Settlement agreement could emerge from behind closed doors in fight over Rio Grande water

Attorneys for New Mexico groups call confidentiality maneuvers a ‘sideshow’

By: - December 15, 2022 12:22 pm

The dry riverbed of the Rio Grande in Albuquerque in September 2021. (Photo by Marisa Demarco / Source NM)

After the October bombshell of a draft agreement to end Texas and New Mexico’s fight over Rio Grande water dropped, much of the controversy in the Supreme Court lawsuit slipped behind sealed documents and hearings closed to the public. 

The lawsuit — officially called Original No. 141 Texas v. New Mexico and Colorado — dragged on for nine years in the Supreme Court and has cost taxpayers more than $30 million in legal fees

Special Master Michael Melloy, the federal appeals justice who oversees the case, weighed whether a proposed settlement should be made public in a hearing Thursday behind closed doors. Melloy limited the hearing to attorneys representing the states and federal government as parties. 

This story will be updated as information becomes available.

More than a dozen groups — including two major irrigation districts, farmers, New Mexico State University and cities such as Las Cruces and El Paso — are part of the case as amici curae, but not as parties. Groups with amici curiae status are allowed to observe but could be excluded by the judge during the hearing. 

It’s unclear when Melloy’s written order will be available. 


A carve out

All attention is on the surprise settlement agreement proposed in October by Texas, New Mexico and Colorado to end ligation. The draft agreement between the three states was negotiated over the objections of the two major regional irrigation districts and the federal government. 

The states call the proposed agreement a “carve-out decree,” which resolves issues between Texas and New Mexico over Rio Grande water but leaves open discussions of “intrastate” water issues in New Mexico, including the management of federal irrigation canals and dams. 

Top attorneys for the federal government disagreed that any issues could be “carved out” and objected to the states’ proposed settlement, saying it would violate the confidential discussions and offers made in negotiations. The terms of the proposed agreement continue to remain confidential.

U.S. objections

Fred Liu, assistant to the Department of Justice’s solicitor general, asked Melloy to toss out the proposed settlement. 

“Without the United States agreeing to this settlement, this compact dispute can’t end,” Liu said at the October hearing announcing a settlement. 

Melloy allowed the federal government to submit their objection to the settlement under seal because its objections would reveal positions protected under confidential settlement talks.

El Paso County’s irrigation district joined the federal government’s objections, even though officials there cannot read the document itself either. 

In court filings, attorneys for the El Paso County Water Improvement District No. 1 said that making the state’s draft agreement public would reveal the irrigation district’s legal strategy in a separate lawsuit in federal district court. That case is on hold until the Supreme Court lawsuit is resolved.

Maria O’Brien, attorney for the irrigation district, argued that Melloy should require all to resume negotiations and not accept a “truncated” agreement. 

“The effort to make the states’ sealed submissions public now may fairly and objectively be viewed as itself a negotiating maneuver,” O’Brien wrote.

The Rio Grande near Las Cruces
The Rio Grande near Las Cruces (Photo by Santana Ochoa for Source NM)

The ‘sideshow’

The states jointly argued the federal government has no legal basis for keeping the documents from the public, saying that water users along the Rio Grande will be impacted. 

New Mexico attorneys further argued the proposed settlement requires future requests in upcoming legislative session, according to court documents

“New Mexico anticipates that certain legislative measures may be introduced in the coming months to facilitate compliance with the consent decree,”attorneys wrote. “But New Mexico will be unable to explain the full reasons for those measures to individual legislators unless the seal is lifted.”

Attorneys for New Mexico amici — including the city of Las Cruces, farmer’s associations, New Mexico State University and the Bernalillo County Water Utility Authority — wrote their own motion asking for the proposed agreement to be made public, calling the federal government’s confidentiality claims “a sideshow” in court documents. 

“Resolution of this litigation is of great public importance and interest, as it will affect all those who rely on a municipal water supply and an agricultural economy in New Mexico worth hundreds of millions of dollars,” they wrote. 

More than 221,000 people live in Doña Ana County below Elephant Butte Reservoir. Las Cruces, which is the state’s second-largest city, and New Mexico State University rely entirely on groundwater supplies.

Tens of thousands of acres of farmland for chile, onions, pecans, alfalfa and other crops pump groundwater in years when river irrigation cannot sustain crops. In the past 20 years, reliance on groundwater is more frequent as climate change and human usage shrink the Rio Grande


The Rio Grande is often embroiled in lawsuits, especially in dry years. A series of lawsuits between federal agencies, municipalities, counties, utilities and irrigation districts emerged in the wake of the 2001-2002 drought. 

One case was a lawsuit between regional irrigation districts Elephant Butte Irrigation District, El Paso County Water Improvement District No. 1 and the federal agencies. Settlement talks hammered out the 2008 Operating Agreement, a document changing how water was allocated to irrigation districts during drought. Neither Texas nor New Mexico were parties in that agreement. 

Trial starts in Rio Grande Supreme Court water lawsuit between New Mexico and Texas

This 2008 agreement sparked a 2011 federal district lawsuit brought by then-New Mexico Attorney General Gary King against irrigation districts and the federal government. King alleged the agreement gave too much water to Texas and shorted New Mexico. 

Texas responded by filing a lawsuit in the Supreme Court, putting the federal district case on hold. 

In 2014, Texas argued New Mexico groundwater pumping in cities and farms below Elephant Butte Dam threatened Texas’ share of river water allotted in the 1939 Rio Grande Compact. 

Since Colorado, New Mexico and Texas all signed the compact that governs how the states split the Rio Grande, they are all involved in the case. 

In 2018, the High Court allowed the federal government to join the lawsuit as a party. The U.S. Department of Justice argued New Mexico’s pumping jeopardized the United States’ treaty obligations and network of dams and canals.

In October 2021, the case began trial before the special master. Due to the novel coronavirus, the trial was split into a virtual portion over six weeks and a future in-person phase for technical arguments. 

But the second phase never happened, as parties started talks for a settlement in early 2022. 

After months of confidential negotiations rolled to a standstill, they appeared to fail in September, and a second trial date was set for January. However, less than a month later, a settlement agreement emerged between New Mexico,Texas and Colorado. 

A hearing looking at the federal government’s objections to the proposed agreement, is tentatively scheduled for February.

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Danielle Prokop
Danielle Prokop

Danielle Prokop covers the environment and local government in Southern New Mexico for Source NM. Her coverage has delved into climate crisis on the Rio Grande, water litigation and health impacts from pollution. She is based in Las Cruces, New Mexico.