Colorado Supreme Court Limits Change of Water from H2O Ranch

In December 2014, the Colorado Supreme Court announced its opinion on the change of water use case involving the H20 Ranch.[ii]  The H2O Ranch was historically one of the most productive hay ranches in the Wet Mountain Valley with excellent water rights. In 2007, the city of Fountain and Widefield Water and Sanitation District (“Widefield”) purchased the H20 Ranch with the intent to dry-up the H2O Ranch and change the water rights to municipal use (“buy and dry”). A change of use case was filed in Water Court Division 2, and has been in litigation ever since.

h20 ranch

H2O Ranch, Westcliffe, CO. Owned by the City of Fountain and Widefield Water and Sanitation District

At issue here is how much of the water that Fountain and Widefield purchased is legally available to change to municipal use. Under Colorado law, water available for change of use is limited to the historical consumptive use. A Water Court must perform a historical consumptive use analysis in order to determine how much water is available for change of use. One of the best ways to determine this is to look at the acreage irrigated. For the H2O Ranch, the original 1896 decree specified that the water rights were to be used to irrigate 350 acres. However, Fountain and Widefield argued that the rights were historically used to irrigate 462 acres and the 462 acres should be the basis for determining the historical consumptive use. The difference between 462 acres and 350 acres could be substantial in the amount of water available. The Water Court ruled that the historical consumptive use analysis was limited to the original decreed amount. Fountain and Widefield appealed to the Colorado Supreme Court.

The Colorado Supreme Court affirmed the Water Court ruling, noting that irrigation of additional lands beyond that specified in the original decree is unlawful without a new decree. The case will now go back to the Water Court where the historical consumptive use analysis will continue based on the original decreed amount of 350 acres. Essentially, Fountain and Widefield purchased 25% less water than they had thought.     

This ruling could have implications for change of use cases throughout the state. The market for agricultural water rights has been on the upswing and will likely continue as population growth in the Front Range puts pressure on municipalities to expand their water supply. H2O Ranch is certainly not the only place in Colorado where the historical use of water has expanded from the original decree. In some places, gains in water efficiency through installing sprinklers, pipes, lining ditches, or removing phreatophytes, have resulted in increased acreage used for irrigation. Future applicants will not be able to claim the expanded irrigation as historical consumptive use when determining how much water is available for other uses. The result is that other irrigated ranches identified for “buy and dry" may not have as much water as the buyer anticipated.

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About the Author: Mike Downey is the Land Protection Specialist/Colorado Open Lands Fellow for San Isabel Land Protection Trust and was formerly a Senior Staff Editor for the University of Denver Water Law Review. To learn more about Mike, click here.

[ii] The case is Widefield Water v. Witte, - P.3d - (Colo. 2014), available at http://www.courts.state.co.us/userfiles/file/Court_Probation/Supreme_Court/Opinions/2013/13SA197.pdf.

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