Court Opinion

ID: 5177746
Source: CourtListenerOpinion
Date Created: 2022-01-06 01:13:33.65224+00
Date Added: 2024-06-11T08:26:25.426058
License: Public Domain

JUSTICE HOBBS,
concurring in part and dissenting in part.
I.
T 27 The majority holds that the 1999 Stipulation between Cherokee Metropolitan District ("Cherokee") and the Upper Black *416Squirrel Creek Ground Water Management District ("UBS") prevents Cherokee from claiming reuse or successive use rights to wastewater Cherokee returns to the Upper Black Squirrel Creek Designated Ground Water Basin ("UBS Basin") from subdivisions it serves within the purview of paragraph 5 of the Stipulation, which provides:
RECHARGE: Cherokee will use it's [sic] best efforts to deliver wastewater returns from Sunset, Paintbrush, and Woodman Hills subdivisions, Falcon Air Force Base and any other subdivisions it services back into the Upper Black Squirrel Creek Designated Basin for recharge of the aquifer. Cherokee shall recharge any wastewater returns from the Sunset Plant into the aquifer.
128 Like the water court, the majority holds that the stipulation at issue in this case "bars Cherokee from reusing the exported water, regardless of any right to reuse foreign water that it might otherwise have had." Maj. op. 117. This includes Cherokee's agreement to surrender whatever reuse and successive use rights that Cherokee might otherwise assert in connection with such wastewater. In this regard, the majority recites with approval the water court's ruling that "paragraph 5 clearly requires the return by Cherokee of certain recycled wastewater to the basin, rather than putting it to successive uses or permitting its return to the stream in the receiving basin." Id. at 17. The majority holds that the stipulation "requires Cherokee to make its best efforts to recapture the specified wastewater returns and upon recapture to deliver them back into the Upper Black Squirrel Creek Basin for recharge of the aquifer." Id. at 117. As the majority states, "[the stipulation clearly mandates that Cherokee forego its right to reuse the exported water or even to permit the wastewater to return to the natural streams of the basin of service." Id. at 1 18.
129 Thus, the majority construes Cherokee's recharge/replenishment obligation as "relinquishing dominion over return flows by delivering them back to the basin for recharge of the aquifer, in lieu of making sue-cessive uses of them." Id. at 116. In so ruling, the majority refers to Cherokee and Meridian's intent to make a "new appropriation" and a "further appropriation" of UBS Basin water. Id. at 1% 15, 17, 20.
180 The majority recognizes the jurisdiction of the Ground Water Commission to determine, under the terms of the Ground Water Management Act and the rules of the Commission, whether to grant or deny Cherokee and Meridian's application for "new and additional appropriative rights" in the UBS Basin. Id. at T11. The majority opinion preserves this essential Commission role and responsibility to protect other designated ground water use rights against material injury in regard to additional appropriations of UBS Basin water such as Cherokee and Meridian propose to make,. The water court ruled, and the majority agrees, that
"an applicant (for replacement plan approval) is required to replace the amount of designated ground water withdrawn with other water in such a 'way that no material injury occurs to other water rights." It may be that the Ground Water Commission will yet determine that the Cherokee/Meridian replacement plan would not meet that burden.
Order Re: Upper Black Squirrel Ground Water Management District's Amended Motion for Declaratory Relief (Water Division 5, State of Colorado, June 17, 2013) (quoting Cherokee III, 266 P.3d 401, 403 n.1 (Colo.2011)).
131 I agree with the majority in each of these holdings and rulings. However, I disagree with the majority's statement that "nothing in paragraph 5's requirement for Cherokee to deliver wastewater back into the basin for recharge of the aquifer implies that it either must or must not be entitled to credit in a subsequent application to the Ground Water Commission for further appropriation." Maj. op. 1 20.
IL
132 Cherokee's proposed replacement plan provides that for every acre foot of wastewater returned to the UBS Basin from Cherokee's new wastewater treatment plant, Cherokee will claim an equivalent volume of fully consumable replacement credit to offset *417new appropriations. Specifically, the replacement plan seeks to appropriate up to 3,086 acre feet per year of new diversions from the UBS aquifer through a combination of existing wells and six new proposed alluvial wells. By seeking replacement credit for the water it is already obligated to return to the UBS Basin, in order to then pump an equivalent amount out, Cherokee would be depriving UBS of its bargained-for recharge benefit negotiated in the 1999 Stipulation.
133 Undoubtedly, in reviewing Cherokee and Meridian's application, the Ground Water Commission will adhere to the court's construction of the Stipulation barring Cherokee from reusing or making a successive use of wastewater it has an obligation to recharge to the UBS Basin, regardless of any right of reuse or successive use it might otherwise have had. Nevertheless, I disagree with the majority's conclusion that "[wlhether or not Cherokee may yet derive some benefit from stipulating away [this] right ... is simply beyond the seope of the stipulation." See id. at 117. The jurisdiction to interpret the 1999 Stipulation is squarely before us. See Cherokee I, 148 P.3d 142, 144 (Colo.2006) (explaining that, although the water involved is designated ground water, the water judge retains jurisdiction over this case pursuant to our decision in Sweetwater Development Corp. v. Schubert Ranches, Inc., 188 Colo. 379, 535 P.2d 215, 218-19 (Colo.1975)); Cherokee II, 247 P.3d 567, 570 (Colo.2011) (same).
