Sustainable Groundwater Management Act

The Sustainable Groundwater Management Act (“SGMA”) was signed into law on September 16, 2014. (California Water Code Section 10720 et seq.). SMGA is intended to regulate California’s groundwater, something which has been up to the Act’s passage largely unregulated.
The need for groundwater management has grown over the years, spiked by years of drought and growth, encouraged by Proposition 1. California is one of last states in the west to have groundwater management at the state level. Previously groundwater scarcity and disputes were adjudicated between government and private stakeholders in court proceedings. Many of the concepts and much of the terminology used or useful in SGMA stem from those earlier decisions. SGMA forces California to do what would probably have happened anyway in court proceedings.

Federal Law re Agricultural Production

Federal laws and regulations are the base of the pyramid of laws and regulations impacting agriculture in California. The federal government passes legislation, issues regulations, and establishes and supports policies that impact the agricultural and food processing industry on national issues, typically interstate in nature. Many of the laws and regulations that are passed at a national level are implemented by state and local governments, or agencies of the federal government in district, state, or local offices. The federal government also enters into cooperative and/or work-sharing agreements with state and local government to implement federal agricultural and food processing law and policy. The principal federal agencies at the national level that implement federal agricultural and food processing law are the United States Department of Agriculture (“USDA”), and the United States Food and Drug Administration (“FDA”), but there are many others.

Sustainable Groundwater Management Act

The Sustainable Groundwater Management Agency (“SGMA”) essentially requires localities to set up Groundwater Sustainability Agencies (“GSA’s”) and Groundwater Sustainability Plans (“GSP’s”) for high and moderate priority basins, some in critical overdraft. If localities do not do so adequately, or in a timely manner, the State can step in. Areas of particularly acute overdraft include the southern San Joaquin Valley, but there are others. Examples of medium priority basins include the Santa Rosa Plain, the Petaluma Valley, and the Sonoma Valley Basins in Sonoma County. In such areas, GSA’s must be set up by June 30, 2017. GSP’s must be established by January 31, 2020 for basins in critical overdraft. GSA’s must be established by January 31, 2022 for medium and high priority basins not in critical overdraft. Basins in critical overdraft must achieve “sustainability” by January 31, 2040, and other medium and high priority basins must achieve sustainability by January 31, 2042.

Groundwater and Surface Water Rights

Rights to surface and underground water in California can be placed in four categories: pueblo rights (arising out of the establishment of pueblos such as Los Angeles while California was still part of Mexico), riparian or overlying (attaching to the land adjacent to a surface river or stream (riparian), or underlying land (attached to the land overlying groundwater)), prescriptive (appropriative after five years of open and notorious taking), and appropriative (neither pueblo, riparian, or overlying, and before the five year prescriptive period has run). These four categories are prioritized: pueblo owners generally having superior rights to overlying, riparian or overlying owners having superior rights to appropriative owners, and prescriptive owners having superior rights to appropriative (and in most if not all respect equal to riparian or overlying owners). Water rights are generally considered “usufructuary,” meaning that water cannot be owned per se, but only the right to its “use” and “fruits.” As a result of a 1928 amendment to the California Constitution, water rights are limited to reasonable and beneficial use. (Cal. Const. Art. X, § 2).

California Laws re Agricultural Production

California takes the laboring oar in passing, implementing, and enforcing laws and regulations relating to the agricultural and food processing industries. California sometimes implements or enforces federal standards. The California Department of Food and Agricultural, as well as the California Department of Public Health and other agencies implement and enforce state law. Not infrequently, district, county commissioner, and local agencies also enforce state law.

Sustainable Groundwater Management Act

California’s Sustainable Groundwater Management Act “(“SGMA”), states that “[n]othing in this part, or in any groundwater management plan adopted pursuant to this part, determines or alters surface water rights or groundwater rights under common law or any provision of law that determines or grants surface water rights.” (Cal. Water Code § 10720.5(b)) The meaning of this passage is not entirely clear, as Groundwater Sustainability Agencies (“GSA”), do have the right to regulate groundwater use, including limiting extractions of groundwater. It appears reasonably clear that although GSAs may not single-handedly determine groundwater rights, they may take actions that effectively determine groundwater rights, with courts stepping in to determine the validity of what the GSAs have done. (See Cal. Water Code § 10726.6 (GSA may file action to determine GSP validity, but makes no binding determination); Cal Civ. Proc. Code § 830) An owner of water rights may find out that he or she or it has fewer rights than claimed, and all rights will be subject to more regulation in light of perceived “undesirable results” and the “reasonable and beneficial use” doctrine under the California Constitution.

Riparian Rights

Riparian rights are rights to the waters of rivers, streams, lakes and other bodies of water that arise by virtue of, and attach to the real property that abuts such courses or bodies of water. The rights attach to the real property in question and cannot be alienated from the real property. The rights similarly cannot be lost by non-use, although they can be lost by prescription, grant, condemnation, or natural change in the course of a waterway. Riparian rights are considered “usufructuary” rights, meaning they are rights to use water, but not ownership rights in the water. As explained further below, riparian rights are limited by the rights of other users and the general public, and owners of such rights are considered tenants in common of the subject water source. The riparian rights to undergrounds streams or courses of water generally follow the rules applicable to surface riparian rights – e.g., underground streams flowing under an owner’s real property – although this is discussed in greater length below.