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State Supreme Court Rejects Federal Reserved Water Right Claims as Sought for State Trust Lands

The Arizona Supreme Court last month rejected the State Land Department’s long-standing claim to a federal reserved water right as applied to over 9 million acres of State Trust Lands granted under the New Mexico/Arizona Enabling Act (1910). The Department had claimed Congress, in passing the Enabling Act, intended to reserve for the “federal purpose” of supporting common schools, water necessary to augment the value of the Trust Lands. In rejecting the claim, the Court evaluated the law applicable to federal reserved rights, concluding it required a withdrawal of the land from the public domain and reservation for federal purposes. Moreover, the Court explained such legislation should be construed narrowly due to the potentially disruptive effect of federal reserved rights on established water rights in prior appropriation jurisdictions. The Court found, with regard to the Trust Lands, that no such reservation or withdrawal had occurred by virtue of the Enabling Act, and no federal purpose was associated with the Trust Lands. Although support of common schools and institutions serves the public interest, the Court noted, it is not a “federal purpose.” The Court further concluded, that even had a withdrawal and reservation occurred, it could find no congressional intent to reserve water to serve a federal purpose.

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