MINUTES OF THE SENATE COMMITTEE ON NATURAL RESOURCES Sixty-eighth Session March 20, 1995 The Senate Committee on Natural Resources was called to order by Chairman Dean A. Rhoads, at 2:25 p.m., on Monday, March 20, 1995, in Room 224 of the Legislative Building, Carson City, Nevada. Exhibit A is the Agenda. Exhibit B is the Attendance Roster. COMMITTEE MEMBERS PRESENT: Senator Dean A. Rhoads, Chairman Senator Lawrence E. Jacobsen, Vice Chairman Senator Mark A. James Senator Mike McGinness Senator Ernest E. Adler Senator John B. (Jack) Regan Senator O. C. Lee STAFF MEMBERS PRESENT: Fred Welden, Chief Deputy Research Analyst, Legislative Counsel Bureau Billie Brinkman, Committee Secretary OTHERS PRESENT: R. Michael Turnipseed, State Engineer, Division of Water Resources, State Department of Conservation and Natural Resources Pete Morros, Director, State Department of Conservation and Natural Resources Jim Weishaupt, Manager, Walker River Irrigation District Doug Busselman, Executive Vice President, Lobbyist, Nevada Farm Bureau Federation Michael DeLee, Concerned Citizen Ralph McCracken, Concerned Citizen Gary Gilgan, Concerned Citizen Laura Lilly, Concerned Citizen Chairman Rhoads asked for a committee introduction of Bill Draft Request (BDR) S-984. Bill Draft Request S-984: Creates Las Vegas Valley Ground Water Replenishment District. SENATOR REGAN MOVED FOR COMMITTEE INTRODUCTION OF BDR S- 984. SENATOR LEE SECONDED THE MOTION. THE MOTION CARRIED. (SENATOR ADLER AND SENATOR JAMES WERE ABSENT FOR THE VOTE.) ***** Chairman Rhoads asked for the drafting of a bill on the management of federal lands in the West following discussions held previously with Pamela Wilcox, Administrator, Division of State Lands, State Department of Conservation and Natural Resources, and Peter Morros, Director, State Department of Conservation and Natural Resources, regarding proposals for legislation in this matter. Chairman Rhoads then took some excerpts from a report by Congressman Don Young, Alaska, Chairman, U. S. Congress House Resources Committee, and Congressman Jim Hansen, Utah, Chairman, U. S. Congress House Subcommittee on Public Lands, who hoped to use budget pressure to force disposition of large tracts of public lands (Exhibit C). They intend to focus, primarily, on Bureau of Land Management (BLM) lands, not on lands with conservation status. States would receive federal lands only if they volunteered. Congress would proceed on a state-by-state basis. There are two or three statements in Exhibit C on different committees. The idea is to transfer lands to the states for the states' own management. The BDR sought by Chairman Rhoads would create a panel to put together, in the next 2 years, an implementation plan for the state to manage a BLM Resource Area for a set period of time, as a demonstration project. At the end of the demonstration, if it was considered successful, the BLM would be replaced throughout the state. Senator Regan inquired if the plan would include multiple land use. Chairman Rhoads confirmed it would. SENATOR REGAN MOVED TO ASK FOR A BILL DRAFT TO CREATE A PANEL TO PUT TOGETHER IN THE NEXT 2 YEARS AN IMPLEMENTATION PLAN FOR THE STATE TO MANAGE A BLM RESOURCE AREA FOR A SET PERIOD OF TIME, AS A DEMONSTRATION PROJECT. SENATOR MCGINNESS SECONDED THE MOTION. THE MOTION CARRIED UNANIMOUSLY. ***** The hearing was opened on Senate Bill (S.B.) 103. Chairman Rhoads asked if there was anyone present who wanted to testify on the bill. SENATE BILL 103: Authorizes board of directors of irrigation district to allow transfer of storage water to land excluded from storage benefits of district irrespective of size or ownership of parcels of land. (BDR 48-996) Jim Weishaupt, Manager, Walker River Irrigation District, testified that the members of the Walker River Irrigation District, since the passage of Nevada Revised Statutes (NRS) 539.705, have been served well by its provisions. Along with zoning and other Lyon County master plan use designations, agriculture has maintained its viability. Mr. Weishaupt told the committee the intent of the original language was to preserve the large agriculture-farm units by not allowing small parcels of stored water rights to be transferred to less than 40 acres, and only if within one ownership. He said in lands that previously had surface water rights, the conversion of large farms into small hobby-type farms not only degrades the efficiency in which a water distribution system can operate, but may affect the rights of others by interfering with their delivery. Mr. Weishaupt continued, saying Lyon County, in response to the Nevada state engineer's recommendation is now requiring the withdrawal, or relinquishment, of 2.02 acre feet per