Opportunities for Improving Water Supply Reliability for Wildlife Habitat on the Tule Lake and Lower Klamath National Wildlife Refuges

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1 Opportunities for Improving Water Supply Reliability for Wildlife Habitat on the Tule Lake and Lower Klamath National Wildlife Refuges Parched wetlands on Lower Klamath National Wildlife Refuge, Sept. 20, 2013 (Photo by Jim McCarthy) By GOLDINWATER Consulting For WaterWatch of Oregon November 29,

2 Upper Klamath Basin map showing Lower Klamath and Tule Lake National Wildlife Refuges. (Map by U.S. Fish & Wildlife Service.) 2

3 Introduction WaterWatch of Oregon retained GOLDINWATER Consulting to describe options, processes, and administrative costs to achieve enhanced water supply reliability at the U.S. Fish and Wildlife Serviceʼs (USFWS) Tule Lake National Wildlife Refuge (TLNWR) and Lower Klamath National Wildlife Refuge (LKNWR). 1 In the Klamath River Basin of Oregon and California, the state of Oregonʼs adjudication of pre-1909 water rights and federal reserved water rights (the adjudication ) creates new opportunities to address refuge water needs by clarifying rights to water, allowing for enforcement, and eventually allowing for water right transfers. The adjudication provides both these refuges with 1905 irrigation rights that could be used for wetland purposes at this time, and the adjudication will create opportunities to use Oregonʼs transfer process to make significant improvements to water supply reliability on the chronically water-short wetland habitats of TLNWR and LKNWR. GOLDINWATERʼs analysis highlights three options that should be considered to enhance refuge water supply: 1. Use the refugesʼ 1905 irrigation rights for wetland purposes within the existing places of use of those rights, instead of for irrigation of leaseland farmland as currently practiced. 2. Transfer USFWS-owned senior water rights to refuge habitat areas with less senior water rights. 3. Purchase or lease senior water rights for transfer to the refuges to enhance wildlife habitat through the Federal Water Rights Acquisition Program, or other programs or funds. These three options are described in detail below. Background Klamath River Basin Adjudication Claims to water prior to the 1909 adoption of Oregonʼs Water Code, including federal reserved water rights, must be quantified and documented through an administrative and judicial process known as adjudication to be used in the system of prior appropriation. The Oregon Water Resources Departmentʼs (the Department ) March 7, 2013 issuance of the Adjudicatorʼs Findings of Fact and Final Order of Determination, completed the first phase of the adjudication. The adjudicationʼs second phase will consist of the Klamath County Circuit Courtʼs review of the Final Order and any exceptions to the Final Order, followed by issuance of a water rights decree affirming or modifying the Final Order. 2 The Final Order describes approved water right claims ( approved claims ) for use by the Department as a record of enforceable water rights according to priority dates. The USFWS owns approved claims for LKNWR and TLNWR as listed in tables 1 & 2. Each refuge has one approved claim with a priority date of May 19, 1905, for irrigation with place of use corresponding to the refuge leaselands. These areas are managed primarily for commercial farming by the U.S. Bureau of Reclamation (USBR) and on co-op lands managed by the USFWS for wildlife purposes. Each refuge also has approved reserved water right claims for maintenance of wildlife habitat in seasonal marshes and wetland areas with priority dates between 1925 and These approved 1 Because the upper Klamath River Basin is so important to migratory birds using the Pacific Flyway, in 1908 President Theodore Roosevelt established LKNWR as the nationʼs first refuge for waterfowl. 2 As explained at the Oregon Water Resources Department website: 3 The Court could modify these approved claims during the Adjudicationʼs second phase. 3

