Water Law Blog

The Nevada Supreme Court last week put lingering municipal water use applications at risk. See the article in the Las Vegas Review-Journal at: http://www.lvrj.com/news/state-high-court-deals-setback-to-pipeline-proposal-for-southern-nevada-83014557.html.

In light of the decision, we recommend municipalities with municipal water use applications filed before 2003 make precautionary refilings immediately (as did the Southern Nevada Water Authority). It is important that the cautionary application contain appropriate remarks so that the cautionary application does not act to intentionally abandon the earlier filing in the event that this decision is reconsidered.

The 2009 Legislative Session passed House Bill 3369. Among other things, this Bill tasked Oregon Water Resources Department (OWRD) with developing Oregon’s Integrated Water Resources Strategy (IWRS). The IWRS goals are to build resources and tools to assist Oregon in looking at its future water needs in terms of water quantity, water quality, ecological needs, economic needs, social needs, and implications of climate change.

Issue papers were drafted addressing these areas and are found by following the link below. These issue papers are open for public comment. All comments received by the OWRD Project Team before October 31st will be available at the next Water Resources Commission meeting currently scheduled for November 19th and 20th in Salem.

According to the Project Team’s September 23, 2009 Briefing, the intent of the IWRS is to “develop a framework, consisting of a set of tools, data, and resources with statewide relevance that communities can use to develop their water resource needs.” We encourage everyone to become involved in this process as submit comments.

Integrated Water Resources Website: http://www.wrd.state.or.us/OWRD/LAW/Integrated_Water_Supply_Strategy.shtml

At Schroeder Law Offices, P.C., we routinely work with our clients to develop efficient water use and management systems. Upon reviewing the competition offered below, we thought of you! Thus, if you are an innovative and efficient water user, or perhaps want to share your ideas with others then you might check out this competition!

Imagine H2O is running its inaugural competition this fall on “Water Efficiency.” Kick-off is September 1st. Competitors will provide solutions that reduce the demand or use of water in either agriculture, commercial and industrial, or residential applications. This could be done via demand response, recycling, reuse, or through any other smart management ideas. Total prizes given in 2009-10 will be $50,000. Winners will receive cash, in-depth business incubation including introductions to financiers, potential beta customers and go-to-market partners, and reduced-rate or free office space.

Imagine H2O is a not-for-profit company based in San Francisco, turning water problems into entrepreneurial opportunities. For more information on the Water Efficiency Competition, you can check out their website at www.imagineh2o.org

Good Luck in the Competition! Be sure to let us know how it goes.

Idaho Power has announced that the Boardman to Hemingway (B2H) project will be holding their Community Advisory Process Public Meetings.

Participants at these meetings will have the opportunity to:
1. Learn more about the Boardman to Hemingway Transmission Line Project.
2. Review and provide input on criteria for evaluating routes for the proposed transmission line.
3. Speak to Idaho Power representatives.

The meeting times and places are as follows:
Baker City
Wed., Aug. 12, 2009 4 p.m. to 8 p.m.
Baker City Community Center
2600 East St.
Baker City, OR 97814

La Grande
Thurs., Aug. 13, 2009 4 p.m. to 8 p.m.
Blue Mountain Conference Center
404 12th St.
La Grande, OR 97850

Pilot Rock
Wed., Aug. 19, 2009 4 p.m. to 8 p.m.
Pilot Rock Community Center
285 N.W. Cedar Pl.
Pilot Rock, OR 97868

Boardman
Thurs., Aug. 20, 2009 4 p.m. to 8 p.m.
Port of Morrow Convention Center
2 Marine Dr.
Boardman, OR 97818

Parma
Tues., Aug. 25, 2009 4 p.m. to 8 p.m.
Community House of Kirkpatrick Church
305 E. Bates Ave.
Parma, ID 83660

Marsing
Wed., Aug. 26, 2009 4 p.m. to 8 p.m.
Community Center – American Legion Hall
126 N. Bruneau Highway
Marsing, ID 83639

Ontario
Thurs., Aug. 27, 2009 4 p.m. to 8 p.m.
Four Rivers Cultural Center
676 S.W. Fifth Ave.
Ontario, OR 97914

For more information, follow the link to the Idaho Power website: B2H Public Meetings

The 2009 Legislative Session was full of excitement for Oregon’s water users. Specifically, new laws face those looking to drill a new ground water well for an exempt use. Oregon’s exempt ground water uses are outlined in ORS 537.545. These exempt uses include drilling a well for single or group domestic purposes not exceeding 15,000 gallons a day.

