THE COUNCIL OF STATE GOVERNMENTS

AUGUST 2013

CAPITOL RESEARCH
INTERSTATE COMPACTS

Supreme Court Issues Ruling in Red River Compact Case--Updated

A June ruling by the U.S. Supreme Court is being hailed as a significant victory for interstate compacts. In the case of Tarrant Regional Water District v. Herrmann, the court rejected the claims of the Tarrant Regional Water District to access water in Oklahoma based on the terms of the Red River Compact, concluding that under the terms of the agreement, Tarrant had no right to the water in question. At issue in the case was whether the Tarrant Regional Water District, located in Texas, could access water from the Red River in Oklahoma pursuant to the terms of the Red River Compact. Tarrant, which serves the Dallas-Fort Worth area, contended it had the right to access approximately 130 billion gallons of water over several years from the Red River under the 1980 Red River Compact, which has been signed by Texas, Oklahoma, Louisiana and Arkansas and received Congressional Consent in 1980. Oklahoma countered that the amount of water requested by Tarrant exceeds downstream amounts established by the terms of the compact. Like nearly all water allocation compacts, the Red River Compact contains language stating, nothing in the Compact shall interfere with or impair the right or power of any Signatory State to regulate within its boundaries the appropriation, use, and control of water, or quality of water, not inconsistent with its obligations under this Compact.1 This language is frequently included in water sharing compacts to protect individual state sovereignty. In September 2011, the 10th Circuit Court of Appeals in Denver ruled against Tarrant, stating in the ruling, the Red River Compact insulates Oklahoma water statutes from a legal challenge.2 While the appellate court conceded that the Red River Compact governs regional water allocation, it also noted the compact language gives considerable discretion as to how the member states regulate and apportion water under the terms of the agreement.

Significance of the Ruling

The Council of State Governments

The Supreme Court upheld the lower court ruling this summer in what is being hailed as a significant victory for interstate compacts. In the ruling, the Su-

preme Court concluded that Tarrant was not entitled to the water in question. The decision, written by Justice Sonia Sotomayor, was based on three factors, Three things persuade the Court that the Compact did not grant cross-border rights: the well-established principle that States do not easily cede their sovereign powers; the fact that other interstate water compacts have treated cross-border rights explicitly; and the parties course of dealing.3 The Courts decision reaffirms the contractual nature of interstate compacts, said Rick Masters, who serves as special counsel to The Council of State Governments National Center for Interstate Compacts. The ruling validates that compacts are protected by the contract clause of the Constitution and will be enforced according to the express terms of each such agreement. Other water resource management compacts were watching the courts ruling closely. In fact, the most common use of the compact mechanism is to manage shared natural resources such as water. Forty-four active interstate compacts are responsible for managing water resources, with 27 of those pertaining directly to the management of rivers or river basins. Masters noted, however, that he did not think the ruling would significantly impact similar compacts.
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The Courts analysis makes clear that the compact language must explicitly provide for cross border access and such authority will not be implied. In this instance, it was clear from the compact language the extent to which Tarrant was entitled to access water from the Red River, he said. Masters concluded that the Tarrant claim simply exceeded what was permissible under the terms of the agreement. In addition to the impact on interstate compacts, this case also was being watched closely for its impact on rapidly growing metro areas. The Dallas-Fort Worth area, which currently has more than 6.5 million residents, is the fastest growing metro area in the country according to the 2011 Census. Engineers from the Tarrant Regional Water District estimate that north Texas, which includes the Dallas-Fort Worth area, must double its water supply by 2050. In fact, the Obama administration encouraged the Supreme Court to hear the case largely because of concerns over water shortages in rapidly growing areas.

Implications for Interstate Compacts

While reaffirming the contractual nature of interstate compacts, the case also seems to protect individual state sovereignty. One of the major issues state legislators must address when considering any interstate agreement is the question of state sovereignty. Language protecting a member states right to regulate resources within its boundaries is common across interstate compacts; it is especially prevalent in water resource compacts and is intended to address state sovereignty concerns. By upholding the lower courts ruling, the Supreme Court has ensured that states can enter into interstate compacts while also maintaining and protecting individual state sovereignty. With approximately 215 active interstate compacts, including approximately 40 water resource management compacts, the high courts decision is a significant victory for state policymakers and interstate compacts.

Crady deGolian, Director, CSGs National Center for Interstate Compacts cdegolian@csg.org RESOURCES
The Red River Compact, http://apps.csg.org/ncic/PDF/Red%20River%20Compact.pdf The Tenth Circuit Court of Appeals, http://docs.justia.com/cases/federal/appellate-courts/ca10/106184/10-6184-2011-09-07.pdf?1315440296 3 Supreme Court of the United States Blog, http://www.scotusblog.com/case-files/cases/tarrant-regional-water-district-v-herrmann/
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ADDITIONAL RESOURCES:
The National Center for Interstate Compacts | http://www.csg.org/ncic/ The U.S. Supreme Court, Tarrant Regional Water District v. Herrmann et al. http://www.supremecourt.gov/opinions/12pdf/11-889_5ie6.pdf The Red River Compact | http://apps.csg.org/ncic/PDF/Red%20River%20Compact.pdf

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