El Niño is gracing the West Coast of the United States and water watchers are enjoying relief from the past few years of drought, but the catch-up game may take longer than hopefuls could dream. Reports from the U.S. Climate Prediction Center indicate that wetter weather is forecast for the West Coast through at least November 24th, but may only be enough to recover part of the damage caused by drought. Not only would water storage reservoirs need to be restored to normal, levels of both surface and groundwater would also need to at least approach normalcy for El Niño to solve the West’s water scarcity issues.

Organizations such as the Agricultural Conservation Easement Program are seeking to aid with scarcity issues, whether El Niño proves itself as a force this winter or not. On November 16, 2015, U.S. Department of Agriculture Secretary Tom Vilsack announced the availability of $350 million funded through the ACEP to benefit the restoration and protection of working agricultural lands and wetlands. The funding was created by the 2014 Farm Bill to protect critical water resources and wildlife habitats, but is also extended to landowners to help protect and restore key farmlands, grasslands and wetlands across the nation. According to a news release by the USDA’s Natural Resources Conservation Service, private landowners can use programs like the ACEP to maintain land for farming and ranching purposes. Voluntary easement sales can help landowners engage in the conservation efforts by limiting future development to protect key resources such as water.

The news of ACEP’s funding comes down right alongside a Presidential Memorandum written in early November. The memorandum is addressed to secretaries such as USDA’s Vilsack and specifically directs such programs to, “Avoid and then minimize the harmful effects to land, water, wildlife, and other ecological resources (natural resources) caused by land- or water- disturbing activities, and to ensure that any remaining harmful effects are effectively addressed, consistent with existing mission and legal authorities.” (Western Livestock Journal)

While El Niño may bring hope to the West Coast, efforts from the USDA and ACEP will be needed to aid the long-term protection of farmland, grassland and wetland in the US, as well as the restoration and consistency of water quality and levels.

NINTH CIRCUIT UPHOLDS RULING — NPDES PERMITS ARE NOT REQUIRED FOR TRANSFERS OF WATER IN THE KLAMATH BASIN

ONRC Action v. United States Bureau of Reclamation (9th Cir. Or. Aug. 21, 2015)
cdn.ca9.uscourts.gov/datastore/opinions/2015/08/21/12-35831.pdf

The Ninth Circuit Court of Appeals was recently presented with the issue of whether the Bureau of Reclamation violated the Clean Water Act by discharging pollutants from the Klamath Straits Drain into the Klamath River without a permit. Finding that the waters of the Klamath Straits Drain and Klamath River were not meaningfully distinct, and applying the reasoning from Los Angeles County Flood Control Dist. v. Natural Resources Defense Council, 133 S. Ct. 710, (2013), the court concluded that a Clean Water Act permit was not required.

Background

The original case was filed in 1997 as a citizen’s suit under § 505(a) of the Federal Water Pollution Control Act, 33 U.S.C. § 1365(a), commonly referred to as the Clean Water Act. Plaintiff Oregon Natural Resources Council Action (“ONCR”), an environmental group, asserted that the Bureau of Reclamation and its commissioner violated the Clean Water Act by discharging pollutants from the Klamath Straits Drain into the Klamath River without a permit. The case was stayed for settlement negotiations for years, dismissed, and then reopened on motion. The magistrate judge’s report and recommendation granting the Bureau’s motion for summary judgment were adopted by the district court. The recommendation was based on the conclusion that the Klamath Straits Drain, which connects Lower Klamath Lake and the Klamath River is a water of the United States as defined by the Clean Water Act, and therefore a discharge of water from the Klamath Straits Drain to the Klamath River would be exempt from the Clean Water Act’s permitting system by the EPA’s Water Transfers Rule. The Water Transfers Rule defines water transfers as “an activity that conveys or connects waters of the United States without subjecting the transferred water to intervening industrial, municipal, or commercial use.” 40 CFR 122.3(i). Under the Rule, “water transfers” are exempt from the NPDES permitting requirements because the transfers do not result in the addition of a pollutant.

On appeal, ONCR raised the issues of whether the discharge of water from the Klamath Straits Drain and the Klamath River was exempted by the Water Transfers Rule and whether the adoption of the Water Transfers Rule was within the EPA’s authority.

The Ninth Circuit panel neatly sidestepped the issue of the validity of the Water Transfers Rule, relying on the holding in Los Angeles County Flood Control Dist. v. Natural Resources Defense Council, __ U.S. __, 133 S. Ct. 710, 184 L. Ed. 2d 547 (2013), which was issued after the district court entered its decision. In the Los Angeles Flood Control Dist., the Supreme Court held that the flow of water from one portion of a river through a concrete channel or other engineered improvement within a river, then back into the river did not constitute a discharge of a pollutant under the Clean Water Act. In summary, the Court held that that “pumping polluted water from one part of a water body into another part of the same body is not a discharge of pollutants under the Clean Water Act,” as no pollutants are being “added”. Id. at 711, citing to South Florida Water Management Dist. v. Miccosukee Tribe, 541 U.S. 95, 109-12 (2004).

