When a farm or ranch subdivides, what happens to the surface water rights? We already got part of the answer from the State Water Resources Control Board, in Post # 82:
Permits And Licenses – What Are The Water Rights When Land Is Subdivided? In summary, it is up to the water right holders to notify the Water Board that the land has subdivided and go from there.
The answer is well defined when a Superior Court Decree is under State of
California Watermaster Service: Water Rights Reapportionment Method. This document describes what is done under nearly all decrees with defined areas for water 
rights, whether or not under state service…unless some other method is specified. The State subdivides water rights whether or not new owners of subdivided parcels notify the Department of Water Resources; the requirement falls on the State instead of the water right holders. Owners of land are notified at least once a year, since a charge for watermaster service is included on their tax bill.
What ACTUALLY happens with the water, when a subdivision is built on what used to be a farm or ranch? Does water always go with water rights?
How do the owners of smaller parcels go about getting their water right? In some cases, new owners have invested in pipelines to keep using the water right on the smaller parcels. When the original owner subdivided the land, he or she made it clear that water rights were split up, or may have paid an attorney or engineer to split them up in advance. These owners are well aware of what their rights are. In other places, some new owners use water, others don’t, which is fine as long as a new owner doesn’t complain loudly.
In still other locations, none of the new homeowners wanted to use the water, either because there was a built-in municipal supply of pure or treated water, or because one or more private or community wells were drilled. The water right probably was not advertised as being available when the homes were built, and once the new owners were in, it became a lot more expensive to arrange pipelines across several neighbors’ properties to get a share of the surface water right.
What happens when nobody uses the water, or less water is used? The answer is, of course, “It depends.” If it is a decreed right, then the right stays with the
land unless the decree specifies another method. It would take another court order to change the rights from what was originally decreed. If it is a riparian right, then unless the owner was very careful to reserve riparian rights when subdividing the ranch, the only remaining rights are with those new parcels still adjacent to the stream. Owners rarely think about reserving riparian rights in these cases, and so the riparian right is lost. That is, unless:
- The right was filed with the Water Board, either as a pre-1914 water right or a post-1914 application and the owner was subsequently issued a permit or license
- …and the water continued to be used, and that use documented by the owner or with the Water Board
- …and the water is used reasonably and beneficially, either for the original purpose of use, or for one of the many other appropriate purposes of use the Water Board considers reasonable and beneficial
- …or, the right is part of a Superior Court adjudication, in which case the right is “eternal” because, for all the adjudications I have seen, there is no provision for expiration of rights. Another court case is needed to change rights defined in the original decree.
I know this is not a neat, tidy explanation of what happens to water rights when a farm or ranch is subdivided. Not surprisingly, water rights are well-understood by maybe 1% of California’s population. No offense intended – only a few percent of the population lives on farms and ranches, and a fair number of those are in water or irrigation districts where the board and manager deal with the actual water rights.
In summary, this is an accurate description of what happens, as opposed to theoretical cases. Water right subdivisions have a legal side, and a practical/applied side. Sometimes the legal water right persists whether or not the water is used, as with riparian and court-decreed water rights. Other times the reasonable, beneficial, and mostly continuous use of the water is what protects the existence of that right, for appropriative pre-1914 or post-1914 water rights. Even if a pre- or post-1914 water right is not used for some years, when the owner does start using the water, if nobody complains, there is nothing to trigger action by the Water Board, or a lawsuit by neighbors. After a few years of use, it will be hard for a complaining party to make the case for loss of the right because of the previous gap in time.
By the way, except where courts have decreed what the groundwater rights are, they are most like surface water riparian rights. Regardless of the size of subdivided parcels, all of them still overlie groundwater and have a right to use it. Control of their use is increasing with the Sustainable Groundwater Management Act, and priorities (effective or actual) will be established, but that is a discussion for some later post.
