Landmark victory for our water and communities

As you’ve likely read, in mid-February the Montana First Judicial District Court ruled in favor of Upper Missouri Waterkeeper, local citizens, and water in our complaint against Broadwater County and the Department of Natural Resources and Conservation (DNRC) for their unlawful approval of the 4-phase, major trophy ranch subdivision, Horse Creek Hills (HCH). 

(This lengthy yet scathing order is worth a read!)

If you need a refresher on HCH, check out our past blog posts:

Here’s what you need to know and why this victory is a huge win for our waterways:

Background: The Horse Creek Hills (HCH) subdivision was proposed as a 4-phase, 435 acre development sited on the eastern shore of Canyon Ferry Lake. The subdivision proposed 39 residential lots and 2 commercial lots among the neighboring agricultural land and keynote wildlife habitat.

The Issues: On top of the numerous issues with the subdivision itself (water quality and quantity impacts, public safety and road concerns, impacts to wildlife, to name a few), the process by which the County approved the subdivision and DNRC rubber-stamped exempt water wells were was unlawful and violated the Montana Water Use Act. 

  • “Exempt wells” are groundwater wells exempt from review and limited to a volume of 10 acre-feet per year. Developers have exploited this loophole to skirt the water rights process, especially in closed basins where all water rights are allocated. In this situation, the HCH developers divided the subdivision into 4 phases so as to receive an exempt well for each of the phases, despite being a single project, and DNRC signed off on it. Read more about the misused exempt well scheme in this opinion piece.
  • The Environmental Assessment (EA) for the sprawling subdivision was, as the judge put it, “abjectly deficient.” The EA failed to consider the impacts of the subdivision on water rights holders, water quantity and quality, wildlife, agriculture, and public safety, yet the County approved it nonetheless.

The Lawsuit: Because Broadwater County ignored both the law and the overwhelming public opposition to the subdivision and authorized the preliminary plat for HCH, local citizens, landowners, senior water rights holders, and Waterkeeper were left with no choice but to file suit against the County and DNRC in August 2022. On February 9th, there was a court hearing and the order was released less than a week later.

The Order: In a scathing 85-page order, Judge McMahon ruled in favor of Waterkeeper et al., shutting down the Horse Creek Hills subdivision as previously proposed and approved.

Three critical take-aways from the lengthy order include:

  1. County governments across Montana cannot shirk its duty to assess both the physical and legal availability of water for new subdivision proposals.
  2. County consideration of preliminary plat applications for new subdivisions must include detailed analysis of both on-site and off-site impacts to agriculture, water quantity and quality, wildlife, wildlife habitat, and public health and safety.
  3. DNRC cannot lawfully allow new subdivisions to use more than one exempt well of 10 ac/ft/yr. This maximum limit includes all phases of a subdivision and lots larger than 20 acres. 

If you don’t have time to read the full 85-page order, here are some highlights:

  • The economic impetus to develop land is overwhelming and relentless. If there is going to be any check on uncontrolled development of Montana’s limited water resources it will have to come from DNRC which is statutorily charged with fulfilling Montanans’ constitutional right to ‘control, and regulation of water rights,’ … a duty DNRC has manifestly avoided or undermined for over a decade to the detriment of our waters, environment, and senior water rights holders whose protection is the ‘core purpose’ of the Water Rights Act.”
  • “DNRC blatantly ignores a recent Supreme Court holding, which the letter demonstrates that DNRC understands, to conclude that each of the four phases of one larger project are entitled to exempt wells. This is contrary to the administrative rule, statute, the rulings of this and the Montana Supreme Court, and perhaps most troubling, DNRC’s own restatement of law in the letters. It should give DNRC pause that citizens with seemingly no legal training appear to have a better grasp of the exempt well limits than DNRC, the agency charged with administering the Water Use Act.”
  • “DNRC gives the distinct impression of a misbehaving child who knows how to say the right words to end the chastisement and yet immediate(ly) returns to the proscribed behavior once out of view.”
  • “With DNRC going out of its way for decades to conclude that such wells are virtually never combined appropriations, each well is entitled to appropriate 10-acre feet per year, totaling 1.2-to-1.9-million-acre feet, or 417-622 billion gallons of water each and every year. Each additional year adding 3,000 exempt wells entitles their owners to an additional 9 billion gallons of water each year. At this rate, in less than 50 years exempt wells will be entitled to draw a trillion gallons of water each and every year.”
  • “Montana has at least 128,000 and perhaps as many as 191,000 exempt wells by 2020, before the influx of new residents during the early COVID years. At this rate, in less than 50 years exempt wells will be entitled to draw trillions gallons of water each and every year. While each exempt well might appropriate only a de minimis quantity of water [,] they are starting to add up.”

Statewide Implications of the Ruling: As one local Broadwater County resident put it, this “court order is not only a victory for rural residents on the eastern shore of Canyon Ferry, but it is also a victory for citizens across the state confronted by rampant sprawl development proposals exploiting our water resources. Montana citizens now have a clear roadmap for holding their local decision-makers and state agencies accountable, ensure they consider public and community comments, proactively identify negative impacts related to new sprawl development, and deny new subdivisions that do not have adequate water supplies.”

In short, this ruling exposed the county governments’ responsibility to do their research and mitigate any concerns before approving new development, and likewise, this ruling closed the exempt well loophole that DNRC and developers have been inappropriately using for too long. We have a system of rules in place for a reason, and both counties and state agencies must legally abide by them.

What does this mean for the future of the HCH subdivision? As of today, the HCH subdivision is dead in the water. The developers could start the process at the top again and resubmit the preliminary plat for County approval, but as the court order explains, “the environmental assessment ‘must include’ ‘available ground water information,’ impacts on ‘agriculture, agricultural water user facilities,’ and a community impact report containing on anticipated water needs of the subdivision. … if the information is lacking, the application is incomplete, and the proposal cannot be legally approved.” Likewise, the order makes crystal clear that “There is no basis in law for DNRC to treat the four phases of 71 Ranch’s subdivision project separately, a conclusion which is absolutely clear from statute, administrative rule, Montana Supreme Court precedent, and even DNRC’s letters in this matter. Any and all phases of this project are one single combined appropriation.” If 71 Ranch reapplied for an exempt well from DNRC, the department must treat the subdivision as a single project and thus a single combined appropriation.

How does this ruling impact affordable housing? It doesn’t. Sprawling McMansion ranchettes for wealthy out-of-staters in our river valleys are not solving the affordable housing crisis in Montana. Don’t be fooled by this untruthful talking point. The HCH subdivision was nothing more than rampant sprawl development and water exploitation for the wealthy, as with many of the proposed subdivisions in high-growth counties.