Here are more water bills that have passed both the House and the Senate:
HB 247: Water Development Amendments
HB 428: Water Issues Task Force (click here to read the amended bill)
SB 103: Joint Use of a Canal or Ditch (click here to read the amended substituted bill)
SCR 3: Concurrent Resolution Supporting Continued Federal Funding of the Central Utah Project (click here to read the amended concurrent resolution). Governor Herbert has declined to sign SCR 3.
Showing posts with label 2011 Legislation. Show all posts
Showing posts with label 2011 Legislation. Show all posts
Thursday, March 10, 2011
Monday, February 14, 2011
2011 Legislature: Water Bills Passed by Utah Legislature
Several water bills have already passed both the House and the Senate and are awaiting the governor's signature. These bills include:
HB 39: Water Rights Amendments
SB 10: Local District Amendments
SB 20: Management of Water Rights Amendments
SB 25: Share Certificates in Water Companies (click here to read amended bill)
SB 26: Water Law Modifications
SB 102: Temporary Water Shortage Emergency - Military Facilities (click here to read the amended bill)
HB 39: Water Rights Amendments
SB 10: Local District Amendments
SB 20: Management of Water Rights Amendments
SB 25: Share Certificates in Water Companies (click here to read amended bill)
SB 26: Water Law Modifications
SB 102: Temporary Water Shortage Emergency - Military Facilities (click here to read the amended bill)
Friday, February 4, 2011
2011 Legislature: Substituted Bill About Joint Use of Ditches
Senator Dennis Stowell has introduced a substituted bill for Senate Bill 108 (S.B. 108) regarding joint use of ditches and canals.
Like the original bill, the substituted bill requires a person seeking to jointly use a ditch or canal to enter into a contract with the ditch or canal owner prior to using or enlarging the ditch or canal. The substituted bill adds that unless the contract provides otherwise, the person using the ditch or canal: (1) does not acquire voting rights in the entity that owns the ditch or canal (i.e., ditch company, canal company, or irrigation company); (2) cannot add water that reduces the water quality in the ditch or canal; (3) cannot add water that exceeds the capacity of the ditch or canal; (4) must pay an equitable proportion of construction or upgrade costs incurred by the ditch or canal owner within the past five years; (5) is proportionally responsible for liability arising out of operation or maintenance of the ditch or canal; and (6) is solely responsible for any liability caused solely by the person. The substituted bill also clarifies that the statute only applies to ditches and canals (i.e., does not apply to pipelines).
To read the full text of Substituted SB 108, click here.
For an update on this bill, click here.
Like the original bill, the substituted bill requires a person seeking to jointly use a ditch or canal to enter into a contract with the ditch or canal owner prior to using or enlarging the ditch or canal. The substituted bill adds that unless the contract provides otherwise, the person using the ditch or canal: (1) does not acquire voting rights in the entity that owns the ditch or canal (i.e., ditch company, canal company, or irrigation company); (2) cannot add water that reduces the water quality in the ditch or canal; (3) cannot add water that exceeds the capacity of the ditch or canal; (4) must pay an equitable proportion of construction or upgrade costs incurred by the ditch or canal owner within the past five years; (5) is proportionally responsible for liability arising out of operation or maintenance of the ditch or canal; and (6) is solely responsible for any liability caused solely by the person. The substituted bill also clarifies that the statute only applies to ditches and canals (i.e., does not apply to pipelines).
To read the full text of Substituted SB 108, click here.
For an update on this bill, click here.
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.
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.)
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.)
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.)
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 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.)
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.)
Tuesday, December 21, 2010
2011 Legislature: Water Law Modifications
Senator Margaret Dayton has introduced a bill to make some changes to Utah Code section 73-3-17. The bill has been numbered Senate Bill 26 (S.B. 26) and is entitled "Water Law Modifications."
Most of the proposed changes in the bill are small, technical changes. The most significant change relates to certificates of beneficial use (aka certificates of appropriation) that are issued by the State Engineer. Currently, the law requires the water right owner to record the certificate with the appropriate county recorder's office within 30 days after the certificate has been issued. This bill removes the recording requirement, but provides that a water right owner may record the certificate if he/she wants to.
To read the full text of the bill, click here.
(For an update on this bill, click here.)
Most of the proposed changes in the bill are small, technical changes. The most significant change relates to certificates of beneficial use (aka certificates of appropriation) that are issued by the State Engineer. Currently, the law requires the water right owner to record the certificate with the appropriate county recorder's office within 30 days after the certificate has been issued. This bill removes the recording requirement, but provides that a water right owner may record the certificate if he/she wants to.
