Large-Scale Water Extraction
(from Maine Townsman, July 2009)
By Leah Rachin, attorney with Bergen & Parkinson in Kennebunk
Groundwater is one of Maine’s most important natural resources. According to the Maine Geological Survey, sand and gravel aquifers occupy about 1,300 square miles of Maine’s landscape. Approximately 40% of Maine’s citizens use private groundwater wells for their household water supply. Another 20% are served by community water suppliers that use groundwater as their primary source. In addition to residential consumption, substantial amounts of groundwater are extracted for crop irrigation, industrial processes, golf courses, and bottling.
As evidenced by recent events in several York County municipalities, large-scale water extraction by commercial water bottlers has become a hot button issue. A proposed 30-year contract between Poland Spring and the Kennebunk, Kennebunkport and Wells Water District that would have allowed Poland Spring to buy up to 432,000 gallons of excess daily capacity drew such public opposition that the water district voted unanimously in May 2009 to permanently remove the contract from consideration.
It is in this context that a number of Maine municipalities have enacted (or are working to enact) ordinances that regulate large-scale water extraction. Such ordinances fall into two categories -- rights-based and regulatory. Rights-based ordinances establish absolute prohibitions on commercial water extraction. Regulatory ordinances, on other hand, permit extraction but only if specified criteria are met.
Water extraction ordinances give rise to a number of important legal issues for municipalities. Municipalities may be vulnerable to constitutional challenges if they enact absolute prohibitions on commercial water extraction because the law extends constitutional protections to corporations as well as to natural persons. In addition, because groundwater extraction is regulated by a number of state statutes, the extent of a municipality’s home rule authority to regulate in this arena must be examined.
Maine courts have not yet had the opportunity to weigh in on the validity of municipal groundwater extraction ordinances. What follows is a discussion of the legal issues that might arise with these ordinances and a projection of how Maine courts might rule if their legality were challenged.
In February and March 2009, identical rights-based ordinances were enacted by referendum in Shapleigh and Newfield. The same ordinance was voted down in Wells in early May 2009.
Drafters of rights-based ordinances are part of a growing social movement premised on the belief that citizens have a fundament right to local self-government (without being preempted by state and federal law). Proponents of the rights-based approach object to the concept of “corporate personhood,” which evolved from a series of U.S. Supreme Court cases that interpret the Constitution as giving corporations many of the same legal rights as natural persons, including freedom of expression, equal protection, and due process rights. Opponents of “corporate personhood” believe that the framers of the Constitution intended to reserve such rights for people only. In the case of rights-based ordinances, proponents believe that corporations have been allowed to exercise constitutional protections to abdicate responsibility for detrimental impacts on society, particularly with respect to the environment.
Below are the most salient features of rights-based ordinances that have been proposed in Maine:
• They declare that “all water is held in the public trust as a common resource.”
• They declare that local self-government is the “inherent, inalienable, and fundamental right.”
• They prohibit any corporation (with limited exceptions) from withdrawing water in the municipality.
• The do not recognize corporations as legal persons (thereby denying them constitutional protections.)
• They grant “natural communities” and “ecosystems” fundamental rights, legal personhood, and legal standing.
• They impose liability, including punitive damages, on any person, corporation, or municipality that harms a natural community or ecosystem.
• They confer legal standing on any town resident who wishes to enforce the ordinance.
• They prohibit federal and state agencies from issuing any license for extraction to any corporation.
• They make violations of the ordinance a criminal offence.
• They allow municipalities to secede if there is state or federal action attempting to preempt then.
The Maine Municipal Association, the Attorney General’s office, and town attorneys were asked at various times to comment on the legality of specific versions of rights-based ordinances. Consensus emerged that such ordinances were unlikely to survive legal challenge given the collective opinion that they violate established constitutional principles and state law.
Rights-Based Ordinances May Violate Constitution
Because the U.S. and Maine constitutions are the supreme law of the land, any local ordinance that conflicts with them is invalid. Moreover, under the Supremacy Clause of the U.S. Constitution, local law (whether state or municipal) cannot supersede or negate federal law.
Several provisions of the rights-based ordinances conflict with established constitutional principles. First, by divesting a corporation of its ability to exercise an available property right (e.g., water extraction), municipalities could be vulnerable to illegal “takings” claims. Second, by stating that no corporation doing business within the Town shall be recognized as a “person” under the Constitution, rights-based ordinances may also be vulnerable to equal protection challenges because they treat corporations differently than natural persons and deny them rights available to other classes of persons. (LD 1028, which would have allowed municipalities to adopt ordinances that deny corporations legal personhood, is now dead.) Third, while rights-based ordinances strip legally recognized entities (corporations) of their “personhood,” they bestow constitutional rights upon “natural communities” and “ecosystems” (which are not recognized at law as “persons.”)
