Washington Supreme Court Restricts Water Rights - Decision May Impede Development in Rural Counties

A recent Washington Supreme opinion will make it more difficult for rural housing developers to secure water rights for their projects. In Kittitas County v. Eastern Washington Growth Management Hearings Board,[1] the court held that Kittitas County (County) violated Washington’s Growth Management Act (GMA)[2] by failing to protect water resources when it passed a revised comprehensive plan and growth code (Plan) that allowed developers to develop rural land without disclosing common ownership of side-by-side subdivisions. The court affirmed a decision by the Eastern Washington Growth Management Hearings Board (Board) that connected the GMA’s mandates to protect water with the Court’s 2002 decision in Dep’t of Ecology v. Campbell & Gwinn, LLC,[3] which held that “the total group groundwater use in a residential development must be considered, rather than the separate use of each residential lot, for purposes of determining if use is in excess of Washington’s 5,000 gallons per day … permit exemption.”[4]

Background

As a general rule, under Washington’s Ground Water Code,[5] anyone who wishes to use underground water (“groundwater”) in Washington must receive a permit from the Department of Ecology (“Ecology”). Since the end of World War II, groundwater wells using less than 5,000 gallons of water per day for domestic use have been exempt from Washington’s permit requirement.[6] As a result of rapid growth and recent droughts, permit-exempt wells have created increasing conflict among water users and Ecology has received requests to limit or prohibit exempt wells, particularly in dry Eastern Washington. Kittitas County, situated in Central Washington’s Yakima River Basin, is the area of the state with the most contentious groundwater exempt well issues because the Basin is one of the state’s most water-short areas. See J. Kray State Attorney General Backs Agency Decision to Prohibit New Wells in Eastern Washington County, Marten Law Environmental News (November 4, 2009).

Because water supply in the Basin is limited, Ecology has not issued any new groundwater permits in the Yakima River Basin since 1993. Exempt wells were, accordingly, the only method available for obtaining new appropriation of groundwater in the Basin. Currently permit-exempt wells are legally used across the state to serve single homes, small developments, irrigation of small lawns and gardens, industry, and stock watering. Washington’s groundwater permit exemptions are codified in RCW 90.44.050, the same statute providing that permits are required for groundwater withdrawals unless exempt. The “domestic well” exemption in RCW 90.44.050 provides a groundwater permit exemption for any withdrawal of public groundwater for single or group domestic uses in an amount not exceeding 5,000 gallons a day.

As it has become more difficult to receive water permits because of delays in processing applications and the probability that applications will be denied, developers have increasingly relied on the groundwater exemption to ensure water for their projects. The use of the exemption for larger projects has raised a number of issues related to the interpretation of the groundwater exemption and concerns that the exemption itself is allowing for the use of water that will impact other existing rights and instream flows.

Procedural History

In December 2006, Kittitas County passed an ordinance[7] updating its Plan as required by the GMA.[8] Several citizen groups[9] and the Washington Department of Community, Trade and Economic Development (CTED)[10] filed petitions for review with the Board, alleging that the County had failed to comply with the GMA.

The Board held a hearing and issued a final decision and order directing the County to further revise its Plan and specific development regulations to achieve compliance with the GMA.[11] The County, the Building Industry Association of Washington (BIAW), Central Washington Home Builders Association (CWHBA), Kittitas County Farm Bureau, and several other parties representing land and business interests[12] separately appealed the Board’s order to the Kittitas County Superior Court, where their appeals were consolidated.[13] One of the respondents then filed motions for discretionary review which Division Three of the Washington Court of Appeals granted. The Court of Appeals then certified the case for review by the Washington Supreme Court.[14]

Supreme Court Decision

As the Supreme Court noted, “The GMA includes requirements that counties consider and address water resource issues in land use planning.”[15] In Kittitas County, the citizens’ groups challenged whether provisions of the County’s subdivision code[16] violated the GMA’s water protection requirements. The specific subdivision regulation the citizens’ groups challenged provides, in part:

Any person desiring to subdivide the land in an unincorporated area of the county shall submit a preliminary plat (see Chapter 16.12) to the director which shall be accompanied by filing fees established annually by the board of commissioners under separate action.[17]

Kittitas County Code (KCC) Chapter 16.12 requires parties seeking to subdivide rural land to disclose the owner(s) of the land and information about abutting property owners but does not require disclosure of related subdivision applications.[18] Primarily as a matter of law, the citizens’ groups “argued that the County is required to assure that ‘all land within a common ownership or scheme of development be included within one application for a division of land’ in order to comply with the GMA’s requirements to protect water.”[19] The court found that the record before the Board included evidence of both water shortages in the county and subdivision applications that allegedly evaded the law by relying on multiple exempt wells.

The court therefore affirmed the Board’s holding “that the County’s subdivision regulations allow multiple subdivisions side-by-side, in common ownership, which then can use multiple exempt wells . . . contrary to the GMA’s requirements to protect water quality and quantity.” The court affirmed a conclusion that the Board reached by connecting the GMA’s mandates to protect water with the Washington Supreme Court’s interpretation of RCW 90.44.050 in Campbell & Gwinn.[20] In that case, the court interpreted the permit exemption in RCW 90.44.050 to hold that commonly owned developments are not entitled to the domestic well exemption and therefore must comply with the established well permitting process if the total development uses more than 5,000 gallons of water per day.[21] The Campbell & Gwinn decision did not, however, directly address the impact of the holding on county planning or land use decisions, noting only that “[amici] urge that [the GMA] planning duties will be hindered if the exempt well provision does not apply to multiple wells in a development.”[22] The Kittitas decision now reaches that issue and requires counties to look more deeply at whether water is legally available for development – including whether a developer is planning to rely on the domestic well exemption for commonly owned properties – before approving applications to subdivide land.

Finally, the court also addressed the counties’ and Ecology’s respective roles in regulating water rights. Petitioners had argued that the County is entirely preempted by Ecology from adopting regulations related protecting groundwater resources. The court disagreed, holding that nothing in Washington’s Ground Water Code expressly preempts consistent local regulation.[23] The court further held that “[i]n fact, several relevant statutes indicate that the County must regulate to some extent to assure that land use is not inconsistent with available water resources.”[24] The court concluded, therefore, that “[w]hile Ecology is responsible for appropriation of groundwater by permit under RCW 90.44.050, the County is responsible for land use decisions that affect groundwater resources, including subdivision, at least to the extent required by law.”[25]

For more information about Marten Law’s water and wetlands practice, please contact Jeff Kray.