Diamond Nat. Res. Prot. and Conservation Ass\u27n vs. Diamond Valley Ranch, 138 Nev. Adv. Op. 43 (June 16, 2022)

This case addressed the scarcity of water in the Diamond Valley Hydrologic Basin located in Eureka County, Nevada. The Basin was over-appropriated and over-pumped causing the groundwater withdrawals from the Basin to exceed its perennial year. In 2011, Nevada Legislature enacted NRS 534.037 and NRS 534.110(7) to address the scarcity of groundwater in Nevada’s over-appropriated basins. NRS 534.110(7) provides that the State engineer may designate an over-appropriated basin a Critical Management Area (VMA). After an area is designated, NRS 534.037 allowed rights holders to petition the State Engineer to approve a Groundwater Management Plan (GMP) that set forth the necessary steps for removal of the basin’s designation as a CMA. Finally, to determine whether to approve the GMP, the State Engineer is required to weigh the factors under NRS 534.037(2). Diamond Valley was designated a CMA and its rights holder submitted a GMP to the State Engineer for approval. The GMP deviated some from the guiding principles underlying Nevada’s water law statutes (the doctrine of prior appropriation, which dictates that priority is assigned based on first in time, first in right to put the water to beneficial use). The State Engineer approved the Diamond Valley GMP. The crux of the case was whether NRS 534.037 and NRS 534.110(7) allowed the State Engineer to approve a GMP that deviated from the doctrine of prior appropriation. The Court held that the Legislature unambiguously gave the State Engineer discretion to approve a GMP that departed from the doctrine of prior appropriation and other statutes in Nevada’s statutory water scheme