In the ONCR case, the Ninth Circuit panel found that the record demonstrated that waters of the Klamath Straits Drain were not meaningfully distinct from those of the Klamath River. In reaching this conclusion it summarized the flow of water through the Klamath Irrigation Project as originating from the Klamath River, then flowing through parts of the Project into Lower Klamath Lake, and then flowing back to the Klamath River via the Klamath Straits Drain. While recognizing that the water was combined with other waters during its journey, including waters from the Lost River Basin, from spring-fed streams, and from runoff, the court concluded that a substantial portion of the water returned to the Klamath River through the Klamath Straits Drain came originally from the Klamath River and was not meaningfully distinct.

Further, despite the excavation and channelization of the previously existing natural waterway, as well as the addition of two pumping stations to ensure the flow of water through the Klamath Straits Drain, the Ninth Circuit viewed the Klamath Straits Drain as essentially an improved version of the previously existing natural water way. The panel relied on the district court’s finding that the Klamath Straits Drain provided a hydrological connection between the lake and river, just as the original Klamath Straits, and that if the headgates and pumps of Klamath Straits Drain were removed, waters would flow between the Klamath River and the Klamath Straits Drain. Because the waters flowing into the Klamath River from the Klamath Straits Drain were not meaningfully distinct from those in Klamath River, the court held that no permit was required under the Clean Water Act.

The validity of the EPA’s Water Transfer Rule has been the source of much litigation, some of which is ongoing. Unfortunately, the Ninth Circuit panel decision did not reach the question of whether the rule adopted by the EPA was properly within its authority and was therefore valid.

By Derek Bradley

Most municipalities have water use permits reserved for their current needs and projected future growth, typically in the form of one or more municipal water rights of use or permits. These water use permits have timelines for the cities to fully develop the beneficial use entitlement. Based on current population and use, cities may not be able to apply the full volume of water to beneficial use by the timeline allowed in the water permit. In order to retain the volume allowed and priority of the water use permit, a municipality may request an extension of time from the Oregon Water Resources Department (OWRD) for additional time to develop the volume of water allowed in their permit.

The Oregon Senate is currently considering Senate Bill 712 (SB712) that could impact how much of the permitted but undeveloped portion is available for future development by Oregon municipalities.  This bill concerns municipal water permits requiring extensions for development that currently are subject to fish persistence conditions, or restrictions on water use to maintain stream flows for wildlife.

SB712 is in response to a 2013 Oregon Court of Appeals ruling, WaterWatch of Oregon v. OWRD, 259 Or. App. 717, decided on December 11, 2013.  In this case, the Court held that the reference to “undeveloped portion of the permit” in ORS 537.230(2), which was passed in 2005 as House Bill 3038,  “is to be measured by reference to the maximum rate of water applied to beneficial use before the expiration of the document deadline in the permit or last-issued extension.” Id. at 742.  The Court’s holding required the fish persistence condition to apply to all water use  not yet  put to beneficial use when the municipality’s previous permit terms or extension expired. For example, if a city held a water right of use by permit to 10 cubic feet per second (cfs) and can demonstrate use of 3 cfs at the time the permit condition expired for development, a condition in granting an extension of time would require fish persistence conditions attached to the remaining 7 cfs.

If the legislature passes SB712, this extension system will change so that the undeveloped portion of the water right permit will be considered to be the volume of water being used by either December 11, 2013, or the time specified to complete construction to perfect the water right in the permit or last approved extension. This alters the quantity of water subject to fish persistence conditions to a specific set date for all municipality extension applicants which would hopefully limit the current unending rounds of litigation that the municipal extensions are currently requiring. This change would also eliminate the large backlog of permit extension applications presently pending with OWRD.  Without this change many cities will have conditions placed on water use they have already begun putting to beneficial use because of the large lag time between expiration of the permit terms and granting of the extension application.  This bill would keep municipalities from the retroactive application of fish persistence conditions being applied to water use presently in use, with some of that usage dating back to the 90s.

Some groups focused on fish habitat view this bill as an attempt to change the terms of the 2005 compromise bill.  However, the intervening litigation since passage of the 2005 act illustrates that the “fish persistence” requirement is procedurally unworkable.  In the meantime, the Oregon courts continue to refuse to adopt the “growing communities” doctrine that would have mitigated the issues presented by the “fish persistence” ideals of fish habitat advocates.

Of course, municipalities are interested in having as much water available for development for their future growth as possible. In addition, the large investment municipalities must make require them to experience as little disruption as possible. This bill seems particularly fair to smaller municipalities that have limited resources to litigate the nuances of the “fish persistence” requirement and need their dollars to invest in water infrastructure with their less flexible water supplies and interconnects to other municipalities and sources.

While it is easy to see the concern of groups opposing SB712, (as it can take well over a decade for an extension to be approved and a municipality can increase their water usage substantially in that time), passage of SB712 will ultimately affect only a small amount of Oregon’s surface source waters.  Once all the current applications are processed by OWRD, all undeveloped municipal permits will have at least a portion of their permitted volumes subject to fish persistence conditions.  With a substantial backlog in extension applications (some cases extending over a decade and a half in water investments already made by some municipalities), SB712 will provide certainty for this state’s towns and cities as they plan how to manage their water use and development for future growth.

