Water Activity Enterprises May Condemn Property When Exercising a Parent District’s Eminent-Domain Power “Relating to Water Activities”

Introduction

In N. Integrated Supply Project Water Activity Enter. v. VIMA Partners, LLC, 2026 CO 29, the Colorado Supreme Court addressed a recurring post-TABOR structural question in Colorado water development: whether a water activity enterprise—a TABOR “enterprise” vehicle used by water districts and municipalities—may itself bring an eminent-domain action against a private landowner.

The dispute arose after Northern Integrated Supply Project Water Activity Enterprise (“NISP Enterprise”), wholly owned by the Northern Colorado Water Conservancy District (“Northern Water”), filed a Weld County condemnation petition seeking permanent and temporary construction easements over VIMA Partners’ property. The easements were sought to survey, locate, construct, operate, and maintain pipelines and related infrastructure for the Northern Integrated Supply Project (“NISP”), a regional supply and distribution project intended to provide approximately 40,000 acre-feet of new annual water supply to participating entities.

VIMA Partners argued that NISP Enterprise lacked condemnation authority under the statutes it cited, and sought judgment on the pleadings. The district court denied the motion, concluding NISP Enterprise had condemnation authority under multiple sources, including the water activity enterprise statutes and the Water Conservancy Act. On C.A.R. 21 review, the Supreme Court focused on the enterprise/district statutory relationship and the meaning of “water activities.”

Summary of the Opinion

The Court held that, under the plain language of § 37-45.1-103(4) and § 37-45-118(1)(c), a water activity enterprise may exercise its parent district’s legal authority—including eminent domain—so long as the exercise is “relating to water activities.” It further held that condemning easements for pipelines and associated infrastructure needed to deliver and distribute water falls within (or is at minimum “related to”) statutorily defined water activities (§ 37-45.1-102(3)).

Accordingly, the Court discharged the rule to show cause and remanded for further proceedings. Having found statutory authority, it did not reach whether independent condemnation authority existed under Colo. Const. art. XVI, § 7 or §§ 37-86-102 and 37-86-104(1).

Analysis

1) Precedents Cited

a) C.A.R. 21 jurisdiction and why condemnation cases often qualify

  • Garcia v. Centura Health Corp. (2025 CO 15): Cited for the principle that original jurisdiction under C.A.R. 21 is discretionary and extraordinary. The Court used it to frame C.A.R. 21 as exceptional rather than routine.
  • People v. Smith (2023 CO 40): Quoted for when C.A.R. 21 relief is appropriate—abuse of discretion, excess of jurisdiction, and lack of an adequate appellate remedy.
  • Dep't of Transp. v. Amerco Real Est. Co. (2016 CO 62): The key condemnation-specific justification. The Court relied on this decision’s recognition that ordinary appeals can be inadequate in condemnation because the condemnor may obtain immediate possession and alter or damage property before appellate review concludes.

b) Standard of review and interpretive method

  • Forest View Co. v. Town of Monument (2020 CO 52): Used to reiterate de novo review of legal conclusions in condemnation matters, while deferring to factual findings.
  • Byers Peak Props., LLC v. Byers Peak Land &Cattle, LLC (2026 CO 7): The opinion’s core interpretive toolkit—plain meaning, holistic reading of the statutory scheme, avoidance of superfluity/absurdity, and respect for the legislature’s chosen words (no judicial additions or subtractions).

c) Narrow construction of eminent-domain delegations—limits and application

  • Bly v. Story (241 P.3d 529 (Colo. 2010)): Cited for the canon that eminent domain statutes are narrowly construed and ambiguities resolved in favor of the landowner.
  • Mack v. Town of Craig (191 P. 101 (Colo. 1920)) and Bd. of Cnty. Comm'rs of Arapahoe Cnty. v. Intermountain Rural Elec. Ass'n (655 P.2d 831 (Colo. 1982)): Invoked for the stricter requirement that condemnation power may not be implied from doubtful/vague language; it must be granted expressly or by necessary implication.

