Robin Silver v. Pueblo Del Sol Water Co

IN THE
SUPREME COURT OF THE STATE OF ARIZONA
ROBIN SILVER, M.D.; UNITED STATES OF AMERICA, U.S. DEPARTMENT OF
THE INTERIOR, BUREAU OF LAND MANAGEMENT; AND PATRICIA
GERRODETTE,
Plaintiffs/Appellees,
v.
PUEBLO DEL SOL WATER COMPANY, AN ARIZONA CORPORATION; THOMAS
BUSCHATZKE, IN HIS OFFICIAL CAPACITY AS DIRECTOR OF THE ARIZONA
DEPARTMENT OF WATER RESOURCES; ARIZONA DEPARTMENT OF WATER
RESOURCES, AN AGENCY OF THE STATE OF ARIZONA,
Defendants/Appellants.
No. CV-16-0294-PR
Filed August 9, 2018
Appeal from the Superior Court in Maricopa County
The Honorable Crane McClennen, Judge
Nos. LC2013-000264
LC2013-000271
LC2013-000272
(Consolidated)
REVERSED
Opinion of the Court of Appeals, Division One
241 Ariz. 131 (App. 2016)
VACATED
COUNSEL:
Timothy M. Hogan, Arizona Center for Law in the Public Interest, Phoenix;
and Heidi J. McIntosh (argued), Earthjustice, Denver, CO, Attorneys for
Robin Silver, M.D.
F. Patrick Barry, Katherine W. Hazard (argued), United States Department
of Justice, Washington, DC, Attorneys for United States of America, U.S.
SILVER ET AL. V. PUEBLO DEL SOL WATER CO. ET AL.
Opinion of the Court
Department of the Interior, Bureau of Land Management
Daniel J. Adelman, Arizona Center for Law in the Public Interest, Phoenix;
and Joy E. Herr-Cardillo, University of Arizona, James E. Rogers College of
Law, Tucson, Attorneys for Patricia Gerrodette
William P. Sullivan (argued), Law Offices of William P. Sullivan P.L.L.C.,
Phoenix, Attorneys for Pueblo Del Sol Water Company
Kenneth C. Slowinski, Nicole D. Klobas, Janet L. Miller (argued), Arizona
Department of Water Resources, Phoenix, Attorneys for Thomas
Buschatzke and Arizona Department of Water Resources
Jesse Richardson, Jr., Law Offices of Jesse J. Richardson, Jr., Morgantown,
WV; and L. William Staudenmaier, Snell & Wilmer L.L.P., Phoenix,
Attorneys for Amicus Curiae Water Systems Council
JUSTICE LOPEZ authored the opinion of the Court, in which VICE CHIEF
JUSTICE BRUTINEL, and JUSTICES TIMMER and GOULD joined. CHIEF
JUSTICE BALES and JUSTICE BOLICK authored separate opinions
concurring in part and dissenting in part, in which JUSTICE PELANDER
joined. JUSTICE PELANDER issued an opinion concurring in the partially
dissenting opinions of CHIEF JUSTICE BALES and JUSTICE BOLICK.
JUSTICE LOPEZ, opinion of the Court:
¶1 The issue in this case is whether the Arizona Department of
Water Resources (“ADWR”) is required to consider unquantified federal
reserved water rights when it determines whether a developer has an
adequate water supply for purposes of A.R.S. § 45-108. We hold that the
statute does not require ADWR to do so.
I. FACTS AND PROCEDURAL HISTORY
¶2 This case arises out of a 2013 adequate water supply
designation by ADWR approving Pueblo Del Sol Water Company’s
(“Pueblo”) application to supply water to a proposed development in
Cochise County. Pueblo was formed in 1972 and received a Certificate of
Convenience and Necessity (“CC&N”) from the Arizona Corporation
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Commission (“Commission”) that year. Pueblo’s service area covers
approximately 4800 acres of land in Cochise County. Castle & Cooke, Inc.,
which owns Pueblo, seeks to build a mixed-use development called
“Tribute,” which would include about 7000 commercial and residential
units near Sierra Vista. The proposed development site is located
approximately five miles from the San Pedro River and is outside a
statutory active management area (“AMA”). See A.R.S. § 45-411(A)
(identifying Arizona’s AMAs).
¶3 In 1988, Congress established the San Pedro Riparian
National Conservation Area (“SPRNCA”) and delegated management of
SPRNCA to the Secretary of the Interior. See 16 U.S.C. § 460xx-1(a). The
Bureau of Land Management (“BLM”) manages national conservation
areas, including SPRNCA, on behalf of the U.S. Department of the Interior.
Congress also created an accompanying federal reserved water right to
fulfill SPRNCA’s conservation purpose and ordered the Secretary of the
Interior to “file a claim for the quantification of such rights in an appropriate
stream adjudication.” Id. § 460xx-1(d). The right has a priority date of
November 18, 1988, for purposes of establishing the federal government’s
priority in the seniority system that governs competing appropriation
rights. Id. In addition to its federal reserved water right, SPRNCA has a
1985 state certificate-based surface water right and other pending state-
based applications. SPRNCA’s federal reserved water right will eventually
be quantified in the Gila River General Stream Adjudication (the “Gila
Adjudication”) but remains unquantified after nearly thirty years of
litigation.
¶4 Pueblo, which plans to provide the vast majority of Tribute’s
water services, calculated that it would need to increase its annual
groundwater pumping from about 1430 acre-feet to 4870 acre-feet to meet
Tribute’s needs. When Pueblo applied to ADWR for an adequate water
supply designation, BLM, Robin Silver, and Patricia Gerrodette
(collectively, “Plaintiffs”) objected pursuant to A.R.S. § 45-108.01(B).
ADWR then issued a draft decision and order finding that Pueblo’s
application satisfied the “adequate water supply” requirements under
A.R.S. § 45-108(I) by showing that water would be “continuously, legally
and physically available” to satisfy Tribute’s water needs “for at least one
hundred years” and that Pueblo possesses “financial capability” to
construct necessary water facilities. Plaintiffs appealed, arguing, among
other things, that the increase in Pueblo’s groundwater pumping would
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Opinion of the Court
affect the flow of the San Pedro River and would therefore conflict with
BLM’s federal reserved water right.
¶5 The administrative law judge (“ALJ”) agreed with ADWR,
concluding that Pueblo met its burden of demonstrating that water would
be continuously, legally, and physically available. ADWR then issued an
order affirming the ALJ’s decision. Plaintiffs filed complaints for judicial
review, which the superior court consolidated, but did not challenge the
ALJ and ADWR’s finding that Pueblo met the physical availability
requirement.
¶6 The superior court vacated ADWR’s decision, ruling that the
agency erred in concluding that Pueblo’s water supply is “legally
available.” The court reasoned that ADWR was required to consider
potential and existing legal claims that may affect the availability of the
water supply, including BLM’s unquantified federal water right. The court
also awarded Silver and Gerrodette attorney fees under A.R.S. § 12-348 and
the private attorney general doctrine.
¶7 The court of appeals vacated the superior court’s decision and
remanded the matter to ADWR. Silver v. Pueblo Del Sol Water Co., 241 Ariz.
131, 134 ¶¶ 4–5 (App. 2016). The court held that the superior court erred in
requiring ADWR to consider BLM’s unquantified water right under
ADWR’s legal availability regulation, Arizona Administrative Code
R12-15-718, and found that regulation consistent with A.R.S. § 45-108(I). Id.
at 141–42 ¶¶ 36–37. However, the court also concluded that, pursuant to
ADWR’s physical availability regulation, A.A.C. R12-15-716, ADWR “must
use its knowledge and expertise” and apply its “educated eye as to what
the Gila Adjudication may eventually determine to be BLM’s water right”
to consider the impact of BLM’s unquantified water right on Pueblo’s water
supply. Id. at 143–44 ¶ 42.
¶8 All parties filed petitions for review in this Court. We granted
review because whether ADWR is required to consider unquantified
federal reserved water rights when determining the adequacy of
developers’ water supplies presents an issue of statewide importance. We
have jurisdiction under article 6, section 5(3) of the Arizona Constitution
and A.R.S. § 12-120.24.
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II. STANDARD OF REVIEW
¶9 We review issues of statutory interpretation de novo, Ariz.
Water Co. v. Ariz. Dep’t of Water Res., 208 Ariz. 147, 151 ¶ 16 (2004), but will
defer to an agency’s factual findings unless they are “arbitrary, capricious,
or . . . an abuse of discretion,” J. W. Hancock Enters., Inc. v. Registrar of
Contractors, 126 Ariz. 511, 513 (1980).
III. ARIZONA WATER LAW AND THE FEDERAL RESERVED
WATER RIGHTS DOCTRINE
¶10 “Arizona law distinguishes groundwater from surface water,
even though such waters may be hydrologically connected.” Davis v. Agua
Sierra Res., L.L.C., 220 Ariz. 108, 110 ¶ 10 (2009). The doctrine of prior
appropriation governs surface water, including its subflow. Id. at 110 ¶ 10,
112 ¶ 19. Prior appropriation is “a seniority system determined by the date
on which the user initially puts water to a beneficial use.” In re Gen.
Adjudication of All Rights to Use Water in Gila River Sys. & Source (Gila V),
201 Ariz. 307, 310 ¶ 4 (2001). Senior rights-holders are entitled to use their
entire water allotments before junior rights-holders receive any water. Id.
¶11 Groundwater, by contrast, is not subject to prior
appropriation, but is instead “governed by the traditional common law
notion that water percolating generally through the soil belongs to the
overlying landowner, as limited by the doctrine of reasonable use.” In re
Gen. Adjudication of All Rights to Use Water in Gila River Sys. & Source (Gila II),
175 Ariz. 382, 386 (1993). “The doctrine of reasonable use permits an
overlying landowner to capture as much groundwater as can reasonably be
used upon the overlying land and relieves the landowner from liability for
a resulting diminution of another landowner’s water supply.” In re Gen.