At 12:15 PM today, Oregon Governor John Kitzhaber announced his resignation, effective Wednesday, February 18, 2015 at 10:00 AM. Kitzhaber’s resignation is the first time in Oregon history that a Governor has resigned amid active criminal and ethical investigations.

Secretary of State Kate Brown will assume the office of Governor, and will hold office at least until a special election for Governor is held in November, 2016.

The change of administration signals some uncertainty for the natural resources community, as appointed department officials are possibly subject to replacement with the new chief executive assuming office. Similarly, policy viewpoints and agenda items previously announced and relied upon may be shifting from the Governor’s office, and may impact the 2015 legislative session.

As the transition takes place in the coming days, weeks, and months, we hope that the new administration continues to support natural resource users that make Oregon a national and international force in food, fiber, and timber production.

Schroeder Law Offices, P.C. is pleased to present the Oregon Irrigation District Election Manual.

This manual provides an overview of the Irrigation District election process, and presents timelines and special considerations involved in regular and special elections.

This manual includes the topics of:

• Elector Voting Rights
• Director Qualifications
• Director Nominations
• Voting by Mail
• Pre-election Procedures
• Election Day Responsibilities
• Post-election Vote Counting and Election Certification

Our office has assisted special districts including Irrigation Districts, Water Control Districts, and others in their elections preparations and procedures, and we welcome the opportunity to discuss a special district’s elections with staff and board members needing assistance. The information in this manual should only be relied upon after consulting with an attorney to discuss a special district’s particular situation.

On December 31, 2014, the Oregon Court of Appeals decided WaterWatch of Oregon Inc., v. Water Resources Department, 268 Or. App. 187 (2014). The Court of Appeals reviewed three final orders for extensions of time for municipal water permits in the Clackamas River. After contested case hearings, the Water Resources department granted the extensions, subject to fish persistence conditions. WaterWatch of Oregon sought judicial review of the final orders granting the extension, challenging, among other things, the adequacy of fish persistence conditions.

As a matter of first impression, the court interpreted ORS 537.230(2)(c), which states:

“[T]he department finds that the undeveloped portion of the permit is conditioned to maintain, in the portions of waterways affected by water use under the permit, the persistence of fish species listed as sensitive, threatened or endangered under state or federal law. * * *.”

After extensive review of the legislative history of the statute, the court concluded that “the legislature intended that the undeveloped portions of the permits be subject to conditions—that is, fulfillment of the conditions are a prerequisite to diversion of the undeveloped portions—that preserve from decline the continued existence, or endurance, of listed fish species.”

The court interpreted the term “maintain * * * the persistence of fish species,” to focus on the “longterm preservation or endurance of fish population health in the affected waterway. . . . It does not express a policy that no habitat may be impaired or that no individual fish may be allowed to perish or leave.” So while the conditions imposed on a municipal extension of time to maintain fish persistence are required prior to diverting the undeveloped portion of the permit, the conditions must preserve from decline listed fish species over the long-term.

Oregon follows the Prior Appropriation principle for water use. The guiding principle of the Prior Appropriation Doctrine is “first in time, first in right.” Thus, water users with earlier priority dates may have their water use rights satisfied before junior water users, or may even require junior users to cease diversions, if there is not enough water in the system to supply all uses.

However, Oregon Revised Statute (“ORS”) 536.750(1)(c) allows the Oregon Water Resources Commission to create a preference for human consumption and stock watering uses after a declaration that a severe, continuing drought exists. The creation of a water use preference allows the State to regulate water use in a way that gives priority to junior users for the identified purpose in the preference statute. Here, the State may allow water users to take water out of priority for human consumption and stock watering uses.

A constitutional problem arises when the State regulates water use on the basis of the preference. The United States and Oregon Constitutions provide that private property shall not be taken for public purpose without just compensation. ORS 536.750(1)(c) was enacted in 1989. Water use rights that were perfected prior to the statute being enacted became vested real property rights before ORS 536.750 was in place. Now, based upon the statute and agency regulations (Oregon Administrative Rule, “OAR,” Chapter 690, Division 22), the Oregon Water Resources Department may order a senior irrigation right shut off, while allowing a junior domestic or stock water use to continue. Such an order deprives the senior water user of their priority date, which is a key feature of their water right.

The Oregon Supreme Court outlined the standard for a “temporary taking” under the Oregon Constitution as follows: “We think that, in order to distinguish between a “taking,” on the one hand, and simple administrative inconvenience or delay, on the other, it is necessary to require that a complaining party allege some degree of permanence in its loss. We hold that, in order to assert a claim for a “temporary taking” under the Oregon Constitution, the complaining party must allege that it has been denied all economic use of its property under a law, ordinance, regulation, or other government action that either is permanent on its face or so long lived as to make any present economic plans for the property impractical.” Boise Cascade Corp. v. Board of Forestry, 325 Or 185, 199 (1997). Such a denial of all economic value might be proved, in the case of a senior’s water use regulation, by a showing that the senior user’s water use would have remained unregulated had the State not exercised a preference for junior domestic and stock water uses instead, and that such regulation denied the senior water right holder all economic value of their water right during the period of regulation, such as an irrigation season where a portion of a crop was lost.

