(1) Notwithstanding the provisions of this chapter, a person using water for only domestic purposes shall not be required to obtain a permit to use water for domestic purposes, and no permit shall be required for the use of surface water in impoundments that are not located on continuous, free-flowing watercourses. No permit shall be required for any use of water obtained from a well with a surface casing diameter of less than six (6) inches; however, a permit shall be required of a person in the business of developing real property for resale who desires to withdraw water from a well, regardless of surface casing diameter, that is to be used for maintaining or enhancing an impoundment of surface water primarily for aesthetic purposes. If the commission declares and delineates a water use caution area as provided in Section 51-3-11, the permit board may require permits for withdrawals of water in excess of twenty thousand (20,000) gallons per day, including withdrawals of water for uses exempted under this subsection.

(2) The board shall have the authority to permit the use of water of any stream only in excess of the established minimum flow as based upon records or computations by the commission. However, exceptions may be made for municipal users. The board may authorize any permittee to use the established minimum flow upon written assurance, supported by any data and reporting requirements that the board deems appropriate that the water will be immediately returned to the stream in substantially the same amount to insure the maintenance at all times of the established minimum flow. The board may authorize a permittee to use the established minimum flow for industrial purposes when the water shall be returned to the stream at a point downstream from the place of withdrawal, where the board finds that the use will not result in any substantial detriment to property owners affected thereby or to the public interest.

(3) The board shall have the authority to permit the use of water of any lake only in excess of the established average minimum lake level as based upon records or computations by the commission. However, exceptions may be made for municipal users. The board, upon affording a hearing to interested parties, may authorize any permittee to use below the established average minimum level when such use will not affect plans for the proper utilization of the water resources of the state, or the commission may establish a level above the established average minimum lake level, after affording an opportunity for a hearing, where plans for the proper utilization of the water resources of the state require it.

(4) No use of water shall be authorized that will impair the effect of stream standards set under the pollution control laws of this state based upon a minimum stream flow.

(5) No use of water shall be authorized or continued that will impair the navigability of any navigable watercourse.

(6) No use of water shall be permitted if the use shall cause mining of any aquifer unless the board shall find that the use is essential to the safety of human life and property or unless the applicant for a permit for such use can show to the satisfaction of the board that he or another person of sufficient financial capability has applied for permit or made any other definite commitment to a plan to acquire water from another source in lieu of the water being mined from the aquifer and which will not also result in mining of any other aquifer.