Vol. 38, No. 1
Winter 2015
An Official Publication of the State Bar of California Public Law Section
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Regulate or Be
Regulated:
The Impact of Landmark
Groundwater Legislation
on Local Agencies
By Kenneth J. Price and Lauren D. Layne*
Inside this Issue
Regulate or Be Regulated:
The Impact of Landmark
Groundwater Legislation on
Local Agencies
By Kenneth J. Price and
Lauren D. Layne
Message from the Chair
By K. Scott Dickey
INTRODUCTION
It is an understatement to say
that California is in the midst of
a historic drought. According to
the National Climatic Data Center,
2014 will go down as the warmest
on record and will rank among the
driest.1 Over one-half of the state is
experiencing “exceptional drought
conditions” – the most extreme
drought classification.2
In the face of such dynamic climate
conditions, California water law
has stayed stagnant. The last
drastic change to California water
law occurred 100 years ago, in 1914,
with the regulation of surface water
rights. Groundwater, however, has
remained a private natural resource.
In fact, California is the only state
that does not regulate, in some way,
3
groundwater. Landowners are
able to pump groundwater free and
clear of any state interference.
Yet, at the same time, limited
surface water supplies have caused
industry, especially agriculture, to
pump water from wells that are, in
some cases, over 1,000 feet deep
Page 7
Unscrambling the Egg: Social
Security Disability Law and
Substance Use Disorders
By The Honorable David J. Agatstein
Page 9
Why the Court Should Apply
Intermediate Scrutiny to Equal
Protection Challenges to
Election Laws
By Matt Collins
I.
Page 1
Page 14
New California Sustainability
Laws
By Theodore L. Senet, Esq.
Page 22
Litigation & Case Law Update
By K. Scott Dickey
Page 30
Legislative Update
By Kenneth J. Price
Page 35
Public Law Section Pioneers
Cutting Edge Conferences
in Conjunction with the
University of California
By John M. Applebaum
Page 38
The Public Law Journal • www.calbar.ca.gov/publiclaw • Vol. 38, No. 1, Winter 2015
to obtain a stable water supply.
The result is a severe overdraft
of California’s underground
aquifers. In 2014, the California
Department of Water Resources
(“DWR”) reported that, in dry
years, groundwater provides close
to 60 percent of the state’s water
4
supply. Since 2008, groundwater
levels have experienced all-time
historical lows in most parts of
California, especially in the San
Francisco Bay, San Joaquin Valley,
Lake Tahoe, and South Coast
hydrological regions.5 In the San
Joaquin Valley, “recent groundwater
levels are more than 100 feet below
previous historical lows.”6
Faced with this increasingly
desperate situation, the Legislature
and Governor decided to act. On
August 29, 2014, the California
Legislature passed Senate Bill
(“SB”) 1168 (Pavley), Assembly Bill
(“AB”) 1739 (Dickinson), and SB
1319 (Pavley). Combined, these
three bills are intended, for the
first time in California, to regulate
groundwater use.
II. THE SUSTAINABLE
GROUNDWATER
MANAGEMENT ACT
On September 16, 2014, Governor
Brown signed the three bills
into law, collectively creating
the “Sustainable Groundwater
Management Act” (the “Act”),7
which is effective as of January 1,
2015. While many hope that the
Act will have a significant impact
on groundwater protection, it
will also create an entirely new
bureaucratic infrastructure. A few
members of our Bar have wryly
called the Act the “Governmental
Lawyer Protection Act of 2014.”
Although the Act is intended to
provide for local management of
groundwater basins and sub-basins,
it will have a significant impact
on counties, cities and special
districts throughout California.
In so doing, there will be plenty
of work for attorneys, engineers,
hydro-geologists and local and state
bureaucrats alike.