Adjudication of All Rights to Use Water in Gila River Sys. & Source (Gila III),
195 Ariz. 411, 415 ¶ 7 n.3 (1999) (citing Bristor v. Cheatham, 75 Ariz. 227,
237–38 (1953)). Our legislature has codified the right of overlying
landowners to “[w]ithdraw and use groundwater for reasonable and
beneficial use” in areas outside AMAs. A.R.S. § 45-453(1). AMAs are
subject to the more stringent “assured water supply” regulations, see A.R.S.
§ 45-576, whereas non-AMA areas are subject to “adequate water supply”
requirements, see § 45-108(A), (I).
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¶12 Although surface water and groundwater are governed by
different legal regimes in Arizona, both are subject to the federal reserved
water rights doctrine. See Gila III, 195 Ariz. at 420 ¶ 31 (holding that the
federal reserved water rights doctrine applies to groundwater in addition
to surface water). Under that doctrine, when the federal government
creates a federal reservation of public land, it also reserves “only that
amount of water necessary to fulfill the purpose of the reservation, no
more.” Cappaert v. United States, 426 U.S. 128, 141 (1976). Determining the
purpose of a reservation and “the waters necessary to accomplish that
purpose are inevitably fact-intensive inquiries that must be made on a
reservation-by-reservation basis,” Gila III, 195 Ariz. at 420 ¶ 31 (citing
United States v. New Mexico, 438 U.S. 696, 700 (1978)), and we construe
federal reserved water rights narrowly due to their “disruptive effect in
prior appropriation jurisdictions,” In re Gen. Adjudication of All Rights to Use
Water in Gila River Sys. & Source, 231 Ariz. 8, 13 ¶ 16 (2012).
¶13 The federal reserved water rights doctrine applies to
groundwater, but only “where other waters are inadequate to accomplish
the purpose of a reservation.” Gila III, 195 Ariz. at 420 ¶ 31; see also Agua
Caliente Band of Cahuilla Indians v. Coachella Valley Water Dist., 849 F.3d 1262,
1271 (9th Cir. 2017). If a federal reserved water right is infringed by
groundwater pumping, the federal government may obtain an injunction.
See Gila III, 195 Ariz. at 422 ¶ 38 (citing Cappaert, 426 U.S. at 141). But any
injunction that issues must “be appropriately tailored to [the reservation’s]
minimal need,” and we do not apply “a zero-impact standard of protection
for federal reserved rights.” Id. Thus, the federal reserved water rights
doctrine effectively modifies the doctrine of reasonable use, as codified in
§ 45-453, because it restricts an overlying landowner’s right to pump
groundwater to the extent required “to preserve the waters necessary to
accomplish the purpose of [a federal] reservation.” See Gila III, 195 Ariz. at
421–22 ¶¶ 34–38.
¶14 Another regulation on the use of water in Arizona is the
adequate water supply designation process. Under A.R.S. § 11-823(A), a
county, at its option, may require a developer to obtain an adequate water
supply designation from ADWR before approving a new subdivision. 1 The
1Cochise County, acting pursuant to this statutory authority, requires
developers to obtain an adequate water supply designation before it will
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Opinion of the Court
director of ADWR (“Director”) is charged with determining “whether there
is an adequate water supply for the subdivision.” § 45-108(B). Section 45-
108(I) provides a two-part definition of “adequate water supply.” First, it
means that “[s]ufficient groundwater, surface water or effluent of adequate
quality will be continuously, legally and physically available to satisfy the
water needs of the proposed use for at least one hundred years.” § 45-
108(I)(1). Second, it requires a developer to demonstrate that it has “[t]he
financial capability . . . to construct the water facilities necessary to make
the supply of water available for the proposed use.” § 45-108(I)(2).
¶15 We consider in this case ADWR’s regulations defining
physical and legal availability. With the background of Arizona water law
in mind, we turn first to the physical availability regulation.
IV. PHYSICAL AVAILABILITY
¶16 We agree with all parties that the court of appeals erred in
directing ADWR to consider BLM’s unquantified federal reserved water
right under ADWR’s physical availability regulation. We interpret agency
regulations according to principles of statutory construction. Home Depot
USA, Inc. v. Ariz. Dep’t of Revenue, 230 Ariz. 498, 501 ¶ 10 (App. 2012).
Accordingly, if a statutorily authorized regulation is unambiguous, “we
apply it without further analysis.” Glazer v. State, 237 Ariz. 160, 163 ¶ 12
(2015).
¶17 ADWR’s physical availability regulation, A.A.C. R12-15-716,
requires an applicant for an adequate water supply designation to submit a
hydrologic study to the Director that “accurately describes the hydrology
of the affected area.” Id. R12-15-716(B). The Director, in turn, “shall
determine” that groundwater is physically available if two requirements
are met. Id. First, the groundwater must be withdrawn “from wells owned
by the applicant or the proposed municipal provider that are located within
the service area of the applicant or the proposed municipal provider.” Id.
R12-15-716(B)(1)(a). Second, the groundwater must be “withdrawn from
depths that do not exceed the applicable maximum 100-year depth-to-static
water level.” Id. R12-15-716(B)(2). Here, the applicable 100-year depth-to-
static water level is “1200 feet below land surface” because the Tribute
approve a final plat for a subdivision. See Cochise County Subdivision Reg.
408.03.
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development site is not located in an AMA and Tribute will not be a dry lot
development. See id.; see also id. R12-15-701(36) (defining “[d]ry lot
development” as “a development or subdivision without a central water
distribution system”). Most relevant to the court of appeals’ holding is the
regulation’s requirement that the Director consider, in calculating the
projected 100-year depth-to-static water level, “[t]he projected declines [in
the water level] caused by existing uses.” Id. R12-15-716(B)(3)(b); see also
Silver, 241 Ariz. at 142 ¶ 39.
¶18 As Plaintiffs concede, Pueblo satisfies both prongs of the
physical availability regulation. Pueblo’s wells are located within its
service area, which satisfies the first prong. The uncontested evidence from
Pueblo’s hydrologic model satisfies the second prong. The model shows
that the development’s groundwater will be withdrawn from a depth-to-
static level of no greater than 650 feet after 100 years of pumping—well
within the 1200-foot limit of A.A.C. R12-15-716(B)(2).
¶19 Although BLM did not challenge ADWR’s physical
availability finding in the superior court, the court of appeals relied on the
“existing uses” language in A.A.C. R12-15-716(B)(3)(b) to require ADWR to
consider BLM’s unquantified federal reserved water right. Silver, 241 Ariz.
at 142 ¶ 39. It reasoned that “[t]he water supporting [SPRNCA] is . . . an
‘existing use’” that ADWR must consider in making its physical availability
determination. Id. But by ordering ADWR to assess the impact of
“projected declines” in groundwater supply caused by Pueblo’s pumping
on BLM’s “existing use,” the court of appeals misconstrued the physical
availability regulation.
¶20 On its face, the regulation requires ADWR to do the converse.
Namely, it requires the agency to measure the impact of “existing uses” on
groundwater supply available for an applicant, not the impact of the
applicant’s proposed groundwater use on “existing uses.” See A.A.C. R12-
15-716(B)(3)(b). The regulation operates to ensure that enough
groundwater is physically available in the aquifer to meet the needs of the
applicant, after accounting for declines in supply “caused by existing uses.”
See id. The regulation is not a mechanism for considering potential legal
disputes between groundwater users. Because Pueblo indisputably
satisfies both prongs of the physical availability regulation, the court of
appeals erred in requiring ADWR to consider BLM’s unquantified federal
reserved water right as part of the physical availability analysis.
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V. LEGAL AVAILABILITY
¶21 Plaintiffs and our dissenting colleagues contend that ADWR’s
legal availability regulation, A.A.C. R12-15-718, is unenforceable because it
is inconsistent with § 45-108(I). We disagree. Section 45-108(I) requires, in
part, that a proposed development’s water supply be legally available “to
satisfy the water needs of the proposed use for at least one hundred years,”
which Plaintiffs and the dissents view as meaning the agency must consider
unquantified federal reserved water rights. A.A.C. R12-15-718 provides
that a private water company (such as Pueblo) has a “legally available”
supply of groundwater when it possesses a CC&N. See id. R12-15-
718(B)(3)(a), (C).
¶22 “Our primary goal in interpreting statutes is to effectuate the
legislature’s intent” as expressed in the statute’s text. Rasor v. Nw. Hosp.,
LLC, 243 Ariz. 160, 164 ¶ 20 (2017). If a statute is unambiguous, “we apply
it without further analysis.” Glazer, 237 Ariz. at 163 ¶ 12. If a statute is
ambiguous, we may consider secondary tools of statutory construction,
including the prior-construction canon of statutory interpretation. Cf.
Moore v. Chilson, 26 Ariz. 244, 254 (1924) (recognizing the prior-construction
canon); see also In re Marriage of Friedman & Roels, 244 Ariz. 111, 115 ¶ 14, 116
¶ 20 (2018) (applying the prior-construction canon). According to that
canon, “[i]f a statute uses words or phrases that have already received . . .
uniform construction by . . . a responsible administrative agency, they are
to be understood according to that construction.” Antonin Scalia & Bryan
A. Garner, Reading Law: The Interpretation of Legal Texts 322 (2012). The
canon applies whenever the “administrative interpretation antedates the
[legislative] enactment” because in such cases, “[t]he term has acquired . . .
a technical legal sense,” apart from its ordinary meaning, “that should be
given effect.” Id. at 324; see also Fed. Deposit Ins. Corp. v. Phila. Gear Corp.,
476 U.S. 426, 437 (1986) (“When the statute giving rise to the longstanding
[agency] interpretation has been reenacted without pertinent change, the
‘congressional failure to revise or repeal the agency’s interpretation is
persuasive evidence that the interpretation is the one intended by
Congress.’” (quoting NLRB v. Bell Aerospace, 416 U.S. 267, 275 (1974))); Bell
Aerospace, 416 U.S. at 274–75 (“[A] court may accord great weight to the
longstanding interpretation placed on a statute by an agency charged with
its administration.”).
