WATER LAW VIOLATION MAXIMUM PENALTY, the official text

HOUSE BILL 111

57th legislature - STATE OF NEW MEXICO - second session, 2026

INTRODUCED BY

Kristina Ortez and Mimi Stewart and Andrea Romero

and Elizabeth "Liz" Stefanics and James G. Townsend

AN ACT

RELATING TO WATER; INCREASING THE MAXIMUM PENALTY FOR A
VIOLATION OF WATER LAW.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:

SECTION 1. Section 72-2-18 NMSA 1978 (being Laws 2001,
Chapter 143, Section 1, as amended) is amended to read:

"72-2-18. STATE ENGINEER--ENFORCEMENT--COMPLIANCE
ORDERS--PENALTY.--

A. When a person, pursuant to a finding of fact,
violates a requirement or prohibition of Chapter 72 NMSA 1978,
a regulation, code, order or special order adopted by the state
engineer pursuant to Section 72-2-8 NMSA 1978, a condition of a
permit or license issued by the state engineer pursuant to law
or an order entered by a court adjudicating a water right, the
state engineer may, in addition to any other remedies available
under law, issue a compliance order stating with reasonable
specificity the nature of the violation and requiring
compliance within a specified time period. A compliance order
shall not be effective against [any] a party other than the
person against whom the compliance order is issued.

B. This section shall not be construed to affect or
interfere with any jurisdiction of an irrigation district, a
conservancy district, a state court, a federal court or an
Indian nation, tribe or pueblo to enforce its orders and
decrees pertaining to water rights.

C. A compliance order may include an order to cease
the violation of a requirement or prohibition of Chapter 72
NMSA 1978, a directive issued in accordance with the provisions
of Section 72-2-8 NMSA 1978, a condition of a permit or license
issued by the state engineer or an order entered by a court
adjudicating a water right.

D. The state engineer shall provide an opportunity
for the person named in the compliance order to have a hearing
on the alleged violation pursuant to Section 72-2-16 NMSA 1978.
A hearing shall be held if a written request is made to the
state engineer within thirty days after receipt of the notice
of the compliance order sent by certified mail. If service by
certified mail is not possible, the state engineer may serve
the compliance order by process server or other effective
means. Notice shall be deemed effective when delivered to the
address of record of the person named in the compliance order.
A compliance order issued pursuant to this section shall become
final unless the person named in the order submits a written
request for a hearing to the state engineer within thirty days
of receipt of the order. A compliance order shall be
enforceable only upon becoming final. Nothing in this section
shall prohibit the person named in the order from pursuing an
informal resolution of the matter after a timely request for
hearing has been made.

E. A compliance order may require repayment of
water that was overdiverted or illegally diverted. Repayment
of water may be up to double the amount of the overdiversion or
illegal diversion. In determining the repayment of water
beyond the amount overdiverted or illegally diverted, the state
engineer shall take into consideration the seriousness of the
violation, any good faith efforts to comply with the applicable
requirements and any other relevant factors. Any requirement
to repay water shall not be enforceable until the compliance
order becomes final. Installation of a measuring device may be
required prior to any future diversion of water. The state
engineer shall not pursue a civil penalty pursuant to
Subsection G of this section for an overdiversion of a water
right. This subsection shall not be construed to alter or
affect any stream adjudication court orders in place prior to
the effective date of this 2026 act.

F. Any appeal to district court shall be conducted
pursuant to Chapter 72, Article 7 NMSA 1978 and shall not stay
enforcement of the compliance order unless ordered by the
district court.

G. [After] Prior to issuing a compliance order,
[becomes final] the state engineer shall issue a written notice
of violation. After issuing a written notice of violation, the
state engineer may assess a civil penalty of up to [one hundred
dollars ($100)] three thousand four hundred dollars ($3,400)
per day for [violation of the compliance order. Any civil
penalty assessed shall accrue from the date of assessment of
the penalty] each day during any portion of which the violation
continues. If the water is sold without a permit to do so, the
maximum penalty shall be double the economic benefit to the
violator resulting from the violation or twenty-five dollars
($25.00) per barrel of water sold, whichever is greater. In
determining the amount of the civil penalty, the state engineer
shall take into consideration the seriousness of the violation,
any good faith efforts to comply with the applicable
requirements and any other relevant factors. A compliance
order may require payment of the assessed civil penalty
accruing from the date of the notice of violation. The civil
penalty shall not be enforceable until the compliance order
becomes final.

H. If a person does not comply with a compliance
order, the state engineer may file a civil action in the county
in which the violation occurred to enforce the compliance order
and receive any of the remedies provided in this section,
including injunctive relief."

SECTION 2. Section 72-5A-12 NMSA 1978 (being Laws 1999,
Chapter 285, Section 12) is amended to read:

"72-5A-12. PENALTIES.--

A. A person who or governmental entity that is
determined to be in violation of the Ground Water Storage and
Recovery Act or a permit issued or rules adopted pursuant to
the act may be assessed a civil penalty in an amount not
exceeding:

(1) [one hundred dollars ($100)] three
thousand four hundred dollars ($3,400) per day of violation not
directly related to the illegal recovery or use of stored
water; or

(2) ten thousand dollars ($10,000) per day

of violation directly related to the illegal recovery or use of
stored water.

B. An action to recover penalties pursuant to this
section shall be brought by the state engineer in the district
court in which the violation occurred."

SECTION 3. Section 72-12-14 NMSA 1978 (being Laws 1949,
Chapter 178, Section 3) is amended to read:

"72-12-14. SUSPENSION OR REVOCATION OF LICENSE--APPEAL--
DAMAGES.--[Any license issued under the provisions of this act
may be suspended or revoked by] Upon notice and after
opportunity for a hearing, the state engineer [upon notice and
hearing, in the event that the license shall have violated any]
may suspend or revoke a license issued pursuant to the
provisions of Sections 72-12-12 through 72-12-17 NMSA 1978 for
a violation of a condition of [the] a bond maintained [by him]
as a prerequisite for [such] the license. Appeals from the
decision of the state engineer may be taken to [the district
courts of the state] a district court in the same manner [and
with like effect] as [now] provided for other appeals from
action of the state engineer. In the event of such breach, the
state engineer, on behalf of the state [of New Mexico] and any
other person injured [thereby] by the breach, is authorized to
recover in a civil suit in the district court of the county
where the well involved is located, judgment for [such] damages
[as may have been] sustained by reason [thereof] of the breach.
In addition, the state engineer is authorized to recover on
behalf of the state [of New Mexico] a civil penalty in an
amount to be determined by the district court [in which the
action is tried] not to exceed [$1,000.00] ten thousand dollars
($10,000), and judgment for both damages and penalty shall be
against the principal and sureties [upon said] on the bonds."

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