Water Reuse: It's Different for Groundwater

As municipalities have increasingly looked to their effluent as an additional water resource, the Texas Commission on Environmental Quality and the Texas Legislature have endeavored to specify and interpret state law related to reuse - the use of surface water which has already been beneficially used once under a water right, or the use of groundwater which has been used before.

At a February 25 work session, TCEQ staff posed six questions to the Commissioners regarding water reuse issues, including whether the authorization to take return flows under section 11.042(b) or ( c ) of the Water Code is a new appropriation and whether the reuse appropriation carries a priority date. Several members of the public provided their own views on these questions, and the Commission then agreed to consider final answers to the questions at the end of the current legislative session.

The staff report also noted that there are two types of water reuse - direct, when effluent from a wastewater treatment plant is piped directly to a place where it is used, and indirect, which is the reuse of water (usually effluent) placed back into a river or stream. Indirect reuse typically occurs when a wastewater treatment plant discharges effluent into a stream and either the discharger or another entity diverts the effluent further downstream for reuse. A bed and banks authorization under section 11.042 of the Water Code is required for the use of a watercourse to transport water for reuse.

Today's problems, staff explained, stem from enactment in 1997 of Senate Bill 1, which amended sections 11.042 and 11.046 of the Water Code. While these amendments resolved some issues, new issues have developed related to how TCEQ should permit the use of a watercourse to transport water for reuse. Staff sees a conflict between the two amended sections.

Specifically, subsection 11.046 ( c ) states that, once surface water diverted under a permit is returned to a stream, absent any provisions in the water right to the contrary, the water becomes state water again and subject to appropriation by others. On the other hand, subsections 11.042(b-c) allows the owner of groundwater-based return flows or the water right holder or discharger of surface-water-based return flows to obtain a bed and banks permit to transport this water for indirect reuse.

TCEQ staff indicated that most controversies arise when someone is requesting a bed and banks permit to reuse historically discharged return flows - water that may otherwise be appropriated by downstream users. In cases where these return flows have not been historically discharged to a watercourse at the time the application is filed, TCEQ usually does not perform any analysis of harm to downstream (or upstream) water users or to the environment on grounds that water right holders and the environment will not have relied upon these flows being in the river or stream.

Staff therefore posed six questions, starting with the priority date issue. They noted that while subsections 11.042 (b-c) govern putting water in a watercourse for transport, the statute does not specify what type of authorization the bed and banks permit is or what the priority date of this authorization should be. They came up with the following matrix of options:

* a bed and banks permit is a new appropriation and must have a new priority date; moreover, the applicant must meet all tests of section 11.134 of the Water Code, including water availability.

* a request to reuse water under section 11.042 is not a new appropriation and this water is governed by the original priority date for the water right holder.

* such a request is not a new appropriation, but the priority date would have to be a new date if there is a need to protect existing water rights (even though section 11.134 does not apply).

* if the request is under sections 11.042 and 11.121 (and no water is available under section 11.121), it must be considered as a new appropriation (subject to section 11.134) and the priority date would be that of the reuse application.

* alternatively, under the same circumstances, the request would not be a new appropriation such that section 11.134 would not apply.

* if the effluent had originated as surface water, the request would be a new appropriation, but if it had originated as privately owned groundwater, it would not be a new appropriation.

As we shall see, the favored option at the work session among commenters was the final one. The other five questions (we will waive listing the options suggested by staff at this time) included -

* how water availability is to be determined for a bed and banks permit.

* who can apply for an indirect reuse permit. The statute apparently does not limit access to return flows to the discharger but suggests the discharger can assign rights to such water via contract.

* what is the required notice for a bed and banks application for historically discharged return flows. Staff noted that there can be impacts both downstream and upstream from reuse of historically discharged return flows (whether from groundwater or surface water). Upstream water right holders may be affected because the downstream water right holders would have to make more frequent "calls" on the upstream water due to a lessening of stream flow thanks to effluent reuse.

* in a water shortage, what would be the relative rights of water right holders to the effluent.

* can a wastewater treatment plant sell its effluent to downstream customers without a bed and banks or other reuse permit.

Attorney Doug Caroom spoke (as it turned out) for most of the commenters as he endorsed the idea of treating applications for reuse of return flows as new applications that would also require new priority dates - except for those return flows related to privately owned groundwater or (purchased) imported water not previously discharged. Such an approach, he said, is consistent with approaches taken by other Western States.

Mary Kelly, representing Environmental Defense, agreed with Caroom's proposal (which Chairman Kathleen Hartnett White had called the simplest and easiest to incorporate into the existing system of allocation). Kelly said that both equity and need should be addressed in the allocation of new water rights (including reuse), but noted that the majority of existing water rights permits do not address environmental flow conditions at all. There is a disconnect, she added, between the amount of surface water available via water rights permits and the amount of surface water actually in streams (and the amount of permitted water actually being used).

