Thursday, January 27, 2011

2011 Legislature: Repeal of Phosphorus Limit

Representative Stephen Sandstrom has introduced House Bill 246 (H.B. 246) entitled "Repeal of Phosphorus Limit in Dishwashing Detergent." The bill seeks to repeal Utah Code section 19-5-24, which was enacted by the Utah Legislature in 2008. Section 19-5-24 prohibits the sale of household dishwashing detergents that contain 0.5% or more phosphorus by weight. The purpose of the law is to keep phosphorus out of Utah's waterways because it causes algae blooms. Recently, however, people have been complaining that the new detergents with lower levels of phosphorus are not getting their dishes clean. These complaints may be the impetus for this bill.

To read HB 246, click here.

Tuesday, January 25, 2011

2011 Legislature: Water Rights Amendments

Representative Jack Draxler has introduced House Bill 39 (H.B. 39), which is entitled "Water Rights Amendments." The bill makes some technical changes to Utah Code section 73-3-18. The bill deletes an incorrect reference to "forfeited" applications and corrects a cross-reference to Utah Code section 73-3-12. The bill also makes wording changes regarding (1) the State Engineer's authority to lapse applications and (2) assigning uncertificated applications to appropriate.

To read the full text of the bill, click here.

(For an update on this bill, click here.)

Monday, January 24, 2011

2011 Legislature: Lost Share Certificates

The following article was written by David Hartvigsen, a partner at Smith Hartvigsen, PLLC, for the Water & The Law newsletter that our firm publishes on a quarterly basis. If you would like to receive an email version of the newsletter, please click here to join our mailing list.

Senate Bill 25 (S.B. 25): Share Certificates in Water Companies
Certificates representing shares of stock in water companies often become lost, destroyed, stolen, or can't be located for any number of reasons. This most typically happens when property and interests in water shares are passed from one generation to another upon the death of the parent or grandparent. Most water companies use share certificates as the sole documentary evidence of ownership of the shares. Therefore, when certificates are lost, a serious problem develops concerning who is the rightful owner of the shares. About the only solution available in the past to water companies was to require the person claiming ownership to provide a bond that could be used to reimburse the company for potential liability under future claims by others purporting to be the true owners and alleging that the company has given their shares to someone else. The problem has become worse over time because the value of water stock, and therefore the cost of such bonds, has skyrocketed and bond companies are no longer willing to issue bonds that protect more than a few years into the future.

This bill, sponsored by Sen. Ralph Okerlund, addresses this problem by setting up a new "safe harbor" for water companies and shareholders to use. It provides for published notice to the public and for direct notice to those known to have a possible interest in the shares covered by a lost certificate, such as those who have paid assessments on those shares within the last five years. In general, if no objections are filed with the company within a 60-day period, the company may issue a replacement certificate and both the company and the holder of the new certificate are protected against future claims of ownership of those shares. If an objection is received, the company can either evaluate the claims and take action as it deems appropriate or tell the parties to go have a court settle the dispute. There are more specific requirements and procedures that must be followed, but this is the basic concept. The bill is supported by Water Coalition, the Water Task Force, and the Interim Natural Resources Committee.

A full copy of the bill is available by clicking here.

(For an update on this bill, click here.)

Thursday, January 20, 2011

2011 Legislature: Joint Use of Ditches

Senator Dennis Stowell has introduced Senate Bill 108 (S.B. 108), which is entitled "Joint Use of Water Infrastructure." The bill modifies Utah Code section 73-1-7, which allows a person to enlarge and/or convey water through an existing canal or ditch owned by another person or company if the person pays for any damage and pays an equitable proportion of the maintenance costs.

The bill makes some minor modifications to the language of the statute, including requiring the person to pay a proportional share of the maintenance and operation costs of the ditch or canal. More importantly, the bill requires the person seeking to enlarge and/or use the ditch or canal to enter into a contract with the ditch or canal owner before the enlargement and/or use can commence. The contract should set forth the terms of use, including the payment terms. The bill requires the person seeking to use the ditch or canal and the ditch or canal owner to negotiate the contract in good faith.

To read the full text of the bill, click here.

(Update: This bill has been replaced by a substitute bill. To read more, click here.)

Wednesday, January 19, 2011

Policy Change Regarding Municipal Use Water Rights

The Utah Division of Water Rights recently adopted a new policy regarding who is entitled to have municipal use water rights. The text of the State Engineer's policy change is included below:

It has been the policy of the Division to approve municipal use only for public entities or entities which are contractually obligated with public entities for public water supply service. Applications in the name of other parties with the concurrence of a public entity to whom the water right is to be conveyed have been approved with the condition the application must be conveyed to the public entity and perfected in their name. Current practice is to approve change applications for public entities to municipal use from other uses with a condition which limits the approval to a specific acre foot diversion and depletion quantity related to the historic use and a requirement the public water supplier maintain records of actual diversion and use sufficient to demonstrate depletions associated with use under the application do not exceed the specified depletion limitation.

Effective immediately, the entities which qualify for municipal use on application approval are to be expanded from public entities to "Public Water Suppliers" as defined in 73-1-4(1)(b) UCA. Please note this expands the universe of qualifying entities to include private water companies regulated by the PSC and community water systems (normally non-profit corporations) serving at least 100 connections or 200 year round residents which are controlled by the residents they serve. This change in policy will allow these entities to submit applications to cover the universe of uses under the umbrella of municipal use expected in a metropolitan setting without the overhead of change applications for each particular use type, the flexibility of accounting for their uses in terms of diversion and depletion, and submit proof on that basis for uses in their service area. With this new found flexibility these entities must also accept the responsibility to maintain records of diversion and use to demonstrate their compliance with the limitations of their applications and are expected to submit data to the water use program consistent with other public entities which are now reporting.

Monday, January 17, 2011

Historic Property Effect Evaluations

Under Utah Code section 9-8-404, a state agency is not supposed to approve any undertaking without taking into account the undertaking’s possible effects on historic property and providing the state historic preservation officer with a written evaluation of any effect the undertaking may have on the historic property. In order to implement this statute, the Utah Division of Water Rights now requires applicants to fill out a Historic Property Effect Evaluation (“HPEE”). A completed HPEE must be submitted with all applications to appropriate, change applications, exchange applications, well rush letters, well replacements, non-production well authorizations, geothermal well applications, dam applications, and stream gage installations.

The HPEE form asks the applicant to (1) describe the physical effects to the land will occur to the land surface under the proposed project; (2) describe any historic properties that could be affected by the proposed project; (3) describe any historic property survey that has been conducted at or near the site of the proposed project; and (4) state whether there is a federal or state connection to the proposed project that would require a historic property evaluation. The HPEE form is to be completed by the applicant, but is to be signed by a representative of the Division of Water Rights.

The HPEE form is available by clicking here.

[Update: As of November 2012, HPEEs are no longer required for water right applications.]

Wednesday, January 5, 2011

2011 Legislature: Temporary Water Shortage Emergency

Senator Ralph Okerlund has introduced Senate Bill 102 (S.B. 102), which is entitled "Temporary Water Shortage Emergency - Military Facilities." The bill makes one change to Utah Code section 73-3-21.1. The bill adds military facilities to the list of those who have a preferential right to use water for drinking, sanitation, and fire suppression purposes during a temporary water shortage emergency.

To read the full text of the bill, click here.

To read about the 2010 bill that enacted section 73-3-21.1, click here.

(For an update on this bill, click here.)