Rights-Based Ordinances May Conflict With Maine Law
Absolute Dominion Rule
The declarations contained in the rights-based ordinances that “all water is held in the public trust as a common resource” and that all residents have “a fundamental and unalienable right to access, use, consume, and preserve water” conflict with the Maine common law rule governing groundwater ownership known as the absolute dominion rule.
Surface waters of ten acres or more and tidal rivers in Maine are owned by the citizens of the state. Groundwater, however, is subject to the absolute dominion rule which holds that groundwater is the property of the owner of the land above it. A landowner has the right to use the groundwater under his land and to interfere with his neighbor’s supply of groundwater with limited liability subject to prohibitions against waste, malicious interference, or negligence. Despite a limited statutory exception which creates liability for withdrawals that interfere with a landowner’s pre-existing beneficial domestic use of groundwater, the absolute dominion rule is alive and well in Maine, at least for the time being.
While most states have rejected the absolute dominion rule in favor of other groundwater use and ownership theories, the Law Court affirmed Maine’s adherence to the absolute dominion rule in 1999. See, Maddox v. Giles, 728 A.2d 150 (Me.1999). In coming to its conclusion, the Law Court was deferential to the Legislature, which chose not to depart from the absolute dominion rule despite recommendations to do so from the Water Resources Management Board. This Board was created by the Legislature to undertake a comprehensive study of water law in Maine. In 1991, the Board recommended that the Legislature adopt the “reasonable use” rule, which prevents landowners from wasting groundwater and from transporting it off their land for use elsewhere. The Legislature did not follow the Board’s recommendation.
The Legislature, however, may soon reconsider whether to abandon the absolute dominion rule in favor of another rule. Scores of bills regarding water were presented during the Legislature’s 124th session. In response, LD 1310, entitled “Resolve, To Establish the Blue Ribbon Commission To Examine the Legal and Policy Implications of Groundwater Extraction” was signed by the governor on June 15, 2009. This resolve establishes another committee to analyze current groundwater law and states that “a reexamination of existing groundwater ownership principles may be in order given the state’s responsibilities for environmental protection and control.” While the Legislature has declined in the past to abandon the absolute dominion rule, its days may be numbered.
Legal Standing and Municipal Prosecutorial Discretion
Rights-based ordinances give any municipal resident standing to compel their enforcement. This is contrary to the concept of prosecutorial discretion which gives municipal officials the right to determine whether or not to proceed with enforcement actions. Additionally, it conflicts with established principles regarding legal standing which require people to have suffered a “particularized injury” (meaning one that is distinct from any injury experienced by the public at large) before they may bring a lawsuit. Maine case law suggests that only municipalities, and not private citizens, have standing to initiate proceedings to enforce municipal ordinances.
The well-established theory of preemption gives supremacy to federal or state laws that either expressly, or by implication, regulate a particular area to the exclusion of local regulation. Rights-based ordinances, however, purport to deny state and federal governments the ability to preempt them. Rights-based ordinances also permit municipalities to secede from the State of Maine or United States if these levels of government attempt to preempt local authority to prohibit extraction.
Tort Claims Immunity
Rights-based ordinances make federal and state officials who issue permits for water extraction liable for damages. For example, if the DEP issued a permit pursuant to its authority under the Natural Resources Protection Act or site location of development law, they could be liable under the rights-based ordinances. Such a result conflicts with Maine tort claims immunity, which protects government officials from liability if they are acting within the scope of their duties.
Town Meeting and Elections Law
Rights-based ordinances prohibit municipal officers from taking any action to amend or overturn them unless such action is approved by town meeting at which two-thirds of the residents attending approve such action. This requirement for approval by a super-majority is inconsistent with state law, which only requires a simple majority for passage. See, 21-A M.R.S. § 743(4); 30-A M.R.S. §2528. (unless a local charter says otherwise).
Rights-based ordinances may conflict with Maine law because they make violation of a municipal ordinance a criminal offence. While municipalities can make violations of their own ordinances a civil offence, they cannot impose criminal liability as this power is reserved to state and federal governments.
In sum, while Maine courts have not had occasion to consider the validity of rights-based ordinances, the general sense among the municipal bar is that they would not likely be upheld given both the constitutional issues they raise and the various ways in which they conflict with state law. The possibility that rights-based ordinances may be invalidated based on existing law, however, is not a disincentive to proponents of such ordinances because part of the underlying goal of such ordinances is to change the law (particularly with respect to absolute dominion, corporate personhood, and traditional notions of preemption). Accordingly, there is a strong likelihood that citizens in municipalities with significant groundwater resources will present such ordinances for consideration.
