shall be | 0005| appointed for two-year terms. Thereafter, all appointments | 0006| shall be for four-year terms. Members shall be chosen for | 0007| their expertise and experience in water rights and water | 0008| resources fields. Each member shall reside in a geographic | 0009| area of the state different from each other member. No more | 0010| than four of the members shall be of the same political party. | 0011| Members may serve two terms and shall remain in office until | 0012| their respective successors have been appointed and have | 0013| agreed to serve. The members shall annually elect a member to | 0014| serve as chairman of the board. | 0015| C. The state engineer, chairman of the interstate | 0016| stream commission, secretary of environment, speaker of the | 0017| house of representatives and president pro tempore of the | 0018| senate, or each of their respective designees, shall be ex- | 0019| officio members of the board, without vote. | 0020| Section 5. [NEW MATERIAL] NEW MEXICO WATER BANK | 0021| AUTHORITY ESTABLISHED--EMPLOYMENT AND DISCHARGE OF DIRECTOR-- | 0022| EMPLOYEES.-- | 0023| A. The "New Mexico water bank authority" is | 0024| established under the direction of the board. | 0025| B. The board shall appoint and fix the salary of a | - 4 - 0001| full-time director who shall serve at the pleasure of the | 0002| board and, pursuant to the direction of the board, the | 0003| director shall employ such employees of the authority as are | 0004| proper and necessary and prescribe their duties and | 0005| compensation. | 0006| Section 6. [NEW MATERIAL] NEW MEXICO WATER BANK BOARD | 0007| AND AUTHORITY--POWERS AND DUTIES.--The authority, acting at | 0008| the direction of the board, shall: | 0009| A. administer, implement and enforce the New | 0010| Mexico Water Banking Act; | 0011| B. administer, operate and regulate the water | 0012| bank; | 0013| C. encourage water rights owners to implement | 0014| water conservation practices; | 0015| D. educate the public, including political | 0016| subdivisions of the state, about the water bank and the | 0017| benefits of depositing conserved or surplus water in the bank; | 0018| E. establish requirements for a deposit of a water | 0019| right or portion of a water right into the water bank, | 0020| including: | 0021| (1) terms and conditions for deposit and | 0022| withdrawal, including the procedure and penalties for early | 0023| withdrawal; | 0024| (2) the procedure for determining eligibility | 0025| of water rights for deposit; | - 5 - 0001| (3) the procedure and formula to quantify | 0002| water rights to be deposited; | 0003| (4) the eligibility of water rights for | 0004| deposit considering legal entitlement, ownership, validity, | 0005| recent historical use and absence of legal restrictions; | 0006| (5) the priority order, if any, of water | 0007| rights to be sold by the bank; and | 0008| (6) monitoring to determine and penalties for | 0009| improper use of deposited or transferred water; | 0010| F. facilitate the transfers of water rights from | 0011| the water bank for future beneficial use, including: | 0012| (1) making annual determinations of available | 0013| deposited water to be transferred; | 0014| (2) making annual determinations of the fees | 0015| for transfer of deposited water; | 0016| (3) establishing the formula to calculate the | 0017| annual pro rata interest of each depositor in transfers made | 0018| during the previous year and computing each depositor's | 0019| entitlement of proceeds; | 0020| (4) negotiating the terms of a transfer; | 0021| (5) maintaining a registry of deposits and | 0022| persons who have registered with the bank and identifying a | 0023| beneficial use for additional water supplies; and | 0024| (6) informing persons listed on its registry | 0025| about water rights available from the bank; | - 6 - 0001| G. purchase, hold and sell water rights in its own | 0002| name; | 0003| H. negotiate and contract for or acquire the use | 0004| of existing surface facilities or reservoirs to store | 0005| deposited water not transferred during any year of its term of | 0006| deposit; | 0007| I. determine compliance with the necessary | 0008| standards for stored water considering the obligations of the | 0009| board and authority pursuant to surface storage reservoir | 0010| contracts, if any; | 0011| J. establish injection standards, in conjunction | 0012| with other state agencies having authority regarding water | 0013| injection schemes or water quality, for deposited water to be | 0014| injected, through direct surface or direct subsurface methods, | 0015| into underground aquifers; | 