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vii I I I I I I I I I I I I I I I I I I I The Supreme Court essentially made three points in striking down the Nebraska law: 1. Preserving and conserving scarce water supp1 ies is clearly interstate in dimension and because Nebraska's claim of state ownershi p of ground water is based on "1 ega1 fi ct ion"; ground water is an article of commerce and subject to congressional regulation. 2. Since water is an article of commerce, the reciprocity require- ment of Nebraska 1 aw p1 aces an undue burden on interstate commerce. 3. Despite 37 federal statutes and numerous interstate compacts differing to state water law; Congress has granted the states permission to engage in ground water regulation that would otherwise be impermissible. The implications of this decision cannot be underestimated. It would appear that the perogative of the judge in the E1 Paso v. New Mexico case mentioned briefly later in this report has been usurped. More importantly it may mean that the ability of a state to contain the waters arising wholly within her boundaries and never entering an interstate basin, ground or sur- face for the benefit of the citizens of the state have been rendered null and void. If this is the case any entity which could otherwise qualify for a water right, but fails because the ultimate use will be outside the state may now be able to get that water. Many examples come to mind: transfer of water for agriculture, coal slurry, municipal, etc. General questions are raised by this ruling as well, e.g. in a state where there is an order of pri ority for the granti ng of a water ri ght (municipal is a higher use of water than agriculture which is a higher use of water than recreation, etc.) must one state gi ve preference to a higher priority uSe to an application for a water right over the application for a lower priority use in its own state?