Regardless of what the STATE says, water on private land is private property. If the State passes a law saying your trees are state property, does that make it so? If you cut down the trees and build a home, is your home now state property? The State could pass a law saying all the money in your checking account is theirs - does that make it true?
Well that's the problem with laws. If passed and upheld as constitutional, then yes, it is true.
Look, I'm not saying I agree wholly with the the taking of the water, but we're a society of laws. 1775 and 1861 aside, we can resolve civil issues reasonably.