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¶23 Here, the term “legally available” is ambiguous concerning
consideration of unquantified federal reserved water rights. In fact, the
statutory scheme is silent on the issue. It does not mention federal reserved
water rights at all, nor does it define “legally available.” It is also not
apparent from the term’s plain language that it encompasses unquantified
water rights that cannot be enforced now (or possibly ever) to enjoin a
developer’s groundwater pumping. “Legally available” could be
interpreted as requiring ADWR to consider every conceivable water right
that might someday affect a prospective developer’s right to pump
groundwater. Alternatively, it could mean that ADWR is only required to
consider conflicting rights that are presently enforceable, or that a
developer has a right to pump groundwater pursuant to the reasonable use
doctrine. In other words, “legally available” is a broad phrase that could
be interpreted in myriad ways. Indeed, it is a textbook example of a term
that is “[c]apable of being understood in either of two or more possible
senses” or “[u]ncertain as regards course or outcome”—the dictionary
definitions of “ambiguous.” Ambiguous, Webster’s Second New
International Dictionary 81 (1949).
¶24 Chief Justice Bales’ dissent hinges on the premise that “legally
available” is unambiguous and requires ADWR to consider unquantified
federal reserved water rights. He reasons that “[i]f the legislature had
meant that a CC&N alone could establish ‘legal availability,’ it could have
easily said so.” Infra ¶ 54. However, the legislature could have also said
that “ADWR shall consider unquantified federal reserved water rights in
making its legal availability determination.” As previously noted, the
legislature’s silence on the issue evidences the statute’s ambiguity.
¶25 But we are not left to guess the meaning of “legally available.”
The history of § 45-108 and ADWR’s regulations interpreting it shows that
the legislature intended to adopt ADWR’s definition of “legal availability.”
Before 2007, § 45-108 gave the Director discretion to “designate cities, towns
and private water companies as having an adequate water supply,” but did
not define “adequate water supply.” See 1994 Ariz. Sess. Laws, ch. 203, § 1
(2d Reg. Sess.). The legislature apparently left that task to ADWR, which in
1995 construed “adequate water supply” as having three defined elements:
physical availability, continuous availability, and legal availability. See
A.A.C. R12-15-717(A)–(D) (Feb. 7, 1995). ADWR last amended the legal
availability regulation in September 2006. See 12 Ariz. Admin. Reg. 3549–
52 (Sept. 29, 2006); see also A.A.C. R12-15-718 (Historical Note).
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Importantly, when the legislature amended § 45-108 in 2007 to define
adequate water supply, it adopted the same three elements—physical,
continuous, and legal availability—without defining them. See § 45-108(I);
2007 Ariz. Sess. Laws, ch. 240, § 8 (1st Reg. Sess.). These concepts are unique
to ADWR’s adequate water supply regulations. And any contention that
the legislature was unaware of ADWR’s definitions of physical, continuous,
and legal availability falls flat. Notably, the legislature ordered ADWR to
make specific amendments to its physical availability regulation. See 2007
Ariz. Sess. Laws, ch. 240, § 10 (1st Reg. Sess.).
¶26 Given that ADWR’s definition of adequate water supply
predates the legislative enactment by twelve years and was adopted by the
legislature without change in 2007, we interpret the term “legal
availability” according to ADWR’s construction as of 2007. See Scalia &
Garner, supra, at 322. The prior-construction canon applies with even
greater force here because the legislature did not merely reaffirm an
existing statutory definition in light of a new agency interpretation; it
amended § 45-108 to add the precise language that originated in ADWR’s
regulations and that operationalized its adequate water supply regulatory
scheme twelve years earlier. The fact that the legislature ordered ADWR to
amend its physical availability regulation but not its legal availability
regulation demonstrates that the legislature was aware of ADWR’s
regulations and capable of ordering amendments to the ones it found
objectionable. See 2007 Ariz. Sess. Laws, ch. 240, § 10 (1st Reg. Sess.).
Consequently, we hold that ADWR’s “legal availability” regulation is
consistent with § 45-108 because the legislature amended the statute to
adopt ADWR’s definition of that term.
¶27 The dissents take issue with our application of the prior-
construction canon to ADWR’s definition of legal availability but express
no similar qualms about the legislature’s implicit adoption of the agency’s
definition of physical availability. In fact, they agree with the analysis
above applying ADWR’s physical availability regulation as written. Yet the
dissents provide no principled reason, other than policy concerns, for
accepting ADWR’s definition of physical availability at face value while
rejecting its definition of legal availability.
¶28 The dissents also contend that the prior-construction canon
should not apply in light of the legislature’s recent amendment of A.R.S.
§ 12-910. See infra ¶¶ 56–57, 82–83. That amendment requires Arizona
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courts to “decide all questions of law, including the interpretation of a
constitutional or statutory provision or a rule adopted by an agency,
without deference to any previous determination that may have been made
on the question by the agency.” See 2018 Ariz. Sess. Laws, ch. 180, § 1
(2d Reg. Sess.) (effective Aug. 3, 2018). But the dissents’ argument conflates
judicial deference (also known as “Chevron deference”) with legislative
adoption. The amendment prohibits courts from deferring to agencies’
interpretations of law. See id. (“[T]he court shall decide all questions of
law . . . .” (emphasis added)). The amendment does not, however, prohibit
the legislature from adopting an agency’s interpretation of a term of art. The
latter is what we have here, where the legislature amended § 45-108 to
incorporate the term “legally available” from ADWR’s regulation into the
statute.
¶29 Moreover, in arguing that our interpretation of § 45-108
“renders ‘legally available’ meaningless,” infra ¶ 53, or “surplusage,” infra
¶ 76, the dissents seem to overlook the bifurcated nature of Arizona’s water
management regime. Surface water rights are often subject to myriad
competing legal claims because they are governed by the doctrine of prior
appropriation. Supra ¶ 10. This explains ADWR’s robust regulation
addressing the legal availability of surface water. See A.A.C. R12-15-718(E).
But groundwater is subject to a very different legal doctrine—the doctrine
of reasonable use—which provides that an overlying landowner has the
legal right to “capture as much groundwater as can reasonably be used upon
the overlying land.” Gila III, 195 Ariz. at 415 ¶ 7 n.3; see also § 45-453. Far
from “vitiating the statute’s language,” infra ¶ 53, ADWR’s legal
availability regulation reflects the operation of the reasonable use doctrine.
¶30 The dissents conclude that obtaining a CC&N is essentially a
pro forma process that “tells us absolutely nothing about the legal
availability of water.” Infra ¶ 80. They are wrong to discount the CC&N’s
procedural and substantive rigors. The Commission is required “to
investigate all applicants for” a CC&N and can issue a CC&N “[o]nly upon
a showing that the issuance to a particular applicant would serve the public
interest.” James P. Paul Water Co. v. Ariz. Corp. Comm’n, 137 Ariz. 426, 429
(1983). Even after the Commission has issued a CC&N, “a water company
must comply with orders and regulations promulgated by the Commission
in the public interest,” including orders and regulations that “may mandate
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installation of additional facilities.” 2 Id. at 429–30 (citing A.R.S. § 40-331).
Pursuant to its statutory authority, the Commission can order “additions or
improvements” to a CC&N-holder’s facilities when the Commission finds
that such additions or improvements “promote the security or convenience
of . . . the public.” § 40-331(A). The Commission has used this authority to
order a CC&N-holder to extend its water distribution main “for the benefit
of its existing customers,” see Ariz. Water Co. v. Ariz. Corp. Comm’n, 161 Ariz.
389, 392 (App. 1989), and the burden of proof in a proceeding to challenge
an order of the Commission is on “the party adverse to the commission . . .
to show by clear and satisfactory evidence that [the order] is unreasonable
or unlawful,” A.R.S. § 40-254(E). Although we do not decide the issue here,
the Commission could presumably use this authority to order construction
of a groundwater recharge facility if a CC&N-holder’s water supply were
limited by an injunction, as such a limitation may threaten “the security or
convenience of . . . the public.” See § 40-331(A).
¶31 At bottom, the dissents would prioritize the consumer
protection “purpose” of § 45-108 as expressed in the selective senate
testimony of a former ADWR director, infra ¶ 49, over the legislature’s
intent as expressed in its adoption of terms of art from ADWR’s regulations.
But at multiple points in the senate hearing Chief Justice Bales relies on, two
senators emphasized the importance of balancing water supply
management and private property rights. See, e.g., Hearing on S.B. 1575
before the S. Nat. Res. & Rural Affairs Comm., 48th Leg., First Reg. Sess. 2007
(Feb. 14, 2007) (statement of Senator Jake Flake, Chairman of the Senate
Committee on Natural Resources and Rural Affairs) (“But even as
important as” managing growth and protecting water supply “is
protecting . . . private property rights.”). The dissents ignore the balance
the legislature struck between water resource management and
landowners’ property rights, and their position would add an impediment
to the already comprehensive adequate water supply designation scheme,
thereby hindering the ability of property owners to develop land. It is for
the legislature, not this Court, to add this impediment. We decline to follow
the dissents’ method of statutory interpretation. See Argentina v. Weltover,
Inc., 504 U.S. 607, 618 (1992) (“The question . . . is not what [the legislature]
‘would have wanted’ but what [the legislature] enacted . . . .”).
2Therefore, it is simply incorrect to claim, as Justice Bolick does, that the
CC&N requirement has no effect after a CC&N issues. See infra ¶ 80.
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Opinion of the Court
¶32 Even if we were interpreting the term “legal availability”
without the aid of the prior-construction canon, the wisdom of interpreting
that term to require consideration of unquantified federal reserved rights is
questionable. ADWR does not have the authority to quantify BLM’s rights;
that is the exclusive domain of the Gila Adjudication. See Gila III, 195 Ariz.
at 414 ¶ 2 (citing A.R.S. §§ 45-251(2), 252(A)). Instead, ADWR could only
speculate about the extent of federal reserved water rights and the impact
of prospective pumping on those rights. The stakes of this speculative
process would be exceedingly high, given that a finding of inadequate
water supply precludes development in counties that require an adequate
water supply designation pursuant to § 11-823(A).
