The Director of the Nevada Department of Conservation and Natural Resources recently announced the appointment of Acting State Engineer Jason King to the position of State Engineer.  Mr. King has spent more than 19 years with the Division of Water Resources.  A press release from the Nevada Department of Conservation and Natural Resources on this appointment is available here.

On January 28, 2010, the Nevada Supreme Court issued its opinion in the matter of Great Basin Water Network, et al. v. State Engineer and Southern Nevada Water Authority, wherein the Court determined that the State Engineer had violated the statutory duty under NRS § 533.370(2), which requires that the State Engineer approve or reject any application made prior to the 2003 legislative amendments within 1 year after the final date for filing a protest. Subsequently, the Nevada Legislature issued a Motion to Express Legislative Intent during a Special Session indicating that the resolution of the issues raised in Great Basin Water Network is of critical importance.

On March 16, 2010 the State Engineer held a workshop to consider possible amendments to Nevada water law to address the issues raised in Great Basin Water Network including (1) the protection of existing water rights, (2) the status of pending applications, (3) the preservation of priorities, and (4) the application of the protest period provisions. The State Engineer has posted written comments filed during the workshop along with suggested language to address the issues raised on the workshop webpage.

The State Engineer will accept proposed amendments that address the issues raised in Great Basin Water Network until Friday, March 26, 2010. Any proposed amendments will be posted on the workshop webpage, and comments to the proposed amendments will be accepted until Friday, April 2, 2010.

For more information, including links to the Supreme Court decision and the Legislature’s motion, visit the workshop webpage.

Do you keep your deeds in the safe? A secure file?  If so, you surely know what water uses you are entitled to and have these records kept safe and secure reviewing them annually?

If not, you’re lucky that the state has records on the water uses related to your property.  However, it’s unlikely these records have not been reviewed in the recent past.  It is also probable that there are lurking “time bombs” in your water use records.  Such “time bombs” include:  (1) Permits or Transfer orders that need extensions; (2)  Permit Conditions that have not been met; (3) Final Proofs past due; (4)  Certificates yet to be issued.

For a fixed fee of $375 and a copy of your property deeds, Schroeder Law Offices, PC, will make a public records request to the proper agency, make a complete copy of your water rights providing you with either a paper or electronic copy or both, as well as one hour of free consultation to provide you an overview on the phone and a summary in writing of issues spotted in your water right files needing attention.

Email Ms Daryl Cole (d.cole@water-law.com) now to begin the process—and start the New Year out right knowing that your water rights are secure!

Federal Judge Robert C. Jones called Schroeder Law Offices attorney Laura Schroeder and others to court today to end 29 years of litigation related to over 200 transfer applications filed by various farmers in the Newlands Project, Nevada.  These transfers were tied up for years by the Pyramid Lake Indian Tribe appeals to Nevada State Engineer rulings on the issues of lack of perfection, forfeiture and abandonment.

Decisions on these transfers were complicated by two factors:

1. The United States issued individual contracts for the storage water in the Newlands Project rather than through an irrigation district (now the Truckee-Carson Irrigation District); and
2. The Orr Ditch Decree and Alpine Decree issued water rights to the Newlands Project farmers in a lump acres allocation rather than describing the allowed decreed water rights for irrigation to particularly described acres.

Today’s final order from the bench at last closed the matter.  Ultimately, a few farmers gained approved water right transfers, many farmers lost water righted acres, and some farmers simply withdrew as the transfer process became too costly over the many years.  A confirming written order will follow shortly.

Completing a teaching tour through Central Nevada, it will come as no surprise that the number one issue in the minds of participants are the duties of the Southern Nevada Water Authority to counties from which it intends to export water.  Emphasis was placed on the need for affected counties to be involved in the transfer and exporting process as provided by Nevada water law.

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.