A drought has been declared in Klamath County, Oregon this year. In response, the Oregon Water Resources Commission (“OWRC”) enacted temporary rules in OAR Chapter 690, Division 20, creating a surface water preference for domestic and stock watering, regardless of priority. OWRC is now proposing to amend the Division 22 rules to extend the preference to groundwater as well. The proposed rules are available on the Oregon Water Resources Department website at: http://www.oregon.gov/owrd/Pages/law/Department_Rulemaking.aspx.

A second public hearing on the proposed Division 22 rules will he held September 18, 2014 in Klamath Falls. Written Comments must be received by the Oregon Water Resources Department by 5:00 PM on September 19, 2014. More information about the public hearing and comments is available on the website provided above.

Schroeder Law Offices drafts comments on behalf of its clients to proposed rules or other agency actions. Contact Schroeder Law Offices if you have questions about a government action that is affecting your water use.

Stay tuned to Schroeder Law Offices’ Water Law Blog for more water news that could affect you!

Earlier this month, the Oregon Water Resources Department announced in this press release that the Department would be submitting a second notice of proposed rulemaking, holding a second public hearing, and extending the comment period for proposed rules that grant preference for “human consumption” and “stockwatering” uses following the Governor’s declaration of a drought. The rules are solely directed at Klamath County, Oregon. After receiving comments from elected officials and concerned local governments stating that there was little notice or public involvement in crafting the proposed rule, the Department decided to hold the second round of comments and public hearings.

Besides making the temporary rule permanent, the rule is different from the original temporary rule in that it eliminates the differentiation between the regulation of surface water to include all water sources, including groundwater. How this proposed rule affects exempt well uses, including “domestic purposes” is unknown, and “domestic purposes” is clearly not included in the definition of “human consumption.”

In addition, granting preference for a particular use does not necessarily translate into a restriction to the access of the water supply. While the Department states that senior calls could “regulate off” a junior user, the preference for a human consumption and stockwatering uses does not speak to restricting access.

The department seems to be conflating the two different aspects between use and access. While shutting off a well or closing a diversion point may be the most efficient method of regulation, granting a preference for human consumption and stockwatering uses would still allow access, and require the department to use a more sophisticated regulation system other than just shutting off the supply: the uses would be regulated, not just the access to the supply. The City of Klamath Falls identified this distinction in its comments, noting its potential role as watermaster for all of its municipal subscribers to enforce the preference of uses as proposed, as municipal uses include industrial and landscape irrigation uses.

The comment period for the proposed rules will close at 5:00 PM on September 19, 2014, and the Commission is expected to take up the proposed rule during the week of September 22, 2014.

The next public hearing is scheduled at 6:00 pm on September 18, 2014 at the Oregon Institute of Technology Mt. Mazama Room, located at 3201 Campus Drive, Klamath Falls, OR.

For municipalities tasked with eliminating stormwater drainage, options tend to be expensive or regulatory steeple-chases with several iterations of reports, plans, approval processes, and permitting. A recent addition to the municipal toolbox of reducing stormwater runoff is the incorporation of Low Impact Development (LID) techniques that can serve as an alternative to the typical stormwater channelization and drainage systems.

The focus of LID is to improve water quality concerns with stormwater runoff; that is by using runoff on the site where it falls, as opposed to conveying the runoff to other locations and transporting pollutants, including sediments, with the runoff. Some of the techniques used include biofiltration and retention basins and swales, rain gardens, green streets, pavement minimization, and permeable pavements. In addition to reducing discharge into adjacent waterbodies, LID implementation can increase groundwater recharge and possibly lower demands on landscaping irrigation. Part of the driving force behind LID developments includes regulatory pressures from state and federal agencies. The Clean Water Act and National Pollutant Discharge Elimination System (NPDES) program require qualifying municipalities to develop and implement stormwater management programs under municipal separate storm sewer system (MS4) permits.

Exploring LID techniques may help a municipality decide if these kinds of practices would be beneficial, and incorporating LID as a stormwater discharge in the local planning codes can be a runoff reduction technique that can lower costs associated with MS4 water treatment and meet permitting planning requirements. In Oregon, the Department of Environmental Quality (DEQ) administers the MS4 program permits, and as part of the permitting requirements, some municipalities have developed stormwater management plans requiring new developments and redevelopments to implement LID where feasible.

LID used as a compliance tool in MS4 permitting

Depending on the size of the municipality, the DEQ can require either Phase I or Phase II MS4 permit, with Phase I sources have populations greater than 100,000, and Phase II sources with populations less than 100,000 and located within a Census-Bureau defined “Urbanized Area.” While the municipalities within these classifications are already aware of the MS4 requirements, entities experiencing growth may find themselves seeking waivers or become very familiar with MS4 permitting through necessary compliance.

For those entities already working within the MS4 permitting regime, LID programs within municipal control could offer compliance with permit conditions requiring “Minimum Control Measures” including:

1) Public Education and Outreach on Stormwater Impacts by identifying LID infrastructure with signage explaining the use and purpose of the bioswale, green street, permeable pavements, etc.;

2) Public Involvement/Participation through implementation LID design concepts in the local planning commissions;

3) Illicit Discharge Detection and Elimination through diverting some possible illicit discharges away from the traditional stormwater sewer system and identifying sources of the discharge closer to the originating site; and

4) Post-Construction Stormwater Management in New Development and Redevelopment through implementation of the localized LID policies and requirements, as readily identified to developers by clear planning and design standards.

