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Show the creation of an Indian reservation by the United States impUedly reserved sufficient water from the Milk River in Montana to satisfy the agricultural needs of reservation lands. This case gave rise to what commonly is referred to as the " Winters Doctrine." Since the United States has no source of power or control over water other than ( 1) ownership rights and ( 2) regulatory authority, it is clear that the Government must have relied on one of these sources of power in withdrawing and reserving water for use on the reservation. And, since a regulatory power does not create ownership rights, it necessarily follows that the Government must have held ownership rights in the Milk River sufficient to allow the withdrawal of water for use on the reservation. The only source of ownership rights which the Government could have had was through riparian rights, since it owned land adjacent to the Milk River but had not made any appropriation under the laws of Montana. This conclusion seems to have been borne out in Arizona v. California, 373 U. S. 546, 595- 601 ( 1963), which is the Court's most definitive statement of the " reserved" water rights of the United States. There, the Court held that the creation of federal reservations impliedly reserves sufficient water from streams arising on or flowing across the reservations to satisfy the purpose or purposes for which the reservations were created. The obvious question, then, is how these continuing riparian rights of the United States are to be correlated with state ownership and control of water. The essential answer lies in the " priority date" of rights created by federal reservations, whether for Indian use or for federal purposes. The priority date is the date when the reservation was officially established. This means that water rights held by private persons and initiated prior to the creation of a federal reservation, will be superior to and have a priority over water rights reserved by the creation of the reservation. Conversely, state- created water rights that were initiated after the reservation was created are inferior and junior to the rights reserved by the creation of the reservation, and as the reserved rights are developed and the water put to use, the junior private rights may be impaired or destroyed without compensation. Thus, the priority of date of federal reserved rights makes the reservation doctrine consistent with the congressional acts of 1866, 1870, and 1877, and with the Supreme Court's opinion in the California Oregon Power case, supra. In other words, federal riparian rights were not extinguished in appropriation States, but were simply made subordinate to water rights created under state law. This gives appropria- tors valid water rights with complete security of title. However, if and when the Government decides to exercise any of its riparian rights, it does so by expressly creating a federal reservation, and this serves as the " appropriation" or " notice" to everyone within the State where the reservation is created that the Government's riparian rights have been exercised to the extent necessary to satisfy the water needs of the reservation. Sometimes this proprietary arrangement has been characterized as an " offer" by the Government to prospective private water users to acquire rights under state law, and to the extent that the offer is " accepted" through the acquisition of such state- created rights, they cannot be divested; but, to the extent unappropriated water remains in the watercourse, then to that extent the federal offer has not been accepted, and in law an offer may always be withdrawn until it has been accepted. In this characterization, creation of a federal reservation withdraws the outstanding federal offer as to those waters reserved by the reservation, and as to all other waters the federal offer to private appropriators remains open and in effect. The most difficult aspect of federal and Indian reserved rights is that they are not quantified by the statutory reservation. They are merely implied reservations of water, with no mention of water- use and no indication of the volume or amount of use intended by the reservation. Since circumstances change, the extent of possible future development and use of water under reserved rights cannot be predicted. Oil shale and other mineral development, for example, could require water use on Indian lands for purposes not foreseen when the reservations were created. It seems logical that water use under reserved rights should not exceed a " reasonable use" as measured by state law, because reserved rights are bottomed on riparian rights, and " reasonable use" is always a limitation on the exercise of riparian rights. But no case has yet addressed this questions. III. Prospects for Sale of Water As indicated above, uncertainties exist as to the extent that water is " owned" by the States, or by the United States, or by anyone else, while it remains in natural watercourses; and further uncertainties exist with respect to the unquantified nature of federal and Indian reserved rights, as well as to the nature of subordinated but continuing riparian rights of the Government in appropriation States. Despite these uncertainties, a number of proposals have been made by legal scholars concerning sales of unappropriated water by States. Some of those are noted below, along with further comments about the prospects of water sales or the imposition of water- use fees. A. Interstate and Interbasin Sales The question of major interbasin transfers from one region of the Nation to another region has been hotly debated for years, and was one of the reasons for creation of the National Water Commission. One of the most prominently discussed potential transfers was |
