BILL REQ. #:  S-0511.1 

Read first time 01/23/13.   Referred to Committee on Agriculture, Water & Rural Economic Development.

     AN ACT Relating to retaining water resources to assure the vitality of local economies; adding new sections to chapter 90.42 RCW; and creating a new section.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:

NEW SECTION.  Sec. 1   The legislature finds that purchase of lands by state agencies for less intensive economic uses may affect the economic vitality of local communities by reducing essential water resources necessary to retain economic activity of the area. The legislature finds that a number of parcels of land purchased by state agencies have water rights appurtenant to them. The legislature continues to support agency efforts to allow continued use of portions of land parcels that contribute to the local economy by actions such as leasing back irrigated parcels to local producers for continued production of food and other agricultural commodities. The legislature finds that the economies in many rural areas of the state have declined and are in need of retaining water resources to prevent further decline.
     The purpose of this act is to establish a process to retain water rights when they are no longer used on state purchased lands and to make this resource available for alternate uses to continue to support the local economy, jobs, and the tax base rather than be permanently lost to the economy of the area through relinquishment under chapter 90.14 RCW.

NEW SECTION.  Sec. 2   A new section is added to chapter 90.42 RCW to read as follows:
     (1) The department of fish and wildlife, the parks and recreation commission, and the department of natural resources shall each maintain an inventory of water rights appurtenant to lands purchased by their agencies. At least once each year, each agency shall review and record whether all or a portion of the water right for each of these lands purchased by the agency has been used. If the agency does not plan on continuing use of all or a portion of the water right on the state-owned lands, or if all or a portion of a particular water right has been unused during the prior four-consecutive-year period, the agency shall commence the process of transferring the unused portion of the water right to the local economy water trust account established in this chapter. Before the end of the fifth year of nonuse of all or a portion of the water rights, the transfer must be completed and the water right shall be temporarily held by the department of ecology until the water right is transferred to another beneficial use as provided in subsection (3) of this section.
     (2) If an agency has commenced the process of transferring all or a portion of a water right as required under subsection (1) of this section, but subsequently placed the water right to beneficial use on the state-owned land before the end of the fifth year, and plans to continue to fully use the water right in subsequent years, the agency shall notify the department of ecology to terminate the transfer of the water right to the local economy water trust account.
     (3) Water rights temporarily held by the department of ecology under this section shall be available for transfer to a new use or uses within the same WRIA as the original use. Once a water right is transferred to the local economy water trust account, the department must provide notification that a water right may be available to the person who filed an application for a new water right under chapter 90.03 or 90.44 RCW as appropriate, based on whose water right appropriation is next in line for processing within the WRIA.
     (4)(a) A request to transfer the water right may be processed if:
     (i) The applicant responds to the department within thirty calendar days; and
     (ii) The applicant agrees to pay the costs associated with completing the transfer from the local economy water trust account to the applicant's new use.
     (b) If the thirty-day period elapses and an affirmative written response is not received from the applicant by the department, the department shall provide the notice to the next applicant in line in accordance with subsection (3) of this section.
     (5) If a person does not indicate an interest in obtaining a water right from the local economy water trust account, it does not affect the standing of the original water right application.
     (6) This section does not apply to properties with deed restrictions in conflict with this section or where application of this section would otherwise violate law.
     (7) The provisions of this section and section 3 of this act apply to all WRIAs in the state.
     (8) As used in this section and section 3 of this act, "WRIA" means a water resource inventory area established in chapter 173-500 WAC.

NEW SECTION.  Sec. 3   A new section is added to chapter 90.42 RCW to read as follows:
     (1) Upon the transfer of a water right under section 2(1) of this act, the department shall establish a local economy trust water account for the WRIA in which the water right had been used. The department shall place and hold the water right in the account pending completion of a transfer to another beneficial use as provided in this section and section 2 of this act.
     (2) The department may transfer all or a portion of a water right held in the local economy trust water account to a new water use identified through the process in section 2 of this act upon occurrence of all of the following:
     (a) The department receives a request from a qualified applicant identified pursuant to section 2 of this act for transfer of a water right or portion thereof; and
     (b) The request is reviewed and approved under RCW 90.03.380 or 90.44.100, as applicable, for the new beneficial use or uses. The department may not authorize the use of a water right if it causes detriment or injury to existing rights.
     (3) The priority date of the water right or portion thereof transferred by the department from the local economy trust water account shall be the priority date of the underlying water right that had been transferred into the local economy trust water account.
     (4) The department shall issue documentation for that water right or portion thereof to the new water right holder based on the requirements applicable to the transfer of other water rights from the trust water program. Documentation must include a description of the property to which the water right will be appurtenant after the water right or portion thereof is transferred from local economy trust water account to the new water right holder.
     (5) The department's decision on the transfer of a water right or portion thereof from the local economy trust water account may be appealed to the pollution control hearings board under RCW 43.21B.230 or to a superior court conducting a general adjudication under RCW 90.03.210.
     (6) Notice of application for transfer of a water right under this section must be published by the applicant as provided under RCW 90.03.380. The department must provide electronic notice and opportunity to comment to affected local governments and affected federally recognized tribal governments before initiating use of the local economy trust water account for the first time in a WRIA.
     (7) RCW 90.14.140 through 90.14.230 have no applicability to:
     (a) Water rights in a local economy trust water account while being held by the department; and
     (b) A construction period granted in the approved water right transfer document for the new water right holder to place the water to beneficial use.