This “exempt” ground water statute, as amended by 2009 legislation (Senate Bill 788), now requires those drilling a new well for an exempt use to: 1) file a map with Oregon Water Resources Department showing the location of the well, and 2) pay a one-time fee of $300.00 to record the exempt use. Both the map and the fee must be submitted to Oregon Water Resources Department within 30 days after the completion of well construction.

According to the Department, these fees will be used to evaluate ground water supplies, carry out ground water monitoring, conduct ground water studies, and process the data collected.

For additional information on the new exempt ground water requirements, please contact our office at (503)281-4100.

Link to Exempt Well Statute: ORS 537.545

The Society for Range Management in partnership with the Bureau of Land Management has produced a 9 minute video that “serves to tell a story about the role of livestock grazing on western public rangelands and our collective hope for a future of sustained rangeland health and enjoyment.” “Hope on the Range” is a video worth watching!

To view this video, follow this link: Hope on the Range

By Therese Ure and Nicole Widdis

Those inheriting natural resource property — which may include land used for farming, forestland or a commercial fishing operation — may qualify for the Natural Resources Tax Credit. Oregon Revised Statute 118.140 allows credit towards inheritance tax obligations based on the value of natural resource and commercial fishery properties, and possibly the value of business working capital and equipment related to those properties.

The legislation’s purpose is protection of natural resource and commercial fishing properties that could otherwise be liquidated to cover inheritance tax obligations. The 2007 enactment of ORS 118.140 was later amended in May, 2008. The amendments are retroactive to an estate where the decedent died on or after January 1, 2007. In addition, eligibility limitations exist. In most situations the total adjusted gross estate must not exceed $15 million and the value of the credit-eligible property must make up at least 50% of the total adjusted gross estate. To qualify for the credit, the eligible property must also be transferred to a family member or the decedent’s registered domestic partner.

The 2009 Oregon Legislative session is considering further amendments to ORS 118.140, in House Bill 3305. These amendments include an adjustment to the credit to consider inflation. The proposed amendments, if passed, will not be retroactive. House Bill 3305 can be viewed at http://www.leg.state.or.us/09reg/measures/hb3300.dir/hb3305.intro.html

Those who have inherited any natural resources property should check with their tax consultant and attorney to discuss their eligibility and options.

*More information on the Natural Resources Credit can be found at http://www.oregon.gov/DOR/BUS/inher-adv.shtml.
*The 2008 Natural Resources credit form is located at http://www.oregon.gov/DOR/BUS/forms-fiduciary.shtml#2007_Tax_Year, under the link to 2008 Tax Year forms.

By Therese Ure and Lincoln Herman

Aquifer Storage and Recovery (ASR) is a device for the storage of excess surface water which has been appropriated under a valid water right. Originally, this device was used primarily for drinking water, however agricultural and other water users are considering ASR as a device to off set seasonal water shortages.

The process involves the injection of excess surface water into wells for storage and later recovery. The water that is injected into the wells must meet drinking water standards. The user can use new or existing rights for the ASR water uses including storage and recovery. However, it is important to realize that the ASR process must first undergo a testing program under a limited license. Only after completion of the testing program can an ASR applicant apply for a permanent permit. ASR activities are regulated by Oregon Revised Statutes §537.531 through 537.534 and Oregon Administrative Rules §690-350-0010 through 0030.

Artificial Recharge (AR) is a device for the storage of water to be used at a later time primarily for irrigation purposes. This device was created in 1961. Similar to the ASR device, water is added to the groundwater reservoir via injection wells or a seepage system. The recharge water cannot degrade or impair the ground water quality and the underlying water right must be for recharge only. Accordingly, it would be necessary to complete a transfer to change the type of use. In addition, if the AR user wants to recover any water under the storage (or recharge) permit, an additional use right must be applied for noting the source will be the recharged water. Permits are required to appropriate the source and also to pump out the recharged ground water. AR is regulated under ORS §537.135 and OAR 690-350-0120.

