Legislative Reallocation: How Compliance with Federal Legislative Initiatives Can Redistribute Water Resources
Water allocation in the United States generally occurs through state administrative processes. Compliance with Federal legislative initiatives, however, can require the reallocation of water resources. Laws enacted to achieve protection of environmental, wildland and wildlife resources have increasingly played a role in the allocation of water, particularly in the West. This Article examines Washington's Methow Valley as a case study in which efforts to recover threatened and endangered aquatic species have achieved reallocations of water resources to protect environmental values. After a brief outline of the Endangered Species Act (ESA) and its requirements, it examines how the ESA's consultation process requires private irrigators to limit water withdrawal to meet the biological and reproductive needs of ESA listed species. Constitutional constraints on legislative reallocation stemming from the U.S. Constitution's “Takings” clause are also discussed as an important limit on this power.
Decisions regarding the allocation of water supply in the United States are generally left to individual states. In the arid West, the doctrine of prior appropriation is used by most states to make such allocations. The prior appropriation doctrine allocates water resources based on a state administered priority system, which often results in complete or even overallocation of existing supply. Compliance with state and Federal legislative initiatives, however, can achieve reallocation of water resources. Laws enacted to achieve protection of environmental, wildland and wildlife resources, in particular, have increasingly played a role in the allocation of water, particularly in the U.S. West.
On occasion, legislative reallocation occurs explicitly. The Central Valley Project Improvement Act of 1992 implemented sweeping reform of the Federal Bureau of Reclamation's operation of the Central Valley Project (Giuda 2007, Weinberg 2007). The Act, among other initiatives to restore fish and wildlife species, reallocated 800,000 acre-feet of water for “fish, wildlife, and habitat restoration purposes” (Reclamation Projects Authorization and Adjustment Act § 3406(b)(2)).
More often, however, legislative reallocation of water resources is a byproduct – an indirect result of environmental protections and public lands designations. Examples include the Organic Administration Act, which reserves Federal water rights necessary to accomplish certain purposes implicit in the designation of national forests (United States v. New Mexico 1978), and the Clean Water Act, where the inextricable nature of water quality and water quantity can require regulation of water flow (Public Utility District No. 1 of Jefferson County v. Washington Department of Ecology 1994, Benson 2005).
The Endangered Species Act
A comprehensive analysis of legislative enactments and their influence on water supply is beyond the scope of this article. However, one Federal law stands apart in its impact on water resource allocation: the Endangered Species Act (ESA). The ESA has been referred to as “the major Federal environmental constraint on water use” (Tarlock 2004). Critics of the ESA often remark that its provisions have been used for the unintended purpose of protecting habitats, including water flows and associated riparian ecosystems. Controversies, for example, over whether the ESA required the recovery of wild, as opposed to hatchery raised, salmon has caused some to argue that the ESA is “out of control” (Lott and Jones 2007). But the ESA was passed into law in 1973 with the purpose of conserving endangered and threatened species and the ecosystems upon which they depend (E.S.A. § 3). The ESA enacted a policy of conservation that includes mandated efforts to recover threatened and endangered species, and while most of the focus of the ESA's requirements is on the recovery of species, Congress also intended to achieve ecosystem protection.
Once a species is listed as endangered, certain protections immediately fall into place under Sections 7 and 9 of the ESA. Where necessary, these protections have the potential to reallocate water resources to achieve the species' recovery. Section 9 prohibits the illegal “take” of the species, with limited exceptions. The term “take” is broadly defined to include any actions that harm the species, including “habitat modification or degradation where it actually kills or injures wildlife by significantly impairing essential behavior patterns, including breeding, feeding, or sheltering” (50 CFR § 17.3). Illegal “take” therefore includes the dewatering of streams in situations where endangered aquatics are either directly killed or actually injured due to habitat alternation. This opens the door for the ESA to have enormous impact on water allocation decisions. In reality, however, Section 9 has had a relatively modest role in the ESA enforcement generally and almost none with regard to aquatic species (Cheever and Balster 2004). Reasons include lack of political will to enforce the statute and difficulty surmounting the “proof problems” associated with meeting the “actual injury” requirement.
ESA's Consultation Process
The enforcement of the ESA is focused on consultation provisions under Section 7 of the ESA. Among other provisions, Section 7 requires all Federal agencies to consult with the appropriate wildlife agency to ensure that their actions are not likely to jeopardize the continued existence of listed species or result in destruction or adverse modification of critical habitat (Figure 1).