4 claims for water are sourced from the Klamath River and Upper Klamath Lake and are diverted and delivered to the refuges through Klamath Project facilities. Table 1. Approve d Claims Approved Claims on Lower Klamath National Wildlife Refuge Priority Date Character of Use Period of Use Place of Use Annual Duty Acre-Feet (AF) 312 Irrigation May 19, Wildlife Habitat Dec 31, 1925 Feb 15 -Nov 15 10,000 ac within 25,881.7 ac in Area K & Co-op Lands 35,000 Jan 1 - Dec 31 Most Refuge Lands 108, Wildlife Habitat Sept 2, 1964 Jan 1 - Dec 31 White Lake & P Canal Area 3, Wildlife Habitat Nov 30, Wildlife Habitat July 14, 1949 Jan 1 - Dec 31 Units 9b/c/g Area 1,141.7 Jan 1 - Dec 31 Small SE Area 87.6 Table 2. Approve d Claims Approved Claims on Tule Lake National Wildlife Refuge Priority Date Character of Use 317 Irrigation May 19, 1905 Period of Use Place of Use Annual Duty Acre-Feet (AF) Feb 15 - Nov 15 16,000 ac within 17,967.3 ac Sumps 2 & 3 Lease & Co-Op Lands 49, Wildlife Habitat Oct 4, 1928 Jan 1 - Dec 31 8,168.8 ac within Sump 1A 31, Wildlife Habitat Nov 3, 1932 Jan 1 - Dec ac near A-dike and within Sump 1A Wildlife Habitat April 10, 1936 Jan 1 - Dec 31 21,867.7 ac within Sumps 1B, 2 & 3 66,205.8 For the 210,000-acre Klamath Project, USBR has approved claims sourced from the natural water of the Klamath River and Upper Klamath Lake, plus additional water stored in Upper Klamath Lake, with a May 19, 1905, priority date. 4 When in the past USBR has delivered water preferentially within the Klamath Project based on claimed priority dates, water was delivered to irrigate farmland with 1905 claims, while deliveries were significantly curtailed to adjacent refuge wetlands that had junior claims. The lack of a reliable water supply has impaired the ability of the 4 Data is derived directly from the Final Orders for each claim and a summary table provided by WaterWatch. 4

5 refuges to preserve and protect waterfowl as intended. 5 For example, water shortages on the refuges sparked separate large-scale avian disease outbreaks in 2012 and 2013, killing tens of thousands of waterfowl 6. Water Right Transfers The legal transfer of a water right from one place of use to another and/or from one character of use to another has become an increasingly common procedure in Oregon. The Department has approved over 2,200 transfers of all kinds within the last 10 years. Transfers are now typically processed and completed by the Department within one year. 7 According to the water right transfer requirements, the approved claims are not eligible or subject to transfer prior to issuance of the decree. 8 But, the state could enact legislation allowing temporary or conditional transfers prior to the decree. The basic requirements of water right transfers are: A) the water use must be subject to transfer; B) the transfer cannot enlarge the original right; C) the transfer cannot harm or injure existing water rights; D) the water user must be ready, willing, and able to use the right and; E) the transfer applicant must follow the process correctly. Transferred water rights maintain the original priority date and limit the diversion rate and total annual duty to the original right. Analysis: Options to Enhance Water Supply at LKNWR and TLNWR With the system of appropriation by priority dates now operating, enforcement of approved claims is now possible. Because the Klamath Basin is over-appropriated, possession of a relatively senior approved claim is essential to ensure a reliable supply of water. Once the Courtʼs decree is issued, the approved claims will become water rights subject to transfer under Oregon Statute (ORS ) and the corresponding Administrative Rules (OAR ) governing water right transfers. 9 This future ability to transfer water rights could provide a means to improve water supply reliability on TLNWR and the LKNWR. Three related options should be considered. Option 1. Increase Wetlands Areas on Refuge Leaselands and Co-Op Lands The irrigated farmland within the refuges has shown the ability to grow wetland plants when floodirrigated under the walking wetlands program. 10 The 1905 approved claims for irrigation can continue supplying water at the current place of use to promote growth of wetland plants. 11 Through a focused expansion of the walking wetlands program and/or conversion of commercially 5 Personal conversation with Ron Cole, Klamath Refuge Complex Manager, November 4, Drought is causing duck die-off from disease: Klamath Basin marshes drying up, The Associated Press, August 29, 2013; Migrating waterfowl die from lack of water, San Francisco Chronicle, April 21, Personal communication with Dwight French, the Departmentʼs Water Rights Services Diision Administrator and Klamath Adjudicator and with Kelly Starnes, the Departmentʼs Transfer Specialist. 8 OAR (14) defines a water use subject to transfer, see Appendix A. 9 For a brief summary of the transfer rule requirements, processes and administrative costs, see Appendix A. 10 See 11 OAR (26) Irrigation means the artificial application of water to crops or plants by controlled means to promote growth or nourish crops or plants. (Emphasis added.) 5

