Diverse stakeholders testify against selling state land
Laura Lundquist
(Missoula Current) A Legislative bill that would change Montana’s water rights process has sparked additional opposition due to a proposal to sell off a quarter of all state land to nearby landowners.
On Friday morning, Rep. Brandon Ler, R-Savage, presented House Bill 676 to the Senate Judiciary committee as a way to provide money for the school trust by selling inaccessible state land and to defend water rights belonging to landowners who lease adjacent state land.
“It would sell off any landlocked piece of state land. These are not publicly inaccessible. We’re not selling off any piece that is publicly accessible,” Ler said. “We don’t want to be, as a state, seizing the water rights of public citizens.”
Ler indicated that he’d already been notified of proposed amendments, including one that would eliminate the requirement to terminate the water court in five years. The water court has spent the past 40-plus years adjudicating more than 240,000 historic water rights in 85 river basins to document all the water Montana owns. In October, Water Court judge Stephen Brown said adjudication would likely take another decade.
Four people spoke in favor of the bill. Two represented the same organization, the recently formed Senior Ag Water Rights Alliance. Helena Attorney Jon Metropolis and his lobbying partner, Jocelyn Galt Cahill, said this was the top issue for the Senior Ag Water Rights Alliance because they claim the state is taking private water rights. The Rocky Mountain Stockgrowers Association also spoke in favor.
The Senior Ag Water Rights Alliance formed in response to a recent court battle regarding a Gallatin County farmer, Sidney Schutter, who had a water right to water four parcels, one of which was state land they’d leased for decades, using a well on his property. The Montana Land Board said in 2019 that the portion of the right that applied to state land belonged to the state. The issue went to the Montana Supreme Court, which sided with the state in May, angering some water rights owners.
“This is designed to address a simply outrageous government exercise of its sovereign power. That is to take ownership of water rights that are developed by a private person on private land and used temporarily on state land while they have a state lease. The excuse is that the state has a fiduciary duty to be a good steward of the state school trust lands. There is a lot of room to question how that duty needs to be fulfilled,” Metropolis said.
Metropoulos is no stranger to contentious water issues in Montana. For example, he was a prominent opponent of the Confederated Salish and Kootenai Tribes water compact in the Legislature and filed several lawsuits pitting a Flathead irrigation commission against the CSKT before the commission voted to replace him in 2014.
In the House, opposition to HB 676 crossed party lines. Two weeks ago, the House passed HB 676 by a vote of 56-43, but the votes in the Judiciary and Appropriations committees were close. Similar bipartisan opposition was reflected in Friday’s testimony as 20 people rose to oppose the bill.
Lieutenant Governor Kristin Juras countered Metropoulos’ claims that the state is “stealing water rights,” explaining the basics of what defines a water right: a point of diversion, a use and a point of application. In Schutter’s case, the point of diversion was a private well but the point of application included state school trust land and the use was irrigating state trust land. So water law holds that that portion belongs to the school trust.
“The state doesn’t own these water rights - it’s legal title only as a trustee. The owners are the public schools and school children. The money doesn’t come to the state; it goes to them,” Juras said. “It’s absolutely not correct that the state land board acting through the Trust Lands Division of the DNRC is taking anybody’s private trust rights.”
Several water rights groups backed Juras’ statement, adding that restricting the water court to five years could end up jeopardizing everyone’s water rights if the adjudication is not valid and complete. The groups included the Senior Water Rights Coalition, Montana Stockgrowers Association, Montana Farm Bureau Federation, Montana Grain Growers Association and the Montana Water Resources Association.
Andrew Gorder, Clark Fork Coalition attorney, also flagged language in the bill that would allow the water court to change the terms of a water compact, if there’s an objection. He warned it would lead to litigation.
“This is a radical change in the way that state courts are allowed to analyze water compacts that have been previously negotiated between the state and Indian tribes, for example, and the federal government. Currently, the court can adopt a compact or reject a compact, but it cannot change terms that were previously agreed upon between two or three sovereign entities. This is simply the law,” Gorder said.
Several other groups and individuals testified in opposition to Section 11 of the bill, which would allow state land lessees to buy isolated state lands if a lessee has a water right on them. That would result in the loss of around 1.25 million acres of school trust land. The groups included the Montana Wildlife Federation, Montana Chapter of Backcountry Hunters and Anglers, Public Land and Water Association, Montana Sportsmen Alliance, and Rocky Mountain Elk Foundation.
“It is not clear why lands marked out in Section 11 must be sold to qualified willing buyers. This amounts to a compulsory sell-off that creates a small number of winners in the private domain and more than a million users, the citizens of this state, in the public domain. Why?” said Bozeman resident Steve Kirchhoff. “If the bill is what it appears to be - a land grab benefitting private interests over the public trust - then there’s small reason to believe the sale value will be proportionate to the increased value realized by the private entities who will purchase public land and enrich their own holdings.”
Mike Mershon, Montana Wildlife Federation spokesman, said limiting the potential buyers to adjacent landowners would create a noncompetitive sale, which wouldn’t produce the highest bid. It also sidesteps Montana’s land exchange program, which allows land managers to buy important pieces of private land to consolidate state land by selling vetted state parcels.
Doug Reisig of the Montana Quality Education Coalition and Margaret Bird of Advocates for School Trust Lands both advocated against selling state trust lands because of the effect on schools.
Reisig said land sales would result in short-term gain but a loss in the long-term sustainable funding. He added that there’s no guarantee that the sales revenue will be distributed fairly or equitably. Bird rattled off several Montana Supreme Court rulings that held that any school trust land sale must bring in the greatest amount of money possible so noncompetitive sales are illegal.
“Consider the two strategic choices you have: 1) you can keep doing the same thing you’ve been doing and the courts can keep telling you, ‘No, you can’t put your hand in the cookie jar.’ Or you have another choice, and that is embrace this trust, honor this trust and have this trust build your schools but build your state at the same time by using it, as you committed at the time of statehood, to be a fiduciary,” Bird said.
The committee took no action on Friday.
Contact reporter Laura Lundquist at lundquist@missoulacurrent.com.