Water rights have lately become a major issue in the cannabis industry. It will continue to be an important factor as more states go from medical-only to full legalization, more cultivators join the industry, and Western states that are experiencing drought seek to protect the limited resource.
Whether you’re established as a cannabis grower or looking to grow in a new location, your source of water and the rights necessary to use it may not be the first thought on your mind. However, it’s imperative that you secure these rights.
For a general explanation, West’s Encyclopedia of American Law defines “water rights” as a group of multiple rights that concern the use and enjoyment of water that collect underground, on the surface, or travels through the land. Water rights become more complicated because states take differing approaches to what is and isn’t permitted for different types of water.
Water that travels through land may be treated by the state as permissible:
Underground water supplies and the legal rights to that water also have different approaches. For example, a state may take absolute ownership (which is in a minority of states), the owner can use as much as they like as long as it is not wasteful, or each landowner has equal rights for a beneficial purpose but cannot deplete a neighbor’s water supply.
The federal government is responsible for determining whether water from their projects can be used to grow cannabis. Previous statements by the government indicate that using Bureau of Reclamation water is prohibited due to the federal ban on cannabis.
In the prominent Colorado case of In Re High Valley Farms, LLC (Case No. 14CW3095), the issue boils down to whether it is a “beneficial use, reasonable and appropriate under reasonably efficient practices to accomplish without waste the purpose for which the appropriation is lawfully made” when cannabis is legal at the state level, but illegal at the federal. The question remains of whether it is a “legal use,” but there are strong arguments on the side of the state. If your source involves water that comes from or integrates with federal water, it’s highly advisable that you seek a water rights attorney to help fill out the permit paperwork.
Given the differing state approaches, the process of securing a permit may vary. To secure your water rights, visit your state’s Division of Water Resources and obtain information on the exact steps. Also pick up an appropriate permit application for the type of use you are seeking; for example, an irrigation permit, commercial and industrial, or well permit. Most states also require that a certified water-rights examiner complete a survey of water use. If the water use is in compliance, you will be granted a water rights certificate.
If you’re unable to secure the type of necessary permit, you can collect rainwater or buy water from a distributor or water hauling service.
Water rights can be a complicated matter. States such as California are currently drafting rules about the types of use and the maximum amount of diversion of water. If a possible water rights issue arises, contact a water rights, environmental or a property law attorney to discuss your particular parcel, use and problem.
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