The consultations process applies to all Federal “actions,” a term broadly defined by the courts to include not only direct construction projects but also the granting of licenses and contracts and the promulgation of regulations (Sullins 2001). The annual delivery of water under Bureau of Reclamation water service projects, for example, has been a source of much ESA litigation (Tarlock 2008).
Once an action agency determines that its proposed activity may affect a listed species or its critical habitat, it proceeds in one to two directions. If the activity “may affect, but is not likely to affect” the species, the consultation required is “informal.” Informal consultation involves the action agency and the appropriate wildlife agency (the U.S. Fish and Wildlife Service for land and fresh water species or National Marine Fisheries Service for marine and anadromous species) to share information regarding the proposed activity in order to assist the action agency in determining whether formal consultation is necessary. If the agencies conduct a “Biological Assessment” and determine that the proposed activity is not likely to adversely affect the species or its critical habitat, no further consultation is required.
If, however, either through informal consultation or because the action agency is already certain that the action “may affect and is likely to affect” the species, formal consultation is required. Formal consultation is a comprehensive process that results in the issuance of a “Biological Opinion,” an analysis of whether the proposed action would be “likely to jeopardize the continued existence of the species or adversely modify designated critical habitat” (E.S.A. § 7). If a jeopardy determination is made, the biological opinion identifies any “reasonable and prudent alternatives” that would allow the action agency to move forward with the proposed activity. Biological Opinions include an “Incidental Take Statement,” anticipating that some “take” of species may result from the proposed project. The Incidental Take Statement includes terms and conditions designed to reduce the impact of the anticipated “take” that are binding on the action agency (U.S. Fish and Wildlife Service 2009)
In contrast with Section 9, there are multiple instances where the consultation process has resulted, in some cases dramatically, in the reallocation of water resources. Well known examples include the Bureau of Reclamation's Klamath Project, a Federal water project spanning the borders of southern Oregon and northern California, in which the consultation process required Bureau of Reclamation to meet certain river flow requirements and also establish a water bank to supplement river flows to protect three fish species: the shortnose sucker, the Lost River sucker, and the coho salmon. (General Accounting Office 2005). In Texas, water withdrawals from the Edwards Aquifer retarded interconnected spring flows and impaired the habitat of a number of threatened and endangered species, including the fountain darter. In response to litigation, the Texas Legislature created the Edwards Aquifer Authority, which established a permit system for ground water withdrawals and limited total pumping from the aquifer through a series of staged reductions. (Votteler 1998, 2002).
Case Study: Irrigation Practices in North-Central Washington's Methow Valley
Though less publicized, the irrigation withdrawals in Washington's Methow Valley, located in the north-central Washington's Okanogan County, present an excellent case study of the potential impact of the ESA on water use. The Methow River and its tributaries are part of the Columbia River basin, and much of this sub-basin is located in the 1.5 million acre Okanogan National Forest.
Once an abundant resource of great cultural, economic, recreational, and symbolic importance to the region, wild salmon and steelhead now occupy slightly more than half of their historic range in the Pacific Northwest (Committee on Protection and Management of Pacific Northwest Anadromous Salmonids, National Research Council 1996, Taylor 1999). This portion of the Columbia River ecosystem has three ESA-listed aquatic species: Columbia spring-run Chinook salmon and upper Columbia steelhead (anadromous species managed by National Marine Fisheries Service), and bull trout, managed by U.S. the Fish and Wildlife Service (National Marine Fisheries Service 2008).
While much of the recovery focus for these species has been on the impact of dams as barriers to fish passage, habitat is also a major concern. Major threats include the degradation of key habitat through the dewatering of streams and the entrainment of fish. Stream diversions leave less water in the natural channel, raising temperatures above levels that support fish and making remaining habitat less viable. In extreme cases, the complete dewatering of streams can fragment habitat or eliminate it altogether. Entrainment occurs when fish are unintentionally diverted – along with water – into unscreened irrigation ditches. Both these threats have been identified as habitat concerns that must be addressed in recovery efforts (Federal Caucus, Columbia River Fish and Wildlife Recovery 2001).
Enter the consultation process. In 1998, the Okanogan National Forest conducted a Biological Assessment of its special use permits on the Chewuch River, one of the Methow's larger tributaries. This area provides relatively pristine habitats for aquatic species; the watershed includes large portions of the Pasayten Wilderness. The special permits under consultation were initially granted decades ago, when settlers constructed a ditch across Federal lands for irrigation purposes. The Skyline Ditch Company applied for and received its original permit in 1903 to construct and maintain a ditch diverting water from the Chewuch River. Similarly, Harry Braggs and others received a special use permit in 1910 to construct and maintain the Early Winters Ditch taking water across Federal lands from Early Winters Creek.
