California’s New Water Measuring, Recording & Reporting Law

California Governor Brown signed Senate Bill 88 into law on June 24, 2015. Part of that Bill amended the California Water Code to require that all persons who divert 10 acre-feet or more of water per year after January 1, 2016 must install a water measuring device to measure the rate of diversion (including diversion into and out of storage). Water users must report installation to the Water Board, as well as provide evidence that the measuring device is functioning properly at five-year intervals. Water users must maintain records of diversion at time intervals of one hour or less (in some cases) and total amounts of water diverted. Annual diversion reports must be submitted to the Water Board, and the law states: “Compliance with the applicable requirements of this section is a condition of every registration, permit, or license.” The new law imposes civil fines in an amount not to exceed $500 per violation, per day, which may be enforced civilly through the superior court, or administratively by the Water Board. The Water Board will provide forms for reporting. On January 19, 2016, the Water Board adopted emergency regulations to implement the new water measuring law. Those regulations were sent to the Office of Administrative Law for approval. Of note, the proposed regulations give the Deputy Director of the Division of Water Rights the authority to require monthly, daily, or more frequent reporting in times when there are insufficient flows to support all diversions. Additionally, the regulations propose a phased approach that takes into account the amount of water diverted, with larger diverters needing to comply with more stringent requirements than smaller diverters. The recent drought spurred California law makers to enact this law that will mark a drastic change in the way water users operate. The Water Board reports that this new measurement, recordkeeping, and reporting law will apply to approximately 12,000 water users in California. The Water Board hopes that the new law and regulations will improve water use regulation and planning. Industry groups, including the California Cattlemen’s Association, oppose the regulations. In Oregon, the Water Resources Department has phased in water use measuring, recordkeeping, and reporting requirements into new water use permits that are issued. California’s new law and regulations impose a new condition on existing water use rights, raising red flags about regulatory takings. For access to S.B. 88 and the draft administrative rules, visit: http://www.waterboards.ca.gov/waterrights/water_issues/programs/measurement_regulation/. Stay tuned to Schroeder Law Offices’ Water Blog for more news that may affect you! Forest Service Changes It’s Tune on Transfer of Ski Area Water Rights

Final rulemaking related to Forest Service permits for Ski Area Water Rights was released on December 30, 2015. Unlike an earlier directive passed in 2011, the Ski Area Water Clause will not require ski areas to transfer water rights to the federal government as a condition of operating on public land. Instead, the new clause will require ski areas to prove there is a “sufficient quantity of water to operate a ski area.” The new directive will take effect on January 29, 2016. In 2011, sparked by the concerns that ski areas might sell their water rights in lieu of using them to operate due to rising temperatures and water scarcity, the Forest Service issued a directive that would require joint ownership of water rights by ski areas and the United States. Since water rights are typically held by the lessee, this directive would have required a transfer of rights into shared ownership in some instances, and for water rights to be acquired in the name of the United States in others. The National Ski Area Association (NSAA) brought suit against the Forest Service challenging the directive on January 9, 2012, characterizing the directive as government overreach. In December, 2012 a federal judge agreed with the NSAA and ordered the Forest Service not to enforce the proposed rule. The December 30th directive abandons the original proposal that ski areas transfer water rights to the federal government. Instead, after an extensive public comment period, the final directive requires an applicant for a ski area permit to submit documentation prepared by a hydrologist that demonstrates there is sufficient water to operate a ski area for the entirety of the ski area permit term. The final directive explains that “sufficient water to operate a ski area” means that under typical conditions, taking into account fluctuations in utilization of the authorized improvements, fluctuations in weather and climate, changes in technology, and other factors deemed appropriate by the applicant’s qualified hydrologist of licensed engineer, the applicant has sufficient rights or access to a sufficient quantity of water to operate the permitted facilities, and to provide for the associated activities to be authorized under the ski area permit in accordance with proposed operating plan. Additionally, if there is a change such as a change in ownership, and a ski area water facility will not be primarily used for operating a ski area, the authorization for the facility under the ski area permit will be terminated and the facility must be removed from National Forest Service lands. Lastly, if a ski area permit is terminated or revoked, the holder must give a right of first refusal of the water rights associated with the permit to the succeeding ski area permit holder. If the water use right is jointly owned with the United States, the holder must give a right of first refusal to the government. The stated goal of this new rule is to promote the long-term sustainability of ski areas on National Forest Service lands and the communities that depend on the ski areas for revenue. There are 122 ski areas that lease approximately 180,000 acres of lands managed by the Forest Service. Ski areas received about 23 million visitors annually, contributing $3 billion to local economies and supporting approximately 64,000 full and part-time jobs in rural communities. In the West, water use rights for many ski areas are business assets, property interests that operate as collateral when re-financing. One major criticism of the original rule, was that requiring water rights to be co-owned by the federal government would limit a ski area’s ability to control their assets and thus their ability to finance operations. Thus, the directive ensures that ski areas not only have adequate water supply for operating, but that infrastructure to handle the water supply is used only for permitted purposes under the special use permit. Hailed as a success by both the Forest Service and the ski industry, these actions demonstrate a coordinated effort to eliminate the risk of sales or transfer of water rights that might prevent a ski area from operating in the future and ensure that water will remain available for ski areas across the West.