0016| K. subject to Sections 13 and 14 of the New Mexico | 0017| Water Banking Act, establish fees to be paid to the water bank | 0018| fund for transfers and the administrative and operational | 0019| costs of the bank, board and authority; | 0020| L. establish procedures for making, transferring | 0021| or withdrawing a deposit; determining the priority of | 0022| transfers, the reports and records of a transfer and the fees | 0023| associated with transfers; and other actions; | 0024| M. report annually to the legislature regarding | 0025| deposits, withdrawals and transfers made, identifying the | - 7 - 0001| number of persons and water rights involved in all deposits, | 0002| withdrawals and transfers; existing and anticipated future | 0003| storage needs of the water bank; and other operations of the | 0004| bank, board and authority; | 0005| N. promulgate rules to implement the New Mexico | 0006| Water Banking Act and to administer, operate and regulate the | 0007| water bank; | 0008| O. contract with any person to achieve or further | 0009| the purposes of the New Mexico Water Banking Act; | 0010| P. file suit in its own name and be sued; and | 0011| Q. take all other actions necessary or advisable | 0012| to facilitate deposits and transfers and to achieve or further | 0013| the purposes of the New Mexico Water Banking Act. | 0014| Section 7. [NEW MATERIAL] NEW MEXICO WATER BANKING ACT | 0015| EXCLUSIVE.--Water rights shall not be banked or eligible for | 0016| storage in either surface facilities or reservoirs or | 0017| underground aquifers in this state, except in accordance with | 0018| the New Mexico Water Banking Act and authorizations of law, | 0019| compacts or contracts of the state valid on the effective date | 0020| of the New Mexico Water Banking Act; provided that the water | 0021| bank may accept water rights of Indian nations, tribes or | 0022| pueblos for banking and storage in accordance with the terms | 0023| of that act. | 0024| Section 8. [NEW MATERIAL] DEPOSITED WATER RIGHTS--USES- | 0025| -REVERSION TO PUBLIC WATER--PUBLIC INTEREST USE.-- | - 8 - 0001| A. In accordance with rules promulgated by the | 0002| board, a water right or portion of a water right deposited in | 0003| the water bank during the term of the deposit may: | 0004| (1) not be used by the depositor, his heirs, | 0005| successors or assignees; | 0006| (2) be transferred, stored or used for public | 0007| interest uses by the bank in accordance with the New Mexico | 0008| Water Banking Act and rules of the board; or | 0009| (3) be withdrawn by the depositor in | 0010| accordance with the New Mexico Water Banking Act, the rules of | 0011| the board and the terms of the deposit. | 0012| B. In any event, unless sold by the bank on behalf | 0013| of the depositor or withdrawn by the depositor in accordance | 0014| with the New Mexico Water Banking Act, the rules of the board | 0015| and the terms of the deposit, a deposited water right reverts | 0016| to the status of unappropriated public water subject to state | 0017| administration over public waters and subsequent appropriation | 0018| for beneficial use at the expiration of the term of the water | 0019| right deposit. | 0020| C. During the term of the deposit, water that is | 0021| neither transferred nor stored during any year may be used for | 0022| in-stream releases, environmental, recreational, flushing or | 0023| other public interest uses, as determined by the board; | 0024| provided that the public interest use shall not interfere with | 0025| any obligation, compact or other interest of the state. | - 9 - 0001| Section 9. [NEW MATERIAL] STORAGE IN SURFACE FACILITIES | 0002| AND RESERVOIRS AND RECOVERY OF DEPOSITED WATER.--The board, | 0003| through the authority, may store deposited water in existing | 0004| surface facilities or reservoirs in the state during the term | 0005| of the deposit. The board shall promulgate rules to implement | 0006| storage and recovery of deposited water in and from surface | 0007| facilities and reservoirs for transfers, alternative surface | 0008| storage, public interest uses, ground water storage and | 0009| conversion to bank ownership, withdrawal or reversion to public | 0010| water. | 0011| Section 10. [NEW MATERIAL] STORAGE AND RECOVERY OF | 0012| DEPOSITED WATER IN UNDERGROUND AQUIFERS--BANK-OWNED WATER.