Troubled waters for rights holders

Bills for water-rights adjudication anger some, confuse others

The Department of Natural Resources and Conservation has found itself inundated with returned bills and phone calls from people angry or confused over a recent billing for water-rights adjudication fees.

But the tangle was expected and in the long run it will be beneficial for water-rights holders across the state, said Mary Sexton, the department's director.

At issue are more than 108,000 bills that were sent out at the end of December, assessing fees on 291,531 water rights across the state. Under House Bill 22, approved by the Legislature last year, the fees are intended to raise more than $3 million a year for the next 10 years to pay for a statewide water-rights adjudication process.

The adjudication, simply put, will define, verify and prioritize water rights across the state. The process started in 1979, but it grinded to a halt in 1987 when funding for the program was slashed and about 30 water-rights claims examiners were laid off.

Since then, the state has fallen behind in keeping track of water rights, and the recent fee billing is showing just how badly behind the state is.

"We sent out over 100,000 bills and we've gotten about 23,000 back because of change of addresses," Sexton said.

What has happened in most of those cases is that property has changed hands but water rights have not, and a vast majority of the returned mail concerns water rights for domestic wells.

In one instance, a Libby resident received a bill assessing fees on water rights for a car dealership that was sold by his deceased father more than 20 years ago.

Sexton herself has a similar situation.

"I got a water right for property both my parents sold 30 years ago, and both of my parents are dead," she said.

In response, Sexton said she found out who the current owner of the property is, then passed that information on to a regional DNRC water office. A notice will be sent to the new owner, explaining options for claiming and updating the water right to go along with the property.

She encourages others in similar situations to do the same.

And there are plenty of others who have questions and complaints about their bills. A special call center that was set up to handle questions has taken more than 1,700 calls since the billing went out Dec. 27. The DNRC's eight regional water offices, including one in Kalispell, have also been fielding calls.

"The actual mailing was done Dec. 27 and the phones started ringing at about noon Dec. 28 and they haven't stopped since then," said Rich Russell, a water resources specialist at the Kalispell regional office. "As far as I know, it is statewide. Everybody is swamped."

Along with answering lots of questions, Russell said he's been "letting people vent" over their bills.

"There are a lot of angry people," he said, and many of them "don't understand why they are being billed. They don't understand what the adjudication of water rights is all about."

Rep. Verdell Jackson, R-Kalispell, has closely tracked the adjudication issue for years. He says problems with the state's water-rights data base is worse in some areas, particularly fast-growing areas like the Flathead where water-rights adjudication never got started.

There has been so much real-estate activity and development in the Flathead, he said, that many water rights are not held by current landowners.

"There are water rights for old agricultural properties that are now parking lots," he said.

"The data base is terrible," he said. "I've looked at it, and it is in terrible shape."

Jackson said that he, too, is getting lots of calls and questions from constituents on the recent billing.

"I'm hearing a lot of profanity on the phone over this," he said. "There's a lot of people who don't understand why they have a bill."

Jackson received a bill charging him $100 for six water rights on his property south of Kalispell, including a water right to a well that has been abandoned.

He said he is advising people who indeed own the properties that are being billed for water rights to pay their fees, and then pursue any objections through an appeal process that is available.

So how can the situation be a good thing in the long run, as Sexton sees it?

Simply put, it's something that must be endured in order to get water rights aligned with property ownerships, she said. And the fees are raising the issue, raising awareness among landowners who need to be cognizant of their water rights.

The fee is "appropriate," she said, because water-rights owners "gain the advantage of having their water right clarified and obviously we get our records cleared up as to who the owners are presently of these rights."

Rep. Jackson, however, believes that the state should have paid for the process with general-fund money, particularly at a time when economic growth is fueling budget surpluses. During last month's special legislative session, House Republicans proposed a bill that would have provided the funding for adjudication, but Democrats did not allow the bill to be considered, Jackson said.

Gov. Brian Schweitzer, incidentally, opposed adjudication fees during his election campaign, but ended up supporting HB 22 as the solution for adjudication.

The DNRC hired 37 people this year to pursue the state's "expedited adjudication process" with some start-up funding provided by the Legislature. But fee collections are projected to raise about $6.28 million per biennium to pay for the program over the next 10 years.

Temporary employees have been hired to help sort through the 23,000 bills that have been returned because of changed addresses.

"We're going to have to take these bills back to our regional water offices and try to figure out who owns these water rights," Sexton said.

Jackson agrees that the state must aggressively pursue adjudication.

"Adjudication of water rights is necessary to protect our water rights and settle conflicts between individual Montanans and more importantly, defend our use of water against other states," he wrote in a recent opinion piece.

He cites DNRC testimony from last year's legislative session: "Water rights are private property rights, which require legal definition. Legally defined water rights form the basis for all administration and enforcement."

Reporter Jim Mann may be reached at 758-4407 or by e-mail at jmann@dailyinterlake.com