Nevada Wastewater Funding Approved by EPA

On December 22, 2015, the United States Environmental Protection Agency (“EPA”) announced funding of more than $19 Million for drinking water and wastewater infrastructure projects in . The program funds fall under Nevada’s Clean Water State Revolving Fund, and provides money for state projects that promote clean water through wastewater treatment projects and improvements to drinking water infrastructure in the State. The EPA’s Regional Administrator stated that “This substantial investment at the federal level helps communities develop the infrastructure needed for clean, safe drinking water and proper wastewater treatment. EPA is committed to protecting the water resources so important public health and Nevada’s economy.” Funds supplied under the EPA program will go to provide financing for state projects such as upgrading septic systems to sewer, and renovations to wastewater treatment facilities to increase efficiency, as well as support projects for better and more efficient access to clean drinking water, such as water storage and water system upgrades. The funds this year will combine with over $200 Million in federal funding previously provided to Nevada’s Clean Water and Drinking Water State Revolving Fund since the project began. While the EPA’s influence can at times be controversial, federal funding is important to State projects, where both municipal and agriculture interests can often benefit from the funds supplied for needed water projects. More information on the topic can be found at the EPA Web Site. Resentencing Issue Clouded by Militia

The news of Dwight and Steven Hammond’s resentencing is an open platform for change in federal handling policies, but the fear incited by Ammon Bundy’s voluntary militia of protesters is clouding evidence that backs claims of federal government mismanagement. Protesters are against the Hammonds’ re sentencing and believe they were convicted unfairly under laws intended for acts of terror for which they’ve been given excessive sentences but are not explicitly calling upon the issue at hand, a reduction of the Hammonds’ sentences. While much of the news coverage related to the Hammond family has broadcasted Ammon Bundy’s armed militia protest, the legal issue at its core is beginning to come into focus. Bundy and his supporters have set up camp on federal land, demanding that control over the asserted public land be remanded to its local people such as the Hammond ranching family. As the American Bar Assocation Journal suggests, the Hammonds became a cause celebre among anti-government activists in part because of mandatory minimum sentencing regarding disputed use of land with the federal government. Both Dwight and Steven Hammond had served their initially imposed sentences when the government successfully appealed to the San Francisco-based 9th U.S. Circuit Court of Appeals. Under said appeal, the Hammonds were re-sentenced to the five-year mandatory minimum, re-trying the pair as if they were terrorists though initially sentenced for arson. While Bundy’s actions are drawing attention to private land conflicts with federal government land rights, they are slowly distracting from the application of said protest: the plight of the Hammonds. At the center of this standoff are a pair of Oregon ranchers who were denied the chance to make their claim to the U.S. Supreme Court. The re-sentencing of the Hammonds turned them quickly from arsonists to terrorists, despite original claims that sentencing the two to the minimum mandatory sentence of five years was acknowledged by a federal district judge as “grossly disproportionate” and a violation of the Eighth Amendment’s ban on cruel and unusual punishment. A 2014 ruling by a panel of the court acknowledged that the Supreme Court has upheld longer sentences for comparable or less serious crimes. In March of 2015, the Supreme court rejected the Hammonds’ petitions for certiorari.

