3. Constitutional “takings” developments. There were two significant court opinions in 2012 that involved constitutional takings of importance to agriculture. One is a Texas Supreme Court opinion that is important for the utilization of underground water for crop irrigation purposes. The second case involved the U.S. Supreme Court’s decision in a case involving temporary flooding of farmland.

The power to “take” private property for public use (or for a public purpose) without the owner’s consent is an inherent power of the federal and state government. However, the United States Constitution limits the government’s eminent domain power by requiring federal and state governments to pay for what is “taken.”*4 The Fifth Amendment states in part “. . . nor shall private property be taken for public use without just compensation.”*5 The clause has two prohibitions: (1) all takings must be for public use, and (2) even takings that are for public use must be accompanied by compensation.

In 2012, the Texas Supreme Court issued an important decision in a case with significant implications for agriculture involving the appropriation of water for agricultural purposes. In the mid-1990s, the farmers involved in the case were denied a permit to pump water from the Edwards Aquifer for use on their ranch near San Antonio. Their permit was denied because they couldn’t prove historical use of the aquifer. As a result, they were granted 14 acre-feet of water rather than the 700 acre-feet that they requested. Under Texas law, landowners have an absolute right to water beneath their land. Article I of the Texas Constitution provides: “No person’s property shall be taken, damaged, or destroyed for or applied to public use without adequate compensation being made.” Texas law specifies that both groundwater and oil and gas deposits are subject to the common-law rule of capture. Thus, landowners can (as long as malice or willful waste is not involved) use as much groundwater as can be captured without any liability to others. The plaintiff was created by the Texas Legislature in 1993 to manages groundwater usage in certain counties in southern Texas. The plaintiff grants water usage permits on the basis of “historic use” — the extent to which groundwater beneath a particular tract has been put to beneficial use in the past. But if groundwater hadn’t been used in the past, how could historic use be established? Under the facts of the case, the ranchers’ tract had an abandoned well on it without a pump. The defendants wanted to drill a replacement well so that they could irrigate their oats and peanuts and provide water to cattle. The plaintiff determined that the prior owner had used the old well to irrigate approximately seven acres in 1983 and 1984, so a permit was granted consistent with that historic use. The court determined that the denial of a permit allowing water withdrawals under the entire property was a taking. The court said that, for constitutional takings purposes, “property” may include more than just the surface estate. For example, the Texas Supreme Court unanimously held, on the basis of oil and gas law, that land ownership in Texas includes interests in in-place groundwater. As such, water cannot be taken for public use without adequate compensation guaranteed by Article I, Section 17(a) of the Texas Constitution. The court determined that the plaintiff’s practice of issuing permits based on historical use was an unjustified departure from the Texas Water Code permitting factors. The court’s decision is anticipated to enhance water conservation efforts in Texas and be influential in other states where irrigation is essential to crop and/or livestock production. The Edwards Aquifer Authority, et al. v. Day, et al., 369 S.W.3d 814 (Tex. 2012).

In late 2012, the U.S. Supreme Court further defined the scope of taking jurisprudence with respect to temporary takings. Under the facts of the case, the United States Army Corps of Engineers deviated from its operating plan for a dam that resulted in increased downstream flooding of a wildlife management area that the plaintiff owned. The flooding was only temporary and was not “inevitably recurring.” The trial court determined that the Corps’ action constituted the taking of a temporary flowage easement over the plaintiff’s property and awarded damages of $5,778,758. On appeal, the Federal Circuit reversed. But on further review by the U.S. Supreme Court, the Court agreed with the trial court and held that “recurrent floodings, even if of finite duration, are not categorically exempt from Takings Clause liability.” The Court’s opinion sends an important message to government agencies whose actions may have a temporary impact on private property rights — such impacts may be compensable. Arkansas Game & Fish Commission v. United States, No. 11-597 (U.S. Sup. Ct. Dec. 4, 2012), rev’g., and rem’g., 637 F.3d 1366 (Fed. Cir. 2011).