Currently, there are 515 basins
and sub-basins identified in
California and defined by DWR.8
The Act states that it is the intent
of the Legislature “to provide
for sustainable management of
groundwater basins and to manage
groundwater basins through the
actions of local governmental
agencies…while minimizing
state intervention to only when
necessary to ensure that local
agencies manage groundwater in a
sustainable manner.”9
The Act defines “sustainable
groundwater management”
as management and use of
groundwater in a manner that
can be maintained during the
planning and implementation
horizon without causing undesirable
results.10 “Undesirable results”
include any of the following effects
caused by groundwater conditions
occurring in the basin: (1) chronic
lowering of the groundwater levels,
excluding overdraft during a drought
if extractions and recharge are
otherwise managed; (2) significant
and unreasonable reduction of
groundwater storage; (3) significant
and unreasonable seawater intrusion;
(4) significant and unreasonable
degradation of water quality;
(5) significant and unreasonable land
subsidence; and (6) surface water
depletions that have significant and
unreasonable adverse impacts on
beneficial uses of surface water.11
2
A. Groundwater Sustainability
Agencies
The Act requires the formation
of Groundwater Sustainability
Agencies (“GSAs”) by June 30,
2017.12 As currently written, the
Act states that, “any local agency
or combination of local agencies
overlying a groundwater basin
may elect to be a groundwater
sustainability agency for that
basin.”13 Existing local agencies,
such as water and irrigation
districts, that overlay each basin or
sub-basin may be charged with the
task of regulating groundwater in
their basin or sub-basin. For those
portions of regulated basins in
unincorporated areas not served by
existing local agencies, the county
within the area in which the
basin is located will be the default
14
regulatory agency. Counties
and cities will be instrumental in
implementing each GSA because
of the broad police powers those
governmental bodies hold and may
use, beyond the powers identified
in the Act. This situation leaves
county counsel and city attorneys
to interpret the Act and provide
advice on the formation of GSAs.
When there are basins and
sub-basins covered by multiple
local agencies, the agencies must
coordinate their individual
Groundwater Sustainability
Plans (“GSPs”) that apply to
a single basin or sub-basin, or
these agencies have the option of
either (1) forming a joint powers
authority (“JPA”) or (2) entering
into a “memorandum of agreement
or other legal agreement”15 to
develop a single plan for the basin
or sub-basin.
The Public Law Journal • www.calbar.ca.gov/publiclaw • Vol. 38, No. 1, Winter 2015
The legislation allows
nontraditional groups to be
members of a JPA, such as any
federally recognized Indian tribe,
or the federal government, or
water corporations regulated by
16
the Public Utilities Commission.
During consideration of this
legislation, it appeared that it
would be possible to establish a
single-purpose special district to
serve as a GSA. However, the text
authorizing the formation of such
a special district was revised and it
is somewhat unclear whether the
Act authorizes such formation. We
expect “clean up” legislation in the
next legislative session to address
this and a host of other items.
B. Groundwater Sustainability
Plans
So what is a GSP? In short a
GSP is the primary function of a
GSA. A GSP may be a single plan
developed by one or more GSAs,
or multiple coordinated plans
within a basin or sub-basin. If
the plans are coordinated, there
must be a coordination agreement
between the GSAs that meets
DWR’s requirements.17 By June 1,
2016, DWR is required to adopt
regulations for evaluating the
adequacy of GSA coordination
agreements.18 Although we do not
yet know the requirements of a
coordination agreement, we know
that the Act requires multiple
GSAs in one basin or sub-basin
to coordinate with each other to
prepare GSPs that utilize the same
data and methodologies.19
DWR has not yet adopted
regulations describing what is
an adequate GSP but, by statute,
GSPs must include the following:
(1) historical data; (2) groundwater
levels, groundwater quality,
subsidence, and groundwatersurface water interaction; (3) a
general discussion of historical
and projected water demands and
supplies; (4) a map that depicts
the area of the basin or GSA; and
(5) a map identifying existing and
potential recharge areas for the
basin.20 We do know that GSPs
must have measurable objectives
and interim milestones in five21
year increments.