¶33 Our caselaw also disfavors consideration of unquantified
federal reserved water rights. In Gila III, we rejected as “premature” the
plaintiffs’ request to immediately enjoin groundwater pumping that was
depleting the groundwater supply beneath Indian reservations. 195 Ariz.
at 421 ¶ 35 n.12. We reasoned that “[u]ntil federal rights are quantified, it
cannot be determined which if any of the tribes are entitled to [injunctive]
relief.” Id.
¶34 Our reticence in Gila III to provide injunctive relief based
upon unquantified federal reserved water rights applies with equal force in
the regulatory context. Here, the legal hurdles for obtaining an injunction
to protect federal reserved water rights illustrate the inherently speculative
nature of the inquiry ADWR would be required to undertake. See supra
¶¶ 11–13. First, ADWR would have to make an educated guess about the
amount of water a judge in the Gila Adjudication will deem necessary to
accomplish SPRNCA’s purpose, including whether surface water alone is
sufficient to satisfy the reservation’s needs. See Gila III, 195 Ariz. at 420 ¶ 31.
Determining the minimum amount of water necessary to accomplish a
reservation’s purpose is inevitably a “fact-intensive inquir[y],” id., and it is
far from certain that ADWR would reach the same conclusion as the trial
judge in the Gila Adjudication. Any difference between ADWR’s
quantification guesswork and the Gila Adjudication’s actual outcome
would widen the margin of error in subsequent stages of ADWR’s
analysis. 3 The established facts Chief Justice Bales’ dissent discusses—
3To circumvent this speculative process, BLM contends that ADWR should
consider its right at face value, as ADWR considers certain surface water
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Opinion of the Court
SPRNCA’s conservation purpose and priority date—would hardly narrow
that margin. See infra ¶ 66.
¶35 After making a tentative prediction about the outcome of the
Gila Adjudication, ADWR would then have to determine whether Pueblo’s
pumping would impact BLM’s right. At a minimum, this would likely
require a study to determine whether there is a hydrologic connection
between the proposed wells and SPRNCA’s water sources. Other relevant
considerations may include the distance between the wells and the
reservation, pumping from other wells in the area, and the amount of
groundwater recharge from wastewater treatment facilities.
¶36 Ultimately, ADWR would have to analyze the likelihood that
Plaintiffs would succeed in obtaining an injunction and make an educated
guess about how a court would “appropriately tailor[]” an injunction to
satisfy SPRNCA’s “minimal need.” See Gila III, 195 Ariz. at 422 ¶ 38.
Without conducting such an analysis, the entire exercise of considering an
unquantified federal reserved water right would be futile; the point is to
determine whether the federal government’s unquantified right could be
enforced against Pueblo to prevent it from obtaining an adequate water
supply. Because groundwater is subject to the reasonable use and the
federal reserved water rights doctrines, not prior appropriation, supra
¶¶ 11–13, only an injunction based on a federal reserved water right could
legally inhibit Pueblo’s right to pump. This is the elephant in the room that
the dissents ignore when they attempt to downplay the extent of the
speculation they would require ADWR to undertake. See infra ¶¶ 66–67, 84,
87. Indeed, the dissents conflate the nature of ADWR’s speculation
concerning physical and legal availability (i.e. hydrology models versus
court proceedings) and thus fail to appreciate the novelty of turning a state
agency that specializes in water management into a fortune-teller that must
predict the outcome of two separate court proceedings—one that has been
pending for nearly forty years with no end in sight (the Gila Adjudication),
and one that is purely hypothetical (the injunction proceeding). Worse still,
claims elsewhere in the legal availability regulation. See A.A.C.
R12-15-718(E)(3). Face value consideration is not warranted here because
the regulations do not contemplate its application to groundwater and no
one can predict with any degree of certainty what quantified rights the Gila
Adjudication, which is hotly contested, will assign to BLM.
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SILVER ET AL. V. PUEBLO DEL SOL WATER CO. ET AL.
Opinion of the Court
ADWR’s speculation regarding the injunction proceeding would be based
on its earlier speculation regarding the outcome of the Gila Adjudication.
¶37 Requiring ADWR to conduct an injunction analysis would
also break with Gila III’s instruction that an injunction is a “premature”
remedy to enforce an unquantified federal reserved water right. See Gila III,
195 Ariz. at 421 ¶ 35 n.12. We decline Plaintiffs’ implicit invitation to
transform ADWR, by judicial fiat, into a forum for anticipatory injunctive
relief through regulation based upon unquantified federal reserved water
rights.
¶38 Finally, Plaintiffs and the dissents contend that failing to
consider unquantified federal reserved water rights undermines the
consumer protection purpose of § 45-108. It does not. The adequate water
supply designation process originated in the 1970s as a mechanism for
protecting consumers against unscrupulous developers who sold
subdivided property that lacked a water source. See L. William
Staudenmaier, Between a Rock and a Dry Place: The Rural Water Supply
Challenge for Arizona, 49 Ariz. L. Rev. 321, 329 (2007) (“In 1973, the Arizona
Legislature enacted a statewide water adequacy statute as a consumer
protection measure in response to marketing of residential lots without
available water supplies.”); see also Thomas E. Sheridan, Arizona: A History
336 (1995) (discussing Ned Warren, a developer who sold lots to consumers
that had “no roads, no water, and no electricity”). The legislature has added
consumer safeguards to the process over the years, making its last
substantive change to § 45-108 in 2007. See 2007 Ariz. Sess. Laws, ch. 240,
§ 8 (1st Reg. Sess.).
¶39 The dissents’ position seems to ignore the fact that legal
availability, like continuous or physical availability, is but one component
of an integrated scheme defining “adequate water supply.” In its current
form, § 45-108 provides consumers with vigorous protections against
unscrupulous developers. As discussed above, supra ¶ 14, a developer
must demonstrate that it has a 100-year supply of water to obtain an
adequate water supply designation. § 45-108(I)(1). The developer must
also show that it has the financial capability to construct the necessary water
supply facilities. § 45-108(I)(2). Counties, in turn, may automatically deny
final plat approval to any developer who fails to satisfy any of § 45-108(I)’s
requirements. See § 11-823(A). Far from leaving consumers at the mercy of
“shifty” developers, this scheme, even without considering unquantified
16
SILVER ET AL. V. PUEBLO DEL SOL WATER CO. ET AL.
Opinion of the Court
federal reserved water rights, provides consumers with considerable
protection.
¶40 Yet § 45-108 does not eliminate all water supply risk for
consumers, nor was it designed to do so. The statute balances the reward
of economic development with the mitigated risk that ADWR’s water
supply estimates will prove inaccurate or be subjected to revisions. The
statutory scheme explicitly contemplates that a change in circumstances
may result in the revocation of an adequate water supply designation. See
§ 45-108(F) (“The director may revoke a designation made pursuant to this
section when the director finds that the water supply may become
inadequate.”). It follows that the statute does not require developers to
demonstrate absolute certainty of supply and that consumers who
purchase land in reliance on an adequate water supply designation may
have their expectations upended. Moreover, if the Director revokes an
adequate water supply designation, consumers have no recourse against
the state, the Director, or ADWR. See § 45-108(G) (providing that “[t]he
state of Arizona and the director or department shall not be liable” for
issuing a designation, so long as it was “prepared in good faith pursuant to
this section”). Any suggestion that the statute, as written, mandates a
moratorium on development in the absence of an absolute certainty of a
future water supply misconstrues its meaning and purpose. Cf. A.R.S.
§ 45-401(B) (stating that groundwater management is necessary to
“protect[] and stabiliz[e] the general economy and welfare of this state and
its citizens”).
¶41 More fundamentally, neither § 45-108 nor A.A.C. R12-15-718
contemplates the issue of federal reserved water rights. Although Cappaert,
which the United States Supreme Court decided in 1976, put the legislature
and ADWR on notice that the federal government “can protect its water
from subsequent diversion[s]” of groundwater, 426 U.S. at 143, neither the
statute nor the regulation requires ADWR to consider unquantified federal
reserved water rights as part of its legal availability analysis. This Court
does not have the constitutional authority to construe a statute so that it
encompasses matters that were not covered or addressed by the legislature.
See, e.g., Iselin v. United States, 270 U.S. 245, 251 (1926) (Brandeis, J.) (“To
supply omissions transcends the judicial function.”); Scalia & Garner, supra,
at 93 (discussing the omitted-case canon, which provides that “[n]othing is
17
SILVER ET AL. V. PUEBLO DEL SOL WATER CO. ET AL.
Opinion of the Court
to be added to what the text states or reasonably implies . . . That is, a matter
not covered is to be treated as not covered”). 4
¶42 Chief Justice Bales asserts that the majority “prioritizes the
interests of subdivision developers over those of homeowners.” Infra ¶ 69.
We do not, nor is it this Court’s prerogative to make this choice. Instead,
we acknowledge and defer to the legislature’s judgment. Whether the
adequate water supply designation process should go further in protecting
consumers is a matter for the legislature. As a threshold matter, the
legislature could jettison the opt-in scheme and mandate counties’
participation in the adequate water supply designation process. That the
legislature did not make the process mandatory statewide further
demonstrates the legislature’s intent to provide only limited protection to
consumers and simultaneously encourage development. If the scheme
rigorously focused solely on consumer protection, as the dissents contend,
we would expect it to be mandatory. Alternatively, the legislature could
require ADWR, as Plaintiffs and the dissents urge, to engage in a
comprehensive assessment of the potential impact of unquantified federal
reserved water rights based upon speculative projections about litigation
outcomes years or decades in the future. The legislature could in turn
require ADWR to halt economic development by denying adequate water
supply designations where unquantified federal reserved water rights cast
any doubt on developments’ 100-year water supplies. The legislature could
also mandate developers to warn consumers that unquantified federal
reserved water rights may impact the water supply of developments in
4 Justice Bolick claims that we mainly rely on only one canon of statutory
interpretation—the prior-construction canon—and suggests that his
interpretation is superior because he relies on two. Infra ¶¶ 75–76. In fact,
we also rely on the omitted-case canon and the ordinary meaning canon.
