Yavapai-Apache Nation v. Fabritz-Whitney – 7/21/2011

August 5, 2011

Arizona Court of Appeals Division One Holds That Only Residents of an Active Management Area Have Standing to Object to an Assured Water Supply Determination.

The City of Prescott applied to the Arizona Department of Water Resources (“ADWR”) for a modification of its assured water supply designation, seeking to include additional water drawn from the Big Chino sub-basin of the Verde River groundwater basin.  ADWR largely approved the modification but during the administrative process, ADWR determined that several parties with objections lacked standing to be heard.  Several of these objectors filed suit against ADWR claiming that the modification harmed their water rights in the Verde River and that ADWR had erred in determining that they lacked standing to participate as objectors during the administrative review process.  Defendants moved for summary on the challenge to ADWR’s determination that the objectors lacked standing under A.R.S. § 45-578.B and the constitutionality of the statute.  The trial court granted partial summary judgment, concluding that A.R.S. § 45-578.B limits the pool of potential objectors to residents of the active management area (“AMA”) where the water is to be used and that this limitation does not violate due process or equal protection. 

The Court of Appeals affirmed the trial court’s holding.  The Court noted that Arizona’s water code provides separately for both water rights adjudication, intended to allocate water rights, and water usage management, intended to regulate water usage.  As part of the process in place to govern water usage management, a city must obtain a designation from ADWR that it has an assured water supply.  This process does not allocate water rights or establish priorities, but only involves an analysis of water rights that are already in place. 

Under this backdrop, the Court of Appeals analyzed the language of § 45-578.A which states in part:  “The director shall give notice of the application for a certificate of assured water supply once each week for two consecutive weeks in a newspaper of general circulation in the active management area in which the applicant proposes to use water“ and § 45-578.B which states in part:  “Notice pursuant to subsection A of this section shall state that objections to the issuance of the certificate may be filed by residents of the active management area…”  The Court determined that a plain reading of the statute provides AMA residents a right to object during the assured water supply determination, but does not provide a similar right to nonresidents.  The Court reasoned that any argument that non-residents have standing to object because not explicitly barred from objecting would render the words of the statute granting that right to residents meaningless.  Additionally, the Court found that this interpretation serves the legislature’s purpose of establishing a system of AMA’s and providing water management procedures to govern within each AMA. 

The Court likewise rejected Appellant’s claim that A.R.S. § 45-578.B violated the Equal Protection Clause and Due Process Clause.  In evaluating the equal protection claim, the Court found that there was a rational basis for limiting objectors to residents of the AMA where the water is used – namely that the administrative review process governs the internal water usage of an AMA and does not determine water rights.  The Court, moreover, reasoned that Appellant has an alternate forum to litigate its water rights.  With regards to the due process claim, the Court of Appeals found that the currently pending general adjudication of water rights provides a forum for Appellant to litigate its water rights.  Not only does another forum exist, that forum is the only forum in which Appellant can properly litigate its water rights as the ADWR lacks the statutory authority and subject matter jurisdiction to adjudicate water rights. 

The Court of Appeals affirmed the trial court’s ruling.

Judge Orozco authored the opinion; Judges Kessler and Hall concurred.