Clyde Snow

My Property has Water Rights. Now What?

by | Jun 21, 2024

Congratulations on your new property, which includes water rights! Understanding the significance of these rights and the necessary steps to manage them is crucial to protecting your investment. Today’s blog equips you with the knowledge to comprehend the implications of water rights and the actions necessary to ensure your rights are in good standing, appropriately transferred in your name, and continue providing value to your property long into the future.

What Are Water Rights?

Under Utah law, a water right is an inchoate real property right representing the ability to use a specific quantity of water for a defined purpose.

Benefits of Having Water Rights:

Having water rights in good standing that are recognized by the State Engineer enhances your property’s value. This is particularly advantageous if located in quickly growing regions of the state where water resources are scarce.

Having updated title and clear documentation of your water rights’ use or changes in use provides security and stability, making your property a valuable investment. Understanding and managing your water rights so they remain in good standing is fundamental to ensuring your property’s value continues to increase for years to come.

Determining Your Water Rights:

To determine whether your property has water rights, review the Division of Water Rights website and call Clyde Snow to assist with information about your rights’ priority dates, available quantity, recognized uses, and authorized diversion points and places of use. Be diligent about monitoring your water rights; non-use, overuse, unauthorized use, or failure to complete the administrative process of appropriating a water right could result in costly disputes and expensive limits being placed on the water rights.

Financial Considerations:

Water rights are valuable. Losing a water right or having the Division of Water Rights reduce your available water significantly decreases your property’s value. Purchasing a new replacement water right can cost tens of thousands of dollars per acre-foot. There are many ways to protect yourself against potential loss, and Clyde Snow can help you navigate the administrative options available to protect your water rights.

Before listing your property for sale, ask Clyde Snow to conduct a due diligence review to make sure that in selling your property, you’re not leaving money on the table and missing out on the significant increase that water rights can have on your property’s value. Similarly, when purchasing a property it’s a good idea to conduct a due diligence review of any water rights that may accompany the property. Without a contemporary review of the water rights, you may significantly overpay for a property with rights that aren’t available for use, or that can’t be changed to different uses or locations.

Potential Challenges and How to Address Them:

Several challenges often arise with water rights. Ownership disputes, use or non-use issues, limits on changing the use of the water or the places where the water is diverted from and put to use, regulatory compliance, infrastructure, maintenance, water quality issues, and land use conflict are all common issues.

Most of these issues require engaging with the Utah Division of Water Rights. Clyde Snow can help identify whether your water rights are in good standing and assist you with administrative and judicial actions to protect your rights.

Rights not in good standing may be subject to forfeiture or changes in the quantity of water available should the intended use of the water change. Clyde Snow can help you protect your right against forfeiture and changes in the amount of water available and help you navigate Utah’s complex and ever-shifting water policy landscape.

When Should I Hire a Water Attorney?

One of the most critical times to hire a water attorney is before purchasing or selling a property. An attorney can help you determine whether the property you are buying has actual usable ‘wet’ water associated with it or whether the water is primarily ‘paper’ water that exists only in records and will not translate to actual water that can be put to use on the property.

When buying or selling a property, a water rights due diligence review can be a powerful negotiation tool and significantly impact the ultimate sale price. A review can also protect you from poor financial choices by informing you of the total value of your property, ensuring that you consider the value of the associated water. A water attorney can also ensure that the title to the water rights is updated with the sale, saving you from costly legal disputes down the road.

Understanding the complexities of water rights can be challenging, but you’re not alone. Clyde Snow’s Natural Resources and Water Law attorneys are here to provide expert guidance and answer any water-related questions. We’re committed to ensuring you are supported and confident in managing your water rights. Contact us today to learn how we may help you with all your water-related issues. 801-322-2516

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