It is also important to note an emerging trend of leasing underground space for ASR and AR projects. For more information, contact Schroeder Law Office via phone at 503-281-4100.

TCID announced that water allocations in the District are being increased from 80% to 90%. The District made this decision after Lahontan Reservoir levels continued to rise. Water users can expect to see the adjustment reflected on their next water card.

TCID also announced that due to amendments in A.B. 226, the District now has greater taxing ability. A.B. 226 was signed by the Governor and will take effect on July 1, 2009. Under the new law, the District can now assess residents up to $5.00 per acre. The District decided to increase their assessments from $1.50 per acre or home lot to $3.00 beginning in 2010. This is a 100% increase! According to the District these funds will go towards canal rehabilitation and upgrade activities.

By Attorney Therese Ure & Law Clerk Nicole Widdis

This session, the Oregon Senate passed Senate Bill 311 legislation to amend the Oregon Tort Claims Act (OTCA). The OTCA limits the amount of money damages a plaintiff can receive from a state entity in a civil wrong (aka tort) case. OTCA passed originally in 1967 without limits on tort damages committed by state actors such as officers, employees and agents of the state entity. The 1991, OTCA amendments eliminated tort claims against public officers, employees or agents, when the tort arose from an omission occurring in the performance of a duty. These amendments additionally required the state entity or public body, in lieu of the individual, to be substituted in a lawsuit as the sole defendant.

After 1991, the OTCA effectively left many tort plaintiffs in the position of suing solely the public body. Additionally in section 30.270, the OTCA limited the recoverable damages to a range of $50,000.00 to $500,000.00 (depending on the number of plaintiffs and types of damages). Parties brought suits arguing these statutory limitations violate the Remedy Clause of the Oregon State Constitution, Article 1, Section 10. This section states that “…every man shall have remedy by due course of law for injury done him in his person, property or reputation.” However, in 2002 the Oregon Supreme Court found in Jensen v. Whitlow, that the OTCA on its face (in other words, as written), was not unconstitutional.

In December 2007, the Oregon Supreme Court determined the OTCA violated the Remedy Clause of the Oregon Constitution when applied to a medical malpractice case. In Clarke v. Oregon Health Sciences University, the plaintiff’s damages totaled over $17 million. However, OTCA party limitations required Oregon Health Sciences University (OHSU) to be substituted as the sole defendant. The damages recoverable by the plaintiff under these OTCA limitations capped the damages to $200,000. The Court determined that the statute as applied in this case clearly denied the plaintiff a constitutionally sufficient remedy. However, the Court went on to say the OTCA is constitutional as written. The Court ruled that while it was legal for the legislature to limit OTCA remedies, it was not permissible to eliminate the ability of the plaintiff to sue individual defendants (OHSU employees) whose negligence might have caused the injuries.

In 2009 the Oregon Legislature addressed this ruling in Senate Bill 311 which amends certain parts of OTCA, and repeals the previous statute setting damage limitations. New damage limits range in the millions rather than thousands of dollars. Furthermore, the new legislation widens the number of parties a plaintiff in these tort cases may sue, and sets the damages limits with respect to the state, officers, employees and agents acting within the scope of their employment or duties. The legislation will regulate liability limits for the state and other public bodies, and makes clear that OHSU, a state entity, is covered by the legislation. The OTCA legislation does not allow punitive damages.

Finally, the new legislation creates a legislative Task Force to study the impact of the new legislation and the operation of other laws governing tort liability of public bodies. The new laws will take effect July 1, 2009.

Sources: Oregon Senate Bill 311, 75th Oregon Legislative Assembly. Clarke v. Oregon Health Sciences University, 343 Or. 581, 175 P.3d 418 (2007). Jensen v. Whitlow, 334 Or. 412, 51 P.3d 599 (2002).

By Law Clerk Lincoln Herman

“Rainwater Harvesting”

These are systems designed to capture water that runs off the roof of a structure. Under Oregon Law you may only capture the water that runs off of your roof in one of these systems. The purpose is to create a store of water that can be reused both in and outside of the structure. For example, water collected in a rain barrel may be reused for gardening. Also, water collected in a cistern system may be filtered.

