Dallas suburb wants to purchase water from Hugo; Hugo sues Oklahoma

By Tony Thornton

Published: August 9, 2008

MUSKOGEE — No longer can Oklahoma officials worry only about a Texas challenge to Oklahoma's ban on out-of-state water sales.

The city of Hugo sued the state Friday in Muskogee's federal courthouse, claiming the Oklahoma moratorium unconstitutionally blocks its proposed sale of water to a Dallas suburb.

If the moratorium is lifted, Hugo stands to make at least $1.7 million a year — and potentially much more — by selling vast amounts of water from Hugo Lake to Irving, Texas.

Hugo's lawsuit is similar to one filed last year in Oklahoma City federal court by a Texas water district. Both sides await a ruling by the 10th Circuit Court of Appeals in Denver as to whether that lawsuit can proceed to trial. The new lawsuit is the first time an Oklahoma entity has challenged the ban.

Hugo City Manager David Rawls said the lawsuit followed "extended” discussions with state officials, including meetings with Gov. Brad Henry and the Oklahoma Water Resources Board.

Duane Smith, the water board's executive director, said there were "conceptual talks” — without a specific buyer in mind — between his agency and Hugo several years ago.

"We've had no conversations with Hugo about Irving,” Smith said.

He said the state agency hadn't been served with the lawsuit by Friday afternoon.

Rawls declined to comment on how the lawsuit might affect Hugo's relations with the state and neighboring southeast Oklahoma communities.

Smith said it wouldn't cause a grudge by his agency.

"This isn't a personal thing. This is just their interpretation of law, and this is the way these kinds of arguments are handled,” he said.

Hugo wants a judge to prevent the state from interfering with its proposed water sale to Irving, Rawls said.

That contract, approved by both cities Thursday, is the first between an Oklahoma entity and an out-of-state water provider, Smith said.

Hugo has existing state permits to obtain 30,000 acre-feet (9.8 billion gallons) per year from Hugo Lake. The city of Hugo uses about 1,500 acre-feet (489 million gallons) per year.

Still pending is an application to take an additional 200,000 acre-feet (65 billion gallons) per year. Rawls previously said it would sell at least part of that amount to Irving if the state water board approved the permit.

"This is not an attempt to take water that is needed in Oklahoma,” said Jim Cline, Irving's public works director.

As part of the contract, Irving will pay Hugo up to $500,000 in legal fees and other costs related to the moratorium.

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