Lawrence Bellatti of Chocolate Bayou Water Co. said his firm's chief concern is that upstream users of Brazos River water might impact its ability to fully use its water right, which consists of 175,000 acre-feet that is permitted for diversion 72 miles upstream of the mouth of the river. In his view, both Caroom and Kelly hit the mark - that reuse applications should be treated as new applications and given new priority dates. Bellatti then said a word that drew shudders from some in the audience - he suggested a possible need for a watermaster on the Brazos River.

Next up was Ben Vaughan from the Coastal Conservation Association, who agreed with the three prior speakers that reuse would require a new permit and a new priority date (with the exceptions noted). Moreover, he continued, new authorizations must consider any impacts of reduced freshwater inflows into bays and estuaries. Texas, he added, must consider the times of dire need when the only flow in a stream might be return flows as well as times during the past decade when we have had a wealth of water flowing through most streams.

Norman Johns from the National Wildlife Federation said his organization considers the reuse issue pivotal. On the one hand, reuse holds the potential for eliminating the need for damaging new infrastructure (dams and reservoirs), but on the other hand it holds the potential for damaging or even eliminating environmental flows into bays and estuaries. The TCEQ staff report, while it does raise some issues, totally fails to provide any techniques for evaluating low-flow impacts of reuse. He also urged TCEQ not to forget to evaluate the cumulative impacts of permits on stream flow conditions.

Attorney Steve Kosub spoke on behalf of the San Antonio Water System, urging TCEQ not to lose sight of the significance of groundwater-based effluent as a reuse source. He called for TCEQ to recognize the historic ownership interests in developed groundwater and noted that SAWS has spent $125 million in recent years to develop a direct reuse system which it hopes to expand in the future.

Lower Colorado River Authority associate general counsel Lyn Dean stated that past permitting decisions were made with the assumption that return flows would not be siphoned off through reuse permits. With recent (and contemplated) changes in policy, existing water rights may not be as secure as they were once thought if the capture of return flows as a practice increases dramatically. One impact of reuse permits is that some water rights holders may be seeking additional water rights to protect against the unreliability of their current allocations.

Dean went so far as to suggest that adopting Caroom's solution might eliminate the need for bed and banks permits altogether (except perhaps for reused groundwater or imported water). If, however, TCEQ does not determine that reuse permits must require new applications, what would that mean for enforcement or the tracking of reuse permits? Complicated accounting schemes (such as the one already in place for Tarrant Regional Water District) might increase the need for watermasters. [There is that nasty word again!]

Finally, someone offered a different perspective. Attorney Carolyn Ahrens suggested that, rather than follow Caroom's scheme, TCEQ might increase its reliance on special conditions in water rights permits. She also said that TCEQ would do well to recognize bed and banks authorizations (as well as direct reuse) as outside the permitting system. Setting new priority dates, she said, would only yield inflexibility for water right holders. Bed and banks authorizations should be unencumbered in order to allow entities to exercise their preexisting right to use their water.

Ken Kramer of the Sierra Club reminded the Commissioners that way back in 1985 the Legislature expanded the definition of water conservation beyond reservoir storage to include recycling and direct reuse of water. Indirect reuse is another matter. It is hard, he said, to distinguish indirect reuse from any other downstream use by a permittee. [Thus Kramer implied that allowing indirect reuse without a new authorization would be counter to water conservation.]

Chairman White then took charge of the discussion, starting with her observation that water reuse is not yet big at the Capitol (other than the report on environmental flows). Indeed, no bill addressing the subject has been filed, though there are indications that an omnibus bill of some sort is in the works and may or may not be filed.

Commissioner Larry Soward warned that even uncontested water reuse permits (of which there have been several of late) ought to be required to take into consideration environmental flows and impacts on upstream and downstream water right holders. Commissioner Ralph Marquez agreed, but said any such policy change would have to be effective immediately or else the Commission would likely be hammered with a rash of applications prior to any future deadline.

Marquez recalled the Commission taking a similar step in the 1990's as it was contemplating major changes to its municipal solid waste permitting rules. That is, the Commission announced that any applications not already in house might be subjected to new policies not yet adopted. He added that TCEQ must set deadlines for making such policy decisions to be fair to permittees.

Soward wondered if 60 or even 30 days would be long enough, but Marquez said he was thinking 6 months or at least until the end of the legislative session. All seemed to agree on the principle that water reuse permits should have as a priority date the date of the application - but none was ready to adopt that as policy without further opportunity for public comment and analysis. Chairman White said she hoped the Water Development Board could provide some input into the discussion and proposed a joint work session.

In the end, the panel decided to publish in the Texas Register a notice providing for a 30-day comment period and to plan for a public meeting (perhaps the June work session) to discuss the public comments and staff analyses and adopt a final policy. [All of this presupposes the Legislature does not take specific actions in the interim.] They also agreed to notify all new applicants of the possible policy changes and that their applications would be subject to any such changes. They further agreed that all comments must be submitted via the Chief Clerk.

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