For the reasons discussed above, supra ¶¶ 29, 38–39, his application of the
presumption against ineffectiveness and the surplusage canon is misguided
because it arises from the erroneous premise that an interpretation of a
statute that fails to give its purpose the most fulsome effect, rather than
defeats or obstructs its purpose, necessarily renders the statute ineffective
or surplusage.
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SILVER ET AL. V. PUEBLO DEL SOL WATER CO. ET AL.
Opinion of the Court
Tribute’s position. 5 But the legislature has not done any of these things. In
its current form, and in context, § 45-108 reflects the legislature’s decision
to adopt ADWR’s definition of legal availability.
¶43 For all these reasons, we conclude that A.A.C. R12-15-718 is
consistent with § 45-108 and that neither requires ADWR to consider
unquantified federal reserved water rights as part of its legal availability
analysis. In so holding, we need not decide whether ADWR must consider
quantified federal reserved water rights. ADWR conceded at oral argument
that it would have to acknowledge a quantified federal reserved water right
if the federal government could prove, likely through an injunction
proceeding, that an applicant’s prospective groundwater pumping would
infringe upon that right. ADWR’s concession arises from the fact that the
federal reserved water rights doctrine restricts the otherwise permissible
reasonable and beneficial use of groundwater, codified in § 45-453, to the
extent required to preserve the waters necessary to accomplish the purpose
of a federal reservation. Supra ¶ 13. As such, ADWR acknowledges that an
applicant for an adequate water supply designation, like any groundwater
user outside an AMA, is subject to the reasonable use doctrine, as modified
by the federal reserved water rights doctrine, and an injunction may, of its
own force, prohibit or require action by ADWR independent of the legal
availability process.
¶44 We readily acknowledge the consumer protection policy that
animates the dissents. But this case is not about the wisdom of the policy
underlying the adequate water supply statute. Our task is to discern the
statute’s meaning. The term “legally available” did not arise in a vacuum.
The dissents ignore the determinative significance of the genesis of the
“adequate water supply” regulation and the context in which the
legislature adopted it. For the reasons discussed, when the legislature
adopted ADWR’s regulation, it also imported ADWR’s definitions
operationalizing the scheme. We decline to recast the statute’s meaning
under the guise of interpreting it. Ultimately, the degree of acceptable risk
5 At oral argument, Pueblo conceded that regardless of what the law
requires, it would “have no problem” giving notice to prospective
homebuyers that the development’s water rights may be adversely affected
by the outcome of the Gila Adjudication. We admonish Pueblo to perform
on its promise to be forthright with consumers about the potential impact
of BLM’s federal reserved water right on the development’s water supply.
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SILVER ET AL. V. PUEBLO DEL SOL WATER CO. ET AL.
Opinion of the Court
to consumers’ water supplies is a policy judgment best suited for the
legislature. Cf. City of Phoenix v. Butler, 110 Ariz. 160, 162 (1973) (“[I]t is not
the function of the courts to rewrite statutes.”). If the legislature intended
to require ADWR to consider unquantified federal reserved water rights
under its legal availability analysis, it failed to do so in § 45-108. The
legislature, not this Court, may impose such a requirement.
VI. ATTORNEY FEES
¶45 Silver and Gerrodette request attorney fees under the private
attorney general doctrine and A.R.S. § 12-348. We deny their request under
§ 12-348 because they did not prevail in this action. See § 12-348(A)
(requiring a party to prevail on the merits in order to receive an award of
fees). To receive an award of attorney fees under the private attorney
general doctrine, a party must “vindicate[] a right that: (1) benefits a large
number of people; (2) requires private enforcement; and (3) is of societal
importance.” Arnold v. Ariz. Dep’t of Health Servs., 160 Ariz. 593, 609 (1989).
Because we hold in favor of Pueblo, Plaintiffs have not vindicated any right.
Additionally, the right Plaintiffs seek to vindicate does not require private
enforcement; BLM has been a party to this litigation throughout.
VII. CONCLUSION
¶46 We hold that ADWR is not required to consider unquantified
federal reserved water rights under its physical availability or legal
availability analysis. We vacate the decisions of the superior court and the
court of appeals and affirm ADWR and the ALJ’s approval of Pueblo’s
application.
20
SILVER ET AL. V. PUEBLO DEL SOL WATER CO. ET AL.
CHIEF JUSTICE BALES, joined by JUSTICE PELANDER, Concurring in Part and
Dissenting in Part
BALES, C.J., joined by PELANDER, J., concurring in part and dissenting
in part.
¶47 Arizona’s legislature amended A.R.S. § 45-108 to ensure
purchasers do not unknowingly buy land without access to adequate water.
Although the statute requires the Arizona Department of Water Resources
(“ADWR”) to determine if water will be “legally available” for a proposed
subdivision for the next 100 years, see § 45-108(I)(1), ADWR contends it can
ignore whether the subdivision’s access to water may be limited by
congressionally recognized water rights for the San Pedro Riparian
National Conservation Area (“SPRNCA”). Because ADWR’s position is
contrary to the statute’s language and purpose, I respectfully dissent from
Part V of the majority opinion and the conclusion that the legal availability
requirement was met here.
I.
¶48 Our primary “task in interpreting the meaning of a statute is
to fulfill the intent of the legislature that wrote it.” State v. Williams, 175
Ariz. 98, 100 (1993). “To determine a statute’s meaning, we look first to its
text.” State v. Burbey, 243 Ariz. 145, 147 ¶ 7 (2017). By its terms, “legally
available” refers to water that can be appropriated or used without
violating the law, i.e., without conflicting with senior water rights. Water
will not be available for the proposed subdivision’s groundwater pumping
if that use will withdraw water necessary to fulfill the purpose of the
SPRNCA. See Cappaert v. United States, 426 U.S. 128, 141-45 (1976). By
ignoring this fact, while purporting to make a 100-year availability
determination, ADWR undermines § 45-108’s core purpose.
¶49 ADWR Director Herb Guenther testified before the Senate
Natural Resources and Rural Affairs Committee in 2007 to explain the
background and purpose of the adequate water supply program. See
generally Hearing on S.B. 1575 Before the S. Nat. Res. and Rural Affairs Comm.,
48th Leg., 1st Reg. Sess. 2007 (Feb. 14, 2007) (statement of Herb Guenther,
Director, ADWR). The legislature enacted the program in 1973 as a
consumer protection program in the wake of predatory sales of land
without adequate water. Id. Although well-intentioned, the initial scheme
was fraught with loopholes. Id. In 2007, the legislature sought to fortify the
adequate water supply program by giving municipalities the authority
necessary to properly plan for development. Id. As Director Guenther
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SILVER ET AL. V. PUEBLO DEL SOL WATER CO. ET AL.
CHIEF JUSTICE BALES, joined by JUSTICE PELANDER, Concurring in Part and
Dissenting in Part
testified, “if you don’t have an adequate supply, you are just going to
postpone it until someone else has to deal with the crisis when [the water]
supply comes up short.” Id.
¶50 Rather than consider whether the water supply will “come up
short” considering all the projected uses – and thus whether water will be
“legally available” for the proposed subdivision – ADWR contends that it
need only consider whether Pueblo del Sol (“Pueblo”) seeks to withdraw
groundwater for a beneficial use under A.R.S. § 45-453 and has a certificate
of convenience and necessity (“CC&N”) allowing it to deliver water to
customers as required by ADWR’s rule, Arizona Administrative Code R12-
15-718(C). In affirming ADWR’s position, the majority relies on the canon
of prior construction to conclude the legislature has endorsed ADWR’s rule.
Supra ¶¶ 25-26.
¶51 The majority argues the statutory phrase “legally available”
is ambiguous as to federal reserved water rights because it does not
specifically mention them. Supra ¶ 23. This approach stands the normal
understanding of language on its head: instead of assuming the general
term includes the more specific (i.e., whether water is “legally available”
embraces whether usage will be limited by prior and superior federal
rights), the majority incorrectly posits that the general term is ambiguous
because it does not expressly include the more specific. Because § 45-108
directs ADWR to “evaluate” if water will be “legally available” for Pueblo’s
proposed pumping, requiring ADWR to consider the SPRNCA’s reserved
rights reflects applying the statute by its terms.
¶52 Having concluded that “legally available” does not mean
what it says, the majority proceeds to conclude that the legislature
implicitly intended to adopt ADWR’s interpretation, even though,
according to the majority, supra ¶ 41, that interpretation does not even
contemplate the impact of federal reserved water rights. But the
congressionally reserved rights for the SPRNCA indisputably could, as a
matter of federal and state law, limit prospective groundwater withdrawals
for the subdivision. To allow ADWR to close its eyes to this fact in assessing
if water will be legally available, the majority squints to find statutory
ambiguity. Such interpretative myopia is not compelled by any canon of
construction.
22
SILVER ET AL. V. PUEBLO DEL SOL WATER CO. ET AL.
CHIEF JUSTICE BALES, joined by JUSTICE PELANDER, Concurring in Part and
Dissenting in Part
¶53 Given the plain language and manifest consumer protection
purposes of § 45-108, the majority’s adherence to the canon of prior
construction is perplexing. In the context of this case, ADWR’s position
impermissibly renders “legally available” meaningless. Counties outside
active management areas, like Cochise, must opt in before developers are
required to obtain an adequate water supply designation, see
A.R.S. § 11-823(A), which includes the statutory requirement of legal
availability. But this phrase has no force with respect to private water
companies if it refers only to a CC&N and beneficial use under A.R.S.
§ 45-453, as those requirements apply whether or not a county chooses to
be in the adequate water supply program. See A.R.S. § 40-281; Ariz. Water
Co. v. Ariz. Corp. Comm’n, 217 Ariz. 652, 656 ¶ 11 (App. 2008) (discussing
CC&N requirement). Instead of vitiating the statute’s language, we should
interpret “legally available” as having independent meaning consistent
with § 45-108’s purpose. See Hohokam Irrigation and Drainage Dist. v. Ariz.