For those entities not yet required to perform within the MS4 permitting regime, having LID concepts employed could serve as a technique to reduce the overall Total Maximum Daily Loads (TMDL) for stormwater sewer discharges, thereby possibly qualifying the entity for an MS4 permitting waiver under federal regulations.

LID as an alternative or compliment to Injection Systems

Rule authorized injection systems are subject to a laundry-list of certifications and requirements in order to protect groundwater supplies from contamination. Prior to authorizing an injection system, the DEQ requires developers to consider LID concepts when municipal stormwater sewer connections are unavailable, and certify that no other stormwater disposal method is appropriate. LID options offer a municipal or private entity the ability to remove stormwater without the degree of regulatory oversight as with injection systems, and can serve as either a primary way of disposing of stormwater or can complement injection system design by removing stormwater that cannot meet the quality requirements of the injection system regulations.

Issues with implementing LID

As with any proposed method of implementing local zoning regulations and design standards, LID may not be appropriate for the particular application. Planning and zoning codes should not be intended as static one-size-fits-all requirements. Issues could include high water tables, previous on-site contamination, or economic issues involving larger rights-of-way and private landowner compensation. Within the proposed local land use planning codes, drafters should incorporate flexibility into the application of LID requirements, while not making the exemptions so broad as to make implementation useless, should that be the desire of the local leadership. LID implementation could be a way for new development or redevelopment to reduce overall strormwater loads, and could be incentivized with a reduction in system development charges. While LID is not a cure-all to a municipality’s issues with stormwater drainage and treatment, it offers an alternative and an additional tool to use when stormwater discharge regulation is already an issue, or is easily visible on the horizon.

On March 4–7, the 2014 United States Committee on Irrigation and Drainage (USCID) met in Sacramento California on the topic of “Groundwater Issues and Water Management—Strategies Addressing the Challenges of Sustainability.”  The Conference included our study of “Conjunctive Management: Changing Water Regulation and Evolving Strategies.” This paper focused on western States regulation of surface and groundwater conjunctively (or not), concluding with creative approaches for water users to employ should groundwater be restricted or limited.

The common themes emerging from the conference included: the increasing reliance on groundwater when surface water becomes limited, salinity concerns from groundwater, and questions on whether California will implement centralized State-control of the groundwater supply. Given the past history of water regulation tied to cyclical droughts, water users and irrigation districts are uncertain about planning for future infrastructure investments when there is the possibility of potential State regulation of their groundwater use.

From an Oregon perspective, State-controlled groundwater use is a daily reality, and you can ask anyone in the Klamath River Basin on their possible concerns of their wells being turned off by the State. For the second year in a row, the Governor declared a drought in much of the southern half of Oregon, and the Oregon Water Resources Department is initiating rulemaking to restrict water diversions in Klamath County. The conference also included tours of two irrigation districts, demonstrating on-call water delivery with a pressurized irrigation pilot program, and an automated lateral demonstration project. These two projects brought irrigation into the 21^st century with water scheduling as easy to order as an airplane ticket.

During the tours I had to opportunity to discuss with irrigation district staff about whether the pressing water shortage will change the regulatory framework moving forward, or whether the will decrease after the rains return. Ideas about increased groundwater recharge and storage during times of water surplus are forthcoming now, but once the water returns, will these ideas remain in the forefront? California water users will be faced with important decision in the coming months, many of which will be how to provide for the nation’s pantries when faced with little to no allocation of surface water. Much like the implementation of automated water delivery of water is moving into the 21^st century, California will likely be at the forefront of 21^st century water storage technology given the stakes of deciding otherwise.

National Ground Water Awareness Week brings our attention to the “hot” issues in ground water now focused in Oregon, perhaps surprising to some, in the Klamath Basin.

On March 7, 2013, the Oregon Water Resources Department (“the Department”) issued its Findings of Fact and Order of Determination (“FFOD”), thus ending the administrative phase of the Klamath Basin Adjudication for pre-1909 surface water claims. Once the FFOD was entered, the Department became vested with the power to administer and regulate adjudicated water use rights according to priority of use, meaning that the Department may order junior water users to shut off water use if there is not enough water in the system to satisfy senior users to their full extent. During the 2013 irrigation season, the Klamath Tribes, holding the most senior water rights pursuant to the FFOD, made a call on the water to satisfy the Tribes’ instream adjudicated claims, and the Department sent notice letters to surface water users to regulate all junior surface water uses upstream.

Under Oregon Administrative Rules (“OAR”) Chapter 690, Division 9, the Department has authority to regulate ground water uses against substantial interference with surface water supplies where the use is hydraulically connected to the surface water. All wells located less than ¼ of a mile from a surface water source and producing water from an unconfined aquifer are presumed by the OAR to be hydraulically connected to the surface water source, unless the appropriator provides evidence to the contrary. Wells that pull water from an unconfined aquifer outside the ¼ boundary or from a confined aquifer must be evaluated by the Department for hydraulic connection to surface water sources.

http://pubs.usgs.gov/circ/circ1217/html/boxa.html, at figure A-2

Also by OAR, wells that produce water from a hydraulically connected aquifer are assumed to have the potential to cause substantial interference with a surface source if they are located within one mile of the surface source. In evaluating hydraulic connection in the Klamath Basin, the Department prepared a ground water model.