To read the full text of the bill, click here.
(For an update on this bill, click here.)
Wednesday, December 8, 2010
How Does the Law Treat Lost Share Certificates in Water Companies?
The following article was published in the Water & The Law newsletter, which 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.
When the pioneers settled Utah in the 1800s, they often banded together to construct common water diversion, storage, and distribution facilities. Over time, these associations of water users were incorporated into nonprofit mutual water corporations. In these companies, the water rights are held in the name of the corporation for the benefit of its members. Shares of stock were issued to signify how much water each individual is entitled to receive. In most cases, to transfer the shares of stock, the shareholder would need to endorse the certificate to a new owner. Thus, the certificate was critical to establish and transfer ownership of the shares and the attendant right to water delivery.
This system works well in most cases, but it presents a challenge whenever a certificate is lost, destroyed, or stolen. Under the Uniform Commercial Code, a portion of which is applicable to transfers of shares of stock in a water corporation, the corporation cannot simply re-issue the share with impunity. If the lost or stolen certificate is later discovered, the corporation would usually need to honor both the replacement certificate and the original. Because shares of a water corporation represent a right to delivery of a proportionate share of the corporation's water rights, dilution of the shares in this manner is especially unpalatable to the other shareholders. To account for these risks, many water corporations have a series of requirements before they will issue a replacement certificate. For example, many corporations require the person requesting a new certificate to post or obtain a perpetual bond to protect the corporation in the event the original certificate surfaced. Recently, however, it has become more and more difficult to secure such a bond.
To address this difficulty, the Utah Executive Water Task Force has recently approved a draft bill in an attempt to streamline this process. The bill is expected to be presented to the 2011 Utah State Legislature for consideration. The present draft of the bill continues to give the corporation the ability to establish its own requirements for issuing a new certificate in its Articles of Incorporation or Bylaws. Without such requirements, however, the new law would provide some options for the water corporation to both protect itself and allow a new share to be issued. For example, the proposed bill would give the water corporation the option to, at the expense of the person requesting the new certificate, publish and mail notice of the request to issue a replacement certificate. The bill then outlines a process that the corporation can use to resolve share ownership disputes. There will undoubtedly be further revisions of the bill before it is passed, but it is a step toward solving this challenge that often faces water corporations and shareholders.
(Update: Click here to read about the bill introduced in the 2011 Utah Legislature.)
When the pioneers settled Utah in the 1800s, they often banded together to construct common water diversion, storage, and distribution facilities. Over time, these associations of water users were incorporated into nonprofit mutual water corporations. In these companies, the water rights are held in the name of the corporation for the benefit of its members. Shares of stock were issued to signify how much water each individual is entitled to receive. In most cases, to transfer the shares of stock, the shareholder would need to endorse the certificate to a new owner. Thus, the certificate was critical to establish and transfer ownership of the shares and the attendant right to water delivery.
This system works well in most cases, but it presents a challenge whenever a certificate is lost, destroyed, or stolen. Under the Uniform Commercial Code, a portion of which is applicable to transfers of shares of stock in a water corporation, the corporation cannot simply re-issue the share with impunity. If the lost or stolen certificate is later discovered, the corporation would usually need to honor both the replacement certificate and the original. Because shares of a water corporation represent a right to delivery of a proportionate share of the corporation's water rights, dilution of the shares in this manner is especially unpalatable to the other shareholders. To account for these risks, many water corporations have a series of requirements before they will issue a replacement certificate. For example, many corporations require the person requesting a new certificate to post or obtain a perpetual bond to protect the corporation in the event the original certificate surfaced. Recently, however, it has become more and more difficult to secure such a bond.
To address this difficulty, the Utah Executive Water Task Force has recently approved a draft bill in an attempt to streamline this process. The bill is expected to be presented to the 2011 Utah State Legislature for consideration. The present draft of the bill continues to give the corporation the ability to establish its own requirements for issuing a new certificate in its Articles of Incorporation or Bylaws. Without such requirements, however, the new law would provide some options for the water corporation to both protect itself and allow a new share to be issued. For example, the proposed bill would give the water corporation the option to, at the expense of the person requesting the new certificate, publish and mail notice of the request to issue a replacement certificate. The bill then outlines a process that the corporation can use to resolve share ownership disputes. There will undoubtedly be further revisions of the bill before it is passed, but it is a step toward solving this challenge that often faces water corporations and shareholders.
(Update: Click here to read about the bill introduced in the 2011 Utah Legislature.)
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