There is a large volume of water that may be collected from a roof. For example, a home near Portland with a footprint of 2,000 square feet has a runoff of just over 39,000 gallons per year. All of that water may be captured and reused. The national average for household water usage is 127,400 gallons per year. Accordingly, a reduction in fresh water usage of almost one third is possible.

By Law Clerk Lincoln Herman

“Water Conservation Systems”

These are systems designed to capture gray water from your house. Examples of gray water are the water that flows out of your bathtub. The premise is that the water can be captured, filtered and reused for toilet flushing. The result is a measurable reduction in the amount of potable water that is used for supplying toilets. The benefit is a drastic reduction in the amount of fresh water that is used for a given structure. Specifically, the average household flushes a toilet six times per day per person. Consequently, a household of four will use just over 14,000 gallons per year for flushing toilets, assuming all of your toilets are low flow (1.6 gallons per flush). The ability to substitute the gray water for fresh water can result in not only a marked reduction in water usage but in cost savings as well. The guide also provides information about the various sizes of systems available, where to purchase the system, how to install it and how to maintain it.

The use of a water conservation system is an approved alternative to the state plumbing code requirements for supply of water to toilets. It is important to note however that complete capture of gray water is not possible at this time. This is because state law does not allow the capture of water from kitchen sinks or dishwashers due to the potentially high salts, fats, oils, food particles, and corrosive detergents content. These systems are regulated under Part II of Chapter 16 of the Plumbing Specialty Code of Oregon. More specific regulatory information concerning these systems may be found at: http://www.cbs.state.or.us/bcd/programs/plumbing/2008_opsc/Chapter_16_Pt_II.pdf.

By Law Clerk Lincoln Herman

Rainwater Harvesting and Water Conservation Systems: a Guide to Smart Water Capture and Reuse.

The Oregon Building Codes Division recently published Smart Guides for Rainwater Harvesting and Water Conservation Systems. These guides are filled with valuable information relating to collecting water from sources such as roof runoff as well as bathtubs, showers, bathroom sinks and washing machines. Additionally, the guides provide technical data concerning the planning for and installation of systems for the collection of water from these sources. Electronic copies of these guides may be found at www.cbs.state.or.us/external/bcd/.

By Law Clerk Nicole Widdis

The Eleventh Circuit Court of Appeals, in an order filed today, was the first court to interpret a recent Environmental Protection Agency (EPA) regulation, the Water Transfers Rule (40 C.F.R. § 122.3(i)), which affects the Clean Water Act National Pollution Discharge Elimination System (NPDES).

The case before the Court involved litigation brought by environmental groups and the Miccosukee Tribe of Indians claiming the South Florida Water Management District was violating the Clean Water Act by pumping waters polluted by a “loathsome concoction of chemical contaminants into Lake Okeechobee.” The EPA joined the case on the side of the Water District arguing that a NPEDS permit was not necessary. The trial court concluded the District violated the Clean Water Act and ordered the executive director of the Water District to apply for a NPDES permit.

The big issue in the case and on appeal was the meaning of the word “addition.” The Clean Water Act bans the discharge of any pollutant without a permit, and “discharge” is defined as “any addition of any pollutant to navigable waters from any point source.” Unfortunately for the courts and many litigants, the Clean Water Act did not define “addition.”

The EPA argued that no permit was necessary for the water district in this case, because the water was already polluted when it passed through the pumps (the point sources) into the lake, and that “navigable waters” means all of the United States navigable waters as a whole. Thus, according to the EPA no pollutants were added to the navigable waters as they passed through district managed pumps to the lake. The metaphor used by the U.S. Supreme Court describing this “unitary waters theory” is a soup pot. When you scoop soup into a ladle and then pour it back into the pot you have not “added” any soup to the pot. Under the unitary waters theory, all of the United States navigable waters are one pot of soup.

