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Water Rights Resources

Water law is complex, nuanced, and can be difficult to understand. We delve into common water law concepts and provide tutorials that describe how it use publicly available tools to learn more about water rights. To this end, below are a series of articles that are designed to help parties develop a general understanding of some of the basic principles of water law. The information provided below is for educational purposes only and if you have specific questions about your water rights, please contact the attorneys at Nazarenus Stack & Wombacher for legal advice. Use of this information is explicitly subject the website disclaimer available at this link https://www.nswlaw.com/disclaimer

Anti-Speculation Doctrine

Colorado’s Constitution establishes that although the water of every natural stream in the state is the property of the public, it is subject to appropriation by private parties.  Colo. Const. Section 5, Art. XVI.  The Constitution also establishes that the “right to divert the unappropriated water of any natural stream to beneficial uses shall never be denied.”  Section 6, Art. XVI.  However, the right to divert water is limited.  One specific limitation is what is known as the Anti-Speculation Doctrine.

 As summarized by the Colorado Supreme Court, “[t]he anti-speculation doctrine precludes the appropriator who does not intend to put water to use for her own benefit, and has no contractual or agency relationship with one who does, from obtaining a water use right.  In other words, a person who intends to hold the right only to sell it or dispose of it for profit in the future, rather than acquire it for the purpose of applying water to an identified beneficial use, is not entitled to a determination of a water use right.”  Colo. Ground Water Comm’n v. North Kiowa-Bijou Groundwater Management Dist., 77 P.3d 62, 78-79 (Colo. 2003).  Subsequent Colorado Supreme Court opinions have clarified that appropriators can appropriate water for third parties but that the appropriator must have “firm contractual commitments for use of the water.”

 It is also worth noting that municipal water suppliers receive unique consideration under the Anti-Speculation Doctrine given the necessity of municipalities to plan for their reasonably anticipated future needs.  In City of Thornton v. Bijou Irrigation Company, 926 P.2d 1, 39 (Colo. 1996) the court summarized the municipal exception as follows:

Thus, under section 37-92-103(3)(a), a municipality may be decreed conditional water rights based solely on its projected future needs, and without firm contractual commitments or agency relationships, but a municipality’s entitlement to such a decree is subject to the water court’s determination that the amount conditionally appropriated is consistent with the municipality’s reasonably anticipated requirements based on substantiated projections of future growth. 

Later, in Pagosa Area Water & Sanitation District v. Trout Unlimited, 170 P.3d 307, 309-310 (Colo. 2007) the court established the following test applicable to municipal water suppliers seeking conditional water rights:

We hold that a governmental water supply agency has the burden of demonstrating three elements in regard to its intent to make a non-speculative conditional appropriation of unappropriated water: (1) what is a reasonable water supply planning period; (2) what are the substantiated population projections based on a normal rate of growth for that period; and (3) what amount of available unappropriated water is reasonably necessary to serve the reasonably anticipated needs of the governmental agency for the planning period, above its current water supply.  In addition, it must show under the “can and will” test that it can and will put the conditionally appropriated water to beneficial use within a reasonable period of time.

            The attorneys at Nazarenus Stack & Wombacher have decades of experience in adjudicating new water rights for clients, including water rights that fall under the municipal exemption to the Anti-Speculation Doctrine.  Please reach out to our attorneys if you have any questions about the Anti-Speculation Doctrine or need assistance adjudicating new water rights.

Anti-Speculation DoctrineWilliam Wombacher