By June 1, 2016, DWR is
required to adopt regulations
for evaluating the adequacy of a
GSP. By January 31, 2020, GSPs
must be adopted for high and
medium-priority basins that are
in critical overdraft.22 Bulletin
118 states a basin is in critical
overdraft “when continuation
of present water management
practices would probably result
in significant adverse overdraftrelated environmental, social, or
23
economic impacts.” By January
31, 2022, GSPs must be adopted
for high and medium-priority
basins not currently in an overdraft
condition.24 The goal is that
every basin in California will be
“sustainable” by 20 years after the
adoption of a GSP.25
Ultimately, DWR must review
GSPs for compliance. If DWR
determines that a GSP has not
been adopted, is inadequate, or is
not being implemented in a way
that will achieve sustainability
within 20 years, then the State
Water Resources Control Board
(“SWRCB”) may designate the
basin as “probationary.”26 Once
the SWRCB designates a basin
as “probationary,” GSAs will have
180 days to bring their GSPs into
3
compliance.27 If the GSPs are
not in compliance within that
time period, the SWRCB has the
authority to create an interim plan
that remains in effect until the
GSA assumes responsibility with a
plan approved by DWR.28
C. Questions Related to GSA
Formation
The initial draft of the
legislation sponsored by Senator
Dickinson required that local
agency formation commissions
(“LAFCOs”) approve the formation
of the GSAs and do so within a
compressed time period. At the
recommendation of many local
government experts, including the
California Association of Local
Agency Formation Commissions,
this language was taken out of
the legislation. Although the
Act no longer expressly requires
LAFCO to approve the formation
of GSAs, there is an open question
regarding the process of forming
a GSA and whether LAFCO
approval must be obtained prior
to formation. Moreover, given the
trend of increased LAFCO review
of JPA activities, as evidenced by
the Governor’s approval of AB
2156 (Achadjian), it would not be
surprising to see in the near future
LAFCOs having clear oversight
over GSAs.29
If you are general counsel for an
agency that was statutorily created
to manage groundwater, then there
is less ambiguity for you because
your agency is going to be the GSA.
There are 15 agencies specifically
listed in the Act that are “exclusive
local agencies” within their
respective statutory boundaries.30
Of course, these agencies may
opt out of being the exclusive
The Public Law Journal • www.calbar.ca.gov/publiclaw • Vol. 38, No. 1, Winter 2015
groundwater management agency,31
but why would they? The Act
allows them to proceed as the GSA
for their area, while continuing
to comply with their statutory
authorities and powers granted in
each agency’s principal act.32 As of
now, this group is already ahead of
the game compared to the rest of
the water agencies in California.
Water attorneys for landowners
or agencies in one or more
of the 26 named adjudicated
basins in the Act or the three
named adjudications that are
still considered by the court, can
breathe easier. Those adjudicated
areas, and any local agency that
conforms to the requirements of
an adjudication of water rights
for one of those adjudicated areas,
do not need to create a GSA
and follow the same reporting
requirements as other water
agencies complying with the Act.33
Instead, by April 1, 2016, the
Watermaster for each adjudicated
area will have to submit an annual
report to DWR that contains
certain information identified in
the Act, if it is available.34
If a GSA is not established for a
certain area or DWR determines
that a plan is not adequate,
SWRCB may elect to come in
and manage the groundwater in
that area.35 Therefore, we can
expect to see battles over which
local agency or agencies will serve
as the GSA(s) for each basin or
sub-basin. Resolving this issue
will require cooperation by various
interests and reasoned arguments
from public agency lawyers. The
ultimate decisionmaker, however,
will be DWR.
D. Other GSA Powers
As provided in the Act, a GSA
has the power to adopt rules,
regulations, ordinances, and
resolutions.36 A GSA also has the
ability to conduct investigations
to (1) determine the need for
groundwater management;
(2) prepare and adopt a GSP
and implementing rules and
regulations; (3) propose and
update fees; and (4) monitor
compliance and enforcement.37
This investigation may include
the inspection of property or
38
facilities of a person or entity,
which will likely lead to trespass
disputes. One of the more
controversial elements of the bill
involves private property rights. A
GSA will have the ability to enter
onto a landowner’s property to
check wells, monitor pumping,
and critique a landowner’s water
management practices.
The new law states that GSAs
may impose fees to fund the costs
associated with preparing GSPs.
Upon sufficient public notice, a
GSA may impose fees, including,
but not limited to, permit fees and
fees on groundwater extraction or
other regulated activities, to fund
the costs of these investigations
and the GSP.39 GSAs are also
authorized to set deadlines for the
payment of fees and to impose late
fees and collection costs.40
The legislation states that any GSA
that imposes fees on the extraction
of groundwater from the basin
to fund costs of groundwater
management shall comply with
Proposition 218 (Section 6 of
Article XIII D of the California
Constitution).41 This requirement
is consistent with various Court
4
of Appeal decisions over the
last few years, including Pajaro
Valley Water Management Agency v.
Amrhein (2007) 150 Cal. App. 4th
1364 where the court concluded
a groundwater augmentation
charge is subject to Proposition
218 restrictions. As public agency
lawyers, we know that there is
always a potential for litigation
when fees are being imposed and
Proposition 218 “elections” are
taking place.