The special use permits reserved the Secretary of Interior's discretion to either revoke or modify the permits. In the case of the Skyline Ditch, the original permit stated that “[i]t is further agreed and understood that the permission herein granted is subject to revocation by the Secretary of the Interior, in his discretion, at any time, notwithstanding the period for which this agreement is approved may not have then expired.” The Early Winters Ditch agreement in 1910 similarly stated that the permittee “shall comply with all the laws and regulations governing National Forests” and that the permit “shall terminate … at the discretion of the Forester” (County of Okanogan v. National Marine Fisheries Service 2003a).
Both permits were renewed several times, and all renewals continued to reserve the Federal government's discretion. In later years, the renewals of the permits explicitly noted that the permittee “will comply with the then-existing laws and regulations governing the occupancy and use of National Forest Lands” (County of Okanogan v. National Marine Fisheries Service 2003b). In 1998, the special use permitees were sent with notices stating:
Please note that the consultation process for this ditch has not been completed with the (National Marine Fisheries Service) for the steelhead trout and the chinook salmon nor with the (Fish and Wildlife Service) for the bull trout. When the consultation is completed, it may be necessary to amend this permit to include conditions which may be required by the (National Marine Fisheries Service) or the (Fish and Wildlife Service)
(County of Okanogan v. National Marine Fisheries Service, 2003a).
The Biological Assessments conducted in 1998 concluded that the Skyline Irrigation Ditch's fish screen was ineffective in protecting the steelhead trout and that continued operation of the ditch was likely to adversely affect steelhead and chinook salmon, in part due to the large amount of water diverted from the river. It also found that the Early Winters Ditch was likely to adversely affect the steelhead and chinook by “adversely affecting nesting and spawning areas” (County of Okanogan v. National Marine Fisheries Service 2003a).
The Forest Service then initiated formal consultation. In 2000, National Marine Fisheries Service issued a Biological Opinion regarding both ditches. It concluded that, because the Early Winters Company planned to use ground water wells in lieu of surface water during low flow conditions, “it was not likely to jeopardize the steelhead and chinook.” (County of Okanogan v. National Marine Fisheries Service 2003a). In the case of the Skyline Irrigation Ditch, however, the agency found that the proposed modifications to the head gate and the fish screen were insufficient, and that continued operation is “likely to jeopardize the continued existence of both steelhead and spring chinook salmon and result in the destruction or adverse modification of designated critical habitat” (County of Okanogan v. National Marine Fisheries Service 2003a). The Forest Service responded by implementing the “reasonable and prudent measures” recommended by National Marine Fisheries Service with regard to the Skyline Irrigation Ditch necessary to avoid the jeopardy finding, which included a limit on stream diversions to avoid low flows. With regard to the Early Winters Ditch, the Forest Service went ahead with the ground water supplementation proposal that National Marine Fisheries Service found sufficient to avoid jeopardy. It then modified the special use permits to reflect these changes.
Both ditch companies sued the Forest Service, arguing 1) the agency lacked authority to limit stream flows to protect fish under the ESA and 2) the restrictions were an unconstitutional taking of property under the Fifth Amendment. They asserted vested property rights to the water under Washington's state water law:
In this case, the Federal government's denial of the use of the ditch is an attempt to conflate the right to control the ditch into a right to control water flows. The sole aim of Forest Service's instream flow condition is not to protect or exercise its interests in the ditch itself, but in fact to utilize the water for instream purposes related to the preservation of endangered and threatened fish. In short, the government is appropriating the use of the water in contravention of the Appellants' rights to that use. Accordingly, the Forest Service's conduct is not merely the exercise of regulatory discretion or a power of contract over the use of federal property, but an appropriation of a private right
(County of Okanogan v. National Marine Fisheries Service 2003b).
The Ninth Circuit disagreed, holding that the special use permits reserved ample discretion to modify them as necessary to achieve compliance with federal law and regulations, including the ESA: “[the law] specifically authorizes the Forest Service to restrict such rights-of- way to protect fish and wildlife and maintain water quality standards under federal law, without any requirement that the Forest Service defer to state water law” (County of Okanogan v. National Marine Fisheries Service 2003a).
