Anti‑Speculation Doctrine Does Not Apply to Water Court Review of Amendments to Augmentation Plans for Not‑Nontributary Denver Basin Groundwater

Anti‑Speculation Doctrine Does Not Apply to Water Court Review of Amendments to Augmentation Plans for Not‑Nontributary Denver Basin Groundwater

Case: Franktown Citizens Coalition II, Inc. and West Elbert County Well Users Association v. Independence Water & Sanitation District, and Division 1 Engineer, 2025 CO 5M, 567 P.3d 121 (Colo. Apr. 21, 2025)

Court: Colorado Supreme Court (en banc) — Chief Justice Márquez delivered the Opinion; Justice Gabriel concurred in the judgment

Docket: 23SA154

Introduction

This decision addresses a narrow but consequential question at the intersection of Colorado’s prior appropriation system and the unique statutory framework for Denver Basin groundwater: Does the anti‑speculation doctrine apply when a water court reviews an application to amend a plan for augmentation for not‑nontributary groundwater? The Supreme Court answers no. The sole inquiry for water courts reviewing augmentation plans (including amendments) is whether the plan will injure vested or decreed conditional rights.

The case arose from the Independence Water & Sanitation District’s plan to serve a proposed 920‑home development on a 1,012‑acre tract in Elbert County. Independence holds a 2006 decree quantifying nontributary and not‑nontributary Denver Basin groundwater and approving an augmentation plan for a subset of Upper Dawson not‑nontributary water. Independence sought to amend that augmentation plan to add all uses adjudicated in 2006 (plus municipal use) and to authorize use both on and off the property, while retaining the same 75 acre‑feet per year withdrawal cap.

Local associations opposed, arguing that without concrete plans for specific quantities for specific uses, Independence’s amendment was speculative and must be denied under the anti‑speculation doctrine. The water court approved the amendment without anti‑speculation review, focusing solely on non‑injury. The Supreme Court affirms, but on clarified grounds that disaggregate East Cherry Creek Valley Water & Sanitation District v. Rangeview Metropolitan District from the augmentation‑plan context and anchor the holding in statutes and augmentation‑plan jurisprudence.

Summary of the Opinion

  • The Court holds that the anti‑speculation doctrine does not apply to a water court’s review of an application to obtain or amend an augmentation plan for not‑nontributary groundwater.
  • Rationale:
    • Anti‑speculation and augmentation plans serve different purposes: anti‑speculation protects the integrity of appropriations by preventing hoarding for profit; augmentation plans enable out‑of‑priority diversions while preventing injury to existing rights and advancing the policy of maximum use.
    • By statute, the water court’s sole task on an augmentation plan is the non‑injury determination; anti‑speculation plays no role in this analysis.
  • East Cherry Creek does not control because it addressed nontributary determinations of rights, not augmentation plan amendments for not‑nontributary groundwater.
  • Application: The amended plan uses return flows and, if needed, direct releases of decreed nontributary water to offset depletions during pumping and provides for post‑pumping depletions. The Court discerns no clear error in the water court’s finding of no injury and affirms.
  • Important caveats:
    • The Court expressly leaves open whether anti‑speculation applies to judicial determinations of rights in not‑nontributary groundwater.
    • If an “amendment” to an augmentation plan amounts to a new appropriation or a change of water right, anti‑speculation may apply through those doctrines and the appropriate procedural vehicle.

