Montana’s Water Rights Lawsuit: What Every Homeowner, Landowner, and Builder Needs to Know in 2025

Montana is facing one of the most significant water-rights cases in decades. The outcome could reshape how the state manages groundwater, private wells, subdivision development, agriculture, ranching, and municipal growth. As Montana continues to grow, water availability has become a defining issue for homeowners, landowners, and builders across the state.

As someone actively developing in Montana, I see firsthand how water availability influences real estate decisions, construction timelines, subdivision feasibility, and long-term planning. Whether you are in Helena, Bozeman, Billings, Missoula, Kalispell, Great Falls, Butte, or anywhere in rural Montana, this case affects property values, private wells, building rights, and long-term water security.

What Is the Montana Water Rights Lawsuit

A broad coalition has filed suit against the State of Montana and DNRC. The plaintiffs include:

• Montana League of Cities and Towns

• Agricultural irrigator groups

• Ranch families

• Trout Unlimited

• Clark Fork Coalition

• Montana Farm Bureau Federation

• Private landowners and developers

Their core argument:

Montana’s exempt well law allows too many new groundwater wells to be drilled without any analysis, permits, measurement, or protection for senior water rights.

Key facts:

• Current law allows a well producing up to 35 gallons per minute and 10 acre-feet per year without a permit

• More than 141,000 exempt wells have been drilled since 1973

• Many are located in fully appropriated or highly stressed basins

Areas with the greatest concentration include Helena Valley, Broadwater County, Gallatin Valley, Flathead Valley, the Bitterroot, and West Billings.

Why This Matters for Montana’s Water Supply

According to DNRC records and court filings:

• Exempt wells could legally pump between 1.2 and 1.9 million acre-feet every year

• That is up to 622 billion gallons of groundwater

• DNRC receives between 2,800 and 3,000 new exempt well filings annually

• The state is prohibited from measuring exempt-well use

This creates uncertainty for:

• Homeowners relying on private wells

• Irrigators and ranchers with senior water rights

• Builders and developers planning projects

• Cities trying to manage growth and infrastructure

Why the Lawsuit Says the Exempt Well Law Is Unconstitutional

The plaintiffs argue the current system violates several parts of the Montana Constitution. Concerns include:

Constitutional Conflicts

• Water must be managed as a public resource

• Senior water rights are protected property rights

• Citizens are entitled to public participation in government decisions

• The state is required to regulate water rights responsibly

Key Problems with Exempt Wells

• No DNRC hydrologic review

• No evaluation of water availability

• No protection for senior users

• No checks on stream depletion

• No measurement of actual water use

These issues form the basis of the constitutional challenge.

Who Filed the Lawsuit and Why

This lawsuit stands out because of how many different groups support it. Their motivations include:

Cities and Towns

• Aquifer depletion

• Rising costs of expanding municipal water systems

Agricultural Irrigators and Ranch Families

• Declining water levels

• Drying springs

• Earlier curtailments despite senior rights

Conservation Groups

• Reduced streamflows

• Impacts on trout habitat

• Protection of instream flow rights

Farm Bureau Members

• Long-term groundwater sustainability

Developers on Municipal Water Systems

• Uneven rules compared to subdivisions using exempt wells

• Higher infrastructure costs for compliant development

This coalition shows how far-reaching the impacts of exempt wells have become across Montana.

How This Lawsuit Impacts Homeowners, Landowners, and Builders

As someone involved in building and development, I see real challenges related to water supply. If the plaintiffs win, the following statewide changes are possible.

Potential Impacts

• Subdivision approvals may require hydrologic studies

• Mitigation plans or full water-right permits may be needed

• Basin-specific groundwater limits could be implemented

• Domestic wells may face new requirements

• Cities could have more leverage in annexation and service connections

• Senior water-right holders may receive stronger protections

• Montana may need a new statewide groundwater management framework

This could become the most significant shift in Montana water law since 1973.

Why Every Montanan Should Pay Attention

This lawsuit has implications for:

• Homeowners with private wells

• Landowners planning subdivisions or lot splits

• Builders and developers across the state

• Ranchers and irrigators relying on senior rights

• Cities experiencing rapid growth

• Conservation efforts to protect fisheries and stream health

Water availability is becoming the primary limiting factor for housing, agriculture, and long-term land value in Montana.

If you are searching for information on Montana well laws, Montana groundwater rights, Montana subdivision water requirements, or the Montana exempt well lawsuit, this case will shape the answers for years to come.

Final Thoughts

Water is one of Montana’s most valuable resources. How the state regulates it will influence everything from homebuilding and subdivision planning to agriculture and wildlife health. This lawsuit is not meant to stop development. It aims to create a sustainable, predictable, and constitutionally sound system for water use as Montana continues to grow.

With Montana’s water laws evolving, you need a builder who stays ahead of the changes. Let’s build your home the right way from day one. Contact us for a free pre-build consultation.