Hammond Protest builds Militia Momentum

If you don’t know the Hammond family of Harney County, Oregon, you will soon. As the Hammond protest builds momentum backed by a voluntary militia, Dwight Hammond, 73, and his son, Steven Hammond, 46, are making headlines again. Three years ago, the pair made headlines when convicted in Federal Court of arson for fires lit on the Hammond Ranch in 2001 and 2006 to reduce the growth of invasive plants and protect their property from wildfires. Convicted under an anti- terrorism act, Dwight Hammond served three months’ time for the conviction while his son Steven served a full year. As the Federal Judge suspended the minimum sentence under the guidelines as “shock[ing] the conscience,” the U.S. Attorney appealed the sentence to the Ninth Circuit who ruled that both are due to return to prison to serve the federal prison terms of five years. Private landowners often find themselves at the mercy of the federal government as large parts of the West Coast are in government hands, the story of the Hammond’s conviction and resentencing may be all too familiar to private ranchers in the area who have already felt the pressures of forced sales. Though the Hammonds have planned to report to prison today, January 4, 2016, as ordered, riled up liberty supporters from surrounding states have a different disposition. Ammon Bundy, son of Nevada rancher whom was involved in a standoff with the government and Bureau of Land Management (BLM) in 2014 over grazing rights, has joined with a growing band of armed militiamen acting as organized sympathizers to the Hammonds. Though the Hammonds have no direct involvement with the militia, Bundy and others valiantly stake support claims that the Hammonds should not be tried as terrorists and have rights to the tried actions per purchase rights and federal grazing allotments. The Hammonds have and will continue respecting the rule of law and follow court orders without incident or violation. Click here to view their statement. The Hammond family’s farm has been eyed by US Fish and Wildlife Service (FWS) and BLM since the 1970s when ranches adjacent to the Hammonds and others were sold and added to the Malheur National Wildlife Refuge. Though approached by FWS and BLM many times, the Hammonds (as well as other ranchers) refused to sell. While many ranchers in the area were forced to leave, another 32 out of 53 permits were revoked, and grazing fees were raised significantly for those who remained in the area. By the 1990s, the Hammonds were one of very few ranchers that were still private owners of property adjacent to the Malheur National Wildlife Refuge. The four year resentencing request for Dwight and Steven Hammond comes from an appeal filed by the BLM Field Manager and Refuge Manager for the Malheur Refuge. The Hammonds attorneys report that “the Hammonds will continue their legal efforts to renew their grazing permits. They will also pursue Executive Clemency. We hope that President Obama will agree with us and with the veteran judge who presided over the trial that the mandatory five-year minimum sentence is far too long for these ranchers.” To sign the Petition in support of a reduction in sentencing and Executive Clemency go to: https://petitions.whitehouse.gov/petition/commute-sentences-dwight-lincoln-hammond-jr-and-steven- dwight-hammond-both-harney-county-oregon.

Statement: Dwight and Steven Hammond Dwight and Steven Hammond respect the rule of law. They have litigated this matter within the federal courts for over five years and, in every instance, have followed the order of the court without incident or violation. That includes serving the entire sentences imposed in this case by the judge who heard the evidence at trial and who concluded that imposition of a five-year sentence under these circumstances would “shock the conscience.” As the Hammonds have previously stated, they will be reporting to the United States Bureau of Prisons today to serve their sentences. The Hammonds will continue their legal efforts to renew their grazing permits. They will also pursue Executive Clemency. We hope that President Obama will agree with us and with the veteran judge who presided over the trial that the mandatory five-year minimum sentence is far too long for these ranchers

Alan Schroeder, Counsel Hammond Ranches, Inc. Kendra M. Matthews, Counsel Dwight L. Hammond, Jr. Lawrence Matasar, Counsel Steven D. Hammond