6 and co-op farmed refuge lands to wetlands, additional wildlife habitat can be maintained through controlled flood-irrigation of wetland plants. This option brings the wildlife habitat to the most reliable water supply. It is important to note that this change could be implemented now and provide future flexibility to pursue other options, such as water right transfers. There are at least two approaches to water right transfers the USFWS can pursue in the future, described below. Figure 2: Lower Klamath and Tule Lake NWRs showing refuge leaseland areas with senior water rights. (Map by U.S. Bureau of Reclamation.) 6

7 Option 2. Transfer USFWS-Owned 1905 Rights to Wildlife Habitat With Less Senior Rights Once the approved claims become subject to transfer, USFWS can change a portion or all of its more senior 1905 approved claims for irrigation use to wildlife habitat use within places where the junior approved claims now exist. Ideally, the transfers would allow the right to be used for wildlife purposes throughout the refuges including within the original place of use. The Department has approved transfers that changed the character of use from irrigation to wildlife habitat and substantially increased the area of the place of use. 12 Use of the transferred water right for wildlife habitat should be broad enough both to flood wetlands and to irrigate wildlife crops to attract and sustain waterfowl, which is currently the primary purpose of irrigation on co-op lands owned and managed by the USFWS. The advantage of this approach is that USFWS already owns approved claims 312 and 317 on the refuges and has the mandate to best utilize its assets for wildlife purposes. Any potential for injury to existing water users outside the refuges is greatly reduced by the proximity of approved claims 312 and 317 to the new place of use, which is at the tail-end of the Klamath Projectʼs water delivery system. Option 3. Purchase and Transfer Water Rights from Willing Sellers Through the Federal Water Rights Acquisition Program, or Other Programs or Funds The USFWS could acquire from willing sellers, through lease or purchase, senior water rights for transfer to the refuges to enhance wildlife habitat. Some nearby areas such as the Lost River have already been decreed and may have water rights for sale that can be transferred to the refuges. One good example of this water rights acquisition approach exists at the USBRʼs Newlands Project in Churchill County, Nevada. In 1990, Congress passed the Truckee-Carson-Pyramid Lake Water Rights Settlement Act (Public Law ). The Act re-authorized the Newlands Project to serve additional purposes including recreation, fish and wildlife and authorized a water rights purchase program to sustain about 25,000 acres of Lahontan Valley wetlands important for migratory waterfowl located on the USFWSʼs Stillwater National Wildlife Refuge. The subsequent Environmental Impact Study and Record of Decision defined the Lahontan Valley Wetlands Water Rights Acquisition Program with a goal of acquiring up to 75,000 AF of water rights from willing sellers through purchase, lease, donations and exchange of water rights. 13 Since 1990, under authorization of the Act and previous efforts, the Lahontan Valley program has acquired 25,774 AF of water for the wetlands. 14 An advantage of this acquisition option is that approved claims or water rights senior to USBRʼs 1905 approved claims could be acquired, which would substantially improve water supply reliability for wildlife habitat. This would be the most costly option, but there is a proven model to follow in Nevada and both the USBR and USFWS already know how to implement such a program successfully. USBR annually leased water from Klamath Project farmers between 2001 and 2006 to reduce onproject water demand. Annual lease prices ranged from $150 to $200 an acre with variation by 12 Transfer 9970 in Lake County increased the place of use of one water right from 48.1 acres for irrigation to 320 acres for wildlife habitat, which included the original 48.1 acres, by limiting the diversion rate and annual duty. 13 Federal Register Volume 61, Number 194, Personal communication with Nancy Hoffman, the Stillwater Refuge Complex Manager. 7