--In | 0013| any year of a deposit term, the bank may store available | 0014| deposited water, unneeded during that year for transfers or | 0015| public interest uses, in underground aquifers. Upon being | 0016| stored in an underground aquifer, through direct or indirect | 0017| surface or direct subsurface methods, the water is deemed | 0018| abandoned by the depositor and converted to bank ownership for | 0019| subsequent recovery by the bank for sale, lease, public | 0020| interest or other use by the bank, without compensation, credit | 0021| or proceeds paid to or for the depositor. The water bank shall | 0022| not use water converted to bank ownership under the provisions | 0023| of this section in competition with or in any manner | 0024| detrimental to its obligations or responsibilities to | 0025| depositors and deposited water rights. | - 10 - 0001| Section 11. [NEW MATERIAL] PRESUMPTION OF NON- | 0002| IMPAIRMENT.--A transfer of a deposited water right for any | 0003| year, during the term of the deposit, by the board through the | 0004| authority, shall create a rebuttable presumption that the | 0005| transfer does not impair existing water rights and is neither | 0006| contrary to the conservation of water within the state nor | 0007| detrimental to the public welfare of the state. Unless the | 0008| state engineer objects to the transfer within ten days of | 0009| written notice of the intended transfer by the board to the | 0010| state engineer, the transfer is deemed approved by the state | 0011| engineer, and the transfer may occur, subject only to objection | 0012| by an objector substantially and specifically affected by the | 0013| one-year transfer of the deposited water right. Upon any | 0014| objection, the transfer shall be reviewed by the state | 0015| engineer, who shall provide his findings to the board about the | 0016| transfer and the objection. If the state engineer objects to | 0017| the transfer or determines that the transfer may adversely | 0018| affect the objector, the board shall rescind or modify the | 0019| transfer to avoid any adverse effect on the objector's water | 0020| right. | 0021| Section 12. [NEW MATERIAL] DEPOSITS--EXEMPT FROM | 0022| FORFEITURE.--A water right, eligible for deposit as determined | 0023| by board rule, may be deposited in the water bank for a term of | 0024| up to ten years and may be transferred annually during the | 0025| deposit term, pursuant to the terms of the New Mexico Water | - 11 - 0001| Banking Act and rules promulgated thereunder. During the | 0002| deposit term, a deposited water right is exempt from forfeiture | 0003| pursuant to Sections 72-5-28, 72-6-3 and 72-12-8 NMSA 1978. | 0004| Section 13. [NEW MATERIAL] FEES AND REPORTS.-- | 0005| A. Fees shall be imposed on each transfer of water | 0006| rights on deposit with the water bank for: | 0007| (1) administration and operation of the water | 0008| bank; and | 0009| (2) each transfer of deposited water rights. | 0010| B. By rule, the board shall set: | 0011| (1) the administration and operation fees to | 0012| be charged to and paid by the transferee of each deposited | 0013| water right to the bank; | 0014| (2) annually, the transfer fees to be paid by | 0015| the transferee to the bank, considering the type and duration | 0016| of the transfer and the amount, quality and intended use of the | 0017| deposited water rights to be transferred; and | 0018| (3) the percentage of the transfer fee to be | 0019| paid over to the depositor for the transfer made and the | 0020| percentage of the transfer fee retained by the bank for making | 0021| the transfer. | 0022| C. By rule, the board shall establish the procedures | 0023| for setting the fees imposed by this section and procedures for | 0024| the calculation and payment of the percentage of the transfer | 0025| fee to be paid over to the depositor. | - 12 - 0001| D. Fees shall not be imposed or paid for public | 0002| interest uses of deposited water rights made pursuant to | 0003| Subsection B of Section 8 of the New Mexico Water Banking Act. | 0004| Section 14. [NEW MATERIAL] WATER BANK FUND CREATED-- | 0005| FUNDING.--There is created in the state treasury the "water | 0006| bank fund" to be used solely for the administration and | 0007| operation of the water bank by the board and the authority. | 0008| The water bank fund is to be financed by appropriations from | 0009| the general fund to the board, fees assessed and collected by | 0010| the board in administrating the New Mexico Water Banking Act | 0011| and such other financing as is permitted by law. Income or | 0012| interest earned on the investment of the fund shall remain in | 0013| the fund. Money shall be expended pursuant to warrant issued | 0014| by the department of finance and administration pursuant to | 0015| vouchers signed by the director of the authority. Any | 0016| unexpended or unencumbered balance of the water bank fund shall | 0017| not revert to the general fund, but shall remain on deposit in | 0018| the fund for administrative and operating costs of the water | 0019| bank. | 0020| Section 15. [NEW MATERIAL] OTHER TRANSFERS.