household before a subdivision is approved. In short, significant supplies of water are becoming tied up within subdivided units. This water is not being used for irrigation, putting the right in jeopardy and basically it is an impractical management of a limited existing water supply, restricted from use by Nevada's statutes. Mr. Weishaupt said, in brief, the board of directors has the authority and, by practice endorsed by the Nevada state engineer, to transfer stored water rights from one parcel to another within the boundaries of a district. Change applications in the form of a petition to the board of directors are allowed, assuming that they meet the present 40-acre limitation and one owner. His organization is asking for the committee's favorable consideration of the suggested changes in NRS 539.702. These changes allow for more flexibility in the administration of the rights, and provides means by which the owner can make choices on what can be done with water rights. The changes in the bill open the use of locked up rights to be used potentially in the resolution of other major issues on the Walker River. On behalf of the district members the committee was asked to approve S.B. 103. Doug Busselman, Executive Vice President, Lobbyist, Nevada Farm Bureau Federation, declared his bureau's support of S.B. 103. The hearing on S.B. 103 was closed. ***** Chairman Rhoads opened the hearing on Senate Joint Resolution (S.J.R.) 16. SENATE JOINT RESOLUTION 16: Urges Congress to maintain United States Geological Survey. (BDR R- 1653) Pete Morros, Director, State Department of Conservation and Natural Resources, testified in support of S.J.R. 16. He stated his department has been extremely concerned about the reports coming out of Washington, D.C. concerning the United States Geological Survey (USGS). The primary concern centers on the Water Resources Division of the USGS, the federal agency with which his department has a long-standing cooperative program. That program has produced a tremendous amount of scientific data and technical information on which his department relies in the decision making process, particularly the state engineer's oOffice, and to some extent, the Division of Environmental Protection. Mr. Morros informed the committee that in Federal Fiscal Year (FFY) 1994, there was a total of $10.4 million invested in Nevada in water studies and scientific efforts. Of that amount, state and local agencies contributed $2.4 million. The remainder of the total amount invested was contributed by the USGS through the federal match, or by other federal agencies. For the $2.4 million, Nevada received $10.4 million worth of scientific data and information. Mr. Morros stressed the program is extremely important to Nevada and urged the committee to pass S.J.R. 16. In answer to Senator Rhoads' question as to whether any actual legislation has been introduced to cut any funding from the USGS, Mr. Morros reported the last information he had was there will be at least a 25 percent reduction in the funding for the USGS. He further stated, if the USGS is dissolved, some of the duties and responsibilities associated with stream monitoring and things of that nature are going to be turned over to the Environmental Protection Agency, which would not be in the best interests of Nevada. Senator Adler voiced his shared concerns on the USGS threat. Senator James echoed Mr. Morros' concerns, adding southern Nevada does not have enough water information available, and to eliminate one of the better sources of this information would severely handicap that area of the state, also. SENATOR ADLER MOVED TO DO PASS S.J.R. 16. SENATOR REGAN SECONDED THE MOTION. THE MOTION CARRIED UNANIMOUSLY. ***** The hearing on Senate Bill 191 was opened. SENATE BILL 191: Revises provisions governing forfeiture of right to use ground water. (BDR 48-538) Senator McGinness, Central Nevada Senatorial District, related S.B. 191 was introduced on behalf of his constituents in Amargosa Valley. He called on his constituents, who were best prepared to speak to the issue, to come forward to testify. R. Michael Turnipseed, State Engineer, Division of Water Resources, State Department of Conservation and Natural Resources, critiqued S.B. 191 stating it is simply an attempt to put into code the results of a Supreme Court decision in a case known as Eureka vs. Morros. He said the Eureka decision essentially allows a water right holder who has gone beyond the 5 years of nonuse to cure a forfeiture by substantially reusing the water, and added there is no real definition of "substantial" in this matter. The Eureka decision has been slightly misinterpreted and therefore Mr. Turnipseed submitted suggested changes in the