Montanans sue over state’s water permitting loophole
Monique Merrill
(CN) — Montana landowners, conservation groups and municipalities have taken their grievances with the state’s water management laws to court, filing an 80-page complaint on Wednesday, accusing the state of disregarding water rights.
“Despite the recognition that basins in high-growth areas are fully appropriated, the State continues to authorize these exempt wells without public notice, mitigation requirements, or evaluation of potential effects on existing water rights or surface flows,” the plaintiffs wrote in the complaint filed in Lewis and Clark County District Court.
Under what is called the “exempt well loophole” of the Montana Water Use Act, the plaintiffs claim the state is allowing unregulated groundwater development outside its permitting system — letting developers drilling groundwater wells skip to the front of the line and overdraw the state’s water resources.
The loophole forces cities and towns to bear the brunt of such unregulated groundwater use, Kelly Lynch, the executive director of lead plaintiff Montana League of Cities and Towns, said in a statement.
“Municipalities are already struggling to ensure reliable water supplies for growing communities,” Lynch said. “We need a consistent, lawful permitting process that protects existing users, not a system that leaves Montana’s communities and taxpayers to clean up the mess.”
The plaintiffs — the Montana League of Cities and Towns, Association of Gallatin Agricultural Irrigators, Clark Fork Coalition, Kevin and Katrin Chandler, Montana Environmental Information Center, Montana Farm Bureau Federation, Mark Runkle and Trout Unlimited — are asking the court to declare the loophole unconstitutional and block the state from continuing to allow harmful and permitless groundwater development.
The state adopted the Montana Water Use Act in 1973, creating a framework under which water rights are obtained, administered and adjudicated. It requires that those seeking new appropriations of water apply for a permit from the Montana Department of Natural Resources and Conservation. The permitting process allows senior users to object to new appropriations and requires applicants to show that the new appropriation won’t negatively impact the existing water rights of senior users, prove that water is legally and physically available and that the usage won’t deplete surface flow.
The loophole, which is a subsection of the act, allows applicants to skip the permitting process if their groundwater appropriations are considered minimal. It was originally meant for small domestic and agricultural users drilling low-capacity wells.
The plaintiffs point to data from the Department of Natural Resources and Conservation that shows that around 72% of the approximately 141,000 exempt groundwater appropriations authorized between 1973 and 2023 are being used for residential uses.
“Each of these exempt wells has been summarily granted a new water right with a priority date and subject to no analysis to determine whether such new water use is consistent with the Water Use Act, no process to ensure fulfillment of the state’s constitutional duty to protect senior water rights, and no mitigation required to minimize the depletion to Montana’s water resources,” the plaintiffs wrote.
Further, they claim the lack of permitting for these wells also prevents the state — or anyone, for that matter — from monitoring or determining how much water is being used under the loophole and if it surpasses statutory limits.
The regions that use the most domestic groundwater are those with the most concentrated rates of population growth and development, areas the plaintiffs say residential expansion has been fueled by reliance on exempt groundwater wells.
“Exempt wells facilitate a housing development model and pattern that is unsustainable,” plaintiff Mark Runkle, a Montana housing developer, said in a statement. “It transfers many of the developer’s responsibilities to future homeowners and taxpayers. This model undermines responsible development on municipal services with infrastructure completed and undermines the affordability of housing.”
The loophole allows developers to construct subdivisions using multiple exempt wells and avoid the costs of obtaining water rights and building centralized water-supply systems. As a result of the loophole, the plaintiffs say the state has reneged on its obligation to manage and protect its waters.
“Everyone has to play by the same rules,” Scott Kulbeck, executive vice president of the Montana Farm Bureau Federation, said in a statement. “When some folks skip the permit process and pull from a water source that’s already spoken for, it hurts their neighbors.”
It’s not the first time the exemption has come under fire.
In 1987, the legislature amended the rule to clarify that multiple wells using the same source could be treated as a single “combined appropriation” and thus require a permit. But a 1993 rule reversed course and narrowed the rule, allowing separate, unconnected wells tapping the same source to avoid permitting as long as they weren’t plumbed together.
In 2016, the Montana Supreme Court ordered the state Department of Natural Resources and Conservation to narrow the loophole. The court found the rule allowing multiple wells to pull from the same source without a permit “unquestionably expands the exemption by limiting the number of appropriations which must be excepted, rendering meaningless the underlying limit on volume.”
The high court directed the Department of Natural Resources and Conservation to strictly apply the exemption, but the plaintiffs claim it has failed to do so.
“When thousands of new wells are drilled with no regard for senior rights, it’s not just a paperwork or data problem; it’s a real-world impact on our ability to grow crops and feed our communities,” Kurt Dykema, board president of the Association of Gallatin Agricultural Irrigators, said in a statement. “We’re simply asking the state to follow the Constitution and the prior appropriation doctrine.”
Neither Montana nor the Montana Department of Natural Resources and Conservation responded to a request for comment before press time.