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

You can submit comments to this petition that must be received by the EPA on or before January 23, 2009. Send comments to the EPA: 1) via following the links to submit comments online through the Federal eRulemaking Portal: http://www.regulations.gov, or 2) mail to: Office of Pesticide Programs (OPP) Regulatory Public Docket (7502P), Environmental Protection Agency, 1200 Pennsylvania Ave., NW., Washington, DC 20460-0001.

Reference Docket No. EPA-HQ-OPP-2008-0877 on all comment submission to the EPA.

For more information go to: http://www.epa.gov/fedrgstr/EPA-PEST/2008/December/Day-24/p30527.htm

The Bureau of Reclamation recently announced they are seeking letters of interest from non-Federal entities throughout the western states to conduct river basin or sub-basin studies.  The Bureau is conducting the studies as part of the Water for America initiative. The Basin studies are to be cost-shared on a 50/50 basis with state, tribal and local partners. Letters of interest must be received by regional Reclamation offices by February 4, 2009.

For more information  including regional office information please see: www.usbr.gov/wfa

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On December 2, 2008 the grand jury in the Federal District Court of Nevada returned an indictment to the court charging the Truckee Carson Irrigation District (TCID) and four of it’s employees: David Overvold, Lyman McConnell, Shelby Cecil, and John Baker with conspiracy to defraud the United States Bureau of Reclamation, falsification of records, false claims, and false statements.

TCID manages the Newlands Project in Northern Nevada pursuant to the Operating Criteria and Procedures established by federal rules and regulation (43 CFR 418.1 et seq.). These federal indictments will have long range effects to those in the Newlands Project!

The charges allege that TCID and its employees essentially mis-managed the district by fraudulently obtaining incentive credits via submitting false data as to water deliveries. The list goes on.

If convicted, each individual defendant faces up to 20 years in prison for each falsification of record count, and five years in prison for each count of false claims, false statements, and conspiracy to defraud the US. The individual defendants also face maximum possible fines of $250,000 as to each count. If TCID is convicted it could be fined for each count twice the gross gain or loss suffered to another, or $500,000. TCID could also be subject to probation and a court-ordered monitoring program, among other things.

TCID is now faced with hiring criminal attorneys to represent the district and the four charged employees. With these costs of all the other pending litigations and issues the district is facing, TCID approved a plan to reduce their work force to approximately half its current size.

What will happen next? Will the water be flowing for the 2009 irrigation season? Stay tuned.

Accepting associations and referrals in Oregon, Washington, Idaho and Nevada, Schroeder Law Offices recently opened its new office in Reno, Nevada.  With a population of 250,000, Reno is at the center of water controversies on the Truckee, Carson, and Walker rivers.

Each of these desert rivers interestingly terminate at a lake with an associated Indian reservations adding to the possible legal issues.  Municipal and agricultural interests use and divert waters from these rivers adding to the on-going controversies over high valued water.  With the official opening of its staffed office in October, Schroeder Law Offices plans to expand its Nevada natural resources clientele.

Colm Moore and Laura Schroeder will present a 4-hour seminar on Nevada water rights in Winnemucca on December 9 and in Elko on December 10. For more information click here.

Throughout the arid West, water users, state agencies and federal agencies have constructed reservoirs and ponds of varying size and capacity to store water for a variety of uses. Many irrigation districts or other water delivery organizations have acquired sizable reservoirs that were initially constructed by the Bureau of Reclamation or another federal agency for the storage of irrigation water.  These reservoirs create unique recreational opportunities for the citizens of the state who enjoy the use of these reservoirs for camping, fishing, boating and swimming.  In most circumstances, the recreational use occurring is promoted or encouraged by one or more state agency, though the state agency has no ownership interest in the facility.  

Owners of such facilities have a unique opportunity to enter into a recreational use contract(s) with the appropriate state agency to allow the recreational use. Recreational use contracts are beneficial to owner and operators of these facilities to protect the interests of the water organizations and users who use the water for irrigation and to maximize the fiscal opportunities to the organization.

