The Water Report Nov 2005

• Year: 2005
• Title: The Water Report
• Author: Envirotech Publications
• Description: Issue #21
• Publications - Doc Type: Other

Issue #21 The Water Report
Takings
Restrictions
Challenged
5th Amendment
Contract Issue
Federal
Arguments
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— one operated by the federal government and the other by California's Department of Water Resources
(DWR) — divert water from the Feather and Sacramento Rivers to pumping systems located at the
southern edge of the Sacramento -San Joaquin Delta. The water is then distributed through a series of
canals to end -users in southern California. The settlement followed several years of litigation in the Court
of Federal Claims, resulting in three reported decisions: 61 Fed. Cl. 624 (2004); 59 Fed. Cl. 246 (2003);
49 Fed. Cl. 313 (2001). The lawsuit challenged the restrictions imposed by the National Marine Fisheries
Service and the US Fish and Wildlife Service under the Endangered Species Act during water years 1992-
1994 on the ground that the water loss was an unconstitutional taking of private property without just
compensation. Plaintiffs were Tulare Lake Basin Water Storage District, Hansen Ranches, Kern County
Water Agency, Lost Hills Water District, H.P. Anderson & Sons, Wheeler Ridge - Maricopa Water Storage
District, and several individual water users. The case was filed as a class action on behalf of all water
users in the districts. Both sides filed motions for summary judgment on liability.
In ruling for the plaintiffs on liability, the court held that plaintiffs possessed a property right to
receive State Water Project (SWP) water, which is protected against uncompensated taking by the Fifth
Amendment's Just Compensation Clause. The court rejected the government's argument that because
plaintiffs' right to receive water was pursuant to contract, plaintiffs' right did not rise to the level of a
protected property interest. The court stated:
Plaintiffs can claim an identifiable interest in a stipulated volume of water. While under California
law the title to water always remains with the state, the right to the water's use is transferred first
by permit to DWR, and then by contract to end - users, such as the plaintiffs. Those contracts confer
on plaintiffs a right to the exclusive use of prescribed quantities of water, consistent with the terms
of the permits... Thus, we see plaintiffs' contract rights in the water's use as superior to all
competing interests.
Tulare Lake Basin Water Storage Dist. v. United States, 49 Fed. Cl. 313, 317 -18 (2001).
In defense, the federal government argued that its actions taken to protect the salmon and the smelt
were consistent with state law, and that the doctrines of reasonable use and public trust barred plaintiffs'
right to divert water to the detriment of wildlife. The court rejected this argument, holding instead that
only the State Water Resources Control Board ( SWRCB) and the California courts, and not the federal
government, have the right to determine "[w]hether a particular use or method of diversion is
unreasonable or violative of the public trust..." Id. at 321. The court further stated, discussing the State
Water Resources Control Board's decision (D- 1485), that:
Once an allocation has been made – as was done in D -1485 – that determination defines the scope
of plaintiffs' property rights, pronouncements of other agencies notwithstanding. While we accept
the principle that California water policy may be ever evolving, rights based on contracts with the
state are not correspondingly self- adjusting. Rather, the promissory assurances they recite remain
fixed until formally changed. In the absence of a reallocation by the State Water Resources
Control Board, or a determination of illegality by the California courts, the allocation scheme
imposed by D -1485 defines the scope of plaintiffs' contract rights.
Id. at 322.
Pointing "to a myriad of state and federal actions as evidence that either the SWRCB or the
California courts would have deemed plaintiffs' proposed use unreasonable," the government urged the
court to "step into the shoes" of the State and declare that plaintiffs' proposed use of the water would
have been unreasonable. Id. at 322. The court, however, flatly rejected the government's invitation that
it anticipate "how the Board or the California courts would apply the doctrine of reasonable use if the
issue were before them..." Id. The court instead held that:
[t]he public trust and reasonable use doctrines each require a complex balancing of interests – an
exercise of discretion for which this court is not suited and with which it is not charged. To the
extent that water allocation in California is a policy judgment – one specifically committed to the
SWRCB and the California courts – a finding of unreasonableness by this court would be
tantamount to our making California law rather than merely applying it. This is especially true
where, as here, the Board charged with such determinations has responded, and continues to
respond, to the concerns about fish and wildlife that the government was seeking to address
through the implementation of the ESA.
Id. at 323 -24.
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