DALLAS – In a case with implications for the bond industry, the United States Supreme Court will decide whether a Texas utility can buy Oklahoma water and pipe it across state lines.

The United States Supreme Court agreed Friday to hear the Tarrant Regional Water District's lawsuit against the state of Oklahoma over control of water that flows into the Red River that divides the two states.

TRWD filed suit in January 2007, seeking to divert more than 130 billion gallons from basins upstream from the river to supply North Texas, including the Dallas-Fort Worth area.  Fort Worth is the county seat of Tarrant County. Dallas and the North Texas Municipal Water District, which supplies water to some Dallas suburbs, joined the suit.

"We expect the Supreme Court's decision will bring finality to the legal issues that have precluded us from addressing regional water needs due to the growing population in the Metroplex," said TRWD general manager Jim Oliver in a prepared statement.

U.S. District Court in Oklahoma and the U.S. Tenth District Court of Appeals in Denver have ruled that Oklahoma has the right to refuse to sell water to out-of-state customers.

"We successfully defended Oklahoma's right to protect its natural resources at the district court and circuit court of appeals, and we will continue that fight at the Supreme Court," said Oklahoma Attorney General Scott Pruitt.

While the TRWD argues that the lawsuit could affect interstate water compacts nationwide, Oklahoma attorneys counter that the issue is a narrow dispute.

Under the Red River Compact approved by Congress in 1980, Texas, Oklahoma, Arkansas and Louisiana are provided an "equitable apportionment of water" from the Red River and its tributaries.

The Tarrant Regional Water District contends that Oklahoma lawmakers violated the compact by passing a 2009 bill requiring that legislative approval for any transfer of Oklahoma water across state lines.

More than 18 metropolitan areas in the United States depend on water supplies governed by interstate compacts.  The cities include Los Angeles, San Diego and Sacramento, Calif., Denver, Atlanta, Phoenix, Tucson, Las Vegas and Salt Lake City.

With a growing population, the Dallas-Fort Worth area has been seeking ways to increase water supplies through pipeline construction financed by bonds.  The TRWD and Dallas Water Utilities are collaborating on a $2.3 billion pipeline to bring water from an East Texas reservoir to Metroplex customers.

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