T 34 Under the 1999 Stipulation, Cherokee derived an important benefit from contracting away any right of reuse or successive use it might otherwise have had. The agreement allowed Cherokee to export UBS water out of that designated basin for a first and only use, subject to returning the treated waste-water to the basin, instead of being barred from exporting any designated ground water. UBS's Rules and Regulations contain a provision prohibiting exports unless permission is obtained from the district's board upon a showing that such use will not materially affect any vested rights to the use of designated ground water within the basin. Cherokee I, 148 P.B3d at 148 n.5; Upper Black Squirrel Creek Ground Water Management District Rules and Regulations and Statement of Policy, As Amended Through February 3, 2009, http://water.state.co.us/ DWRIPub/Documents/UBSCRules.pdf (last visited June 17, 2015). Therefore, UBS had the authority to completely deny Cherokee's export request, but it allowed the export, subject to certain conditions, including paragraph 5's recharge requirement.
1385 As we explained in a previous case interpreting this same stipulation, UBS and Cherokee "overcame polar opposite positions" in reaching this agreement. Cherokee I, 148 P.3d at 151. UBS had opposed Cherokee's request to export its conditional water rights for use outside of the UBS Basin, and the 1999 Stipulation represented a compromise on the part of both parties to allow Cherokee to export certain water while balancing UBS's statutory mandate to conserve its ground water resources. Paragraph 5 of the 1999 Stipulation mitigates the effects of the export that UBS had otherwise opposed.
136 We must adopt a construction of the stipulated agreement that will give effect to all of its provisions. Union Rural Elec. Ass'n v. Pub. Utils Comm'n, 661 P.2d 247, 252 (Colo.1983). When interpreting a contract, the court must seek "to harmonize and to give effect to all provisions so that none will be rendered meaningless." Pepcol Mfg. Co. v. Denver Union Corp., 687 P.2d 1310, 1313 (Colo.1984). If Cherokee had the right to claim replacement eredit, the stipulation's recharge obligation would be an unnecessary and meaningless intermediary step for which UBS had no incentive to bargain. Rather, paragraph 5 was a bargained-for exchange: Cherokee agreed to return certain wastewa-ter to the UBS Basin for recharge of the aquifer in order to secure UBS's consent to its pending diligence application. Recharging the basin with return flows was critical to UBS's approval of Cherokee's water export.1 *418Any claim to use those return flows for replacement purposes conflicts with the plain language stating that the purpose is recharge of the aquifer. As the majority points out, the purpose of recharge is to avoid or miti- . gate mining of the aquifer, such as is occurring in the UBS Basin.2 Maj. op. 17.
Conclusion
137 I agree with the majority that the Ground Water Commission must consider Cherokee and Meridian's pending application as proposing "new," "further," and "additional" appropriations subject to the Ground Water Act and the Commission's rules. I agree with the majority that if there is available, unappropriated water in the UBS Basin, the Commission may decide to issue the parties a permit. However, to the extent that the application will cause material injury to other water users, the Commission is free to deny or condition the permit upon adequate replacement water being available. The waste-water Cherokee was already obligated to return to the UBS Basin does not constitute available replacement water because it is dedicated to recharge/replenishment, under the terms of the 1999 Stipulation. I agree that the 1999 Stipulation does not preclude Meridian, who was not a party to that agreement, from claiming replacement credit for returns of its wastewater from developed, non-tributary ground water treated at Cherokee's wastewater treatment plant, in accordance with the terms of their intergovernmental agreement. See id. at TL. The issue of Meridian's claimed credit is for the Commission to determine in the exercise of its jurisdiction over applications to divert and use UBS Basin water.
IIL
138 Accordingly, I respectfully concur in part and dissent in part. ~
I am authorized to state that CHIEF JUSTICE RICE joins in this concurrence in part and dissent in part.

. Correspondence between UBS and Cherokee during negotiations for the 1999 Stipulation provides evidence that UBS's agreement to allow export of the conditional water rights was coupled with Cherokee's obligation to return the wastewater for recharge. For example, a September 18, 1998 letter from UBS counsel to Cherokee counsel states that "the return flow[] *418must be recharged back into the basin or left in the basin and not diverted." Cherokee's use of the term "recharge" in its negotiations shows that it was aware of the significance that UBS attached to the recharge requirement and, moreover, that it consented to delivering its return flows for recharge. Specifically, Cherokee's counsel acknowledged Cherokee's intent "to return effluent to the basin," an arrangement that would "greatly benefit" the basin and comply with UBS's statutory duty to "recharge the ground water reservoir." Aff, of Peter M. Su-semihl, 116, No. I8CV2331 (July 23, 1998).

. The Ground Water Commission has declared the UBS Basin's alluvial aquifer to be overap-propriated. See 2 C.C.R. 410-1, Rule 5.2.6.2 (2010). This means that the Commission may permit new wells to tap this resource only when it approves a replacement plan that protects the other permitted appropriators against unreasonable injury. See §§ 37-90-103(12.7), -107.5, C.R.S. (2014).