On July 30, 2020, I attended the State Bar of Montana’s one-day Montana Law Seminar.  One of the Montana-specific presentations covered water rights – and the opening slide below aptly captured the topic:

One of Montana’s most prominent water challenges arises from many of its basins being “over-appropriated,” whereby claims filed exceed the available water.  Much has thus been written about Montana land developers utilizing “exempt wells” to meet the water requirement of the residential home development boom that has occurred across the state since 1990.  That fact should not be a surprise since the dispute has the elements of a Shakespearian political drama; it involves:

  • all three branches of government (and a fourth branch if you consider administrative agencies a separate branch, as many argue it often is),
  • water rights (as under the Montana Constitution, all water is owned by the state), and
  • the natural pitting of a traditional way of life and the rights established to support that way of life (ranching and farming) versus the economic pressures to accommodate changing ways-of-life (the subdividing of ranches and farmlands for residential housing).

Origins and Current Status of the Exempt Well Dispute

In the residential land development sphere, the exempt well legal dispute has its origin in a  heavily disputed administrative rule issued in 1993 by the Montana Department of Natural Resources and Conservation, Admin. R. M. 36.12.101(13).  A loophole in the rule that residential land developers began relying on beginning in the late 1990s was litigated to the Montana Supreme Court.  In The Clark Fork Coalition v. Tubbs, 384 Mont. 503, 380 P.3d 771 (Mont. 2016), the Montana Supreme Court ruled the loophole invalid because it conflicted with the underlying statute on which the administrative rule was based.  The state legislature responded by passing legislation that overturned the Montana Supreme Court decision by codifying language the Montana Supreme Court rejected.  Montana’s governor then vetoed the legislation.  The result of this peculiar ping-ponging across Montana’s branches of government  is that the exempt well issue is, as stated by Montana Farm Bureau Federation, “back in the same old, familiar boat; where do we go from here?,” where it remains today.  At its core, the dispute remains about the amount of water diverted by current and potential appropriators.

The Bigger-Picture Environmental Issue: The Loss of Open Space to Residential Land Development and its Ripple Effect

A simple online search reveals significant attention has been given to the competing interests at stake if residential home builders can develop homes utilizing single groundwater wells.  Specifically, the public, academic, and legal debate appears to fall into one or two categories:

  • The public policy and legal tension between accommodating new residential land development and protecting Montana’s long-established system of protecting holders of senior water rights; and
  • The environmental impact of widespread single groundwater wells on the ongoing ecological health of the water source from which water is diverted.

However, as many groups seek a long-term, collaborative solution, more attention needs to be given to the impact of open space loss across Montana on what underlies the exempt-well – not enough water to go around to satisfy all stakeholders’ preferences.  My reasoning is this: the loss of open space impacts water sources, usually reducing available water to be appropriated downstream; fewer water sources and less water to be appropriated downstream puts further strain on Montana’s already tense water rights legal and public policy state of affairs.

Recommendation: Greater Attention to the Loss of Open Space on Available Water.

More scientific research needs to be conducted accessing the ripple effect of the loss of open space on the water ultimately available to divvy up by Montana’s water rights system.  The exempt-well dispute cannot be allowed to be narrowed down to just being about the amount of water diverted or the cause of the diversion – although those will always be points of contention between current and future appropriators.  What also requires equal attention is what land use changes are impacting the gross availability of water to be allocated to all stakeholders.  Nonprofit research organizations, such as Headwaters Economics, have already raised the issue of the accelerating loss of open space and its impact on water policies and concerns.  The next step is increased research into and policy focus on the ripple effect of the loss of open space.  Whether parties can reach a collaborative solution or the matter is resolved by adversarial legislation or litigation, the information generated by the recommended scientific research will be beneficial to all parties.