wording of the bill to more appropriately reflect the Supreme Court findings (Exhibit D). Senator Rhoads asked how the amendment would affect Amargosa Valley? Mr. Turnipseed related in Amargosa Valley there had been a petition from an outside party to declare approximately 25,000 acre-feet of water rights forfeited. That petition was filed in connection with applications to appropriate about 25,000 acre- feet of water to be shipped to Las Vegas, presumably. That process is just now beginning the evidentiary stage. Senator Rhoads wanted to know if the bill with the proposed amendment had been in place, how it would have affected the Amargosa petitioners. Mr. Turnipseed could not recall when the petitions in question were filed, but said it was probably in either 1992 or 1993, and that means that the clock stops as far as the forfeiture procedure is concerned. In other words, he said, the petitioner was claiming a nonuse of water between 1987 and 1992. His office staff has found through the pre-hearing process that approximate time frame was not the case in many instances, and those petitions have been withdrawn. Mr. Turnipseed stated now, 3 years later, the forfeitures have not been declared either way as being still active or having been forfeited. Presumably, with S.B. 191 as written, users could be irrigating now and substantially curing the forfeiture. Ralph McCracken, Concerned Citizen, water right owner, and a farmer from Amargosa Valley, testified the change in this law, as written, would make it much easier for anyone, including the state engineer, to look at a situation and make an easy and accurate decision as to the status of a water right. He stated had this law been changed, as directed by the Eureka decision, he would not have been held back more than a year on establishing multi-crop usage on his water right. He maintained the agricultural stipulation of the conservation services (ASCS) took the position that since the water right was being questioned or looked at, they would not participate in a conservation project on that water right's place of use. A year later, only when Mr. McCracken was able to convince the agency in charge their own records showed continuous use for more than the last 5 years, did they approve the application. Mr. McCracken claims he is not the only person who has been financially or economically hurt by a petitioner who alleges nonuse to the state engineer. Mr. McCracken's neighbors, Ron and LaVonne Selbach, lost the interest from Basic Vegetable Products because of a challenge, not because of a decision on water availability (Exhibit E). Mr. McCracken stated the Eureka decision gives state lawmaking bodies a clear mandate to change the law, and even the state engineer agrees. Functionally, Mr. McCracken said he has been guilty of nonuse; when, in fact, there has been no decision at all, and he has actually been using the water. He stressed the bill as written needs no amendment. Senator James wanted to clarify the amendment's content. The amendment makes sure the cutoff period for substantial use, which would amount to a cure, is the initiation by the state engineer of the forfeiture procedure, instead of the ultimate decision that there is a forfeiture which might occur down the road. Senator James asked why Mr. McCracken is against this amendment to the bill? Mr. McCracken explained in the Eureka decision there are two cases referenced which talked about having the point of time for the cure to be able to happen all the way up to the point of decision. He said right now there are people in Nevada who are potentially in the position of being in a second forfeiture position because they have not received an answer back from the state engineer's office for 5 years after the case has been heard. Senator James stated the court ultimately decided it would be the point of the initiation of the forfeiture time. He said the court was concerned about people just using water to pump up water rights to show use when there was really no beneficial use in the past. Senator James added this part of the decision was necessary, because once a person is alerted to a problem with usage over the past 5 years, it makes a mockery of the proceedings because the state engineer is trying to show it on historical use, while the water right owner has begun to show as much usage as possible. Senator James continued saying this is a concern because on the interim committee on which he served, there was a big discussion on whether the law should be amended to give notice to people that had a problem with their water rights. Then after the notice, if those people did not use their water beneficially, they would lose their water rights. The interim