Pub. Serv. Co., 204 Ariz. 394, 398 ¶ 15 (2003) (noting that we seek to “give
meaning to each word, clause or sentence, considered in light of the entire
act and the purpose for which it was enacted into law”); State v. Pitts, 178
Ariz. 405, 407 (1994) (presuming that “the legislature did not intend to write
a statute that contains a void, meaningless, or futile provision”).
¶54 At bottom, ADWR’s rule cannot overcome the language of
§ 45-108. If the legislature had meant that a CC&N alone could establish
“legal availability,” it could have easily said so. This point is not answered
by the majority’s effort to characterize ADWR’s rule as a “longstanding
interpretation” that predated the 2007 amendments. Supra ¶¶ 25-26. Even
ADWR does not think its rule fully defines “legal availability,” as it
acknowledged in this Court that the phrase also requires compliance with
§ 45-453 (which is not specified in the rule). Thus, ADWR itself recognizes
that a controlling background legal principle, such as the “reasonable use”
requirement of § 45-453, can affect whether water will be “legally
available,” and the same should be true for federal reserved water rights.
If ADWR itself has not interpreted its rules as fully defining the term “legal
availability,” then how can one impute to the legislature any intent to
endorse such an interpretation as a matter of prior construction?
¶55 The majority accuses the dissents of seeking to “add” to or
“recast” § 45-108 to cover matters it does not address. Supra ¶¶ 31, 41, 44.
This assertion falls flat: the majority inconsistently argues both that the
23
SILVER ET AL. V. PUEBLO DEL SOL WATER CO. ET AL.
CHIEF JUSTICE BALES, joined by JUSTICE PELANDER, Concurring in Part and
Dissenting in Part
statute does not apply as written and that the dissents’ interpretation
improperly seeks to rewrite it; relatedly, insofar as the majority contends
that the dissents disregard the statute’s language or intent, it presumes the
correctness of its own interpretation, thus committing the logical fallacy of
using a premise to support itself. Finally, the majority contends that if the
legislature intended to require ADWR to consider federal reserved water
rights in assessing legal availability, it failed to do so in § 45-108. Supra ¶ 44.
Thus, the majority says it will not apply the statute by its terms even if doing
so would further the legislature’s intent, and this approach respects the
proper role of the courts. Id. I disagree.
¶56 Finally, deferring to ADWR’s interpretation of its rule seems
contrary to the legislature’s recent amendments to A.R.S. § 12-910, which
directs:
In a proceeding brought by or against the regulated party, the
court shall decide all questions of law, including the
interpretation of a constitutional or statutory provision or a
rule adopted by an agency, without deference to any previous
determination that may have been made on the question by
the agency. Notwithstanding any other law, this subsection
applies in any action for judicial review of any agency action
that is authorized by law.
2018 Ariz. Sess. Laws, ch. 180, § 1 (2d Reg. Sess.) (to be codified at A.R.S.
§ 12-910(E)) (effective Aug. 3, 2018).
¶57 Noting that this statute concerns judicial deference to agency
interpretations rather than the “prior construction” canon, supra ¶ 28, the
majority misses the deeper point. If it is objectionable to cede the power to
interpret statutes or rules to an agency, isn’t it even more objectionable to
cede to an agency – as the majority effectively does – the very power to pass
statutes by inferring, from legislative silence, an intent to enact preexisting
agency regulations? Based on the “prior construction” canon, one might
reasonably conclude that if courts have authoritatively interpreted a
particular term (e.g., “special weight” or “creditors”), the term has the same
meaning when later adopted in a statute concerning the same subject. See,
e.g., In re Marriage of Friedman & Roels, 244 Ariz. 111, 115 ¶ 14, 116 ¶ 20
(2018); Moore v. Chilson, 26 Ariz. 244, 254 (1924). It is an entirely different
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SILVER ET AL. V. PUEBLO DEL SOL WATER CO. ET AL.
CHIEF JUSTICE BALES, joined by JUSTICE PELANDER, Concurring in Part and
Dissenting in Part
proposition, however, to contend that the legislature by enacting a statutory
standard (e.g., the requirement of “legal availability”) has implicitly
codified a pre-existing body of detailed agency rules. Doing so combines
deference and delegation with a vengeance.
II.
¶58 Just as an administrative agency cannot exceed its delegated
powers, it cannot shirk its delegated responsibilities. See Kendall v. Malcolm,
98 Ariz. 329, 334 (1965) (noting that “[t]he powers and duties of an
administrative agency are to be measured by the statute creating them”).
The legislature here has directed that ADWR evaluate a proposed
subdivision’s 100-year adequate water supply. Whereas ADWR’s physical
availability regulation fulfills its statutory duty to assess a landowner’s
prospective ability to access groundwater, the legal availability regulation
fails to reasonably assess whether a landowner would have legal access to
an adequate water supply 100 years in the future. ADWR cannot fulfill its
delegated responsibility without considering the SPRNCA’s federal
reserved water rights here.
¶59 “[W]hen the Federal Government withdraws its land from the
public domain and reserves it for a federal purpose, the Government, by
implication, reserves appurtenant water then unappropriated to the extent
needed to accomplish the purpose of the reservation.” Cappaert, 426 U.S. at
138; see also Winters v. United States, 207 U.S. 564 (1908). “The implied-
reservation-of-water-rights doctrine, however, reserves only that amount
of water necessary to fulfill the purpose of the reservation, no more.”
Cappaert, 426 U.S. at 140. Because the reserved rights doctrine is based on
the “necessity of water for the purpose of the federal reservation,” the
federal government can protect its water “from subsequent diversion,
whether the diversion is of surface or groundwater.” Id. at 143; see also Agua
Caliente Band of Cahuilla Indians v. Coachella Valley Water Dist., 849 F.3d 1262,
1270 (9th Cir. 2017). Given that federal water rights “are not dependent
upon state law or state procedures[,] they need not be adjudicated only in
state courts; federal courts have [concurrent] jurisdiction under 28 U.S.C.
§ 1345 to adjudicate the water rights claims of the United States.” Cappaert,
426 U.S. at 145.
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SILVER ET AL. V. PUEBLO DEL SOL WATER CO. ET AL.
CHIEF JUSTICE BALES, joined by JUSTICE PELANDER, Concurring in Part and
Dissenting in Part
¶60 This Court has recognized the reserved water rights doctrine
and the primacy of federal law when examining federal water rights in state
court. See In re the General Adjudication of All Rights to Use Water in the Gila
River Syst. and Source (Gila III), 195 Ariz. 411 (1999). “[I]n order to adjudicate
and quantify water rights based upon federal law, the Arizona courts must
afford federal claimants the benefit, when state and federal law conflict, of
federal substantive law.” Id. at 416 ¶ 13. This Court “may not defer to state
law where to do so would defeat federal water rights.” Id. at 419 ¶ 27.
¶61 Although Arizona law still adheres to the legal fiction that
surface water is hydrologically separate from groundwater, “upon
evidence that ‘federal [surface] water rights [are] being depleted by
groundwater pumping because . . . groundwater and surface water are
physically interrelated,’” the federal government can protect its rights from
subsequent groundwater diversion. Gila III, 195 Ariz. at 418 ¶ 20 (quoting
Cappaert, 426 U.S. at 142-43). Thus, the “significant question of the purpose
of the reserved rights doctrine is not whether the water runs above or below
ground but whether it is necessary to accomplish the purpose of the
reservation.” Id. at 419 ¶ 24.
¶62 Here, Congress created the conservation area to “protect the
riparian area and the aquatic, wildlife, archeological, paleontological,
scientific, cultural, educational, and recreational resources of the public
lands surrounding the San Pedro River in Cochise County, Arizona.”
16 U.S.C. § 460xx(a). Congress’s reservation of water rights was explicit:
Congress reserves for the purposes of this reservation, a
quantity of water sufficient to fulfill the purposes of the San
Pedro Riparian National Conservation Area created by this
subchapter. The priority date of such reserve rights shall be
November 18, 1988. The Secretary shall file a claim for the
quantification of such rights in an appropriate stream
adjudication.
Id. § 460xx-1(d). The federal government’s claimed water rights for the
conservation area incorporate a surface water instream flow component,
point sources such as ponds, springs, and wells, and a groundwater
elevation component. BLM contends that all these rights are essential to
maintaining the riparian area’s surface flows and vegetation.
26
SILVER ET AL. V. PUEBLO DEL SOL WATER CO. ET AL.
CHIEF JUSTICE BALES, joined by JUSTICE PELANDER, Concurring in Part and
Dissenting in Part
¶63 Congress’s reservation of water rights for the conservation
area is robust. But the subwatershed in which the conservation area is
located is strained. The United States Geological Survey (“USGS”) has
found that the “[l]ong-term sustainability of [the San Pedro] riparian
system is directly dependent on base flow and shallow near-stream ground-
water levels.” Stanley A. Leake, Donald R. Pool & James M. Leenhouts, U.S.
Geological Survey, Simulated Effects of Ground-Water Withdrawals and
Artificial Recharge on Discharge to Streams, Springs, and Riparian Vegetation in
the Sierra Vista Subwatershed of the Upper San Pedro Basin, Southeastern Arizona
1 (version 1.1 Apr. 2014).
¶64 This Court has already found that “[u]nder the ‘reasonable
use’ doctrine, Arizona has consumed far more groundwater than nature
can replenish.” Gila III, 195 Ariz. at 420 ¶ 30. Moreover, ADWR has
presented evidence to this Court in other proceedings regarding the
diminishing water flows in the San Pedro and Upper San Pedro
watersheds. See id. Indeed, the USGS has found that “ground-water levels
in parts of the subwatershed are declining . . . [and t]he continued decline
of ground-water levels upgradient from perennial river reaches will
eventually diminish the base flow of the San Pedro River and imperil the
riparian ecosystem within the SPRNCA.” See Leake et al., supra ¶ 63, at 2.
