I don't think this characterization by Adam Schwitters at Burnt Orange Report of the Texas Supreme Court's decision in Edwards Aquifer Authority v. Day is right. In particular, I don't think the opinion means that "aquifers and other groundwater features are not treated as a public resource" or that "our limited stocks of groundwater . . . are now subject to the whims of landowners who happen to own property over these features."
Here's my bird's eye view of the opinion:
The Edwards Aquifer was being depleted through overuse, so in 1993 the Texas Legislature created the Edwards Aquifer Authority to manage the aquifer. The Edwards Aquifer Authority Act requires everyone to get a permit from the EAA to pump water from the aquifer (with limited exceptions). The EAA cannot, by law, permit more than 542,000 of acre-feet of water to be pumped from the aquifer per year.
The issue in Day was, How should the EAA divvy up the permits? There are an infinite ways to do this, but the EAA Act settled on about the dumbest system possible: it assigns water rights based solely on prior use. Hence, a landowner who drew a lot of water in the past gets more water going forward than a landowner who drew just a little water in the past.
That might sound fair at first blush -- if we're going to ration water, we don't want to cause unnecessary hardship by cutting people off from their supply of water -- but historical use does not require that the use be a current use; the use might have been abandoned a decade ago. What's more, these permits are transferable, which means that what the EAA is really handing out is the right to a future stream of income.
So imagine two adjacent 100-acre tracts. One tract has always been used for cattle ranching and has always drawn a modest amount of water per year. The other tract also has always been used as a cattle ranch except for a five-year period in the mid-1980s when the owner's idiot nephew talked him into trying to grow watermelon and watercress and they pumped 1,000 acre feet per year from the aquifer. The venture failed miserably. But under the EAAA scheme, that five-year span entitles the tract to a huge amount of water in perpetuity while the other tract gets shut out, except for a small amount to water the cattle.
From an equity standpoint, that's a pretty strange system -- the people who were the greediest and most profligate users in the past get the most going forward. And it's an idiotic system from a policy standpoint -- if landowners know in advance that that's the rationing system that will be put in place, they have an incentive to draw as much water as possible to establish high historic usage rights. The common-law rule of capture encourages waste, not conservation, and using it as the basis for a rationing system was . . . unwise.
I do not read Day to hold that the EAA or other groundwater conservation districts cannot cap groundwater withdrawals. On the contrary, the Court said they can. Nor do I read Day to require EAA or groundwater conservation districts to compensate landowners when they restrict groundwater withdrawals. Rather, I think the Court "merely" held that if the state misallocates water rights among landowners -- by, e.g., allocating water based solely on historic use -- then it might owe some landowners compensation for a takings.
I put "merely" in quotes because the opinion has created a lot of uncertainty. What permitting system would not subject the state to takings claims? The Court doesn't say. The Court did not even hold that Day has a valid takings claim -- it remanded that to the trial court to determine based on the notoriously vague regulatory takings standard. Can the EAA permitting system be reformed by the Legislature without subject the state to claims by existing permit holders? Dunno. Will the case generate a lot of takings claims from landowners? Likely, although it's unclear what they'll have to show to perfect a claim.
The EAA permitting system is now a mess. No question about that. One can certainly argue that rectifying the EAA's unwise water permitting system is not worth this mess. On a positive note, though, this will be the last time that water rights are handed out solely on the basis of the principle, "The most to he who used the most."