The Act specifically provides that
the California Environmental
Quality Act (“CEQA”) does not
apply to the preparation and
42
adoption of the GSPs, but there
is no such provision exempting
the implementation of a GSP.
Consequently, it is foreseeable that
regardless of the specific exemption
in the Act, in order to implement
the plan, GSAs will need to
undertake more extensive CEQA
review during the earliest phase of
the “project,” which is the adoption
of the GSP. Therefore, we expect
this Act will also keep the CEQA
attorneys quite busy.
Even though the Act is not
effective until January 1, 2015,
there are already interested parties
working to revise the language
of the Act, especially to add an
“expedited adjudication” process.
There are also groups seeking
clarification of provisions in the
Act regarding GSA formation. We
will likely see a “clean up” bill in
the next legislative session. In the
meantime, local water agencies
and interest groups have already
started to collaborate about
forming GSAs for the basins and
sub-basins in California. Turf
wars are already commencing
The Public Law Journal • www.calbar.ca.gov/publiclaw • Vol. 38, No. 1, Winter 2015
over who will have the power to
manage groundwater. Needless
to say, these are interesting times
and the need for good legal
representation to navigate this law
will continue to increase in the
near and distant future.
* Kenneth J. Price
is a shareholder
with Baker
Manock & Jensen,
PC in Fresno
where he chairs
the firm’s Public
Agency Practice
Group. Mr. Price,
who is a member
of the Executive
Committee of
the Public Law
Section, represents
numerous
public agencies and private businesses
throughout Central California. Lauren
D. Layne is an associate attorney with
Baker Manock & Jensen, PC in Fresno
where she is a member of the firm’s
Public Agency and Reclamation and
Water Law Practice Groups. She has
a background in farming and her law
practice focuses on water law, public
agency law, agricultural business issues,
eminent domain, condemnation, and
various transactional matters.
Endnotes
1
Los Angeles Times, 2014 Warmest
Year: California, world set to
break records, November 21, 2014.
2
Ibid.
3
Sacramento Bee, California
Poised to Restrict Groundwater
Pumping, September 15, 2014.
4
California Department of Water
Resources, Public Update for
Drought Response Groundwater
Basins with Potential Water
Shortages and Gaps in
Groundwater Monitoring, April
30, 2014, available at http://www.
water.ca.gov/waterconditions/
docs/Drought_Response–
Groundwater_Basins_April30_
Final_BC.pdf (last visited January
6, 2015).
5
Ibid.
6
Ibid.
7
Water Code §§ 10720 et seq.
8
Cal. Dept. of Water Resources,
California’s Groundwater:
Bulletin 118–Update 2003 (Oct.
2003), available at http://water.
ca.gov/groundwater/bulletin118/
report2003.cfm (last visited
January 6, 2015).
9
21 Water Code §§ 10727.2(b)(1);
10733.8.
22 Id. § 10720.7(a)(1).
23 Cal. Dept. of Water Resources,
California’s Groundwater:
Bulletin 118–Update 2003
(Oct. 2003) at p. 98, available at
http://water.ca.gov/groundwater/
bulletin118/report2003.cfm (last
visited January 6, 2015).
24 Water Code § 10720.7(a)(2).
25 Id. § 10727.2(b)(1).
26 Id. § 10735.2.
27 Id. § 10735.4.
28 Id. § 10735.4 (c).
29 Govt. Code § 56378(a).
30 Water Code § 10723(c).
31 Id. § 10723(c)(2).
32 Id. § 10723(c)(3).
33 Id. § 10720.8(a)-(d).
Water Code § 10720.1(a)-(h).
34 Id. §10720.8(f)(3).
35 Id. § 10735.2.
36 Water Code § 10725.2(b).
37 Id. § 10725.4(a)(1-4).
38 Id. § 10725.4(c)-(d).
39 Id. § 10730.
40 Id. § 10730.6.
41 Id. § 10730.2(c).
42 Water Code § 10728.6.
10 Id. § 10721(u).
11 Id. § 10721(w).
12 Id. § 10735.2(a)(1).
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13 Id. § 10723(a).
14 Id. § 10724.
15 Water Code § 10723.6(a)(1-2).
16 Id. §§ 10720.3(c); 10723.6 (b).
17 Id. § 10727(b)(1-3).
18 Id. § 10733.2(a).
19 Id. § 10727.6.
20 Id. § 10727.2(a)(1-5).
5
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