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South Platte River Task Force Briefing Document wells could continue under annual plans approved by the State Engineer, without water court adjudication. The owners of many surface water rights believed that water court adjudication was required. The State Engineer and GASP did not, and responded to the Empire Lodge decision by proposing amended rules and regulations pursuant to § 37-92- 501, under which annual State Engineer approval would have continued without water court adjudication. Concurrently, during the 2002 session, t he General Assembly responded to Empire Lodge ¼ by enacting HB 02-1414 (C.R.S. § 37-92-308). This legislation granted the State Engineer specific authority to review and approve SWSPs under four circumstances: (1) all previously approved SWSPs could be re-approved for 2002 only; § 37-92-308(3); (2) augmentation plans filed with the water court could be approved as SWSPs while the water court adjudication was pending; § 37-92-308(4); (3) short duration water uses (not exceeding 5 years) could be approved as SWSPs without water court adjudication; § 37- 92-308(5); and (4) water use necessitated by a public health and safety emergency could be approved as SWSPs without water court adjudication for a period not to exceed 90 days. § 37-92-308(7). HB 02-1414 acknowledged the pre-existing rulemaking authority of the State Engineer under § 37-92-501, but it did not address the question of whether that rulemaking authority was broad enough to include annual approval of out-of-priority depletions without water court adjudication. State Engineer Simpson filed proposed new rules in May 2002. The rules, which were ¼ nearly identical to the rules promulgated successfully in the Arkansas River basin in 1996, would have allowed the State Engineer to annually approve “replacement plans” under much more stringent standards. 2002, however, also brought the worst drought in recorded history. The call by senior ¼ water rights began in June and stayed on throughout the rest of the year. The calls in 2003 lasted nearly the entire year, and in 2004 the situation was similar. As a result, replacement of depletions caused by wells required considerably more augmentation water and GASP ultimately went out of business in 2006. Central GMS had to scramble to lease additional water in order to obtain approval of its SWSP during those years. With the drought as a backdrop, more than 30 water user entities and individuals opposed ¼ the State Engineer’s proposed rules. Only a handful supported them. The parties agreed that there were threshold legal issues that could be briefed and decided as questions of law, prior to trial. Accordingly, several motions were filed in the Division 1 Water Court, challenging the State Engineer’s authority to adopt the proposed rules, and arguing that they could not take effect until after a full trial on the merits had been completed (the State Engineer wanted the rules to become autom atically effective December 31, 2002, regardless of the status of water court review). These issues were briefed in the fall of 2002 and argued in December. In separate rulings, the water judge held that: 1) the rules could not take effect until after ¼ review by the water court had been completed; and 2) the rules must be dismissed in their entirety because the State Engineer lacked statutory authority to review and approve annual replacement plans outside the statutory framework of express authorization granted by § 37-92-308. The final dismissal by the water judge was signed on December 30, 2002. The State ¼ Engineer filed an appeal the next day, and reques ted expedited review by the Supreme Court. That request was granted, the case was fully briefed in approximately five weeks, and oral argument was held on February 19, 2003. - 5 -