Contracts for recreational use should include terms addressing:

1.Approved recreational uses and extent of recreational use;

2. Liability for injuries caused by recreational use;

3. Protection of stored irrigation water;

4. Duties and obligations regarding maintenance and repair work;

5. Reimbursement for maintaining a “minimum pool”.

These are a few, among many other, terms that should be included in a recreational use contract. Owners considering this action should consult legal counsel before entering a contract of this kind.

With food prices at all time highs, agricultural market prices rising, and water rights at a premium, now is the time to plan for the future.  We suggest that water users create and update water management plans with an eye to water rights security, stability, and development.  A water management plan will analyze the current state of the water rights designated and appurtenant to property or other boundary and will provide a tool to consider options for their use, development or marketing.  One can begin this work by emailing Kelley Wesson for a water rights authorization packet.

One can’t help but notice the increasing amount of wind-generation farms that are being installed throughout Oregon, Washington and the U.S.  At first glance, wind energy seems like a great idea with many people looking to jump on the bandwagon.  It provides clean renewable energy and helps stabilize energy costs and our nation’s dependence on foreign fuel sources.  However, it is not as simple as it may seem and careful feasibility and due diligence analysis must be made to determine if wind energy is right for you and your land.

There are three categories of systems that are available:

1.  Small Scale – for your own residential or commercial (office or farm) facility. These are small wind generation towers. These help to offset the individual owner’s utility costs.
Some of these systems allow the owner to be hooked up to the power grid, wherein any extra power the owner currently generates is fed directly to the grid.  Later when the owner needs power, they can take back from the grid at no-cost and use the credit on the power they previously supplied to the grid. This system is known as net metering. The owners power meter will actually track in both positive and negative directions.  Of course the owner doesn’t have to be connected to the grid and thus their power generation would be used at that moment in time unless additional equipment, like batteries, are installed to capture that generation – the stand alone system.
These smaller systems cost anywhere from $10,000 to $80,000 installed. They generally produce around 10 kilowatts (kW) to 25 kW in generating capacity, and can be up and running in about a year.

2.Community Program – group of landowners come together to install mid-sized wind generation towers and the power created is spread amongst the group.

3.  Large Scale and Utility Scale – wind farms that generate power to sell to distributors like PGE, Pacific Power, and Idaho Power for a profit.  These are the systems that usually produce 10 megawatts (“MW”) or more.  The cost is anywhere from $800,000 to $1,200,000 per turbine, in a multiple turbine system, and can be up and running in about five years, from first idea to completed construction.

Leasing the wind rights on your land to a developer is a viable option if you are not interested in going through the development process, and can provide you as the landowner with $3,000 to $4,000 per year for one 1.4 MW turbine, using .5 acre footprint that is spread over 50-75 acres of land.  Of course profit will be based on the amount of wind produced by that turbine, thus you want to make sure you have “windy land.”

The level of due diligence required to determine cost/benefits and feasibility will change depending on which system you are interested in.  The key things to remember and look at when assessing any of these systems are: goals including leasing versus developing, wind resources, amount of available land, energy needs or interconnection to the power grid, permitting through local and state governments, capital contributions available and amount of risk you are willing to assume, government grants and incentives and tax incentives and consequences.  There are different ways to structure these projects to make it worth the investment and minimize risks, but like property, each project is unique.  It is important to spend the time and money up-front in researching the opportunities and feasibility of any new business opportunity.

While the costs may ward off many potential developer candidates in prime site locations, there are several grants available for all systems including financing for the feasibility study.  There are also several different incentive programs available for project costs, taxes and production.  The range of these programs is great and should be considered specific to the proposed system.   With these grants and incentives, it can turn an $80,000 project into $10,000 project with a positive return on investment.  Thus with careful time and consideration spent up front, a landowner or company could turn this clean renewable energy resource into a profitable venture.

