The ground water emergency chapter (IC 13-2.5) is interpreted as follows: If the activities of any significant water withdrawal facility result in a substantial lowering of the ground water and cause a failure of a domestic well to provide its normal supply of potable water, the owner of the significant water withdrawal facility is responsible for providing timely and reasonable compensation to the domestic well owner. If upgrading the existing well is impracticable, the owner of the significant water withdrawal facility may be required, at its sole expense, to construct a new well for the benefit of the owner of well. The owner of the significant water withdrawal facility is entitled to engage in consultation with the Department before the Commission makes an initial determination concerning what should be permanent timely and reasonable compensation. Where the activities of more than one significant withdrawal facility together cause damage to the domestic well, these significant water withdrawal facilities are jointly liable for providing timely and reasonable compensation and are each entitled to engage in consultations with the Department before an initial determination is made by the Commission.
FINDINGS OF FACT
1. This proceeding is governed by IC 4-21.5 (sometimes called the "administrative orders and procedures act" or the "AOPA") and 310 IAC 0.6-1, a rule adopted to assist in the administration of the AOPA before the natural resources commission (the "Commission").
2. The parties to this proceeding are John Brown & son, Inc. ("Brown"), Mathis Farms, Inc. ("Mathis"), and the department of natural resources (the "Department").
3. The Commission has jurisdiction over the parties and over the subject matter of this proceeding.
4. 310 IAC 0.6-1-15 provides that a person may, in writing, request the Department to interpret a statute or rule administered by the Department as applicable to a specific statutory circumstance. The interpretation is subject to administrative review. Peabody Status of Subsoil Replacement on Non-Prime Farmland, 6 Caddnar 8 (1991). This rule section provides for "quasi-declaratory judgment" relief. Scales v. State, 1991 Ind. App., 563 N.E.2d 554, 666.
5. The parties stipulated to the application of 310 IAC 0.6-1-15 and to compliance by Brown and Mathis with the procedural requirements of the rule section.
6. The basic legal regime for using ground water in Indiana is the "riparian" doctrine. Generally, the right to use ground water is associated with the ownership of land within which the water is located. 6 R. Beck, Water and Water Rights, 137 (1991).
7. Indiana has adopted a variation of the "reasonable beneficial use" definition of the Model Water Code. As provided in IC 13-2-6.1-1, "reasonable-beneficial use" refers to "the use of water for a beneficial use in such quantity and manner as is necessary for economic and efficient utilization and is both reasonable and consistent with the public interest."
8. Indiana legislation requires that surface or ground water be put to a "beneficial use" and that the waste of ground water be prevented. Beneficial use is defined as "the use of water for any useful and productive purpose and includes irrigation. IC 13-2-6.1-1. The Indiana General Assembly has declared a state policy to plan for full beneficial use of the state's water resources. IC 13-2-1-1.
9. The Indiana common law of percolating ground water (that is, ground water other than water which flows in the definite channel of an underground stream) "falls within the principle which gives the owner of the soil all that lies beneath his surface." New Albany & Salem R.R. v. Peterson, 14 Ind. 112, 114 (1860).
10. Recently, the vitality of the traditional common-law view of underground water use has been reaffirmed in Indiana. "Groundwater is part of the land in which it is present and belongs to the owner of that land." Where a person uses or disposes of percolating ground water for a beneficial purpose, damage that results to another is not actionable unless the damage is deliberate or gratuitous. Wiggins v. Brazil Coal and Clay Corp., 452 N.E.2d 958, 963 (Ind. 1983).
11. Problems with competing usages of ground water, and with the application of strict common-law doctrines by the courts to those usages, were largely responsible for the enactment of the "ground water emergency chapter (found at IC 13-2-2.5). This legislation was given state-wide application in 1985.
12. The ground water emergency chapter authorizes
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the director of the Department (the "Director") to afford emergency relief and authorizes the commission to provide long-term relief from the common-law doctrine of reasonable use within specified circumstances. The Director may restrict the quantity of ground water that may be extracted from a facility capable of withdrawing more than 100,000 gallons a day (a "significant ground water withdrawal facility") and shall, by temporary order, require the immediate temporary provision to the complainant at the prior point of use of an adequate supply of potable water. The Commission may order the restoration of the complainant to its former relative capability, the continuation of provision at the point of use of an alternative potable supply of equal quantity, or the permanent restriction or rescheduling of the ground water withdrawals by the significant ground water withdrawal facility. The Commission may also order a significant ground water withdrawal facility to reimburse the expenses incurred by the complainant to secure an alternative supply of potable water.
13. Brown and Mathis both operate significant ground water withdrawal facilities. The usage of those facilities is to provide irrigation. The ground water is entirely put to this beneficial use; and their water withdrawals do not cause damage which is either malicious or gratuitous.
14. If not for the ground water emergency chapter, the water withdrawal activities of Brown and Mathis would not be actionable.
15. The parties have stipulated, for the purposes of this proceeding, that the Director has issued a ground water emergency order under IC 13-2-2.5-3 against both Brown and Mathis relative to the operation of a well, known as the "Browning well", near Shelby in Lake County, Indiana.