8 crop type idled. 15 A simple way to estimate a general purchase price is to multiply an annual lease price by 25, which provides a sale price range of approximately $3,750 to $5,000 per acre. If there are willing sellers at this price, purchasing 10,000 acres (35,000 acre-feet) of relatively senior irrigation rights for the refuges could cost upwards of $50,000, A thorough water pricing study should be completed prior to implementation of any program to acquire water rights. Conclusion The USFWS has a range of viable options for securing a more reliable water supply to enhance wildlife habitat at TLNWR and LKNWR. While the USFWS approved claims are not yet subject to transfer, the fairly reliable 1905 approved claims for irrigation can be utilized to promote growth of wetland plants at their current places of use. The USFWS can plan to transfer some portion of the 1905 approved claims to wildlife habitat use within the refuges and/or establish a program to acquire water rights from willing sellers using Public Law and the Lahontan Valley program as an example. The options outlined can be implemented sequentially and in combination until the desired habitat conditions are achieved. 15 This information is derived from the report Development of a Water Pricing Framework: Upper Klamath Lake Watershed, June 1, 2010, by WestWater Research, LLC. 16 This calculation is intended only as a rough example and not to indicate actual water right values, costs of water, or quantities needed by the refuges. 8

9 APPENDIX A Water Right Transfer Requirements Oregon Administrative Rules (Chapter 690, Division 380) establish the requirements and procedures used by the Department to evaluate a water use transfer application. An application for transfer must be submitted on Department forms detailing the relevant information such as applicant name and contact information, type of change proposed, water right information, source of water, priority date, proposed use of water, affected local governments and irrigation districts, whether the transfer is to be permanent or limited in time, and including an appropriate map and application fee. The transfer application filing fee for 1,000 acres of irrigation water rights (39 cfs) to fish and wildlife enhancement purposes is about $6,600, according to the Departmentʼs on-line transfer fee calculator. A 5,000-acre transfer (192 cfs) calculates to $29,550. Use of the Departmentʼs Reimbursement Authority program to accelerate processing would add cost. The Department makes an initial review of the application for completeness and to determine whether the water rights proposed for transfer are water uses subject to transfer as defined by ORS (4) and OAR (14), meaning a water use established by: a) an adjudication as evidenced by a court decree; b) a water right certificate; c) a water use permit with an approved request for issuance of certificate or; d) an issued transfer application order of approval with a filed proof of completion. Transfer Application Public Review and Comment Once the water use is subject to transfer and an application is submitted, the Department creates an application file and requests public comments for 30 days in the weekly notice published by the Department and by postal or electronic mail to each affected local government and irrigation district identified in the application ( ). Following the public comment period, the Department prepares a draft preliminary determination ( ) of whether the application should be approved or denied considering comments received and an assessment of whether: a) The right has been properly used in the past five years and is not subject to forfeit; b) The water user is ready, willing, and able to use the full amount of allowed water; c) The proposed transfer would result in enlargement; d) The proposed transfer would result in injury to existing water rights and; e) Other requirements for water right transfers are met, such as fees and maps. For permanent transfers, an applicant receiving a favorable draft preliminary determination must submit proof of ownership of the water right and land involved, or provide documentation demonstrating consent of the owner(s). Preliminary Determination Public Review and Comment 9

10 The Department then issues the preliminary determination and posts it in the Departmentʼs weekly notice and by publication for three weeks in a newspaper in the local area of the transfer. The Department sends a copy of the preliminary determination to each person who submitted comments on the application. Any person may file a protest or standing statement regarding the proposed transfer within 30 days following the last newspaper publication, as described in If a proper protest is filed, the Department will hold a contested case hearing on the matter in the area of the transfer. The Department shall approve a transfer if it determines after all comments and contested case hearings are completed that the criteria above (a-e) are met, and will then issue a final order approving the transfer. Most transfers are now being completed within one year. 10