In doing so, the court was quick to point out that its ruling was based on the fact that the Forest Service was exercising its management authority granted by the Federal Land Policy and Management Act and that the ESA did not confer the agency with new authority to restrict water rights. Citing the landmark Supreme Court decision Tennessee Valley Authority v. Hill (1978), it emphasized that the ESA “amplifies the obligation of federal agencies to take steps within their power to carry out the purposes of this act.” (County of Okanogan v. National Marine Fisheries Service 2003a) (emphasis in original).
The Methow case study stands for the proposition that, where a Federal agency has management authority, this authority may be exercised to restrict water uses to protect species under the ESA. The ESA requires the agency to avoid jeopardizing and instead assist in efforts to recover the species. While the focus here was on the Forest Services' authority, the same holds true for any federal agency, including the Bureau of Reclamation, who is responsible for providing irrigation water to over 140,000 farmers operating over 10 million acres (U.S. Bureau of Reclamation 2007). As a result of the Methow decision, the water users complied with limits in the special uses permit in accordance with consultation document recommendations (Gehlert 2008, Health 2008, Johnson 2008).
As the water users in the Methow case study pointed out, the Federal government can exercise its authority in a way that “takes” property, and, when it does, compensation is due. The Fifth Amendment provides that private property shall not “be taken for public use, without just compensation” (U.S. Constitution Amendment V). A “taking” can be physical, in instances in which government actually appropriates an individual's property, or regulatory, in cases where the level of government control over an individual's property is so great that it effectively rises to the level of eminent domain; government compensation if the result is a “taking” of private property under the Fifth Amendment. (Benson 2002).
In the ESA context, “takings” cases are rarely successful. However, a United States Court of Appeals for the Federal Circuit decision recently opened the door to more “takings” claims for water users who are adversely affected by government constraints on water use. In Casitas Municipal Water District v. United States, water users with contracts in the Bureau of Reclamation's Ventura River Project brought a “takings” claim when, in consultation with the National Marine Fisheries Service, the project was required to install a fish ladder and divert water to the fish ladder to protect the endangered West Coast steelhead trout.
The Casitas court held that the government action, which required diversion of water towards the fish ladder and away from the irrigation canal, constituted a “taking” under the Fifth Amendment. The court emphasized that the government had effectively taken physical possession of water for government use by requiring the water to be rerouted through the fish ladder for the public purpose of protecting trout.
Previous to this ruling, there was only one published case in which efforts to protect species under the ESA was held to constitute a “taking” of property under the Fifth Amendment: Tulare Lake Basin Water Storage District v. United States. (Benson 2002). In Tulare, the Federal Court of Claims held that water users in central California suffered a physical taking of property when water restrictions during the 1992-1994 irrigation seasons occurred to protect two listed species – winter-run chinook salmon and delta smelt.
Subsequent rulings, however, had limited the Tulare decision and instead have employed a regulatory taking analysis to government efforts to limit stream diversions to protect species. Under a regulatory takings analysis, a government action is only a compensable “taking” under one of three circumstances: 1) when the regulation requires an owner to suffer a permanent physical invasion of his or her property; 2) when the regulation deprives the property of “all use or value” or 3) under the Supreme Court's three-part balancing test articulated in the Penn Central Transportation Co. v. New York City (1978) the government restriction is so great that it rises to the level of a “taking.” Applying the Penn Central test, the court weighs: 1) the economic impact of the regulation on the property, 2) the extent to which the regulation interferes with reasonable investment-backed expectations, and 3) the character of the regulation. No cases applying a regulatory takings analysis have held that water restrictions designed to protect threatened and endangered species constitute a “taking.” The future of constitutional boundaries in this area is unclear, but the Casitas case signals willingness by the Federal circuit to take a more generous view of takings claims.
While water law generally leaves allocation decisions to state government, Federal legislative enactments such as the ESA have the potential to achieve reallocation of water resources. Examples including ESA enforcement efforts to protect salmonids in Washington State's Methow Valley demonstrate that Federal laws can achieve water resource reallocation. Such actions may require government compensation if the result is a “taking” of private property under the Fifth Amendment.
I wish to thank O. Paul Mathews for his encouragement and valuable feedback regarding this article.
Author Bio and Contact Information
Melinda Harm Benson, Assistant Professor, Department of Geography, University of New Mexico. Address: MSC01 1110, 1 University of New Mexico, Albuquerque, NM 87131-0001; email: email@example.com. For more information about the author, please visit: http://www.unm.edu/~mhbenson.