16. The Browning well had historically provided a domestic supply of potable water for a residence. The Browning well was not capable of providing 100,000 gallons of water in a day and was not; therefore, a significant ground water withdrawal facility.
17. Immediately prior to the declaration of the ground water emergency, the Department conducted an investigation of the Browning well. The Department concluded from the investigation as follows:
(a) The well was constructed before January 1, 1986.
(b) The facility was operated as a shallow well jet system, which does not conform to current minimum construction standards for protection under the ground water emergency chapter, but which is "grandfathered" by IC 13-2-2.5 and thus eligible for protection. See, also, 310 IAC 16.5-2-2.
(c) At the time of the investigation, the well was not functional.
(d) At the time of the investigation, the water level in the aquifer which serves the Browning well had been lowered 15 or 16 feet from its normal level. This lowered level is substantial[FOOTNOTE i] and demonstrates more than a seasonal fluctuation. The primary causation for the lowering was the irrigation activities by Brown and Mathis.
(e) The water level at the Browning well was 22 1/2 feet below the surface at the time of the investigation. This determination was derived, in part, from the hydrologic history of the portion of Lake County near Shelby, as well as data collected through a monitoring well located roughly 1/4 mile from the Browning well.
18. Expert testimony by the Department indicated that a shallow-well jet system ordinarily cannot function properly more than about 25 feet below the surface even under optimum conditions. Optimum conditions are not the basis for determining real-life situations and the Browning well could reasonably be expected to fail with a water level 22 1/2 feet below the ground surface.
19. The Department determined from its investigation that the proximate cause of the failure of the Browning well was the irrigation activity of Brown and Mathis.[FOOTNOTE ii] This determination is supported by the evidence.
20. Evidence admitted at hearing discloses that the Browning well was in marginal working condition prior to the failure occasioned by the lowering of the ground water.
21. The parties have stipulated that the Department ordered an upgrading of the Browning well, but the upgrading has been unsuccessful.
22. The failure of the effort to upgrade the Browning well may have resulted, in part, from the marginal working condition of the well. Due to the limited lift capacity of the shallow-well jet system, however, a new well which conforms to the standards set forth in 310 IAC 16.5 may be required to provide a permanent solution to the problems associated with the Browning well.
23. The Department policy has been to require a well replacement which conforms to current construction standards if an upgrading of the existing well is not expected to provide a permanent solution to a ground water problem.[FOOTNOTE iii] This policy conforms to the legislative scheme set forth in the ground water
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emergency chapter. A permanent solution under IC 13-2-2.5 should seek to achieve the full beneficial use of the ground water resource while minimizing the need in the future for the Department to expend human resources to address reoccurring water problems.
24. Clearly, the ground water emergency chapter does not provide relief if the causation for a well failure is improper functioning of the well or its equipment. See, particularly, IC 13-2-2.53(b)(3). However, the evidence in this proceeding does not support the proposition that the Browning well failed because the well or its equipment were not functioning properly prior to the lowering of the ground water. The preponderance of the evidence is that the Browning well, though less than ideal and inferior to current construction standards, was functional.
25. Brown and Mathis seek release from responsibility, or at least contribution from Browning[FOOTNOTE iv], for the construction of the new well. They argue that significant water withdrawal facilities should not be responsible for the replacement of "old corroded wells". Although this argument can be viewed with some empathy, the determinative issue is the proximate causation of the well failure. Where the activities of significant water withdrawal facilities result in a substantial lowering of ground water and cause the failure of a domestic well, the significant water withdrawal facilities must provide an alternative supply of potable water. If the most practicable method for providing an alternative supply of potable water is to construct a new well, the significant water withdrawal facilities are responsible for the cost of a new well.
26. Brown and Mathis also urge that significant water withdrawal facilities, which may be responsible for damages suffered by a domestic well user, be consulted before a determination is made as to permanent timely and reasonable compensation.
27. Before the Commission may enter an "initial determination" as to timely and reasonable compensation to a complainant, the Department "shall conduct an investigation and proved affected persons with an informal opportunity to contribute to the investigation." IC 13-2-2.5-11(b).
28. The Department is obliged to consult with the affected significant water withdrawal facilities, as well as with the complainant, before presenting to the Commission the Department's proposal for timely and reasonable compensation.
FOOTNOTES
i. IC 13-2-2.5-3(a)(2) requires a showing that the lowering of the level of ground water be substantial in order to be actionable. Hacker v. DNR, City of Huntington, 4 Caddnar 35 (1987).
ii. Where more than one "significant water withdrawal facility" contributes to the lowering of the level of ground water which causes damage to a domestic user, each significant water withdrawal facility is liable under IC 13-2-2.5. Kuss, DNR v. Churchill, et al., 5 Caddnar 5 (1988).
iii. An example offered by the Department at hearing is that a significant water withdrawal facility was required to replace the "Armstrong well" because piping was seriously corroded. See Kuss at 5 Caddnar 5, supra.
iv. The parties have stipulated that Browning is not a necessary party to the proceeding. Because the proceeding is governed by the quasi-declaratory judgment provisions of 310 IAC 0.6-1-15, this stipulation was accepted by the administrative law judge.