Previous courts rejected the unitary waters theory. The difference here is that the 11th Circuit could include consideration of the Water Transfers Rule recently adopted by the EPA to support a unitary waters theory. In order to apply the Water Transfers Rule, the Court had to determine whether the language of the Clean Water Act was “ambiguous.” Both sides of the controversy argued reasonable but conflicting interpretations of the “navigable waters” language. Does it mean one collective group of water, or does it mean any distinct body of water? The Court determines that since it could mean either, the language was ambiguous.

Because of the ambiguity, the Court was required to defer to EPA’s Water Transfers Rule enacted by the EPA, because it matched one of the reasonable interpretations of the statute. Thus, unless and until the EPA rescinds their rule or Congress overrides it, all bodies of navigable water in the United States are to be considered one body of water for the purpose of NPDES permits.

Since South Florida Water District was not adding the pollutants to the water initially, and was merely transferring polluted water from one place to another, the District was not required to obtain a permit, something the environmental groups in the case find contrary to the purpose of the Clean Water Act.

Eleventh Circuit Case: Friends of the Everglades, Florida Wildlife Federation et al. v. South Florida Water Management District, et. al. D.C. Docket No. 02-80309-CV-CMA, Order filed June 4, 2009.

By Law Clerk Nicole Widdis

The Truckee-Carson Canal breached in early 2008, however the litigation continues. See Water Law Blog entries from April 24 and 30, 2008 for background on the matter.

The latest attempt by the homeowners in this case to limit the amount of water going down the canal was heard in Nevada Federal District Court for three days beginning May 11, 2009. The homeowners renewed their 2008 motions for a preliminary injunction to stop water going down the canal. However this year, the homeowners put a new spin on their request. They asked the court to make a ruling that if there was a mere forecast of a storm event, that the water in the canal would have to be dropped from 350 CFS flow to 100 CFS flow.

On May 12, 2009, the federal judge in Nevada denied the preliminary injunction, without prejudice. This means that though the court has denied the request at this time, the parties are free to renew their request for injunction at a later date. The flow in the canal will remain at the 350 CFS flow which is the maximum flow allowed in the canal under the 2008 court order. The court also ordered post-trial briefing on some of the issues discussed at the hearing. In other words, this case will continue to be litigated. Stay tuned.

The Nevada Federal District Court case numbers for these matters are: 03:08-cv-00246-LDG-RAM, 3:08-cv-00621-LDG-RAM; and, 3:08-cv-00285-LDG-RAM.

By Law Clerk Nicole Widdis

On May 6, 2009, Governor Gibbons signed into law Assembly Bill 226, changing the financial requirements of irrigation districts in Nevada. This law will go into effect July 1, 2009.

The existing law had limited the amount of money spent on a single purchase by a district on machinery or materials for constructing or repairing an irrigation system to no more than 5 cents per acre of land in the district. The new amendment will remove that cost limit. Also, the new law will allow irrigation districts to incur up to $500,000 in debt, rather than the $350,000 limit under the existing law.

Finally, under the existing law, assessments of $1.50 per acre could be collected and used for ordinary and current expenses of the district, for example salaries of officers. The new law will still allow for collection of such assessments. The new law will also allow for assessments by an irrigation district of not more than $5.00, per acre, for deposit into a capital fund for the construction, reconstruction or maintenance of the irrigation system.

However, the new law limits the total cumulative assessment for capital fund and ordinary expenses, at $5.00, per acre. Thus, the district will not be able to tax $6.50 per acre in order to contribute to a capital fund and pay ordinary expenses. The total assessments must not exceed $5.00 per acre.

Nevada Revised Statutes 539.255 and 539.480. Changes to become effective July 1, 2009.

As evidenced in the recent amendments to proposed HB 3369 concerning revisions to loan and grant funding for Oregon water projects, climate change issues are finding their way into Oregon statutes. One might ask if this is proper given the lack of science surrounding climate change issues.

The Environmental Protection Agency realizes that the science is not fully developed. Specifically, the EPA states: “Important scientific questions remain about how much warming will occur, how fast it will occur, and how the warming will affect the rest of the climate system including precipitation patterns and storms.” http://www.epa.gov/climatechange/science/stateofknowledge.html. To answer these questions with any degree of certainty will thus require advancements in scientific knowledge in many areas including “determining the relative contribution to climate change of human activities and natural causes.” Id.