Another approach municipalities have taken to deal with of water extraction is to enact regulatory ordinances. In so doing, municipalities must determine what land use districts are appropriate for water extraction and establish specific criteria to regulate any such extraction. Regulatory ordinances require a permit before large-scale water extraction can be conducted. Before such permits will be issued, applicants must establish that their extraction activities will not adversely affect the long term sustainability of the aquifer, its recharge areas, or other ground water sources. These ordinances generally require on-going monitoring and documentation.
The regulatory approach has been taken by several Maine municipalities including Fryeburg, Denmark, Newfield, Parsonsfield, Palmyra, and Bridgton. Such ordinances are not as vulnerable to legal challenge as their rights-based counterparts. While Maine courts have yet to address either kind of water extraction ordinance, other kinds of regulatory ordinances in Maine and across the country tend to be upheld as proper exercises of municipalities’ police power if they are reasonably related to the public health, safety, or general welfare. Local ordinances regulating air pollution, junkyards, public sewage use limitations, and septage spreading have all been upheld in Maine.
The experience of Maine and other jurisdictions in the analogous context of mineral extraction is helpful. While cases have been resolved both ways, a common thread can be ascertained. In those cases where the regulations bore a clear and reasonable relationship to the protection of public health, safety, and welfare, they were generally upheld. The cases suggest that a municipality need not include extraction as a permitted use if prohibiting that use is a reasonable exercise of its police powers to prevent damage to the rights of others and to promote the interests of the community as a whole. On the other hand, in cases where there was little competent evidence to support the conclusion that extraction activities would adversely affect public health or safety (or the rights of nearby property owners), prohibitions were held to be unreasonable, arbitrary, and confiscatory.
One of the deciding factors, therefore, in determining whether extraction ordinances will be upheld is the existence of sufficient scientific or other competent evidence to support the need for the challenged regulation. Where there was scant evidence to show that quarrying would disturb underground water supplies (and most evidence was to the contrary), the impugned ordinance was struck down. However, an absolute prohibition on strip mining was upheld when significant evidence was presented to suggest that associated blasting created a substantial risk of harm to the aquifer.
The implication for water extraction in Maine is that ordinances that limit extraction to certain designated zoning districts would be more likely to survive legal challenge than an outright prohibition. Courts tend to examine with particular scrutiny zoning ordinances that entirely ban certain land uses instead of delineating appropriate areas for those uses. Municipalities must bear this in mind because most zoning ordinances state that if a use is not specifically listed as permitted, it is prohibited by default. Accordingly, the potential legal implications of imposing an absolute prohibition on commercial water extraction (whether intentionally or not) must be considered.
Ultimately, regulatory ordinances will likely be upheld as constitutional and a legitimate exercise of a municipality’s home rule authority to regulate for the general health, safety, and welfare of its residents. However, if municipalities enact absolute prohibitions on large-scale extraction (whether by way of “rights-based” ordinances or simply by excluding water extraction as a permitted use), such ordinances are more likely to be successfully challenged.
Home Rule & Local Water Extraction Ordinances
The question of whether local water extraction ordinances are a proper exercise of a municipality’s home rule authority brings into sharp focus the eternal tension between state regulation and local control.
Municipalities have the right to exercise any power or function that is not denied them by the Legislature either expressly or by clear implication. There is no implicit denial of authority unless the municipal ordinance would frustrate the purpose of a state law.
A number of state statutory schemes govern water extraction in Maine. What follows is an analysis of whether any of these statutes are likely to preempt local home rule authority.
Ground Water Protection Program (38 M.R.S. § 401 et seq). This statutory scheme directs the study of groundwater and coordination between the various state agencies that regulate it. It does not, however, establish any specific regulations or permitting criteria. It creates a cause of action when withdrawal “causes interference with the preexisting beneficial domestic use of ground water by another landowner.” This scheme expressly states that it does not limit a municipality’s power to enact ordinances under its home rule authority “to protect and conserve the quality and quantity of ground water.” It is therefore unlikely that it would be found to preempt local regulation.
Groundwater Withdrawal Reporting Program (38 M.R.S. §470-A et seq). This statute creates reporting program which requires that water extraction in excess of certain threshold amounts (between 20,000 and 50,000 gallons) be reported to the state. In addition to the amount of water withdrawn, reports must include information regarding anticipated water use, water source, location of the withdrawal, and volume of the withdrawals that might be reasonably anticipated under maximum high-demand conditions. Such information is very similar to that required by a number of regulatory ordinances enacted by Maine towns. Municipal regulation, however, does not appear to be preempted. Rather, it is expressly permitted (“[t]he department shall encourage and cooperate with…municipal agencies, boards or organizations in the development…[of] local water use policies that protect the environment from excessive drawdown of water sources...”)