Factual and Procedural Background

  • 2006 Decree:
    • Quantified 1,269 AFY of nontributary groundwater (Lower Dawson, Denver, Arapahoe, Laramie‑Fox Hills) and 288.3 AFY of not‑nontributary Upper Dawson.
    • Decreed a broad suite of uses (use, reuse, successive use) on and off property for domestic, industrial, commercial, irrigation, stock watering, fire protection, exchange and augmentation (municipal not listed in the 2006 decree’s use list).
    • Approved an augmentation plan for up to 75 AFY of Upper Dawson not‑nontributary water, limited to in‑house and irrigation uses on the subject property; return flows during pumping and nontributary water after pumping to replace depletions.
  • Amendment Sought:
    • Keep 75 AFY cap; expand plan uses to all decreed uses (plus municipal) on and off the property.
    • No allocation specified by use; no specific off‑property plan.
    • Division Engineer required documentation that return flows cover depletions in time, location, and amount; if not, direct releases to streams from nontributary water.
  • Opposition and Discovery:
    • Opposers sought use‑by‑use quantities and locations. Independence stated no specific plans for domestic, industrial, exchange, stock‑watering, or off‑property uses; limited municipal/commercial and irrigation estimates supplied; relied on East Cherry Creek to argue anti‑speculation does not apply.
  • Water Court: Denied summary judgment; concluded anti‑speculation did not apply; entered final decree approving the amendment and requiring direct releases if return flows insufficient; found no injury.

Analysis

Precedents and Authorities Cited and Their Influence

  • East Cherry Creek Valley Water & Sanitation Dist. v. Rangeview Metro. Dist., 109 P.3d 154 (Colo. 2005)
    • Holding: Water courts do not apply anti‑speculation to adjudications of rights in nondesignated, nontributary Denver Basin groundwater; the SEO applies anti‑speculation in the well‑permitting stage.
    • Use here: The Court distinguishes East Cherry Creek as inapposite to augmentation plan amendments; it neither commands nor prohibits anti‑speculation review in this context.
  • Colorado Ground Water Commission v. North Kiowa‑Bijou Groundwater Management District, 77 P.3d 62 (Colo. 2003)
    • Recognized Denver Basin groundwater’s unique statutory treatment; not‑nontributary groundwater is administered on the basis of land ownership if its use is augmented.
    • Influence: Supports the separate roles of adjudication/administration and the necessity of augmentation for not‑nontributary use.
  • Danielson v. Castle Meadows, Inc., 791 P.2d 1106 (Colo. 1990)
    • Augmentation plans for not‑nontributary groundwater must provide for replacement of post‑pumping depletions.
    • Influence: The final decree’s post‑pumping provisions track Danielson’s requirement.
  • Empire Lodge Homeowners’ Ass’n v. Mayer, 39 P.3d 1139 (Colo. 2001)
    • Defines augmentation plans as instruments permitting out‑of‑priority diversions by providing legally available replacement water; advances “maximum flexibility” while protecting prior appropriation.
    • Influence: Anchors the Court’s purpose‑based distinction from anti‑speculation; frames the non‑injury focus.
  • Buffalo Park Development Co. v. Mountain Mutual Reservoir Co., 195 P.3d 674 (Colo. 2008)
    • Augmentation plans allow diversions where unappropriated water is otherwise unavailable; applicants must establish the availability of replacement water.
    • Influence: Supports the non‑injury and replacement‑water certainty principles used in the Court’s analysis.
  • Upper Eagle Regional Water Authority v. Simpson, 167 P.3d 729 (Colo. 2007)
    • If no injury, the water judge “shall” approve an augmentation plan; the focus is on injury to vested or decreed conditional rights.
    • Influence: Cited for the mandatory approval upon non‑injury finding; emphasizes the narrow scope of review.
  • High Plains A & M, LLC v. Southeastern Colorado Water Conservancy District, 120 P.3d 710 (Colo. 2005)
    • Extended anti‑speculation to changes of water rights to ensure continued validity of the underlying appropriation.
    • Influence: Contrasts change‑of‑right proceedings (which can trigger anti‑spec) with augmentation plan review (which generally does not).
  • Well Augmentation Subdistrict v. Centennial Water & Sanitation District, 2019 CO 12, 435 P.3d 469
    • An augmentation decree is a “prediction” of non‑injury operation; it does not depend on the applicant’s intent to execute at a particular time.
    • Influence: Reinforces why intent‑based anti‑specification is out of place in augmentation review.
  • City of Aurora ex rel. Utility Enterprise v. Colorado State Engineer, 105 P.3d 595 (Colo. 2005); Williams v. Midway Ranches, 938 P.2d 515 (Colo. 1997); Weibert v. Rothe Brothers, Inc., 618 P.2d 1367 (Colo. 1980)
    • Collectively: Emphasize identification and certainty of replacement supplies and the essentiality of adequate replacement water in an augmentation plan.
    • Influence: Support the Court’s requirement that proposed beneficial uses and return‑flow modeling serve the injury analysis, not anti‑spec review.
  • Coors Brewing Co. v. City of Golden, 2018 CO 63, 420 P.3d 977
    • Amendments to augmentation plans cannot be used to obtain new appropriations or add new uses to decreed rights without following proper procedures, which include anti‑spec review where applicable.
    • Influence: Provides the caveat that if an “amendment” is effectively a new appropriation/change, anti‑specification may apply via that doctrine.
  • Front Range Resources, LLC v. Ground Water Commission, 2018 CO 25, 415 P.3d 807 (designated groundwater context)
    • Applied anti‑speculation where a replacement plan amounted to a new appropriation.
    • Influence: Reinforces the exception carved out by the Court’s footnote: anti‑spec is implicated if the procedural vehicle is used to obtain a new appropriation.
  • Colorado River Water Conservation Dist. v. Vidler Tunnel Water Co., 594 P.2d 566 (Colo. 1979)
    • Origin of the anti‑speculation doctrine in Colorado; a right to appropriate is not a right to speculate.
    • Influence: Provides doctrinal baseline that the Court distinguishes from the augmentation‑plan context.
  • Statutes
    • Section 37‑92‑305(3)(a), (8)(a): Water court must approve an augmentation plan if it will not injure vested/decreed conditional rights; directs the injury analysis framework.
    • Section 37‑92‑103(9): Defines an augmentation plan as a program to increase water available for beneficial use by providing substitute supplies.
    • Section 37‑92‑103(3)(a): Codifies anti‑specification for appropriations and changes; requires a specific plan and intent for a specific quantity for specific beneficial uses.
    • Section 37‑90‑137(9)(c.5)(I)(A)–(C): For not‑nontributary Denver Basin groundwater, use requires judicial approval of an augmentation plan and must meet general augmentation criteria; special quantification for replacement obligations by aquifer/location.
    • Section 37‑90‑103(10.5) and (10.7): Define nontributary and not‑nontributary groundwater in the Denver Basin.
    • Section 37‑90‑137(1)(b)(II), (4)(a): SEO well‑permit requirements include proposed beneficial use; applies to both nontributary and not‑nontributary groundwater.