With so many unknowns as to climate change analyses, it is likely an exercise in futility to put any climate change analysis into the requirement mix for a water project loan application. Oregon House Bill 3369 currently provides that anyone making a loan application include project impacts such as the “expected environmental public benefits including a plan describing possibilities for adaptation of the project in response to long term climate change.” Other proposals in this Bill require analyses as to “global” climate change. Can one even begin to outline possibilities to adapt a project to “long term” climate change when “questions remain” as to the affects of warming on the climate systems? Adding such provisions to a loan and grant application would be futile to the success of any water project funding program. Perhaps more importantly, Oregon and the west have a long history of considering water shortage implications to water projects and infusing climate change with a unique status is unnecessary.

If the State of Oregon is going to have a successful funding program for water projects, having mandatory provisions to consider “the likely impact of global climate change in regard to the project,” is simply unnecessary, bad law.

The Oregon Ground Water Association (OGWA) is holding their Spring Technical Conference on March 6-7, 2009 at the Oregon Garden Resort in Silverton Oregon.

Schroeder Law Offices’ Therese Ure will join the panel discussion on Government Affairs which will discuss and consider the 2009 Legislation’s proposed bills relating to the ground water industry.

For more information, you can contact Therese Ure or view the OGWA’s website at www.ogwa.org.

In Senate Bill 424, Oregon considers changes to the water right forfeiture law. Currently a water right in Oregon is subject to forfeiture if the water has not been applied to beneficial use under the certificate once in every five year period. As proposed, this bill sponsored by Senator Girod and Representative Gilliam would allow certificated water right holders to file affidavits for exemptions to the forfeiture clock in certain very limited instances. These limited instances include crop rotation or tiling. The responsibility of filing the affidavit is placed on the water user and must be done in the same calendar year as the crop rotation or tiling was done in lieu of irrigation under the water right certificate.

We suggest that an exemption via affidavit should be made available for any reason, not just crop rotation and tilling. This would allow certificated water right holders to make environmentally sound decisions to use less water and not simply to waste it for purposes of “holding” onto the right.

Oregon might look to the broader Nevada law found at NRS 534.090 that allows the certificated water right hold to submit an affidavit in the 5th year of non-use and accepts reasons such as good cause, unavailability of water, economic conditions or natural disasters, prolonged period of precipitation wherein appropriated water use is not needed, and efficiency of irrigation and water use practices to excuse the non-use. In addition, Nevada’s law provides consequences, in that a certificated holder must file a proof of beneficial use once he has filed a non-use affidavit. This would provide the “checks and balances” to assure that use continues as required.

The Oregon bill as proposed requires the water user to be overly cautious in filing an affidavit in the same year as the non-use, however that same user might be able to apply water to beneficial use in the following year or two years, thus creating the need to simultaneously file an extra burden, and quite frankly not needed to meet the 5 year burden in many instances. In this regard, the Oregon law as proposed would also increase in administrative burden to the Water Resources Department unnecessarily.

The concept is environmentally sound; however, we would encourage the Senators to look at NRS 534.090 for further guidance.

On Tuesday, January 27th while speaking on hot topics in water at the annual Oregon Water Coalition meeting in Hermiston Oregon, Laura Schroeder, Cortney Duke and Therese Ure announced the Schroeder Law Office new Hermiston Oregon location.

Attorney Therese Ure will be making a monthly rotation of up to 10 days a month in the Hermiston, Schroeder Law Office location. In general, Therese will be in the Hermiston office during the first week of the month. Appointments can be made with Therese by contacting Ms Daryl Cole at 1-800-574-8813. You may also contact Therese directly via email at t.ure@water-law.com or via telephone at 541-612-4840.

Schroeder Law Office attorneys represent water users, municipalities, agri-businesses, and other agricultural based organizations in Oregon, Nevada, Washington, and Idaho. Laura Schroeder is also working as a water consultant internationally. Attorney Ure’s practice focuses on agricultural and rural water issues. She is well suited to this focus being a native of rural eastern Oregon and a member of a fourth generation of family farmers.

Schroeder’s law practice includes offices in Portland Oregon and Reno Nevada.