California increases fines for diversions and unauthorized uses of water | Allen Matkins

As California prepares for future cycles of water scarcity, the Legislature continues to prioritize improving regulations to address critical water supply needs, ensure the rights of diverse water owners, and protect resources essential environmental On September 22, 2024, Governor Newsom signed AB 460 into law, a bill that significantly increases fines for unauthorized water diversions and other violations of state orders related to water use . AB 460 was introduced in response to limitations in existing provisions of the California Water Code that limited maximum fines for violations of diversions and appropriate water uses to $500 per day. During the 2022 drought conditions, the California State Water Resources Control Board (the Board) issued emergency drought reduction orders on the Shasta River to protect salmon and rights holders water Violators were subject to the maximum legal fines, but the maximum limitation of $500 per day proved insufficient to deter many from continuing to divert water from the river. AB 460 increases the penalties the Board can impose in various circumstances and strengthens the Board’s enforcement powers in a way that advocates hope will prevent future violations.

The Board fulfills several important functions in the management of the use of the water resources of the state. As the water rights and permitting agency, it oversees the allocation and regulation of surface water appropriation rights acquired after 1914. Although the Board does not issue permits for riparian appropriation rights, overlying or prior to 1914, has at least some oversight and enforcement powers in connection with the exercise of all water rights in the state. For example, under Section 1831 of the Water Code, the Board may issue cease and desist orders when it determines, among other matters, that there has been a violation of (1) one of its orders or regulations; (2) any term or condition of the permit; (3) withdrawal restrictions imposed on groundwater pumping under the Sustainable Groundwater Management Act (SGMA); (4) the provisions of the California Constitution against unreasonable use of water; and (5) drinking water use for non-potable uses. The Board may also conduct investigations, issue orders, and make determinations regarding the scope and validity of any surface water rights, including pre-1914 riparian and appropriation rights. This comprehensive approach ensures that water resources surface areas of the state are managed sustainably while guaranteeing the rights of various users and protecting environmental needs. Consequently, the increased fines established by AB 460 could affect a wide variety of water users across the state.

Under the changes in AB 460, the maximum fine imposed under Section 1846 of the Water Code will increase to $1,000 per day for any person who violates (1) a permit, license, certificate, or registration issued by the board; (2) a regulation or order adopted by the Board; or (3) a condition or reporting requirement for the diversion of floodwaters for groundwater recharge. If the violation is the diversion of water in violation of a restriction order adopted by the Board, the maximum fine shall be $10,000 for each day the violation occurs and $2,500 for each acre-foot of water diverted, from the first day on which the infringement occurs. the violation occurs.

AB 460 also increases penalties for certain violations of cease and desist orders issued by the Board. Violation of a cease-and-desist order during a critically dry year that immediately follows two or more consecutive below-normal, dry, or critically dry years, or during a period in which the governor has declared a drought emergency , is already subject. to a fine of $10,000 per day under the Water Code. AB 460 increases the fine for all other violations of a cease and desist order from $1,000 per day to $2,500 per day. As described above, the Board’s authority to issue cease and desist orders extends not only to violations of permitted water appropriation rights, but also to violations of other orders and regulations , unreasonable uses of water in general and pumping of groundwater in violation of SGMA restrictions. . Therefore, the penalties in AB 460 could also have implications for many types of water users, including appropriated, riparian, and certain pre-1914 groundwater users in watersheds regulated by SGMA .

Finally, to ensure long-term future compliance, AB 460 adds a provision to the Water Code that requires the Board to adjust for inflation all civil and administrative liabilities or penalties it imposes or in a right-of-way action water presented at the request of the Board. The requirement to adjust for inflation does not affect the other statutory penalties in AB 460, described above. The Board will have to annually adjust the penalties it imposes for these violations from January 1, 2026.

The new law recognizes the growing importance of access to water, especially in times of scarcity, and aims to alter the economic dynamics so that paying penalties or fines is no longer a financially prudent option. It remains to be seen whether the value of continued water use will outweigh the costs of the newly imposed penalties. The increased liability and penalties under AB 460 underscore the caution that California water users and diverters must exercise to comply with applicable legal requirements.

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