Central Colorado Water Conservancy Dist. v. Simpson

• Decision Date: 11 July 1994
• Docket Number: No. 92SA499,No. 1,S,1,92SA499
• Citation: 877 P.2d 335
• Parties: CENTRAL COLORADO WATER CONSERVANCY DISTRICT and Ground Water Management Subdistrict of the Central Colorado Water Conservancy District, Plaintiffs-Appellants and Cross-Appellees, Jackson Lake Reservoir and Irrigation Company, Fort Morgan Reservoir and Irrigation Company and Lower South Platte Water Conservancy District, Plaintiffs-in-Intervention-Appellants and Cross-Appellees, v. Harold D. SIMPSON, State Engineer, State of Colorado and Alan Berryman, Division Engineer, Water Divisiontate of Colorado, Defendants-Appellees and Cross-Appellees, and Colorado Rock Products Association, a Colorado non-profit corporation, Defendant-in-Intervention-Appellee and Cross-Appellant.
• Court: Colorado Supreme Court

Page 335

877 P.2d 335

CENTRAL COLORADO WATER CONSERVANCY DISTRICT and Ground Water Management Subdistrict of the Central Colorado Water Conservancy District Plaintiffs-Appellants and Cross-Appellees Jackson Lake Reservoir and Irrigation Company, Fort Morgan Reservoir and Irrigation Company and Lower South Platte Water Conservancy District Plaintiffs-in-Intervention-Appellants and Cross-Appellees, v. Harold D. SIMPSON, State Engineer, State of Colorado and Alan Berryman, Division Engineer, Water Division No. 1, State of Colorado Defendants-Appellees and Cross-Appellees, and Colorado Rock Products Association, a Colorado non-profit corporation, Defendant-in-Intervention-Appellee and Cross-Appellant.

No. 92SA499.

Supreme Court of Colorado, En Banc.

July 11, 1994.

Lind, Lawrence & Ottenhoff, Kim R. Lawrence, Greeley, for plaintiffs-appellants and cross-appellees.

Timothy R. Buchanan, P.C., Timothy R. Buchanan, Boulder, for plaintiffs-in-intervention-appellants and cross-appellees.

Gale A. Norton, Atty. Gen., Stephen K. ErkenBrack, Chief Deputy Atty. Gen., Linda L. Preslan, Asst. Atty. Gen., Denver, for defendants-appellees and cross-appellees.

Vranesh & Raisch, Michael D. Shimmin, Douglas A. Goulding, Boulder, for defendant-in-intervention-appellee and cross-appellant.

Justice KIRSHBAUM delivered the Opinion of the Court.

In November 1989 appellants, the Central Colorado Water Conservancy District and the Ground Water Management Subdistrict of the Central Colorado Water Conservancy District (hereafter collectively referred to as "the Central Colorado District"), filed this case in the District Court for Water Division No. 1 seeking a declaration that Senate Bill 120, chapter 314, 1989 Colorado Session Laws 1422 (hereafter "S.B. 120"), which statute requires certain sand and gravel pit owners and operators who expose tributary ground water to evaporation in the course of their mining operations to file augmentation plans with appellee Colorado State Engineer (hereafter "the State Engineer"), violates certain provisions of the United States and Colorado Constitutions. ¹ Appellants, the Jackson Lake Reservoir and Irrigation Company (hereafter "the Jackson Lake Company"), the Fort Morgan Reservoir and Irrigation Company (hereafter "the Fort Morgan Company"), and the Lower South Platte Water Conservancy District (hereafter "the Lower South Platte District"), intervened in the action.

The water court held that the legislation did not violate the applicable constitutional provisions, and the appellants appeal that judgment. We affirm in part and reverse in part.

I

As a result of open-pit sand and gravel mining operations, ground water contained in shallow aquifers is often exposed to the atmosphere by excavation below the water table. ² Prior to the enactment of the Water Right Determination and Administration Act of 1969, §§ 37-92-101 to -602, 15 C.R.S. (1990 & 1993 Supp.) (hereafter "the 1969 Act"), the State Engineer did not regulate the evaporation of exposed ground water from such sand and gravel pits. For several years after the adoption of the 1969 Act, the State Engineer adopted policies with respect to augmentation requirements for evaporative depletions from sand and gravel pits that ranged from disavowal of authority to prevent such losses to requiring court-approved augmentation plans. By 1980, however, the State Engineer had begun treating the evaporation of water from reclaimed sand and gravel pits as a beneficial use and administering such pits as "wells" that required permits and augmentation plans pursuant to section 37-90-137, 15 C.R.S. (1973 & 1979 Supp.). ³