Legal Reasoning

  • Different purposes, different inquiries:
    • Anti‑speculation polices the creation or alteration of appropriative rights by requiring non‑speculative intent and a definite plan for beneficial use.
    • Augmentation plans do not create or alter appropriative rights; they authorize out‑of‑priority diversions by ensuring legally available replacement water and preventing injury to existing rights.
    • Because augmented water is not “available” for new appropriation (it is tethered to replacement operations), anti‑spec’s anti‑hoarding rationale is not implicated by augmentation plan approvals.
  • Sole statutory test: injury vel non.
    • Under section 37‑92‑305(3)(a), the water court “shall” approve an augmentation plan if it will not injure vested or decreed conditional rights.
    • This is a technical hydrologic/legal inquiry focused on timing, amount, and location of depletions and replacement water; the applicant’s subjective intent about which beneficial uses will predominate is beside the point.
    • While applicants must model return flows and often must identify proposed beneficial uses to support the replacement calculations, this is in service of non‑injury—not to prove anti‑spec compliance.
  • East Cherry Creek disaggregated.
    • East Cherry Creek shifted anti‑spec review to the SEO in the well‑permitting context for nontributary groundwater determinations of rights. It did not answer whether anti‑spec applies to augmentation plan review for not‑nontributary water.
    • The Court declines to expand East Cherry Creek and instead resolves the case under the statutes that govern augmentation plans and the state’s augmentation jurisprudence.
  • Application to the record.
    • Independence’s amendment keeps the 75 AFY cap for Upper Dawson not‑nontributary withdrawals, broadens authorized uses, and provides two replacement mechanisms: return flows (septic/irrigation) and direct releases of nontributary water if needed; it also provides for post‑pumping depletions.
    • The Division Engineer’s consultation recommendations (document return flows; require direct releases if short) were incorporated into the final decree.
    • The water court’s non‑injury finding is supported: modeled irrigation return flows alone nearly quadruple estimated depletions, and nontributary releases serve as a fail‑safe.
  • Caveats and limits.
    • The Court expressly reserves the question whether anti‑spec applies when a water court adjudicates rights to not‑nontributary groundwater.
    • If an “amendment” to an augmentation plan is effectively a new appropriation or change of water right (e.g., adding new reuse rights not previously decreed), anti‑spec applies in that proper proceeding; an augmentation plan amendment cannot be used as a shortcut.