--Nothing in | 0021| the New Mexico Water Banking Act shall prevent the sale or | 0022| purchase of water or water rights by or through persons other | 0023| than the board or authority to the extent permitted by and in | 0024| accordance with law. | 0025| Section 16. [NEW MATERIAL] CONSERVATION OF WATER | - 13 - 0001| RIGHTS.--Subject to Section 7 of the New Mexico Water Banking | 0002| Act, the amount of water rights conserved by a water right owner | 0003| may be deposited in the water bank in the amount conserved, | 0004| subject further to board rule establishing eligibility terms for | 0005| the conserved water deposit and the calculation of the water | 0006| conserved. | 0007| Section 17. Section 72-5-28 NMSA 1978 (being Laws 1907, | 0008| Chapter 49, Section 42, as amended) is amended to read: | 0009| "72-5-28. FAILURE TO USE WATER--FORFEITURE.-- | 0010| A. When the party entitled to the use of water fails | 0011| to beneficially use all or any part of the water claimed by him, | 0012| for which a right of use has vested for the purpose for which it | 0013| was appropriated or adjudicated, except the waters for storage | 0014| reservoirs, for a period of four years, such unused water shall, | 0015| if the failure to beneficially use the water persists one year | 0016| after notice and declaration of nonuser given by the state | 0017| engineer, revert to the public and shall be regarded as | 0018| unappropriated public water; provided, however, that forfeiture | 0019| shall not necessarily occur if circumstances beyond the control | 0020| of the owner have caused nonuse, such that the water could not | 0021| be placed to beneficial use by diligent efforts of the owner; | 0022| and provided that periods of nonuse when irrigated farm lands | 0023| are placed under the acreage reserve program or conservation | 0024| reserve program provided by the Food Security Act of 1985, P.L. | 0025| 99-198 shall not be computed as part of the four-year forfeiture | - 14 - 0001| period; and provided, further, that the condition of notice and | 0002| declaration of nonuser shall not apply to water ~~[which]~~ that | 0003| has reverted to the public by operation of law prior to June 1, | 0004| 1965. | 0005| B. Upon application to the state engineer at any time | 0006| and a proper showing of reasonable cause for delay or for nonuse | 0007| or upon the state engineer finding that it is in the public | 0008| interest, the state engineer may grant extensions of time, for a | 0009| period not to exceed three years for each extension, in which to | 0010| apply to beneficial use the water for which a permit to | 0011| appropriate has been issued or a water right has vested, was | 0012| appropriated or has been adjudicated. | 0013| C. Periods of nonuse when water rights are acquired | 0014| by incorporated municipalities or counties for implementation of | 0015| their water development plans or for preservation of municipal | 0016| or county water supplies shall not be computed as part of the | 0017| four-year forfeiture statute. | 0018| D. A lawful exemption from the requirements of | 0019| beneficial use, either by an extension of time or other | 0020| statutory exemption, stops the running of the four-year period | 0021| for the period of the exemption, and the period of exemption | 0022| shall not be included in computing the four-year period. | 0023| E. Periods of nonuse when the nonuser of acquired | 0024| water rights is on active duty as a member of the armed forces | 0025| of this country shall not be included in computing the four-year | - 15 - 0001| period. | 0002| F. The owner or holder of a valid water right or | 0003| permit to appropriate waters for agricultural purposes | 0004| appurtenant to designated or specified lands may apply the full | 0005| amount of water covered by or included in the water right or | 0006| permit to any part of ~~[such]~~ the designated or specified | 0007| tract without penalty or forfeiture. | 0008| G. Periods of nonuse when water rights are acquired | 0009| and placed in a state engineer-approved water conservation | 0010| program by a conservancy district organized pursuant to Chapter | 0011| 73, Articles 14 through 19 NMSA 1978, an acequia or community | 0012| ditch association organized pursuant to Chapter 73, Article 2 or | 0013| 3 NMSA 1978, an irrigation district organized pursuant to | 0014| Chapter 73, Articles 9 through 13 NMSA 1978 or the interstate | 0015| stream commission shall not be computed as part of the four-year | 0016| forfeiture period. | 0017| H. Periods when water rights are deposited in the | 0018| New Mexico water bank pursuant to the New Mexico Water Banking | 0019| Act shall not be computed as part of the four-year forfeiture | 0020| period." | 0021| Section 18. Section 72-12-8 NMSA 1978 (being Laws 1931, | 0022| Chapter 131, Section 8, as amended) is amended to read: | 0023| "72-12-8. WATER RIGHT FORFEITURE.