On January 26, 2011, the Georgia Department of Natural Resources (DNR) adopted new rules governing surface water withdrawal permits that involve interbasin transfers. The rules are the latest and perhaps, for the moment, final step in the development of state water policy regarding interbasin transfers. The new rules will be effective in February 2011 and will be found in the Rules and Regulations of the State of Georgia, Rule 391-3-6-.07.

Changes to the laws regarding interbasin transfers have been proposed for close to 10 years in Georgia, starting with the Final Report of the Joint Comprehensive Water Plan Study Committee (August 2002) and continuing through the State Water Plan (January 2008). While the proposed regulatory approach has changed over time, the adopted rules follow the discussions closely and do not represent a significant deviation from earlier documents, in particular the State Water Plan.

The new rules first modify the definition of an “interbasin transfer” to “a withdrawal or diversion of water from one river basin, followed by use and/or return of some or all of that water to a second river basin.” (Rule 391-3-6-.07(2)(m).) The former definition was based on the location of return flows only, whereas the new rule expands the basis to “use and/or return” flows. “Basins” are defined as they were previously, according to a list of 14 watersheds in Rule 391-3-6-.07(2)(l), and as depicted in the colored areas to the right. The basins represent relatively large watershed areas, so that interbasin transfers are not unduly limited by separating small tributary watersheds.

The most significant provisions of the new rules establish factors that the Director of the Environmental Protection Division of DNR “shall” or “should” consider in evaluating permits for interbasin transfers. First, the Director “shall give due consideration to competing existing uses and applications for permits which would not involve interbasin transfer of surface water and … shall endeavor to allocate a reasonable supply of surface waters to such users and applicants.” (Rule 391-3-6-.07(14)(a).) Thus, before approving an interbasin transfer, the Director must evaluate and allocate water to existing water uses and pending applications for water in the donor basin, as well as projects in the receiving basin that could obviate the need for the interbasin transfer. This acts to ensure than an interbasin transfer is junior to all pending permits and applications for water, although it does not reserve water in the donor basin for uses for which no application has been filed. This requirement represents a relatively weak form of “basin of origin” protection.

A second, more comprehensive list of factors the Director “should” consider is found in Rule 391-3-6-.07(3)(b). The list is broken down into considerations related to the donor basin, the receiving basin and both areas. Factors include: the quantity of the proposed interbasin transfer; future water needs of the donor basin; water quality impacts in both basins; reasonableness of the proposed use of water; water conservation; the applicant’s efforts to explore “all reasonable options” for use of reclaimed water; connections between surface water and groundwater; any offsetting increases in flow in the donor basin that might be arranged through permit conditions (commonly called “physical solutions” in other states); the cumulative impact of interbasin transfers in the basins; economic feasibility, cost effectiveness and environmental impacts of the proposed project; impact on instream flows; and impact on interstate waters, if applicable. This is a relatively complete list of factors to evaluate an interbasin transfer and for the most part are fair and reasonable considerations. Critics have mostly focused on their perception that the list is permissive rather than mandatory for consideration by the Director (“should” rather than “shall”), and the length of the list and frequent use of terms like “reasonable” do give the Director significant discretion that may be difficult for a disgruntled applicant or interested party to successfully challenge in court. The very lack of a clear answer for any particular interbasin transfer may, however, make applicants and opponents less likely to defer to the Director and more likely to seek compromises they can control.

The new rules provide for increased public participation in the permitting process by lengthening the required public comment period to 30 days from seven under the current rules. This change applies not only to interbasin transfers, but any application for a surface water withdrawal permit. A 30-day comment period is more consistent with the practice in other jurisdictions and gives the public a much better chance to discover, review and comment on a permit application, especially in light of the frequent need for expert assistance and the long list of factors that could be addressed related to an interbasin transfer. As under the previous rules, the Director must hold a public hearing in the affected area(s) if he determines that sufficient public interest exists. That is likely to be the case for most interbasin transfers, which are frequently controversial in many jurisdictions, including Georgia.

As with all surface water withdrawal permits in Georgia, interbasin transfer permits are issued for a period between 10 and 20 years, although permits may be issued up to 50 years for government agencies where the longer period is required to provide for the retirement of bonds for the construction of water works related to the permit. Permit renewals are subject to de novo review of the water withdrawal, so that there is no legal presumption that an interbasin transfer will be allowed to continue after the initial term of the permit. (Rule 391-3-6-.07(9), (10).) This feature of permits tends to discourage investment in interbasin water infrastructure, which is often likely to be quite expensive, because a project proponent is not able to judge with certainty the return on its investment, in terms of either water or money. This is especially true for private entities, who are limited to 20 years. At a minimum, I would suggest that the rules be modified to extend permit terms for interbasin transfers to 50 years, with no discrimination between government agencies and private entities. A more complete fix would make withdrawal permits perpetual in nature, or, as a middle ground, establish a presumption in favor of renewal.

Overall, the changes to the Georgia rules on interbasin transfers represent a reasonable improvement. Their protection of future water uses in the donor basin is relatively weak, but quite reasonable in my opinion, especially given the short term of permits. The list of factors is complete, although there will be substantial areas for the Director to exercise his discretion in how to interpret particular factors and in how to weigh those factors to reach a decision. The strongest factors appear to focus on ensuring development of the full potential for water recycling and conservation prior to undertaking interbasin transfers. While I certainly support water recycling and conservation projects as vital to sustainable water management in Georgia and elsewhere, such a preference for some types of projects over others seems misplaced. Given the number of new interbasin transfers that have been proposed in Georgia in light of its water management struggles, I suspect we won’t have to wait long to see how the new rules will be implemented under the current administration.