committee chose to stay with the Eureka decision. Senator James pointed out this bill was meant to preserve the intent of the law which stated water rights would be forfeited if they are not used beneficially. He added, while at the same time, curing the inequitable situation where water was used from 1960 to 1975 and then not used form 1975 to 1980 and then reused from 1980 to 1985. The state engineer picks a forfeiture date and cannot look back to a time when there was a defective past. Mr. McCracken told the committee there have been points in time in the Amargosa Valley where it was not economically feasible to grow crops due to the unavailability of markets within a reasonable transportation distance. Since the Las Vegas Valley area has grown, new markets have opened and it has become feasible to grow crops in Amargosa Valley. Many people had no idea there was a way to get an extension of time to cure a forfeiture. Chairman Rhoads asked if the amendment would correct that problem? He indicated the amendment states the right must not be forfeited if the holder of the water right provides sufficient proof to the state engineer that the water has been substantially used after the engineer has begun a forfeiture proceeding. Senator Rhoads queried if this meant if the person uses the water when the forfeiture proceedings is noticed, the forfeiture is canceled? Senator Adler read the amendment differently. To him the amendment states that if the 5-year period has elapsed and then the water is put to use, but prior to anyone initiating a forfeiture, then it is not forfeited. Thus, the 5 years may be exceeded, but not past the time of the notice of filing of forfeiture. Mr. McCracken repeated there were people who were unaware they could extend the 5-year period, so they do not apply for an extension. Then, the engineer comes along and says, by the way, there has been no usage so the water rights are forfeited. Mr. Turnipseed agreed some people are not aware of the provision under NRS 534.090 which allows relief of this obligation of having to use water at least once in every 5 years by applying for an extension. He indicated his office processes extensions on a routine basis and he does not recall ever denying an application for extension. He said at the last session of the Legislature there was quite a bit of testimony on speculation. Mr. Turnipseed stated, "This is the purest form of speculation. A person has a water right, perfects it, sits on it for 20 years until it becomes worth something, mainly when the state closes the basins to any new water appropriations, and then the person turns around and sells it to a developer." He said his office is not in existence primarily to take water rights away from people. The office was created to protect peoples' water rights. Nonetheless, if it goes 5 years without use, there must not have been much economic return on the water. If, as Mr. McCracken says, it became uneconomic to use the water for mining, for agriculture, or whatever, the extension provision is in the law. After much discussion by the committee on an apparent typo, or misprint, in the proposed amendment to S.B. 191, it was determined the amendment's last words should be changed from "declared a forfeiture" to "begun a forfeiture proceeding," and then to add the definition of a forfeiture proceeding. Michael DeLee, Concerned Citizen, asked to go through the material he had presented to the committee members and then he would come back and address the points raised by the previous testifiers on the bill. Mr. DeLee is of the opinion the Eureka decision, while it laid down some case law for Nevada, was also somewhat vague. He said the vagueness of the decision is what precipitated S.B. 191. He commented this bill will put the decision directly into statute for every layman to read and help avoid problems testified to by Mr. McCracken and others who cannot understand the law. He directed the committee's attention to two notices, one dated June 16, 1993 (Exhibit F), and the other notice dated November 27, 1989. The June 16, 1993 notice relates to the Amargosa Valley which is being referenced to signify the time "when the clock stops." After this time, according to the state engineer, anything done concerning the water rights is irrelevant. Chairman Rhoads asked for clarification on what constituted beneficial use to the state engineer. Does 1 day starting the pumps suffice, or does it have to be a season of usage? Mr. Turnipseed explained the Supreme Court was quite clear in saying there must be substantial use. The Eureka decision, however, did not define substantial and therefore is vague on that point. Mr. DeLee again repeated his position the law needs to be