Impact and Practical Implications

  • For water providers and developers in the Denver Basin:
    • Streamlined augmentation plan amendments: Applicants need not carry the burden of proving a non‑speculative plan for each new listed use when amending a plan, provided they meet the non‑injury standard.
    • Design plans around robust, conservative replacement modeling (return flows and backup releases), and document post‑pumping obligations for Upper Dawson and other aquifers as required.
  • For opposers and senior water rights holders:
    • Opposition strategies should focus on injury: scrutinize return‑flow assumptions, lag times, location of return, hydrologic connectivity, and enforceability of direct release triggers, not the applicant’s lack of current demand plans.
    • Anti‑spec arguments remain viable when a proceeding functions as a change of right or a new appropriation masquerading as a plan amendment.
  • For the State Engineer’s Office (SEO):
    • Anti‑spec review continues to occur in the well‑permitting context for both nontributary and not‑nontributary wells under section 37‑90‑137; applicants must specify proposed beneficial uses in permits.
    • This decision complements, rather than displaces, the SEO’s role; water courts will not duplicate anti‑spec review in augmentation proceedings.
  • Doctrinal clarification:
    • Reaffirms the “injury‑only” scope of section 37‑92‑305(3) in augmentation plan approvals, harmonizing Denver Basin practice with the state’s broader augmentation jurisprudence.
    • Draws a line between adjudications of rights (where anti‑spec or SEO review may apply) and augmentation plans (where anti‑spec generally does not).
  • Open questions and likely future litigation:
    • Whether anti‑spec applies to judicial determinations of rights in not‑nontributary groundwater remains unresolved by this decision.
    • The boundary between a bona fide amendment to an augmentation plan and an amendment that effectively performs a change of right/new appropriation (triggering anti‑spec) will continue to be litigated (see Coors Brewing; Aurora).

Complex Concepts Simplified

  • Nontributary vs. not‑nontributary groundwater (Denver Basin):
    • Nontributary: Withdrawals over 100 years deplete connected streams by less than or equal to 0.1% of the withdrawal rate.
    • Not‑nontributary (unique to the Denver Basin): Withdrawals over 100 years deplete streams by more than 0.1% of the withdrawal rate; use requires an augmentation plan.
  • Augmentation plan: A court‑approved program allowing out‑of‑priority diversions if the diverter provides legally available replacement water to prevent injury to senior rights; the decree is a “prediction” of non‑injury operation.
  • Anti‑speculation doctrine: To obtain or change an appropriative right, an applicant must show a specific plan and intent to use a specific amount of water for specific beneficial uses, preventing hoarding or purely speculative claims.
  • Injury analysis: A technical evaluation of whether the timing, amount, and location of depletions caused by the proposed diversion will be offset by replacement supplies so as not to harm vested or decreed conditional rights.
  • Return flows: Water that returns to the hydrologic system after use (e.g., septic and irrigation return flows), which can be credited as part of replacement water if predictable in time, place, and amount.
  • Post‑pumping depletions: Continued stream impacts after pumping stops due to aquifer response; must be replaced under plans involving not‑nontributary groundwater, especially in the Upper Dawson.

