State Water Board Decision May Halt New Melones Project

The decision of a state administrative agency recently went a long way toward mitigating the worst of the environmental impacts associated with the New Melones Dam on the Stanislaus River in California. The decision by the California Water Resources Control Board gives a much-needed shot in the arm to litigation on the project in federal district court. The controversy illustrates how environmental protection efforts, even for a large federal project, may often proceed as energetically and forcefully on the state level as on the federal. The result here must be contrasted to the less successful efforts of parties in the long-lived Storm King litigation to achieve a more searching state review of the merits of the pumped storage project at issue in that case, via the state certification of water quality required by § 21(b) of the Water Quality Improvement Act of 1970.¹

On April 4, 1973, the California Water Resources Control Board issued Decision 1422, which adjudicated the U.S. Bureau of Reclamation's applications for water rights permits to the Stanislaus River. Its order contains 25 conditions, the net effect of which is to allow New Melones Reservoir to be filled less than halfway (1.1 million of 2.4 million acre-feet storage) and to protect almost all of the whitewater reach of the Stanislaus, which the Board found to be a "unique asset to the state and the nation."

The state board decision is part of a continuing controversy regarding the Dam. In its most recent opinion in Environmental Defense Fund v. Armstrong,² the District Court for the Northern District of California ruled that a supplemental impact statement, in conjunction with the statement previously filed by the Army Corps of Engineers, fully satisfied the requirements of NEPA, but the court retained jurisdiction over the case to deal with future questions concerning alternative water uses. This decision regarding NEPA compliance has been appealed to the Ninth Circuit.

Specifically, State Board Decision 1422 provides that use of water from the New Melones Reservoir for consumptive purposes must be limited to the four counties within the Stanislaus River Basin until the Bureau makes a showing before the Board that water from other sources in the Central Valley Project is not available to serve areas outside the basin. The Board also stipulated that no water would be allowed for consumption until the Bureau has shown that the benefits that will accrue from specific uses will outweigh any damage that would result to fish, wildlife or recreation (including the white-water) in the watershed above New Melones Dam, and that the Bureau has a firm commitment to deliver water for such purposes.

Current controversy centers on whether the Bureau, which has historically refused to acknowledge the Board's jurisdiction over its projects, will comply with the terms and conditions the Board attached to the Stanislaus water rights permits. An earlier opinion of the district court in the EDF v. Armstrong case³ made clear that the requirement to obtain permits from the State Board before appropriating water applies to the Bureau, but the court refused to decide at the time whether the Bureau is in fact subject to the orders and conditions of the state Water [3 ELR 10063] Board. The Bureau has indicated that it does not regard itself as bound by conditions attached to the permits insofar as they conflict with congressional authorization of specific water projects.

The Environmental Defense Fund, which is the lead plaintiff in the district court suit to enjoin the project's construction, does not expect the Bureau to change its position. EDF believes that the Bureau's developing strategy is to avoid having the issue litigated. This conclusion is suggested by the Bureau's motion to have itself dismissed on the ground of sovereign immunity from an Eastern District of California case where it was joined as an unwilling party. The case, Central Valley East Side Project Ass'n v. State Water Resources Control Board,⁴ represents a challenge by agricultural interests to State Water Board decisions holding that the Board has power to subrogate permits for use beyond the project watershed to those for use within it, and to impose conditions on the permits it grants. Clearly, if the Bureau wished to assert its independence from conditions attached to state water permits, it could remain an active party in the Central Valley case. Apparently it has decided against such a course of action, and EDF predicts there is little probability of a frontal assault by the Bureau on the New Melones decision, either.

In a recent development, a letter dated April 17, 1973, from Russell Train, Chairman of the Council on Environmental Quality, to the Under Secretary of the Army, recommends that a further draft impact statement be filed regarding the project, and that postponements be requested in all pending litigation until the project is reappraised. Specifically, the letter asks that the Corps of Engineers and Bureau of Reclamation respond to the following issues:

(1) If the Board's recent decision is in fact ultimately accepted as controlling on the water rights issue, what effect does the decision have on the environmental analysis conducted in the existing impact statement?

(2) What arrangements has the Bureau or Corps made to reassess the alleged benefits of the project against potential environmental costs in the light of the Board's decision?

(3) Does the viability of the original project design depend on a favorable outcome for the Bureau regarding the water rights issue? If so, what provisions are being made for accommodating the project to an unfavorable decision upholding the state's jurisdiction if that eventually should occur?

At this point it would appear that the New Melones Project faces at the very least a further extended delay. An additional impact statement will either postpone or further complicate the litigation pending before the Ninth Circuit on the issue of the project's NEPA compliance. EDF believes that this may well be the first case since the Cross-Florida Barge Canal litigation⁵ in which construction of a disputed project is not merely delayed or modified, but ultimately terminated.

1. DeRham v. Diamond, 3 ELR 20327 (N.Y. Ct.App., Mar. 14, 1973); 2 ELR 20499 (Sup. Ct., App. Div. N.Y., June 29, 1972) reversing Scenic Hudson Preservation Conference v. Diamond, 2 ELR 20207 (Sup. Ct., Albany Co., N.Y., Mar. 14, 1972).

2. __ F. Supp. __, 3 ELR 20294 (N.D.Cal. Mar. 16, 1973).

3. 352 F. Supp. 50, 2 ELR 20735 (N.D.Cal. 1972).

4. Civil No. S-2582

5. EDF v. Corps of Engineers (Cross Florida Barge Canal), 324 F. Supp. 878, 1 ELR 20079 (D.D.C. 1971). See also In re Cross Florida Barge Canal, 329 F. Supp. 543, 1 ELR 20366 (Panel on Multi-District Litigation, 1971).