Recent information indicates that the Department will rely on its regional modeling to establish a presumption that wells within 1 mile of Klamath Lake, Agency Lake or within 1 mile of perennial gaining reaches of streams tributary to Upper Klamath Lake have the potential to cause substantial interference with the aforementioned surface sources (“gaining” reaches of streams are those that have increased flow as a result of ground water contribution to surface stream flows). Consequently, according to the OAR, these ground water uses will be subject to control (or regulation) by the Department.

Anticipating that the Department will begin shutting off wells within the “presumed” surface water connection boundary, Oregon Representative Gail Whitsett and Oregon Senator Doug Whitsett sponsored identical bills to add provisions within the Oregon Revised Statutes to protect ground water users by requiring the Department to tie regulation of a particular well or proposed well to scientific evidence that is specific to that use, rather than relying on a presumed surface water connection or a presumption created by a regional model. The full text of Senate Bill 1572 and House Bill 4044 can be accessed by following the links below.

https://olis.leg.state.or.us/liz/2014R1/Downloads/MeasureDocument/SB1572

https://olis.leg.state.or.us/liz/2014R1/Downloads/MeasureDocument/HB4044

The main focus of the bills was to require written notice prior to any action by the Department to regulate ground water use rights as a result of adjudicated claims, based upon the presumption of surface water interference and general regional modeling. The notice must be supported by the report of a qualified hydrologist finding a specific hydrologic connection between the well location at issue and the point of appropriation for the senior water use right. The supporting report must find that regulation of the ground water use would have a measurable effect on exercising the senior water use right. The bills also sought to prohibit the Department from amending a proposed final order to include additional supporting information following a request for hearing, and allow for collection of attorney’s fees by the water right applicant or water right holder under various circumstances.

Unfortunately, neither bill was passed during the 2014 regular session. The House bill was given a hearing, but no vote! Senator Whitsett and Representative Whitsett discussed their efforts during the February 21^st Oregon Cattlemen’s Association’s Quarterly Meeting, and reported that they intend to reintroduce the bills during the next legislative session.

Thus, the OARs will continue to place the burden on the ground water user to prove a negative in the case of a senior surface water call: that their well is not hydraulically connected to the nearest surface source.

Stay tuned to Schroeder Law Offices’ Water Law Blog as we follow the progression of this important legislation.

On December 11, 2013, the Oregon Court of Appeals issued a ruling interpreting the amended ORS 537.230(2) conditions. ORS 537.230(2) prescribes conditions for the Oregon Water Resources Department (“the Department”) to grant municipal permit extensions to complete construction and apply water to beneficial use in order to perfect water use rights. In this case, the City of Cottage Grove (“the City”) sought an extension, but then completed construction and application of water to beneficial use before the extension was granted. Based upon the language of the statute, the Department issued the extension without the ORS 537.230(2) conditions, and WaterWatch sought judicial review. The Oregon Court of Appeals reversed and remanded the Department’s final order.

In 2005, ORS 537.230(2) was amended by the passage of HB 3038 to allow municipal permittees to have up to 20 years to commence and complete construction of proposed water use infrastructure and apply water to beneficial use (as opposed to the previous 5-year deadline), so long as certain conditions are imposed. ORS 537.230(2) currently provides:

(2) The holder of a permit for municipal use shall commence and complete the construction of any proposed works within 20 years from the date on which a permit for municipal use is issued under ORS 537.211. The construction must proceed with reasonable diligence and be completed within the time specified in the permit, not to exceed 20 years. However, the department may order and allow an extension of time to complete construction or to perfect a water right beyond the time specified in the permit under the following conditions:

(a) The holder shows good cause. In determining the extension, the department shall give due weight to the considerations described under ORS 539.010 (5) and to whether other governmental requirements relating to the project have significantly delayed completion of construction or perfection of the right;

(b) The extension of time is conditioned to provide that the holder may divert water beyond the maximum rate diverted for beneficial use before the extension only upon approval by the department of a water management and conservation plan; and

(c) For the first extension issued after June 29, 2005, for a permit for municipal use issued before November 2, 1998, the department finds that the undeveloped portion of the permit is conditioned to maintain, in the portions of waterways affected by water use under the permit, the persistence of fish species listed as sensitive, threatened or endangered under state or federal law. The department shall base its finding on existing data and upon the advice of the State Department of Fish and Wildlife. An existing fish protection agreement between the permit holder and a state or federal agency that includes conditions to maintain the persistence of any listed fish species in the affected portion of the waterway is conclusive for purposes of the finding.

In the Cottage Grove Case, 2013 WL 6498547, 2013 Ore. App. LEXIS 1463 (December 11, 2013), the ORS 537.230(2)(b) and (c) conditions were tested. The City of Cottage Grove was issued a permit in 1977 with deadlines to complete construction in 1979 and apply water to beneficial use in 1980. The City was granted a number of extensions, ending in 1999.