clarified to eliminate the vagueness of the Eureka decision. In the memorandum from Nye County (Exhibit G), the third paragraph refers to the Eureka decision and the Supreme Court's interpretation of NRS chapter 534.090 and its holding that the curing period for a water right forfeiture extends until forfeiture proceedings are initiated, will stand as the law for Nevada. Mr. DeLee wants to amend this chapter in NRS to address vague language in the Eureka decision, but he does not want to address all the vague language. Substantial use is very difficult to define to everyone's satisfaction. He suggested the state engineer office staff are professionals and are the best judges of what constitutes substantial use. Mr. DeLee pointed out hearings have been held in Amargosa Valley back several years. At the last hearing on Amargosa Valley water rights, a very respected water attorney insisted the clock does not stop upon notification such as that issued in the June 16, 1993 notice. Mr. DeLee stated the attorney's position was the clock stopped when permits to appropriate water from the Amargosa Valley were filed and declared forfeitures on the existing water right holders. He referred to a Memorandum of Option Agreement (Exhibit H) between Amargosa Resources, Inc. and American Land Conservancy. Mr. DeLee questioned the sincerity of Amargosa Resources, Inc. and said this agreement raises the question of speculation which falls under the purview of substantial use. Again, returning to when the clock stops, Amargosa Resources, Inc. argued the clock stopped when they filed the application. Mr. DeLee referred the committee to page 169 of the Town of Eureka V. State Engineer (Exhibit I), to wit: Under the rule we adopt, substantial use of water rights after the statutory period of nonuse "cures" claims to forfeiture so long as no claim or proceeding of forfeiture has begun. Mr. DeLee indicated there is an operative in the sentence, "or." "Claim" could certainly be Amargosa Resource's claim, and the "proceeding" would be the June 16, 1993 letter. Therefore, there is one party making a legal argument the claim is dated December, 1992, and the other party making the argument the proceeding is dated June, 1993. Mr. DeLee said to his knowledge there has not yet been a ruling in court. Mr. DeLee maintained the notice and the clock stopping has a big effect. He told the committee that on November 27, 1989 a notice was issued concerning Diamond Valley near Eureka and a hearing followed in January. People there went through circumstances very similar to those the people of Amargosa Valley are going through. He said people in the Eureka area claim to have not heard, in over 5 years, whether or not they have actually lost their water rights. That although they had their day in court (the hearing in January, 1990), they do not have any determination, and this results in a real question. Where is due process left? Is it left on the side of the water right owners, or at the administrative level? Mr. DeLee pointed out the forfeiture process, which was estimated to take a year, is still going on after 2 years in the Amargosa Valley, and the individuals involved in the forfeiture process in Eureka are still in limbo after 5 years. Research led Mr. DeLee and his associates to "Corpus Juris Secundum" (CJS) (Exhibit J). He had a previous discussion with Karen Peterson, the attorney who handled the Town of Eureka case. Ms. Peterson informed Mr. DeLee that on page 999, CJS, in item c., last paragraph it states: It has been held that a forfeiture does not become perative until it is formally declared by someone clothed by law with authority to de- clare it, and that until such time, the owner retains title to the water right and may resume his use of it, and where the resumed use is continued for a substantial period of time, the water right may no longer be declared forfeited. It seems to Mr. DeLee a mockery has occurred both to the people of Amargosa Valley and Diamond Valley. He said it is very questionable whether due process has been served when such process is taking years and years to complete. By adopting S.B. 191, as it was proposed, it will possibly have the effect of reorganizing the priorities of how forfeitures are handled. Mr. DeLee remarked forfeitures should be handled with the highest priority, and the Supreme Court seems to concur wherein it says it needs not a preponderance of evidence, but clear and convincing evidence. It needs to be treated the same as real property. Mr. DeLee said the Supreme Court specifically says forfeitures are disfavored, and that all these items speak to coming down on the side of the water right owner, which is something there seems to be agreement