What Is a Surplus Water Agreement?

Under Article XI, § 6 of the Utah Constitution, a municipality cannot “directly or indirectly, lease, sell, alien or dispose of any waterworks, water rights, or sources of water supply” owned or controlled by the municipality. However, under Section 10-8-14 of the Utah Code, a municipality is authorized to “sell and deliver the surplus product or service capacity of [its water system] not required by the city or the city’s inhabitants, to others beyond the limits of the city.” Accordingly, municipalities can enter into surplus water agreements under which the municipality allows a person to use the municipality’s surplus water until the water is required to meet the municipality’s demands.