The Court treated these cases as guardrails against inventing condemnation authority—but not as permission to disregard clear statutory text. In other words, “narrow construction” operates only after identifying the legislature’s actual grant; it cannot be used to rewrite an express grant into a nullity.

d) Distinguishing cases where condemnation authority was not found

  • Coquina Oil Corp. v. Harry Kourlis Ranch (643 P.2d 519 (Colo. 1982)): Distinguished because the asserted authority rested on general constitutional/statutory takings language that did not unambiguously grant condemnation power to the claimant class (federal oil and gas lessees). Here, by contrast, the statutes expressly address the district’s condemnation power and the enterprise’s ability to exercise district legal authority.
  • Town of Eaton v. Bouslog (292 P.2d 343 (Colo. 1956)): Distinguished because condemnation could not be implied from the word “otherwise” in a cemetery-acquisition statute—an example of “vague” language insufficient to confer the taking power.
  • Akin v. Four Corners Encampment (179 P.3d 139 (Colo.App. 2007)): Distinguished because “private ways of necessity” had a historically narrow meaning that did not extend to a natural gas pipeline, underscoring that courts will not stretch terms beyond their settled scope to create condemnation authority.

e) Reading broad grants as written when the legislature speaks clearly

  • Dep't of Transp. v. Stapleton (97 P.3d 938 (Colo. 2004)): Used to reject the landowner’s attempt to use “narrow construction” to defeat a plainly broad authorization. As CDOT’s “state highway purposes” included integral ancillary facilities, a “relating to water activities” grant can include infrastructure integral to water delivery.

f) “Related to” and “includes, but is not limited to” as interpretive signals

  • Woodrow v. Wildlife Comm'n (206 P.3d 835 (Colo.App. 2009)): Cited for understanding “related activity” as having a “connection, relation, or reference” to listed activities. This supported the Court’s conclusion that pipeline construction/maintenance is “relating to” water activities.
  • People v. Roggow (2013 CO 70), quoting Ruff v. Indus. Claim Appeals Off. (218 P.3d 1109 (Colo.App. 2009)), and referencing City of Manassa v. Ruff. (235 P.3d 1051 (Colo. 2010)): Used for the proposition that “includes, but is not limited to” signals expansion rather than limitation—critical to rejecting the argument that only enumerated items count as “water activity.”

2) Legal Reasoning

a) The statutory chain: district power → enterprise exercise

The Court’s reasoning turns on a simple but consequential statutory linkage:

  1. § 37-45-118(1)(c) (Water Conservancy Act) expressly grants a water conservancy district board the power to “exercise the power of eminent domain” to take property necessary to exercise the district’s statutory powers.
  2. § 37-45.1-103(4) (water activity enterprise statute) provides that a water activity enterprise’s governing body “may exercise the district’s legal authority relating to water activities,” with the explicit limitation that an enterprise may not levy a TABOR tax.

Because NISP Enterprise is wholly owned by Northern Water (a water conservancy district), the enterprise can “exercise the district’s legal authority” (including eminent domain), but only when doing so “relat[es] to water activities.”

b) “Relating to water activities” supplies the limiting principle

Rather than treating enterprise condemnation as unlimited, the Court identified the limiting phrase in the very grant: the enterprise may act only when the action relates to “water activities,” defined broadly in § 37-45.1-102(3) to include “diversion, storage, carriage, delivery, distribution, ... augmentation, exchange, or discharge of water,” plus wholesale/retail water services and acquisition of water or water rights.

On these facts, pipelines and related infrastructure for a water delivery/distribution project are directly connected to “carriage, delivery, and distribution.” Even if one viewed “pipeline construction” as not itself an enumerated “water activity,” the phrase “relating to” and the “includes, but is not limited to” formulation foreclose a cramped reading.

c) Confirmatory evidence from the general eminent-domain statute

The Court reinforced its interpretation with § 38-1-202(1)(f)(XXX), which expressly lists: “A water activity enterprise ... exercising the legal authority to exercise the power of eminent domain of the district that owns it in relation to a water activity ... as authorized in section 37-45.1-103(4).” The Court treated this as a strong signal that the General Assembly understood the enterprise statutes to confer condemnation authority in the manner the Court described.