of in theory. However, he stated, in practice, there seems to be a question of how it can be done, and to solve the problem the language of CJS must be adopted as is used generally and what the law is and how it should be applied specifically in NRS as the Eureka case is applied to the statute. Senator Adler offered there have been several large filings from Clark County on rural water. He queried if the state engineer were to grant those water rights and Clark County does not utilize them for 5 years, then should Clark County be given a warning toward the end of the 5-year period so those rights will remain perfected? He pointed out by doing that every 5 years, the county could hold onto the water rights for 20 or 30 years, making them unavailable to the rural counties. He quipped that this is the flip side of this argument. Mr. DeLee disagreed because NRS chapter 534, which deals with ground water, is under discussion. He recognizes surface water and ground water have many similarities in how they are administered, but there are also a great many differences in the administration. He said applications from Las Vegas such as mentioned would fall under NRS chapter 533. Senator Adler explained he, too, was talking about ground water, not surface water, and disagreed with Mr. DeLee's explanation concerning the two chapters of NRS. Discussion on both chapters ensued with the consensus that forfeiture can occur to both surface and ground water rights and the same provisions seem to apply to both chapters, and if NRS chapter 534 is amended, then NRS chapter 533 should probably also be amended. Senator James asked if the law were changed if it would affect the situation in Amargosa Valley as S.B. 191 makes no reference to being retroactive. Mr. DeLee agreed there is nothing in the bill in regard to being retroactive to restore water rights as a result of passage. He recognized the people in the Eureka case still do not have an answer and Amargosa Valley does not want that to happen to them, too. Senator James said he is satisfied after the discussion, S.B. 191 would have no effect on current Amargosa Valley cases. That the question raised concerns the date a forfeiture is ultimately declared. Senator James said nothing has been said which demonstrates why moving the date forward for the forfeiture would not create a complete travesty. He asked why the state engineer would go through a forfeiture proceeding if during the whole time the evidence is being looked at, the evidence is changing? Chairman Rhoads announced he would hold another hearing on the bill because time is needed to digest all the information received. Mr. DeLee concluded his testimony by stating the travesty is not what might occur, but what is presently occurring. He remarked waiting over 5 years for a decision is a travesty. That the fact there is no guiding or specific language on which to base a consistent approach to forfeiture of water rights in the State of Nevada, even though it exists generally in CJS, is a travesty. He stated that it is precisely why he is working to incorporate the general provisions of CJS into Nevada statutes. That right now there are two dates being used, and there are equally valid arguments on both sides. He pointed out S.B. 191 is to determine which date is to be used. Chairman Rhoads said the committee will review the information they have received on the measure and all interested parties will be notified the next time there is a hearing. Gary Gilgan, Concerned Citizen, and a land owner with water rights in Amargosa Valley, testified in opposition to the amendment proposed for S.B. 191. He stated when his mother acquired land with water rights in the late 1970s or early 1980s, he accompanied her to the office of the Division of Water Resources to help transfer the water rights to her name. He said following the filing of copies of the deeds and taking other necessary steps in order to get the water rights into her name, they were told by the office staff of the Division of Water Resources, State Department of Conservation and Natural Resources, that nothing more was required to keep the water rights active once the water rights had been transferred. Then they began using water, but they did not document the usage to any great extent. Then, approximately 2 years ago a notice was received stating a forfeiture hearing would be held shortly. Mr. Gilgan said 73 permits were being petitioned for forfeiture by a group some believe are water speculators. Mr. Gilgan and his mother were given a deadline of April 15, 1994 by which to submit evidence of beneficial use. He said 14 of the 73 permits were eventually dropped for various reasons. Mr. Gilgan stressed this whole procedure