In an unpublished opinion released August 24th, the Ninth Circuit rejected a long waged effort to upend the City of Bend’s water planning by forcing it to abandon its vested surface water rights in favor of an all-groundwater supply. As is often the case, plaintiffs chose a somewhat oblique attack on the City’s water planning, relying on NEPA and forest planning laws to force a change of direction.

Central Oregon LandWatch v. Connaughton was a challenge to a Special Use Permit issued by the U. S. Forest Service to the City to construct a new pipeline and to upgrade water diversion facilities on Tumalo Creek, within the Deschutes National Forest. The existing pipeline also was previously constructed within the national forest under a SUP, but needs replacement. The project drew controversy.

Plaintiffs contended that cessation of water withdrawals by the City is necessary to preserve Tumalo Falls, whereas the City argued that the project would enhance Tumalo Creek. To maintain pressure, the old pipeline needed to be kept full, resulting in constant diversions and discharge of surplus water downstream. The new pipeline allows the City to withdraw water on demand, which will keep more water in the stream. In addition, the City is working closely with the Tumalo Irrigation District to further protect the creek.

An amici group comprised of municipal and agricultural water users, intervened on behalf of the Forest Service and the City. (Disclosure: Our firm represents the amici, and serves as water counsel to the City, though we did not represent the City in this case). The Oregon Water Resources Department separately intervened as an amicus.

The central concern for amici was the integrity of Oregon’s appropriative water rights law, which follows the first in time, first in right principle of other Western states. Plaintiffs sought to upend that principle by elevating federal minimum flows, in the forest planning context, over state water law. Oregon law allows the Oregon Department of Fish and Wildlife to apply for instream water rights, which would have priority from the date of application and would be treated like any other water right. The purpose of the instream right is to prevent future appropriations, and so the “minimum” flows in the water right usually comprise or exceed the entire flow of the stream.

Plaintiffs argued that the Forest Service should have imposed minimum flows for the creek in the SUP, which they contended should be derived from the instream water right established for Tumalo Creek. The problem is that the instream water right is junior in priority to the City’s water rights. Imposing the instream water right flows as a condition of the SUP would effectively turn appropriative water rights law on its head. The instream right—with its aspirational flow regime—would then take precedent over the City’s right.

The court below rejected that outcome, as did the Ninth Circuit, but on the basis that establishment of minimum flows are not required by rule or case law. Further, doing so would not benefit Tumalo Creek because the City’s project would “positively impact stream flows” in one reach of the creek and “have no or minimal impact” in two other reaches, one of which is subject to Tumalo Irrigation District diversions that are not subject to the SUP.

The court also found that the Forest Service did not violate NEPA by limiting the alternatives analysis in the Environmental Assessment to just two: (1) implementation of the project and (2) a “no action” alternative based on the existing SUP. In other words, the court was not troubled by the Forest Service assuming that continuing exercise of the City’s surface water rights represents the status quo. The court rejected plaintiffs’ argument that the Forest Service needed to additionally evaluate an alternative scenario where the City reduces or ceases withdrawals from Tumalo Creek. The court found that the discussion in the Environmental Assessment was adequate, and relied on language in the EA that fully supports the City’s water planning:

The Forest Service determined that the surface water formed a “critical component of the City’s dual-source [water] supply.” . . . The EA explained that groundwater-only options would “compromise the City’s ability to provide a safe and reliable water supply,” reduce water flows in other parts of the Deschutes River, be costly, and be less reliable than a dual-source system. The EA also flagged possible environmental concerns posed by the groundwater-only option, including reduced surface stream flows (which are fed by groundwater) and increased energy consumption caused by pumping groundwater. This discussion was sufficient.

A dual source water system is the dream of every municipal water planner. That redundancy is insurance against natural or human-caused catastrophes that could disable one source. And all water users need to be able to rely on the priority of water rights under the law. That the Forest Service and the Ninth Circuit declined to upset the City’s long-term water planning is a victory for municipal water planners everywhere.