d) Rejection of the landowner’s textual counterarguments

  • Narrow construction defeats enterprise condemnation: The Court held narrow construction cannot override unambiguous text. The statutes here are not “doubtful or vague” about (i) district condemnation power and (ii) enterprise exercise of district legal authority.
  • “Water activity” doesn’t say “eminent domain”: The Court separated “existence of authority” (found in the district-power + enterprise-exercise provisions) from “scope/purpose limitations” (defined by “relating to water activities”). The “water activity” definition limits when the power may be used; it need not restate the power.
  • Pipelines/infrastructure not listed in “water activity”: The Court emphasized “relating to,” plus the expansive “includes, but is not limited to” phrase.
  • “Water project or facility” includes “pipeline,” so pipelines must not be “water activity”: The Court read § 37-45.1-103(1)—authorizing enterprises for “water activities, including water acquisition or water project or facility activities”—to treat “water project or facility activities” as a subset of “water activities,” not a mutually exclusive category.

3) Impact

a) Practical effects for Colorado water development

The decision clarifies that a TABOR-structured water activity enterprise is not limited to contracting and financing functions; it may also be the named condemnor, provided it acts within the parent district’s legal authority and the condemnation relates to statutory “water activities.” For large, multi-year projects (pipelines, conveyance corridors, treatment and distribution systems), this reduces litigation risk about who must file the condemnation petition (the district versus its enterprise) and supports continuity of project delivery under enterprise governance.

b) Litigation consequences and likely future disputes

Although the Court found authority here because pipelines are closely tied to “carriage/delivery/distribution,” the opinion’s framework signals where future disputes will land: (1) whether a particular taking is sufficiently “related to” a water activity; (2) whether the asserted district authority is indeed part of the “district’s legal authority”; and (3) whether the record demonstrates necessity and public use under generally applicable condemnation law (issues not resolved by this original proceeding).

c) Institutional and statutory-design implications

The Court’s reliance on § 38-1-202(1)(f)(XXX) is a reminder that Colorado’s condemnation authority often appears as an interlocking scheme: entity-specific enabling acts, general eminent-domain enumerations, and limiting definitions. This opinion encourages future courts to read these provisions cohesively rather than isolating definitions to negate express grants.

Complex Concepts Simplified

  • Eminent domain: The government’s power to take private property for public use with payment of just compensation, exercised through statutory procedures.
  • Water conservancy district: A statutorily created special district (here under the Water Conservancy Act) with enumerated powers, including eminent domain (§ 37-45-118(1)(c)).
  • Water activity enterprise: A government-owned business created to carry out water-related functions while fitting within TABOR’s “enterprise” concept (i.e., generally excluded from certain TABOR limitations if structured properly). The key statutory feature here is that it may exercise its parent district’s legal authority “relating to water activities” (§ 37-45.1-103(4)).
  • “Relating to”: A connective phrase that broadens scope beyond an exact match. If an action is connected or associated with a water activity, it can qualify, even if not enumerated as a “water activity” itself.
  • “Includes, but is not limited to”: Statutory language signaling an illustrative, non-exhaustive list—courts treat it as expanding the category rather than restricting it.
  • C.A.R. 21: Colorado’s extraordinary original proceeding mechanism. The Court may intervene before final judgment when an ordinary appeal would be inadequate, a condition often met in “quick take” condemnation contexts.
  • Easement (temporary/permanent construction easements): A property interest allowing limited use of another’s land (e.g., to build, access, and maintain a pipeline), as distinct from taking full title.

Conclusion

N. Integrated Supply Project Water Activity Enter. v. VIMA Partners, LLC establishes a clear rule: when a water activity enterprise is wholly owned by a district with eminent-domain authority, the enterprise may itself condemn private property so long as it is exercising the district’s legal authority “relating to water activities.”

The opinion’s significance lies in its disciplined statutory linkage—district power plus enterprise exercise—paired with an expansive but textually grounded understanding of “relating to water activities.” For Colorado water infrastructure, the decision reduces formalistic challenges to enterprise-led project delivery and channels future fights into the more fact-specific question of whether a particular taking is sufficiently connected to statutorily recognized water activities.