could have been avoided and tens of thousands of dollars saved by sending water right holders a 19 cent postcard instructing water right holders to use their water, file an extension or lose the water rights. He stated in almost 2 years since the notice was sent, a total of two forfeiture hearings have been held. He objected to the language in S.B. 191, which indicates water right owners might try to cure their water rights while the hearings are in progress, but if the hearings were held in a timely manner, this would not be a consideration. Mr. Gilgan provided further information for discussion on the status of his water rights. Chairman Rhoads asked Mr. Turnipseed to respond to some of the issues raised. Mr. Turnipseed responded that during a Legislative Interim Study the process of notification was discussed. It was the consensus it would have been very time consuming and expensive, as well as a complicated thing to do. Mr. Turnipseed reported there are a little over 60,000 water rights in the state which are post statutory. He explained that is where an application has been filed and a permit granted. He indicated he did not know what percentage of this number are permits for ground water and what percentage are for surface water. He did want to mention he had 4,200 applications for water rights ready for action, 1,600 of which are protested. Mr. Turnipseed emphasized holding hearings to take water rights away from people is not very high on his list of priorities. Mr. Gilgan finished his testimony by maintaining before a water right is taken away, some notice should be given to those involved which informs them they have the opportunity to file an extension and the reasons for which the time can be extended. Senator Rhoads asked Mr. Gilgan if he agreed with the water engineer that S.B. 191, as written, is an improvement. Mr. Gilgan agreed the original S.B. 191 before the amendment is an improvement, but he opposes the amendment, because the forfeiture hearings have been going on for quite some time. Senator Jacobsen observed Mr. Gilgan had indicated he utilized water on his land, but did not have proof. He asked Mr. Gilgan if he did not have any power bills or copies of invoices for products sold, or anything to substantiate water usage. Mr. Gilgan said he had photographs taken after the state engineer ordered the evidence presented. However, it was observed at the first two hearings photographs taken after the notice was sent, but during the gathering of evidence time, were objected to because they were not taken before the notice was sent. Laura Lilly, Concerned Citizen, testified residents of the Amargosa Valley water basin who have purchased water rights in good faith and sold them in good faith, and expended money and efforts on those water rights in good faith want to be assured no other Nevada water right owners are put in the situation those in the Amargosa Valley find themselves. She said land and water rights had been purchased shortly prior to 1993, and at that time, the land was in agricultural use. She stated she checked with the Division of Water Resources about the water rights and was told the water rights were in good order and later were held in forfeiture hearings for prior years for which they had absolutely no personal knowledge. She indicated she is not the only one to which this has happened. Chairman Rhoads asked Ms. Lilly how many acres she owns in the Amargosa Valley. Ms. Lilly responded she owns 50 acres with 40 acres of water rights. All 40 acres still have the line and levees. She said everyone seems to know water rights are a valuable commodity, but since 1993, the value of the properties are in question because of the cloud on the water rights and many owners are in a state of limbo. In answer to Senator Jacobsen's question regarding how many water right holders were involved in the hearings, he was told there are 70-75 in the Amargosa Valley. Chairman Rhoads announced there would be no vote on the bill today. He suggested committee members refer to the interim water study report on the hearing held in Amargosa Valley. He also asked all those present who were interested in being kept informed to leave their names, addresses and telephone numbers with the secretary. When discussion is to be held on the bill in the future, those interested will be given plenty of notice so they can participate again. There being no further business, the meeting was adjourned at 3:55 p.m. RESPECTFULLY SUBMITTED: ____________________________ Sandy Arraiz, Committee Secretary APPROVED BY: _________________________________ Senator Dean A. Rhoads, Chairman DATE: ___________________________ Senate Committee on Natural Resources March 20, 1995 Page