In 2007, the City enlarged its water treatment plant and applied to the Department for an extension of time to perfect its water use right. Prior to being granted an extension, the City applied the full amount of water allowed under its permit to beneficial use. The Department thereafter approved the City’s extension, but without the ORS 537.230(2)(b) and (c) conditions because the Department determined that there was no undeveloped portion of the permit at the time of the most current extension. WaterWatch sought judicial review of the Department’s order approving the extension in the Oregon Court of Appeals. The Department thereafter issued a water right certificate to the City.

First, the Oregon Court of Appeals determined that WaterWatch’s action was no rendered moot by the issuance of a water right certificate. Although water right certificates may only be cancelled for certain statutory reasons (ORS 537.250(3)), and are generally “conclusive evidence of the priority and extent of the appropriation therein described” (ORS 537.270), the Court determined that the validity of the certificate was predicated upon the validity of the final order approving the extension application as a necessary prerequisite to the certificate. Therefore, if the final order approving the extension was reversed, the certificate could be cancelled as well.

Second, the Oregon Court of Appeals conducted statutory interpretation to determine whether the “undeveloped portion of the permit” should be measured at the time the extension application is considered by the Department (as argued by the Department and City), or whether it should be measured at the permit deadlines or previous extension deadlines (as argued by WaterWatch). The Court outlined the legislative history leading to the ORS 537.230 amendment, and concluded that the statutory amendment represented a compromise between environmental interests and municipal needs to engage in staged water development.

The Court ruled for WaterWatch, holding that the undeveloped portion of the permit before extension must be measured at the time specified in the permit or last extension. Otherwise, municipalities could avoid the ORS 537.230(2) conditions by developing additional amounts of water before applying for extensions. The Oregon Court of Appeals ruled that the Department’s failure to condition the permit extension on ORS 537.230(2)(b) and (c) was inconsistent with the statute. The Court reversed and remanded the Final Order for the Department to vacate the water right certificate and reconsider the permit extension in line with the Court’s decision.

The Cottage Grove Case is the first in a number of municipal extension judicial review cases. The statutory interpretation will affect numerous municipal entities throughout the State of Oregon, and require municipalities to implement water conservation management plans and protect the persistence of certain fish species when conducting staged water development that requires extensions of time. This will make staged development of water resources for municipal uses more challenging. It is currently unknown whether the Department or the City will seek review before the Oregon Supreme Court.

For a full version of this article, visit the Oregon State Bar Environmental & Natural Resources Section webpage, at: http://osbenviro.homestead.com/.

Stay tuned to Schroeder Law Offices Water Law Blog for more water news that could affect you!

Senator Doug Whitsett”s recent e-newsletter provides some insight into EPA’s proposed rule concerning Clean Water Act Jurisdiction.  Read more here.

Our office often receives questions from clients regarding the availability of water in a particular area.  The Oregon Water Resources Department has a search engine that we often use to get started on this type of research.

To access the search engine use the following link:

http://apps.wrd.state.or.us/apps/misc/lkp_trsqq_features/default.aspx.

Enter the latitude and longitude or address for the parcel you would like to research. The search will generate a report outlining the basin and sub-basin, as well as Wild & Scenic designation, whether minimum stream flows are instituted, and other useful information. Use the basin and sub-basin designation to look up applicable regulations in the Oregon Administrative Rules, Chapter 690, Divisions 502 et. seq., available at: http://arcweb.sos.state.or.us/pages/rules/oars_600/oar_690/690_tofc.html. 

Sometimes the search generates codes, which may require a call to the Department to decipher.  The report may also link to information regarding what times of year water use is allowed or restricted.

The search engine is one of several tools to determine whether water is available for appropriation. Give us a call if you have further questions about water availability in your area, and be sure to stay tuned to the Schroeder Law Offices Water Blog for more information that may affect your water use!

The 2013 Oregon Legislature session will begin Monday, February 4. Of over 1200 bills introduced, several expressly or implicitly relate to water use and water management. In particular the Oregon Water Resources Department (“Department”) has introduced several bills related to water management and water use fees.

SB 217, introduced by the Department, proposes a water management fee of $100 for all water rights of record.  The water management fee is proposed to apply to primary, supplement, secondary use, storage, municipal, district and federally held water rights. The water management fee will be capped at $1,000 per water right holder. In-stream water rights and domestic exempt water uses are not proposed to be subject to the fee. To read the full text of the bill as introduced please use the following link.

http://landru.leg.state.or.us/13reg/measures/sb0200.dir/sb0217.intro.html

The current rate schedule used by the Department is set to sunset in 2013. SB 2259, introduced by the Department, proposes to extend and adjust the fee schedule. To read the full text of the bill as introduced please use the following link.

http://landru.leg.state.or.us/13reg/measures/hb2200.dir/hb2259.intro.html

Find contact information for your local representative here: http://www.leg.state.or.us/findlegsltr/

The following annoucenment was issued by the Bureau of Reclamation on January 4, 2012:

The Bureau of Reclamation has reissued for public comment four draft Reclamation Manual releases regarding water-related contracting activities. These draft releases provide definitions of key terms and revise existing definitions for water-related contracts, restructure and clarify Reclamation’s water transfer and conversion policy and consolidate and set-out basic pricing requirements for water-related contracts. Comments are due to Reclamation by April 3.