-- | 0024| A. When for a period of four years the owner of a | 0025| water right in any of the waters described in Sections 72-12-1 | - 16 - 0001| through 72-12-28 NMSA 1978 or the holder of a permit from the | 0002| state engineer to appropriate any such waters has failed to | 0003| apply them to the use for which the permit was granted or the | 0004| right has vested, was appropriated or has been adjudicated, the | 0005| water rights shall be, if the failure to beneficially use the | 0006| water persists one year after notice and declaration of nonuser | 0007| given by the state engineer, forfeited and the water so unused | 0008| shall revert to the public and be subject to further | 0009| appropriation; provided that the condition of notice and | 0010| declaration of nonuser shall not apply to water ~~[which]~~ that | 0011| has reverted to the public by operation of law prior to June l, | 0012| l965. | 0013| B. Upon application to the state engineer at any time | 0014| and a proper showing of reasonable cause for delay or for nonuse | 0015| or upon the state engineer finding that it is in the public | 0016| interest, the state engineer may grant extensions of time, for a | 0017| period not to exceed three years for each extension, in which to | 0018| apply to beneficial use the water for which a permit to | 0019| appropriate has been issued or a water right has vested, was | 0020| appropriated or has been adjudicated. | 0021| C. Periods of nonuse when irrigated farm lands are | 0022| placed under the acreage reserve program or conservation reserve | 0023| program provided by the Food Security Act of l985, P.L. 99-l98 | 0024| shall not be computed as part of the four-year forfeiture | 0025| period. | - 17 - 0001| D. Periods of nonuse when water rights are acquired | 0002| and placed in a state engineer-approved water conservation | 0003| program by an artesian conservancy district, a conservancy | 0004| district, an acequia or community ditch association organized | 0005| pursuant to Chapter 73, Article 2 or 3 NMSA 1978, an irrigation | 0006| district organized pursuant to Chapter 73, Articles 9 through 13 | 0007| NMSA 1978 or the interstate stream commission shall not be | 0008| computed as part of the four-year forfeiture statute. | 0009| E. A lawful exemption from the requirements of | 0010| beneficial use, either by an extension of time or other | 0011| statutory exemption, stops the running of the four-year period | 0012| for the period of the exemption, and the period of exemption | 0013| shall not be included in computing the four-year period. | 0014| F. Periods of nonuse when water rights are acquired | 0015| by incorporated municipalities or counties for implementation of | 0016| their water development plans or for preservation of municipal | 0017| or county water supplies shall not be computed as part of the | 0018| four-year forfeiture statute. | 0019| G. Periods of nonuse when the nonuser of acquired | 0020| water rights is on active duty as a member of the armed forces | 0021| of this country shall not be included in computing the four-year | 0022| period. | 0023| H. The owner or holder of a valid water right or | 0024| permit to appropriate waters for agricultural purposes | 0025| appurtenant to designated or specified lands may apply the full | - 18 - 0001| amount of water covered by or included in that water right or | 0002| permit to any part of the designated or specified tract without | 0003| penalty or forfeiture. | 0004| I. Periods when water rights are deposited in the | 0005| New Mexico water bank pursuant to the New Mexico Water Banking | 0006| Act shall not be computed as part of the four-year forfeiture | 0007| period." | 0008| Section 19. APPROPRIATION.--Two hundred fifty thousand | 0009| dollars ($250,000) is appropriated from the general fund to the | 0010| water bank fund for expenditure in fiscal year 1999 and | 0011| subsequent fiscal years by the New Mexico water bank board for | 0012| the purpose of carrying out the provisions of the New Mexico | 0013| Water Banking Act. Any unexpended or unencumbered balance | 0014| remaining at the end of any fiscal year shall not revert to the | 0015| general fund. | 0016| |