¶65 Such hydrologic realities confirm that Pueblo’s proposed
increase in groundwater pumping could potentially conflict with the
SPRNCA’s federal reserved water rights. Therefore, ADWR cannot
determine that Pueblo will have “legally available” water without
evaluating whether the federal reserved rights will limit the subdivision’s
projected use. To be sure, directing ADWR to fulfill its statutory
responsibilities does not determine whether the permit at issue should be
approved. But ADWR should consider the SPRNCA’s water rights before
it grants Pueblo an adequate water supply designation.
III.
¶66 Pueblo and ADWR argue, and the majority agrees, that
consideration of unadjudicated rights is impermissibly speculative. Supra
¶¶ 32, 34, 36. They reason that ADWR will be forced to make several
assumptions regarding the purposes of the reservation, whether those
purposes require water, whether water supplies other than groundwater
27
SILVER ET AL. V. PUEBLO DEL SOL WATER CO. ET AL.
CHIEF JUSTICE BALES, joined by JUSTICE PELANDER, Concurring in Part and
Dissenting in Part
will be sufficient, whether there is a causal connection between
groundwater pumping and adverse impacts to the reservation, and even
whether BLM would seek to enforce its rights. But many of these
“assumptions” have already been established. BLM has repeatedly sought
to protect and enforce its water rights, as evidenced by its claims in the Gila
Adjudication and its litigation here. Furthermore, the conservation area’s
purposes, reserved water rights, and priority date have already been
established by federal law. See 16 U.S.C. §§ 460xx, 460xx-1.
¶67 ADWR – our state’s department of water resources – has the
expertise and resources necessary to analyze the physical interactions of
water withdrawals and the legal interactions between water rights. See, e.g.,
A.R.S. § 45-105(A)(1)-(4). The consideration of the SPRNCA’s
unadjudicated water rights would be no more speculative than many of the
calculations and estimations ADWR already makes in its 100-year adequate
water supply evaluation. Given the degree of speculation attendant to any
evaluation of a 100-year water supply, the fact that the SPRNCA’s reserved
rights are not yet quantified does not justify ADWR abdicating its statutory
responsibility. ADWR, as the state agency empowered to “[m]easure,
survey and investigate the water resources of this state,” A.R.S.
§ 45-105(A)(4), could conduct a hydrological study to determine whether
Pueblo’s proposed increase in groundwater pumping, when combined
with existing groundwater pumping in the watershed, would infringe the
SPRNCA’s federal reserved water rights so as to defeat the purpose of the
conservation area.
¶68 Pueblo and ADWR next argue that it would be inappropriate
for ADWR to consider BLM’s unquantified federal water rights because
ADWR currently serves as a technical advisor to the Gila Adjudication,
where BLM’s rights are being litigated. Pueblo claims that this “dual role”
as technical advisor and adjudicator would create separation of powers and
due process concerns. Pueblo misapprehends the legal availability
analysis. ADWR is not required to conclusively quantify the conservation
area’s water rights in assessing whether water will be legally available for
Pueblo’s proposed development. Instead, it must only consider the
potential impact that Pueblo’s groundwater pumping will have on the
SPRNCA’s water rights. Any calculations ADWR would make regarding
those rights, including any impact of Pueblo’s proposed pumping, would
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SILVER ET AL. V. PUEBLO DEL SOL WATER CO. ET AL.
CHIEF JUSTICE BALES, joined by JUSTICE PELANDER, Concurring in Part and
Dissenting in Part
have no precedential effect and would not usurp the Gila Adjudication’s
judicial authority.
¶69 The majority prioritizes the interests of subdivision
developers over those of homeowners, observing that the “stakes of this
speculative process would be exceedingly high, given that a finding of
inadequate water supply precludes development.” Supra ¶ 32. But the
potential harm suffered by homeowners would be even higher if their
property is one day rendered almost worthless due to an inadequate water
supply.
IV.
¶70 Trial to quantify the conservation area’s water rights is
currently set to begin on January 28, 2019. See In re San Pedro Riparian
National Conservation Area, Contested Case No. W1-11-232, Scheduling
Order, Maricopa County Superior Court (June 15, 2018). At oral argument,
ADWR conceded that it could consider quantified federal reserved water
rights in its legal availability analysis, but that it would do so only if “the
federal government could prove, likely through an injunction, that an
applicant’s prospective groundwater pumping would infringe upon that
right.” Supra ¶ 43. The majority seems to agree, summarily concluding that
“only an injunction based on a federal reserved water right could legally
inhibit Pueblo’s right to pump.” Supra ¶ 36. This approach threatens to
undermine both § 45-108 and the reserved rights Congress recognized for
the SPRNCA.
¶71 Problematically, the majority misapprehends the relationship
between our prior case law and ADWR’s granting an adequate water
supply designation. The majority cites Gila III for the proposition that our
caselaw “disfavors consideration of unquantified federal reserved water
rights.” Supra ¶ 33. To be sure, Gila III described as premature the tribes’
argument to “immediately enjoin pumping that is depleting water beneath
reservations” because, “[u]ntil federal rights are quantified, it cannot be
determined which if any of the tribes are entitled to such relief.” 195 Ariz.
at 421 ¶ 35 n.12. But those comments, made in proceedings seeking
injunctive relief, are inapposite here. Requiring ADWR to consider federal
water rights in making an adequate water supply determination does not
require the water rights to be finally adjudicated.
29
SILVER ET AL. V. PUEBLO DEL SOL WATER CO. ET AL.
CHIEF JUSTICE BALES, joined by JUSTICE PELANDER, Concurring in Part and
Dissenting in Part
¶72 Essentially, the majority would allow ADWR to ignore the
legal inadequacy of a proposed water supply until the problem becomes a
reality. This interpretation defeats the adequate water supply provision’s
manifest purpose to proactively protect consumers in Arizona before they
purchase property. The plain text of § 45-108(I) requires ADWR to
prospectively evaluate a 100-year water supply, and not merely to evaluate
what has already happened. Moreover, this interpretation could also
damage the federally protected ecosystem by allowing diminishment of the
base flow and groundwater levels. Although a zero-impact standard
would likely not be appropriate, see Gila III, 195 Ariz. at 422 ¶ 38,
groundwater users in the area with inferior water rights should not bring
the conservation area’s wildlife populations and aquatic environments to
the brink of collapse before the federal government can enforce its rights.
V.
¶73 Directing ADWR to consider the possible impact of the
existing federal rights on the availability of water for the proposed
subdivision comports with the language and purpose of § 45-108. Such
consideration does not inherently involve any greater uncertainty or
speculation than the other projections ADWR must make for a 100-year
availability determination. Accordingly, with due respect for my
colleagues, I would affirm the superior court’s ruling.
30
SILVER ET AL. V. PUEBLO DEL SOL WATER CO. ET AL.
JUSTICE BOLICK, joined by JUSTICE PELANDER, Concurring in Part and
Dissenting in Part
BOLICK, J., joined by PELANDER, J., concurring in part and dissenting in
part.
¶74 This case raises the meaning of the statutory command that
the Director determine whether sufficient water “will be . . . legally . . .
available to satisfy the water needs of the proposed use for at least one
hundred years.” A.R.S. § 45-108(I)(1). Because the majority’s construction
renders that command essentially meaningless, I respectfully dissent from
that portion of the opinion.
¶75 Our task here implicates multiple canons of statutory
interpretation, of which the majority hitches its outcome to mainly one. The
first relevant principle is the presumption against ineffectiveness, which
holds that a textually permissible interpretation that furthers rather than
obstructs the statute’s purpose should be favored. Antonin Scalia & Bryan
A. Garner, Reading Law: The Interpretation of Legal Texts 63 (2012). As Scalia
and Garner explain, “This canon follows inevitably from the facts that (1)
interpretation always depends on context, (2) context always includes
evident purpose, and (3) evident purpose always includes effectiveness.”
Id. Here, although we do not know from the text exactly what a
determination of legal availability entails, we do know that such a
determination is required. From the language and context, the evident
purpose is to protect consumers against purchasing homes for which water
supply may be insufficient. As a cardinal principle of statutory
interpretation, we should favor an interpretation that gives substantive
meaning to the statutory command rather than one that defeats or
diminishes its evident purpose.
¶76 A second and related principle is the surplusage canon, which
holds that if possible, “every word and every provision is to be given
effect,” and that “it is no more the court’s function to revise by subtraction
than by addition.” Id. at 174. Scalia and Garner observe that “this canon
prevents not [only] the total disregard of a provision, but an interpretation
that renders it pointless.” Id. at 176. As the Chief Justice points out, that is
exactly what the majority does here. See supra ¶ 53.
¶77 The majority decision rests largely on a third principle, the
prior-construction canon, which holds that where a term is undefined, the
legislature is deemed to have adopted a preexisting interpretation by,
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SILVER ET AL. V. PUEBLO DEL SOL WATER CO. ET AL.
JUSTICE BOLICK, joined by JUSTICE PELANDER, Concurring in Part and
Dissenting in Part
among other entities, an administrative agency. Supra ¶¶ 22–28. Here, the
Arizona Department of Water Resources (“ADWR”) had a preexisting
regulation defining legal availability, and the majority assumes that by its
definitional silence, the legislature implicitly adopted it.
¶78 The canon’s legal foundation is solid and its application here
is intuitively appealing. But where, as here, it collides with other
fundamental interpretive principles, its application should be carefully
considered.
¶79 As a threshold question, we should ask how far this principle
logically extends. For instance, if the agency had issued a preexisting rule
saying the Director should determine legal availability by eating a jelly
sandwich, surely we would not apply that definition even if the legislature
subsequently adopted the legal availability terminology without defining
it. So too should we not adopt the preexisting agency definition here if it is
inconsistent with the subsequent legislative enactment, given that agency
authority derives entirely from express legislative delegation. See, e.g., Ariz.
State Bd. of Regents ex rel. Ariz. State Univ. v. Ariz. State Pers. Bd., 195 Ariz.
