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Front Range Feedlots, LLC et al v. Rein et al., Rein et al. v. Front Range Feedlots, LLC
In related cases, the Colorado Supreme Court considered multiple elements related to orders issued by the state engineer and District Court for Water Division 1.
According to court records, Front Range Feedlots, LLC and another entity own and operate beef cattle feedlots known as Wellington Feedyard. For years, water was supplied to the lots from Horton Well 1 and 2 which was decreed for irrigation with appropriation dates in 1946.
In 2016, the Colorado Division of Water Resources got a complaint alleging Front Range was using the wells for its cattle feeding operation and not irrigation. Front Range representatives confirmed at the time Front Range had been using the wells for the feeding operation for at least 30 years.
In 2016, the division’s engineer issued a show cause order requiring Front Range to either permanently disconnect the discharge pipe from the wells and cease and desist non-decreed and non-permitted uses or show evidence the wells have a valid water right and or/ well permit and augmentation plan or a substitute water supply plan to be used in the feeding operation.
Front Range applied for an emergency SWSP and the state engineer granted the application for a term ending in March 2017. From there, Front Range filed in water court, an application for underground water rights and approval of an augmentation plan, along with an application to extend the approved emergency SWSP through Dec. 31, 2017, or until Feb. 28, 2018, if further extended.
Front Range acknowledged in the water court application, diversions from the wells caused depletions to Boxelder Creek, but stated to the extent such depletions were out-of-priority, Front Range’s proposed augmentation plan would replace them to prevent injury to vested water rights.
During the next few years and while its water court application was pending, Front Range requested other SWSPs which the state engineer granted. As a condition of Front Range’s ongoing out-of-priority depletions, the state engineer required Front Range to replace those depletions in time, location and amount to prevent injury to senior water rights and replace its delayed depletions until they no longer impacted the surface stream.
Front Range didn’t challenge those conditions by seeking judicial review in the pending water court case. Instead, under the terms of the SWSP, Front Range used the wells causing out-of-priority depletions, according to court records.
The state engineer approved the final SWSP in February 2020. It contained many conditions that are at issue in the appeal including the 2020 SWSP provided depletions will be replaced at 100% of estimated pumping (steady state). It also noted Front Range had proposed to use water owned or leased by Front Range from any other source legally available for augmentation which can be provided in the amount, at the time and location required to replace out-of-priority depletions from the wells.
The 2020 SWSP also stated the additional sources of replacement water in the plan could be used only if Front Range complied with Water Division 1 protocol regarding the use of replacement source not identified in the SWSP or augmentation plan. The 2020 SWSP also required Front Range to provide replacement water to cover all out-of-priority depletions and to curtail pumping if the depletions impacted a senior water right.
Ten months after the 2020 SWSP was approved by the state engineer, Front Range filed a motion to withdraw its pending water court application for underground water rights and for approval of an augmentation plan. In the motion, Front Range said as of June 29, 2020, it stopped using the wells under the 2020 SWSP and began relying on a new local water supply for the feedlots that doesn’t involve the use of groundwater wells or a plan for augmentation.
The engineers (the state engineer and division engineer for Water Division 1) opposed Front Range’s motion to withdraw its water court application.
The water court granted Front Range’s motion in March 2021, finding in part the engineers hadn’t asserted any prejudice to their legal interests if Front Range was permitted to withdraw its application, but rather relied on presumed injury to other water users if Front Range weren’t required to replace its past out-of-priority depletions.
As part of Front Range’s withdrawal of its application, the water court ordered the wells shouldn’t operate unless they are part of a court-ordered augmentation plan or as part of a lawfully approved SWSP.
The state engineer appealed that order in case no. 21SA138 which is before the Colorado Supreme Court.
In May 2021, the state engineer issued an order to comply with the 2020 SWSP and according to the engineer, Front Rage was in violation of it by not providing replacement water to prevent injury. The state engineer found since December 2020, Front Range hadn’t provided daily accounting needed by the 2020 SWSP.
The engineer assumed replacement water hadn’t been provided during that period, causing injury to senior water rights. The state engineer said past pumping of the wells for commercial livestock watering uses would continue to deplete the South Platte River stream system for years.
The state engineer ordered Front Range to provide replacement water to the stream system to cover out-of-priority depletions in time, place and amount from replacement sources under the 2020 approval. The state engineer also ordered Front Range to provide plans for near-term replacement which would show how Front Rage would provide replacement of depletions through December 2023 or longer, using sources in the 2020 approval.
The state engineer also curtailed the use of the wells and ordered they not operate unless they were included in the court-approved augmentation plan or as part of the approved SWSP.
Front Range didn’t comply with the foregoing terms, instead it filed a complaint in the water court for judicial review, arguing the order to comply wasn’t valid because the state engineer didn’t have the authority to issue it.
The state engineer responded asking the water court to uphold the order to comply as a lawful order and filed a counterclaim seeking a mandatory injunction requiring Front Range to take the actions required by the order to comply and recovery of the engineers’ attorney fees and costs incurred in prosecuting their counterclaim.
The water court granted judgment in favor of the engineers, affirming the state engineer’s order to comply as a lawful order. The court found because Front Range didn’t challenge the conditions it now argues are unlawful and proceeded to make out-of-priority depletions under the terms of a SWSP, which resulted in the injury to senior water rights from delayed depletions impacting the surface stream, the state engineer had the right to enforce the replacement requirements imposed by the SWSP.
The water court ordered Front Range to comply with the replacement water conditions in the order to comply and directed the engineers to file a proposed form of injunction, which they did and the court signed. The injunction required Front Range to abide by the terms of the order to comply and the 2020 SWSP by taking actions that are relevant in the current appeal.
First, to the extent that depletions shown on the depletion schedule attached to the order to comply that accrued to the stream in May of 2022 and thereafter were out-of-priority, Front Range was required to provide replacement water to the stream system to replace the depletions in time, place and amount.
Second, to the extent the depletions required to be replaced couldn’t be replaced in the time, location and amount using the replacement sources specified in the 2020 SWSP, Front Range was also required to get the right to use additional replacement sources capable of replacing the depletions in time, place and amount. The water court also ordered Front Range to pay the engineers’ attorney fees and costs of prosecuting their counterclaim for injunctive relief.
Front Range appealed the water court’s orders and was before the Colorado Supreme Court in case no. 22SA211.
The Colorado Supreme Court concluded under the plain language of the statutes, the state engineer had the right to issue the order to comply; the state engineer had the authority to enforce the terms of the 2020 SWSP after the expiration of that SWSP and Front Range’s withdrawal of its water court application; the state engineer had properly attached the 2020 SWSP terms to Front Range rather than to the water rights at issue; the state engineer had the jurisdiction to require the replacement of depletions for pre-application pumping; and the water court properly exercised its discretion ordering Front Range to acquire more replacement sources.
The state high court also concluded the engineers are entitled to recover attorney fees and costs including those incurred in appeal under case no. 22SA211. The Colorado Supreme Court also found in its determinations, the engineers’ appeal in case no. 21SA138 is moot.
The high court en banc unanimously affirmed the water court’s judgment in case no. 22SA211, remanded the case to water court to determine attorney fees and costs and dismissed the engineers’ appeal in case no. 21SA138.