An agreement reached by two of the groups jockeying to shape the future of a water district in Paso Robles wine country won’t stop two lawsuits that could lead to years in court and millions of dollars in legal fees to sort out the water basin’s woes.

Groundwater levels in the Paso Robles area are estimated to be dangerously low, forcing homeowners to spend tens of thousands of dollars drilling deeper wells and threatening the wine industry that has spurred economic growth. This summer, the San Luis Obispo County Board of Supervisors enacted emergency pumping restrictions until a plan for managing the basin could be crafted.

PRO Water Equity, a group made up of small landowners and homeowners, and the Paso Robles Agricultural Alliance for Groundwater Solutions, or PRAAGS, made up of larger agricultural and wine interests, were vying to influence the eventual shape of the management plan. PRAAGS submitted a proposal for a new management district, but the homeowner group objected, saying that small landowners and the public would have too little voice in the proposed district.

Meanwhile, two new groups filed lawsuits over the Board of Supervisors’ emergency pumping restrictions, potentially tossing the entire issue into a protracted court battle. In so-called arbitrated groundwater basins, a judge oversees a plan for balancing water rights among users. In the Santa Maria Valley, a court-administered plan took more than a decade and cost $11 million.

The two Paso Robles landowner groups are hoping to avoid all that by agreeing to a plan that would go before San Luis Obispo County voters.

The preliminary agreement calls for a board that would be governed by seven members. Two of those members would be elected by large landowners, and two of the members would be elected by smaller landowners.

The remaining three members would be elected by the public at large. Within each landowning class, votes would be determined by acreage owned.

“We believe this proposal provides fair and equitable representation for basin water users and a structure that meets the long-term needs of the area,” the groups said in a joint statement. “The proposed water district would be governed by locals, have the ability to obtain supplemental water, and could implement water management through an AB 3030 management plan. Development of the district will involve working through the LAFCO process and via special legislation.”

Cindy Steinbeck of Steinbeck Vineyards and Winery, who is involved with the two groups that filed lawsuits, said the recent agreement will not affect her group’s efforts. “It has no impact whatsoever on the lawsuits,” Steinbeck told the Business Times.

Steinbeck, whose family has occupied the same ranch for seven generations, said she approaches the water question from a different philosophical position than PRAAGS or PRO Water Equity. Landowners like her family have what’s known as an “overlying right” under state law to pump water on their property for use in agriculture. Assenting to a potential water district would essentially mean conceding those rights to management and enforcement by a governmental body — even a district in which landowners are represented on a governing board would need to operate through the mechanism of a county government for policy enforcement.

One group, Protect Our Water Rights, filed a “quiet title” suit against the county. Quiet title suits arise when there are competing claims on a set of property rights. In this case, the group is asking a judge to declare that the landowners who brought the suit have the right to use the water beneath their land and that the county does not seek the right to regulate that use. Steinbeck said that the case will only spiral into expensive adjudication if the county asserts that it has some stake in landowners’ water rights. “We have the right under California law for reasonable and beneficial use,” Steinbeck said. “While we don’t own the water, we own the rights to use that water.”

The other lawsuit, filed by Paso Robles Water Integrity Network, asks the county supervisors to reconsider its emergency pumping restrictions, arguing that the county did not wait for evidence to come in from an independent study by a blue-ribbon panel of water users. “We simply asked the Board of Supervisors to wait until all the information was available,” Steinbeck said.

But what is clearly at stake in what has become a four-way fight over the future of Paso Robles water district is how much of a voice various parties — homeowners, large wine interests, independent farmers and the government — have in the process.

Under the proposed PRAAGS-PRO Water Equity agreement, the distinctions between “small” landowners and “medium/large” landowners has yet to be decided. But it is expected that within each category, landowners will cast votes based on acreage.

No matter how the categories are sliced, it is clear that the landowners just big enough to fall into the “medium/large” category but whose acreage is small compared with the region’s most powerful wine interests might feel marginalized. If enough medium-sized landowners feel that way and join the lawsuits, a water district could become unworkable.

Steinbeck said that she does not see any reason to cede over the rights she currently holds to a government-backed water district. “As a business person, I’m very concerned that we as landowners have overlying rights,” she said.