In Three Bells Ranch Associates v. Cache La Poudre Water Users Ass'n, 758 P.2d 164 (Colo.1988), and Zigan Sand & Gravel, Inc. v. Cache La Poudre Water Users Ass'n, 758 P.2d 175 (Colo.1988), this court considered several issues regarding the duties of owners and operators of sand and gravel pits with respect to evaporative losses of ground water from sand and gravel mining operations. We concluded that sand and gravel pits exposing tributary ground water to evaporation constitute "wells" subject to regulation pursuant to the Colorado Ground Water Management Act, §§ 37-90-101 to -142, 15 C.R.S. (1990 & 1993 Supp.) (hereafter "the Ground Water Management Act"), and the 1969 Act, and that the formation of lakes and ponds through the process of sand and gravel mining and reclamation constitutes an appropriation of water. Three Bells, 758 P.2d at 169-75; Zigan, 758 P.2d at 181-85. We also concluded that sand and gravel mining permits issued pursuant to the Colorado Mined Land Reclamation Act, §§ 34-32-101 to -127, 14 C.R.S. (1984 & 1993 Supp.) (hereafter "the Mined Land Reclamation Act"), must include a requirement that ground water exposed as a result of the operation of such sand and gravel pits and lost through evaporation be augmented. Three Bells, 758 P.2d at 171-72; Zigan, 758 P.2d at 184-86.

During the legislative session immediately following our decisions in Three Bells and Zigan, the General Assembly adopted S.B. 120, which bill contained amendments to the Ground Water Management Act, the 1969 Act, and the Mined Land Reclamation Act. S.B. 120 contains provisions exempting owners and operators of sand and gravel pits excavated prior to January 1, 1981, and for which augmentation plans requiring replacement of evaporative losses have not been established by court decree, and owners and operators of sand and gravel pits for which augmentation agreements were entered into with conservation districts or water users associations prior to January 15, 1989, from requirements respecting augmentation for evaporative losses generally applicable to applicants for well permits. S.B. 120 also contains a provision requiring persons who have reactivated or who reactivate sand and gravel mining operations that ceased activity prior to January 1, 1981, to obtain well permits and augmentation plans in the same manner as other well permit applicants, except that owners or operators of such reactivated pits will not be required to provide increased replacement of water if, prior to January 15, 1989, they entered into and continually complied with written augmentation or replacement agreements with water conservancy districts or water users associations. Finally, S.B. 120 authorizes owners and operators of sand and gravel pits to consider evaporative losses attributable to vegetation historically growing on the surface area of land excavated for sand and gravel mining operations when calculating the requisite amount of augmentation water to replace evaporative losses from such pits.

On November 9, 1989, the Central Colorado District filed this action against appellees the State Engineer and the Division Engineer for Water Division No. 1. The complaint challenged the constitutionality of the provisions of S.B. 120 exempting certain categories of sand and gravel pits from the prior appropriation system of water rights codified in the Ground Water Management Act and the 1969 Act. The complaint alleged, inter alia, that various provisions of S.B. 120 violated the Equal Protection Clauses of the United States and Colorado Constitutions; violated the provisions of article XVI, sections 5 and 6, of the Colorado Constitution establishing this state's appropriation system; effected a taking of property without just compensation in violation of article II, section 15, of the Colorado Constitution; and, by authorizing ground water diversions from some sand and gravel pits without adequate augmentation, injured the Central Colorado District's water rights in the South Platte River basin. The complaint sought relief in the form of a decree containing the following requirement:

[T]he curtailment of all diversions by gravel pits which exposed ground water and continue to expose ground water, regardless of the date of the original exposure, unless the out-of-priority depletions caused by said diversions are replaced in time, quantity and location so as to prevent interference with or any injury to the vested water rights and decreed constitutional water rights of Plaintiffs and their constituents as determined by a decree for a plan of augmentation entered by the Water Court.

Appellee, the Colorado Rock Products Association, an industry group representing sand and gravel pit operators, intervened as a defendant-in-intervention in the case.

In January 1992, the water court conducted a four-day bench trial. Numerous witnesses testified and several hundred exhibits were introduced. At the conclusion of the trial, the water court determined that S.B. 120 did not violate the provisions of the United States and Colorado Constitutions relied upon by the appellants and that the State Engineer may consider, in determining the requisite augmentation, the eradication of pre-existing vegetation which results from the excavation of a sand and gravel pit. The court awarded certain costs to the appellees and to the appellants and denied a request by the Colorado Rock Products Association for an award of costs in excess of $40,000 for expenses associated with its employment of expert witnesses. The appellants have appealed the water court's judgment, including its award of costs to the appellees. The Colorado Rock Products Association has cross-appealed the denial of its request for costs associated with its employment of expert witnesses.

II

The appellants argue that S.B. 120 violates guarantees of equal protection of the law established by the Fourteenth Amendment to the United States Constitution and article II, section 25, of the Colorado Constitution by treating similarly situated persons differently. Specifically, they contend that sand and gravel pit owners and operators who excavated such pits after 1980 and other non-exempted water users are denied equal protection of the law because S.B. 120 requires them to obtain well permits and augmentation plans pursuant...