## Facts

- Several Arizona municipalities historically treated sewage and discharged the treated effluent into typically dry channels associated with the Salt River system.
- Downstream ranchers and agricultural users captured and used the discharged effluent for irrigation, asserting appropriative rights based on historical use.
- The municipalities entered long-term contracts to deliver large volumes of treated effluent to electric utilities for use as cooling water at the Palo Verde Nuclear Generating Station.
- The utilities invested in infrastructure to transport and further treat the effluent for use at Palo Verde.
- Downstream users challenged the contracts, alleging the discharged effluent had become appropriable public water and that municipal diversion/sale would unlawfully impair their water rights.
- The municipalities and utilities maintained that treated effluent is neither statutory surface water nor groundwater and remains subject to municipal control for reuse or sale, subject to environmental regulation.

## Issues

1. Whether treated municipal sewage effluent is governed by Arizona’s surface-water prior appropriation doctrine or groundwater law such that downstream appropriators can claim enforceable rights against municipal reuse or sale.
2. Whether municipalities that historically discharged treated effluent into a natural channel have a legal duty to continue those discharges for downstream users.
3. Whether long-term municipal contracts selling treated effluent to utilities are void or limited by downstream appropriative claims.

## Decision

- The Arizona Supreme Court affirmed summary judgment for the municipalities and utilities.
- The court held that treated sewage effluent is not clearly classified as either statutory surface water or groundwater and is not appropriable in the same manner as natural streamflow.
- The court rejected the claim that downstream use of historically discharged effluent created a right to compel municipalities to continue discharging it.
- The court upheld the validity of the effluent-sale contracts for Palo Verde, concluding they did not unlawfully impair vested downstream rights under Arizona water law.

## Legal Principles

- Treated municipal sewage effluent is a distinct category of water not expressly integrated into Arizona’s surface-water and groundwater statutory schemes.
- Beneficial use of another party’s historical waste discharge may support use of water when present, but it does not create a legal right to require continued generation or discharge of that flow.
- In the absence of contrary legislation, municipalities may reasonably dispose of, reuse, or sell treated effluent, subject to applicable environmental and regulatory constraints.
- Courts will not create a comprehensive effluent allocation system by judicial decision where the legislature has not directly addressed the legal status and governance of effluent.

## Conclusion

The court sustained municipal control over treated effluent as a reusable resource, holding that downstream appropriators could not force continued discharges and could not invalidate long-term contracts supplying effluent to utilities for off-stream industrial use.


Ariz. Pub. Serv. Co. v. Long, 160 Ariz. 429, 773 P.2d 988 (Ariz. 1989)