Statutory Roadmap (What the Court Applied)

  • Section 37‑92‑305(3)(a), (8)(a): Non‑injury standard and factors for augmentation plan approval.
  • Section 37‑92‑103(9): Definition of augmentation plan—substitute supplies to increase water available for beneficial use.
  • Section 37‑92‑103(3)(a): Anti‑specification requirement for appropriations and changes (not generally implicated in augmentation reviews).
  • Section 37‑90‑137(9)(c.5): Special requirements for not‑nontributary use (judicial augmentation approval; aquifer‑specific replacement obligations).
  • Section 37‑90‑103(10.5), (10.7): Definitions of nontributary and not‑nontributary Denver Basin groundwater.
  • Section 37‑90‑137(1)(b)(II), (4)(a): SEO permitting requirement to specify proposed beneficial use; applies to nontributary and not‑nontributary wells.

Concurrence in the Judgment (Justice Gabriel)

  • Agrees with affirmance but would decide the case on narrower grounds closely aligned with the water court’s reasoning and the parties’ arguments.
  • Would avoid announcing a broad rule that anti‑spec “virtually never” applies in augmentation contexts; emphasizes judicial restraint and the specific interplay between not‑nontributary administration and the 2006 decree’s vested uses.

Practice Pointers

  • For applicants:
    • Build a defensible, conservative return‑flow model; specify backup replacement water (e.g., nontributary releases) and clear, enforceable triggers.
    • Address post‑pumping depletions explicitly for Upper Dawson and other applicable aquifers.
    • Remember: an augmentation plan amendment is not a vehicle to add new uses to undecreed rights or to seek new reuse rights; use the correct proceeding (change/appropriation) and be prepared for anti‑spec review there.
  • For opposers:
    • Focus on injury: challenge return‑flow timing/location, aquifer‑stream interaction assumptions, accounting, and adequacy of direct release provisions.
    • Assess whether the “amendment” is actually a change of right/new appropriation; if so, press anti‑spec and proper‑procedure objections.
  • For the SEO:
    • Continue to apply anti‑spec at the well‑permitting stage; this decision complements rather than constrains that role.

Conclusion

The Colorado Supreme Court clarifies that water courts do not apply the anti‑speculation doctrine when reviewing applications to obtain or amend augmentation plans for not‑nontributary Denver Basin groundwater. The statutory and doctrinal focus is singular: whether the plan, as structured and conditioned, will prevent injury to vested and decreed conditional rights by providing legally available replacement water in the right amounts, places, and times—during pumping and post‑pumping. East Cherry Creek’s allocation of anti‑spec review to the SEO in the nontributary adjudication/permit context does not govern augmentation plan review.

At the same time, the Court preserves guardrails: if a purported augmentation plan amendment is functionally a new appropriation or change of water right, anti‑spec applies in that proceeding; and the Court leaves unanswered whether anti‑spec applies to judicial determinations of rights in not‑nontributary groundwater. Practically, this decision streamlines augmentation plan amendments for Denver Basin providers while steering litigation toward the technical merits of injury and replacement, not the applicant’s current demand plan granularity.

Key Takeaways

  • New rule: Anti‑specification is not part of a water court’s review of augmentation plans or amendments for not‑nontributary groundwater; the sole statutory test is non‑injury.
  • Doctrinal harmony: Augmentation plans operationalize maximum use and non‑injury; anti‑spec guards appropriations and changes—distinct spheres with limited overlap.
  • Exceptions remain: If an amendment effectively seeks a new appropriation or change, use the proper proceeding and expect anti‑spec scrutiny.
  • Open question: Anti‑spec’s role in judicial determinations of rights to not‑nontributary groundwater awaits a future case.

Case Details

Comments