(1) The board may reallocate a water reservation for instream flows, or a portion thereof, to a qualified reservant not more than once every five years.

(2) A qualified reservant shall apply to the board for a reallocation by filing a petition on a form prescribed by the board. The petition must include the information required under ARM 36.16.104 through 36.16.106 and the following:

(a) an analysis of the need for the reserved water showing that the need of the petitioner is greater than that identified by the original reservant for the instream flows, and

(b) an analysis showing that all or part of the reservation is not required for its purpose.

(3) Upon receipt of a petition the board shall notify the original reservant for instream flows that a petition for reallocation has been filed. The board may require the original reservant to submit appropriate information in accordance with ARM 36.16.105, 36.16.l05A, 36.16.105B, 36.16.105C, such as whether the amount of water needed for the instream flow reservation has changed due to new or refined methodologies for determining flow needs. The board may require the reservant to submit revised estimates of instream flow needs based on these new or refined methodologies.

(4) The board shall set a date for hearing and direct the petitioner to establish at a show cause hearing that the reservation criteria under 85-2-316(4) , MCA, the reallocation criteria under 85-2-316(11) , MCA, and the requirements of this rule will be met under a reallocation of reserved water. The board shall provide notice by first class mail on persons who according to the department's notice list as determined under ARM 36.16.122 have an interest in the reservation and shall publish such notice at least once in a newspaper of general circulation in each county as determined by the board within the basin 60 days prior to the hearing.

(5) A person wishing to intervene in the show cause hearing must file a notice with the board 30 days prior to board action.

(6) The petitioner for reallocation shall pay for notice and publication of hearing and proposed action under this rule as required under ARM 36.16.114.

(7) To reallocate an instream reservation the board must find that all or part of the reservation is not required for its purpose and that the need for the reallocation has been shown by the petitioner to outweigh the need shown by the original reservant. In making such determinations, the board must follow the criteria defined under ARM 36.16.107B.