Restrictions on Transport of Water (22 M.R.S. § 2660-A). Any person intending to remove 10 or more gallons of water from a municipality must get a state permit to do so and must demonstrate that: (1) the transport of the water will not constitute a threat to public health, safety or welfare; and (2) the water withdrawal will not have an undue adverse effect on waters of the State; water-related natural resources; and existing uses, including, but not limited to, public or private wells, within the anticipated zone of contribution to the withdrawal.
Unlike the Groundwater Protection Program and the Groundwater Withdrawal Reporting Program, there is nothing in the Bulk Transport of Water scheme that expressly addresses municipal home rule authority. Maine courts have held, however, that when there is a comprehensive state statutory scheme that regulates a particular area (e.g. waste management, concealed weapons, and liquor licensing) this impliedly preempts a municipality’s right to do so.
There does not appear to be any language in 22 M.R.S. § 2660-A, either express or implied, that would prohibit regulatory ordinances. A town’s regulation of water extraction does not conflict with the requirement that extractors seek a state permit should they wish to transport water outside of the municipality. A preemption problem may arise, however, if the municipality imposed an absolute prohibition on extraction. Because the state statute specifically provides for granting permits for out of state transport if certain conditions are met, a local absolute prohibition could be determined to be preempted by state law.
Natural Resource Protection Act (38 M.R.S. § 480-A et seq). The Act requires any person establishing a “significant groundwater well” to get a permit from DEP. “Significant groundwater wells” are defined as withdrawals of 75,000 or more gallons during any week (or 50,000 gallons per day) if located within 500 feet or less from water body, or, 216,000 or more gallons per week (or 144,000 per day) if located more than 500 feet from water body. If a proposed activity includes a significant groundwater well, the applicant must demonstrate that the activity will not have “an undue unreasonable effect on waters of the state, including but not limited to, public or private wells.” The Act specifically provides that it should not be interpreted to limit the home rule authority of a municipality to protect the natural resources of the municipality through enactment of standards that are more stringent. The implication of this language is that municipalities can regulate so long as those regulations are at least as stringent as the state’s.
Site Location of Development (38 M.R.S. § 484). Projects that involve 20 or more acres or 3 or more acres of impervious surface must be reviewed by DEP to ensure that it will have “no adverse effect on the natural environment” including water quality. As part of the adverse effect analysis, when reviewing structures that “facilitate withdrawal of groundwater”, the DEP must review the project’s impact on “waters of the state” (which include groundwater). The applicable DEP regulations require an analysis of any potential change in groundwater levels, saltwater intrusion, change in flow, and subsidence.
There is nothing in the Site Location of Development law that either expressly permits or prohibits local regulation of groundwater extraction. Again, the question becomes whether the state’s site law impliedly preempts local regulation. On the one hand, the statutory scheme establishes a relatively in-depth regulatory process, which has lead Maine courts to conclude that local regulation is preempted. On the other hand, there are provisions in the site law seem to imply that local regulation is permitted. For example, it allows municipalities (instead of DEP) to assume responsibility for review if their regulations are sufficient to guarantee thorough review. It also states that nothing in the site law prohibits municipalities from enacting stricter noise regulations that contained in the site law. These provisions imply that municipalities have concurrent jurisdiction to regulate areas that are subject to state site location review as long as those regulations are at least as stringent as the state’s.
Ultimately, the determination of whether a particular state statute will preempt local regulation is a tough call, as evidenced by one of the Law Court’s more recent decisions on municipal home rule. In Smith v. Town of Pittston, 2003 ME 46, 820 A.2d 1200, the Law Court narrowly upheld a municipal ordinance that prohibited spreading of septage in Pittston on a 4-3 basis. While the majority held that the ordinance was a valid exercise of its home rule authority, a strongly worded dissent held that the ordinance was incompatible with the state’s comprehensive regulatory scheme governing the disposal of septage (the Solid Waste Management Act). While both the majority and dissent engaged in the same preemption analysis, they reached opposite conclusions. The Smith case exemplifies how the question of whether a state statute will preempt a local ordinance by “clear implication” is by no means clear.
In conclusion, while there is much uncertainty in this emerging area of law, one thing is sure – the Legislature and Maine courts will be called upon in the months and years ahead to address the issue of groundwater extraction. Fundamental change may well be on the horizon.
©Copyright, Leah B. Rachin, Esq., 6-30-09
Leah Rachin is an attorney with Bergen & Parkinson in Kennebunk. Her practice focuses on land use, employment and municipal law. She serves as town attorney for several Maine communities.