BASALT – It’s been two years since High Valley Farms, LLC applied for a water right to grow marijuana near Basalt, but it’s still not known if officials in the Division 5 water court will issue a decree to water pot plants when it is still a federal crime to do so.
And while the hazy legal question posed by court officials has been lingering in the air since 2014, High Valley Farms has amended its application twice and both times has increased the size of its proposed water right.
Instead of seeking a right to use 2.89 acre-feet annually from an on-site well and the Roaring Fork River, High Valley Farms is now seeking to use 9.24 acre-feet a year.
Put in terms of gallons instead of acre-feet, High Valley Farms has gone from asking for the right to use 941,711 gallons of water a year, or 2,580 gallons a day, to asking for 3,010,867 gallons a year, or 8,249 gallons a day.
Further, High Valley Farms has recently picked up two opposers in the case, both oil-company executives from Texas who own property near the 25,000-square-foot pot-growing facility along Highway 82.
The opposition is WCAT Properties, LLC controlled by Earl Michie of Midland, Texas, and the Spencer D. Armour III 2012 Trust, controlled by the namesake, also of Midland.
Both men, according to their attorney, Scott Miller of Basalt, are concerned that the use of water at the High Valley Farms facility is drying up wells on their property, and are less concerned about the issues of federal law raised in the case.
Miller also represents the Roaring Fork Club, which filed the first statement of opposition in the case. That, too, concerns its water rights, not federal legal questions about growing pot.
More water
High Valley Farms, which is controlled by Jordan Lewis, the owner of the Silverpeak marijuana store in Aspen, wants to use the water covered by the proposed water right to fill and refill large underground storage tanks. The water will be used for plants in the indoor greenhouse, and to power the mist and evaporative cooling systems in the greenhouse.
Those systems now include an expensive odor-suppression system that uses water and carbon filters to stop the smell of potent buds from wafting through the neighborhood.
The water would also be used in sinks and bathrooms in both the greenhouse and a nearby single-family home, and for landscaping purposes on the 4.7-acre lot, which is near the Roaring Fork Club, just upvalley from Basalt.
Rhonda Bazil, the attorney for High Valley Farms, declined on Tuesday to discuss the application.
Legal questions
Both the original application from High Valley Farms in August 2014 and the amended version in May 2015 prompted the same question from the water referee in Division 5 water court: Can a water right to grow marijuana be granted in Colorado when growing pot is still a federal crime?
“The application must explain how the claim for these conditional water rights can be granted in light of the definition of beneficial use as defined [under state law],” the water referee said in a summary of consultation in August 2015. “Specifically, beneficial use means the ‘use of that amount of water that is reasonable and appropriate under reasonably efficient practices to accomplish without waste the purpose for which the appropriation is lawfully made.’”
The document put an emphasis on the word “lawfully,” as in, can it be done lawfully if it is still a federal crime?
It was the first time a water court official in Colorado had posed the question, and the case is likely to set a precedent, at least in Division 5, which encompasses the Colorado River basin above the Gunnison River.
The answer to the question remains outstanding, although Bazil, the attorney for High Valley Farms, filed a response to the court in November 2015 making three main points.
She argued that the state water engineer has already said it’s OK to use water to grow pot plants; that the federal Bureau of Reclamation has also said it’s fine to water pot plants in Colorado (as long as you don’t use water taken directly from a federal facility); and that the federal government has long ceded general management of water rights to the states.
Bazil also told the court at the time, “If this court were to determine that, contrary to the findings of the state engineer, the use of water for marijuana facilities is not a beneficial use, the entire industry, which reportedly employs almost 160,000 residents, would be shut down.”
Next steps
After receiving the second amended application from High Valley Farms in May, the water court referee set Oct. 4 as the next date for a status conference.
But on Aug. 31, in response to a motion to extend from High Valley Farms, the referee vacated the scheduled October status conference while all the parties await the third “summary of consultation” in the case from the division engineer’s office.
Once the consultation, or review of the application, is submitted to the court, High Valley Farms will have 30 days to respond and “circulate a proposed ruling.” There is no deadline set for the consultation to be submitted by the division engineer.
Opposers in the case will then have another 30 days to respond to the proposed ruling from High Valley Farms, and a status conference will be scheduled after that.
When ready to act, the water court referee doesn’t necessarily have to address the larger legal question posed by the High Valley Farms application in order to recommend approval by the water court judge.
If satisfied by answers to the lingering federal question, the referee could simply recommend approval of a proposed decree, without comment.
If the referee denies the decree, for any reason, the decision could then be appealed to the water court judge. And an eventual decision by the judge could be appealed directly to the Colorado Supreme Court.
In the meantime, High Valley Farms can continue to water its pot plants; it just doesn’t have a decreed water right to do so.
Editor’s note: Aspen Journalism and the Aspen Daily News are collaborating on coverage of rivers and water. The Daily News published this story on Wednesday, Sept. 7, 2016.