173, 175 ¶ 9 (1999) (noting administrative agencies have no “inherent
powers” but only those derived from legislative delegation); R.L. Augustine
Constr. Co. v. Peoria Unified Sch. Dist. No. 11, 188 Ariz. 368, 370 (1997) (agency
rule must be “substantially consistent” with the statute).
¶80 The lack of any meaningful connection between the statutory
command to determine legal availability and the substance of ADWR’s
regulation renders the agency’s definition untenable. To determine legal
availability, ADWR’s regulation requires only one thing: that the applicant
has secured a certificate of convenience and necessity (“CC&N”) from the
Arizona Corporation Commission. Ariz. Admin. Code R12-15-718(C). The
Commission has no jurisdiction over water. Its authority to grant CC&Ns
applies generically to public service corporations constructing any “street
railroad, [] line, plant, service or system.” A.R.S. § 40-281(A). The CC&N
process entails no analysis whatsoever of water supply. Obtaining a CC&N
tells us absolutely nothing about the legal availability of water for a single
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SILVER ET AL. V. PUEBLO DEL SOL WATER CO. ET AL.
JUSTICE BOLICK, joined by JUSTICE PELANDER, Concurring in Part and
Dissenting in Part
day much less for the next hundred years. 6 That is especially true here,
where the CC&N was obtained forty-six years ago, before either ADWR’s
regulation or the statute requiring a legal availability determination. The
majority notes that the Commission could order construction of additional
facilities in the public interest, supra ¶ 30, but again, that has nothing to do
with legal availability. Obtaining a CC&N is thus completely unrelated to
determining legal availability and would be highly unlikely to survive
challenge had ADWR adopted it to implement the statutory command to
determine legal availability. We therefore should not impute to the
legislature an intent to define the statutory command in this manner,
particularly when by so doing we would drain that command of any
meaningful content.
¶81 Moreover, the statutory command to determine legal
availability is directed to “the director of water resources,”
§ 45-108(B), (I)(1), suggesting that the legislature, in fact, meant for the
Director to conduct the analysis, and not to outsource it to another agency.
Ironically, in one breath, ADWR argues that the statute cannot mean what
it says because it lacks the expertise to project legal availability; while in the
next, it urges us to accept a CC&N issued by the Arizona Corporation
Commission before ADWR’s regulation was even adopted as compliance
with the statutory command.
¶82 Further, as the Chief Justice observes, supra ¶ 56, the
legislature itself recently has categorically instructed that with regard to
statutory interpretation, we should provide no deference “to any previous
determination that may have been made on the question by the agency.”
A.R.S. § 12-910(E); see 2018 Ariz. Sess. Laws, ch. 180, § 1 (2d Reg. Sess.)
(effective Aug. 3, 2018). 7 ADWR’s definition of legal availability is a
“previous determination . . . on the question by the agency” and therefore
we should give it no weight. Whatever continuing vitality, if any, the prior-
construction canon has in Arizona with regard to agency interpretations or
6 ADWR says it also requires that the applicant must show it has the right
to a reasonable and beneficial use of the water, A.R.S. § 45-453, but that
determination likewise suggests nothing about future legal availability.
7 I regret that the majority has seen fit to apply a limiting interpretation to
this statute before its ink is barely dry.
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SILVER ET AL. V. PUEBLO DEL SOL WATER CO. ET AL.
JUSTICE BOLICK, joined by JUSTICE PELANDER, Concurring in Part and
Dissenting in Part
definitions, it must yield to enforcement of the statute’s language and
context and the evident purpose that we derive from it.
¶83 The majority thwarts that purpose, creating a Swiss cheese
statute with robust obligations on either side and a hole in the middle. As
the majority describes it, ADWR’s process to determine physical
availability is rigorous, requiring among other things, a hydrology study
and independent determination that the groundwater will be drawn from
certain wells and at certain depths, taking into account projected declines
in water level caused by existing uses. Supra ¶ 17; see also Silver v. Pueblo
Del Sol Water Co., 241 Ariz. 131, 141 ¶ 32 (App. 2016) (Analysis entailed
“consideration of the water already committed to approximately 200 area
users.”). Similarly, the obligation that the applicant demonstrate financial
capability to construct the water facilities, including a delivery system and
any storage facility or treatment works, § 45-108(I)(2), is substantial on its
face. It would be incongruous for the legislature, in a list of prerequisites,
to include two that relate directly and substantively to the provision of
water supply and another that seems to on its face but in reality does not.
¶84 The majority’s interpretation similarly frustrates the statute’s
evident consumer protection purpose. It tries to assure us otherwise but
fails. First, it points back at the very statute it has eviscerated to show that
it “provides consumers with vigorous protections against unscrupulous
developers,”8 supra ¶ 39—but of course now without meaningful analysis
that water will be legally available. Then it notes that ADWR can revoke
its availability determination, which of course is cold comfort to
homeowners who purchase homes in reliance on that determination,
especially when coupled with the fact that if the agency does so,
“consumers have no recourse against the state, the Director, or ADWR.”
Supra ¶ 40 (citing A.R.S. § 45-108(G)). The majority acknowledges that the
8 From its language and context, the requirements of § 45-108 appear
primarily aimed not at “unscrupulous developers,” for it provides no cause
of action against them, but rather at ensuring a balanced, objective,
independent, good-faith analysis that our state’s most scarce and precious
commodity will likely be available for the extended future to those who
make a major investment in a home purchase. The statute provides
absolutely no guarantees or warranties, except that such an analysis will in
fact take place.
34
SILVER ET AL. V. PUEBLO DEL SOL WATER CO. ET AL.
JUSTICE BOLICK, joined by JUSTICE PELANDER, Concurring in Part and
Dissenting in Part
legislature could require a “comprehensive assessment of the potential
impact of unquantified federal reserved water rights based upon
speculative projections about litigation outcomes years or decades in the
future.” Supra ¶ 42. Of course, speculation is inherent in any projection
regarding water availability, legal or otherwise, “for at least one hundred
years,” but that is exactly what the statute commands. § 45-108(I)(1).
¶85 Any analysis of legal availability necessarily includes known
competing claims, even if they are not finally adjudicated. No one would
purchase a residence that was subject to eminent domain proceedings, even
if they were incomplete. The legislature plainly wanted ADWR to provide
an analysis, as best it can given the inherent uncertainty, of the projected
water supply’s future legal availability. Certainly, that is a more logical
inference than that the legislature wanted the developer to obtain a CC&N
from the Arizona Corporation Commission. If it did, it surely employed an
odd term (“legal availability”) to accomplish that purpose.
¶86 To recap: no legal availability determination was made in this
case; no meaningful legal availability determination will be made in future
cases; and consumers have no recourse under these statutes even if it would
have been clearly foreseeable to ADWR that the water supply would not be
legally available for the next hundred years. That could not have been what
the legislature intended when it included legal availability within the
requisite tripartite analysis. We can either read the obligation, in light of its
plain language and evident purpose, to mean exactly what it says, or we
can read it to mean essentially nothing. I opt for the former not because I
prefer that policy result, but on the ground that we should never presume
that the people’s elected representatives meant to accomplish nothing when
they enacted a statutory provision.
¶87 I agree with the Chief Justice that ADWR’s projection is not a
predetermination of legal rights, has no precedential effect, and does not
usurp the Gila Adjudication’s judicial authority. Supra ¶ 68. The majority
creates a straw man by suggesting that the dissenters would rewrite the
statute, supra ¶ 44, to “mandate[] a moratorium on development in the
absence of an absolute certainty of a future water supply.” Supra ¶ 40.
Quite to the contrary, our interpretation would enforce the statute as
written, which in my view contemplates nothing more than a nonbinding
35
SILVER ET AL. V. PUEBLO DEL SOL WATER CO. ET AL.
JUSTICE BOLICK, joined by JUSTICE PELANDER, Concurring in Part and
Dissenting in Part
analysis. The determination required of ADWR does not require
exactitude; indeed, by its explicit terms, all it requires is good faith.
§ 45-108(G). By contrast, the majority’s interpretation largely erases the
statutory requirement, which absent a constitutional infirmity that is not
suggested here, we are not empowered to do.
¶88 The legislature has justifiably reposed great confidence and
responsibility in ADWR. We should effectuate its decision to do so. With
great respect to my colleagues, I dissent.
36
SILVER ET AL. V. PUEBLO DEL SOL WATER CO. ET AL.
JUSTICE PELANDER, Concurring in the Partial Dissents
PELANDER, J., concurring in the partial dissents.
¶89 This is a close and important case, with good arguments on
both sides. I join the Chief Justice’s partial dissent because, viewed in
context and in light of the statute’s undisputed consumer-protection
purpose, the phrase “legally available” in A.R.S. § 45-108(I)(1) is not
ambiguous; therefore, ADWR’s mandatory evaluation and determination
under § 45-108(B) must include its consideration of federal reserved water
rights. Given that unambiguity, I find persuasive the Chief Justice’s
reasoning and conclusion.
¶90 But assuming the reference to “legally available” in
§ 45-108(I)(1) is ambiguous, as the majority concludes and Justice Bolick
implies, I agree with the analysis and conclusion in Justice Bolick’s partial
dissent. Among other things, I find illogical the notion that issuance to
Pueblo of a CC&N by the Arizona Corporation Commission nearly a
half-century ago ipso facto satisfies the mandatory duty owed by ADWR
now, decades later, to “evaluate” and “determine whether there is an
adequate water supply for the subdivision.” § 45-108(B). That premise
seems particularly unfounded inasmuch as any development, let alone one
the magnitude of “Tribute,” was neither contemplated nor planned until
long after the CC&N was issued in 1972.
¶91 Because the statutory interpretation issues here are of
statewide interest and importance, the legislature should carefully and
promptly consider the parties’ arguments and our differing opinions. If the
majority has it wrong, statutory clarification would be helpful to
developers, consumers, water companies, ADWR, and many other entities
and persons who care about and are affected by water issues in this state.
37