TCID’s Policy Committee will meet on Monday, September 8, 2008 at the TCID office (2666 Harrigan Road, Fallon NV) to review their policy and  decide on a  “Possible Increase in ‘In Lieu’ Charges for the Retiring of Water Rights.” Your attendance is encouraged.
The In Lieu charges are those one-time payments that TCID Policy provides it should receive when a land owner retires his water rights through AB380 program, through individual settlement of the Tribe’s Petition acres, or through any other retirement.  For example, if a person entered into an individual settlement of his water rights wherein a portion of his water rights were retired (meaning the  water rights are no longer available for diversion from the source by TCID to the landowner), that individual is required to pay TCID.

TCID’s policy states  that “in lieu” payments help them offset “the proportionate share of tolls, charges, fees, assessments, and tax levies that such water rights would have paid in the future.” (See TCID Management Policies dated September 7, 2000). The “in lieu” payment policy was created out of the AB 380 program wherein TCID would receive the “in lieu” payment from federal funds upon the successful retirement of water rights challenged by the Tribe through the AB380 program.  There is no more money in the AB 380 program.

TCID also remains whole on the backs of its patrons.  Despite the fact that TCID patrons paid TCID assessments for challenged acres while not receiving a water allocation, TCID patrons now retiring these same non-allocated water rights are required to pay the “in lieu” fee to TCID.  Pursuant to TCID policy, TCID patrons are to pay  $1200 per water righted acre that is retired in order for TCID to remove the retired acres from the assessment roles.

While there is little question that TCID has authority to charge an Operation and Maintenance (O&M) fee for each assessed acres to which TCID provides water delivery services through an allocation, the question is whether TCID has authority to charge O&M for water righted acres to which it does not deliver an allocation?  In addition, there is a question as to the authority of OCAP and TCID acting under OCAP to deny water allocations since this effectively cancels the water rights?  Cancellation is a function of state law and requires that the landowner be afforded due process before the loss of his property interest.

TCID’s role is to deliver water to water right holders in the Newlands Project.  TCID is governed by the Alpine and Orr Ditch Decrees as well as the Bureau of Reclamation under OCAP or the Operating Criteria and Procedures for the Newlands Reclamation Project, Nevada (found at 43 C.F.R. 418 et seq).  No where in OCAP or the Decrees does it say that TCID is the owner of the water rights, or that TCID can charge  landowners when it does not delivery water to existing water righted acreage.  In fact, OCAP at Sec. 418.26 states that TCID should give consideration to adopting a financing and accounting system that provides reasonable financial incentives for the economical and efficient use of water.

While it may be appropriate to “charge” a fee to remove water righted acres from the assessment roles, patrons retiring water rights that have not received an allocation under these “retired” water rights for years are owed some consideration for their many years of payments to TCID.  TCID should not be allowed to effectively condemn landowner water rights by making OCAP non-allocation orders, take money from the landowners for delivery when TCID has no intention to provide water delivery, and charge the landowner again to remove non-allocated/cancelled water rights from the assessment roles when the landowner retires them.

At the end of last year, the Nevada Division of Water Resources issued a bulletin to water right professionals notifying them that the Division will be refocusing its review of applications for extension of time for proof of completion of works or extensions of time for proof of beneficial use.  NRS 533.380(3) precludes the State Engineer from granting an extension unless the applicant provided proof that he is proceeding in good faith and with reasonable diligence to perfect the application. Reasonable diligence was defined by statute as “the steady application of effort to perfect the application in a reasonably expedient and efficient manner under all facts and circumstances.”

Unfortunately, the Division has not promulgated regulations that would clarify the type of activities that are sufficient to warranting the granting of an extension.  The application form instruction sheet does provide some examples, however, of what types of activities can be highlighted as indicative of progress made during the previous year, including descriptions of any facility or feature completed, identification of project reports or engineering drawings submitted for review or recorded pursuant to applicable law, and explanation of conditions that adversely effected the applicant’s ability to establish beneficial use.  Other suggestions are viewable on the Division’s website at http://water.nv.gov/Forms/formroom.cfm, on the instruction page of the form entitled NEW Extension of Time.

The Division ended its commentary suggesting that water right professionals should advise their clients that cancellation of their water use permits will result if they are unable to meet the statutory requirements for approval of an extension.