AgdaPkt 2010-02-01 clsd and regular

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7A - ATTACHMENT NO.3 Saltworks Proposal- Water Group Summary Report (22 January 2010) Page 58 Reliability of Nickel Water Parties transacting in Nickel water have consistently identified this water as "pre-1914 water rights water." KCWA, Nickel and OMB have all entered into agreements representing and warranting that the Nickel water is pre-1914 water rights water. In acquiring 2,000 acre-feet in 2009, SCVWO stated that the water is "very reliable." "Pre-1914 water rights" refers to the common law appropriative rights obtained before enactment of the Water Commission Act ("Act"). Before 1914, the right to appropriate water was acquired by actual diversion and use of the water. (United States v. State Water Resources Control Bd. (1986) 182 Cal.App.3d 82, 102 (SWRCB).) After 1914, a party intending to appropriate unappropriated water must file an application with the State Water Resources Control Board (SWRCB) pursuant to procedures codified in the California Water Code. (People v. Murrison (2002) 101 Cal.App.4th 349, 359, fn. 6) After water is put to beneficial use, the permittee may apply for a license confirming its water right. (Ibid.) Pre-1914 rights were grandfathered into the water rights system; they are not, however, subject to the statutory scheme of the Water Code for purposes of acquisition and supervision of use. (Ibid.) Holders of pre-1914 water rights have the right to change the purpose and place of use of the water, without the approval of the SWRCB, so long as any change does not injure other water rights holders in the watercourse. (Water Code, 9 1706.) This is known as the "no injury rule." Pre-1914 water rights are freely transferable, subject to the no injury rule and to the beneficial use requirement applicable to all water rights. (North Kern Water Storage Dist. v. Kern Delta Water Dist. (2007) 147 Cal.App.4th 555, 559.) Priority of all appropriative rights is governed by the first-in-time, first-in-right rule, whereby the senior appropriator is entitled to fulfill its needs before a junior appropriator is entitled to use any water. (SWRCB, supra, Cal.App.3d at pp. 101-102.) Priority among appropriators becomes most important during times of drought as "the most junior rights-holder must reduce use even to the point of discontinuance before the next senior appropriative rights-holder must cut back at aiL" (Id. at p. 131, fn. 25.) As between statutory appropriators and pre-1914 rig hts holders, statutory appropriators have priority if notice at the place of diversion was posted and recorded with the county recorder before the pre-1914 holder actually diverted the water and put it to beneficial use. However, the pre-1914 water right holder is senior to the statutory appropriator if water was diverted and put to beneficial use before the statutory appropriator had posted and recorded the required notice. (Haight v. Costanich (1920) 184 Cal. 426, 431.) For appropriations since 1914, an appropriator's priority is generally fixed by the date of his or her application to appropriate the water. (EI Dorado Irrigation Dist. v. State Water Resources Control Bd. (2006) 142 Cal.App.4th 937,962.) Because the Nickel water is a pre-1914 water right, the Nickel water would have priority over certain statutory appropriators depending on whether such water right was perfected before the statutory appropriator posted and recorded the required notice. With respect to the priority of Nickel water relative to SWP water, Nickel water would have priority over SWP water rights. As noted above, priority of appropriative rights is determined by the first-in-time, first-in-right rule. According to OWR, the California 51