The four draft releases are:

• Draft RM Policy Water-Related Contract and Repayment General Principles and Requirements (PEC P05).
• Draft RM D&S Water Rates and Pricing (PEC 05-01).
• Draft RM Policy Transfers and Conversions of Project Water (PEC 09).
• Draft RM D&S Conversions of Project Water from Irrigation Use to Municipal and Industrial Use (PEC 09-01)

These releases have been updated to reflect comments received during the first comment period from September 29 to November 30. The changes are highlighted with redline-strikeout throughout the documents.

The Reclamation Manual establishes Reclamation requirements, assigns program responsibility and establishes and documents Reclamation methods of doing business.

These draft updates are available for detailed review at: www.usbr.gov/recman. A summary of the draft updates can be found at: http://on.doi.gov/rMciUA. Comments or questions may be directed to Owen Walker at owalker@usbr.gov.

The Director’s Report for the Oregon Water Resources Commission January Meeting breaks down water conditions in the State:

“Current Water Conditions: The surface water supply index (SWSI) is a numerical index computed for the 14 major water basins in Oregon. The index ranges from + 4.0 indicating extremely wet conditions to – 4.0 indicting extremely dry conditions. An index of 0 would indicate normal conditions. The index is computed monthly and generally considers snowpack, rainfall, irrigation reservoir content and average monthly streamflow. On December 1, 2011 the indices in the 14 basins ranged from -1.5 in the Klamath Basin to +1.6 in the Deschutes Basin. According to the SWSI, water conditions in Oregon are generally below normal and trending downward.

On January 9, 2012 snowpack conditions range from a high of 55 percent of normal in the Grande Ronde, Powder, Burnt and Imnaha Basin Basins to a low of 19 percent of normal in the Owyhee Basin. Generally, snowpack is currently well below normal after 3.5 months into the water year.

We normally experience the bulk of our snowpack accumulation in December, January and
February. Total precipitation for the water year ranges from a high of 69 percent of normal in the
Grande Ronde, Powder, Burnt and Imnaha Basins to a low of 44 percent of normal in the Lake
County/Goose Lake Basin.

Storage carryover in the major irrigation reservoirs puts them at near normal capacity.
The northwest is still under the influence of La Niña conditions and continues to be forecasted for below normal temperatures and above normal precipitation over the winter period. However, these conditions have not been consistent with the moving three month forecast. Storms have been consistently pushed to the north, leaving the state with below normal water conditions.”

 Under Oregon law, a city may provide utility services to its inhabitants “[w]hen the power to do so is conferred by or contained in its charter or act of incorporation.” (ORS 225.020).  This includes providing water and sewer services “for profit” so long as the city’s charter provides and the public trust is not violated in doing so.

Portland is currently facing a lawsuit that will push the City’s water and sewer disposal expenditures to the forefront.  The claimants, a group of ratepayers, assert that Portland violates the city’s charter by diverting water and sewer funds toward projects and expenditures unrelated to the provision of those services.  The suit seeks an independent accounting of water and sewer disposal fund expenditures, together with an order of reimbursement.

The court will be asked to interpret key portions of Portland’s City Charter, including whether Portland’s charter restricts the City Council from using rate-payer funds to finance so-called “pet” projects.  The court will also be asked to determine whether various past expenditures were reasonably related to the provision of water and sewer services.

Follow this link to an article discussing the suit:  http://www.oregonlive.com/portland/index.ssf/2011/12/portland_faces_lawsuit_over_ut.html\

Oregon Public Broadcasting (“OPB”) News recently featured a brief story on the Oregon Natural Desert Association’s (“ONDA”) agreement with a rancher in the Bend, Oregon area.

The agreement allows for retirement of a nearly 3,000 acre federal grazing permit. Typically, the law requires retired permits to be reissued; however this particular allotment falls under a land management plan that provides for the voluntary retirement of grazing permits without re-issuance to the next preference holder. Thus, this grazing permit will remain retired for the duration of the management plan, which is about ten years.

This story evidences the continuing conflict that surrounds the use and management of Federal lands. While this story is about voluntary retirement of a grazing permit and not a cancellation, it highlights the influence that special interest groups are attempting to gain in this regulatory arena.

Click here to view the original OBP News story: http://news.opb.org/article/14357-onda-reaches-agreement-retire-3000-acre-grazing-permit-near-bend/

USG Oregon, LLC, a subsidiary of U.S. Geothermal, Inc., has acquired two geothermal mineral ownership interests in the Neal Hot Springs Project in Eastern Oregon.  USG Oregon now holds significant mineral ownership interests in the Neal Hot Springs geothermal reservoir.  The lands to which the mineral interests are appurtenant currently have two existing production wells and there are plans for new production and injection wells.  USG Oregon’s current plans predict development of 26MW of power production.  For additional information please see the articles linked below.

http://www.usgeothermal.com/NealHotSpringProject.aspx

http://thinkgeoenergy.com/archives/5092