Those who divert water from streams in exercise of water rights without otherwise altering the streams need not notify the California Department of Fish and Wildlife (formerly Department of Fish and Game) nor enter into streambed alteration agreements with the Department, ruled the superior court in Siskiyou County.  In Siskiyou County Farm Bureau v. California Department of Fish and Game, the court held on December 24, 2012, that “Fish and Game Code [section] 1602 does not require notification of the act of extracting water pursuant to a valid water right where there is no alteration to the bed, bank, or stream.”  The ruling confirms that in exercising their water rights, landowners are subject to regulation by the State Water Resources Control Board, and not to duplicative, potentially inconsistent regulation by the Department.

Farmers and other landowners have long diverted water from streams to use for irrigation and other purposes.  Some have acted under common law riparian rights that afford those owning land next to a stream the right to use water in the stream, subject to various constitutional and legal limitations.  Others have acted under a statutory system of water appropriation that enables those owning land distant from a stream to perfect an appropriative right to divert water from the stream in order to make reasonable and beneficial use of it on their land.  Some of these rights have been adjudicated and established by the State Board (or predecessor agencies), others by the courts.  Some landowners have diverted water using pumps or headgates, which has not entailed physically changing the beds or banks of streams; others have constructed temporary push-up dams or other like methods involving physically changing the beds or banks.

In 1961, owing to concerns that aggregate mining and other like activities in streams were adversely affecting fish and wildlife, the Legislature enacted a program calling for those engaged in such activities to enter into streambed alteration agreements with the Department designed to mitigate such effects.  As amended over the years, section 1602 now generally prohibits anyone from “substantially divert[ing] or obstruct[ing] the natural flow of, or substantially chang[ing] or us[ing] any material from the bed, channel, or bank of, any river, stream, or lake” without first notifying the Department and, if the Department determines the planned activity will substantially adversely affect an existing fish or wildlife resource, entering into a streambed alteration agreement with the Department providing measures to mitigate those effects.  In the absence of mutual agreement, the section provides for a panel of arbitrators to decide on the terms of the agreement.

In 2005, shortly after the Fish and Game Commission listed coho salmon as endangered, the Department developed criteria for enforcing section 1602 in the region encompassing Siskiyou County.  Included was a presumption that any diversion of water is “substantial,” which would trigger the requirement to notify the Department.  The Department sent letters to water diverters informing them that it considered agricultural diversions subject to section 1602, inviting them to participate in a regional agreement or obtain individual agreements, and threatening them with criminal sanctions if they did not comply.

The Siskiyou County Farm Bureau sued to challenge the Department’s expansive interpretation of section 1602.  The Farm Bureau alleged that the Legislature intended section 1602 to govern activities that physically alter the beds or banks of rivers, streams, and lakes and not to reach the mere act of extracting water pursuant to a water right.  The Department countered that water rights are subject to regulation by the state, and the plain meaning of section 1602 requires anyone who would “substantially divert . . . the natural flow” of a stream to first notify the Department, regardless of whether the person holds a water right or the diversion involves a physical alteration of the stream’s bed or banks.

The trial court agreed with the Farm Bureau.  It observed that the Legislature had authorized the State Board to administer a comprehensive and exclusive scheme for the appropriation of water that requires the Board to take into account the amounts of water required for recreation and the preservation and enhancement of fish and wildlife resources.  Toward this end, the Board must notify the Department of any application for a permit to appropriate water, and the Department must investigate the stream in question, report its findings to the Board, and recommend the amount of water required to preserve and enhance fish and wildlife resources.  The State Board must then decide on allowing the appropriation of water based on its judgment of how it may best serve the public interest, guided by the legislatively established policy that the highest use of water is domestic use and the next highest is irrigation.  The “literal interpretation” of section 1602 urged by the Department would lead to the “absurd consequence,” the court concluded, of “giv[ing] the [D]epartment authority to regulate a water right [and] prohibit a water user from extracting any part of his water allotment if [the Department] believes a species would be adversely affected by the activity” and thereby “make the duties of the [State Board] superfluous.”

An additional consequence of the Department’s interpretation, the court noted, is that it “guarantee[s] the appropriation of a minimum in-stream flow for the preservation of fish and wildlife.”  That, the court said, is “contrary to law.”  Moreover, the court rejected the Department’s implicit presumption that “use of water consistent with a water right is per se unreasonable if it adversely impacts fish and wildlife.”  Noting that the Department’s interpretation “pits one reasonable and beneficial use of water, [i.e.] for irrigation, against another reasonable and beneficial use, [i.e.] to preserve and conserve fish and wildlife,” the court said the Department “is mistaken” in presuming that “of the two beneficial uses, only that used to benefit fish and wildlife promotes the public trust and . . . therefore holds a higher status than the use for irrigation.”  Apart from the fact that “the authority to weigh competing beneficial interests in administering and managing a water right . . . rests solely with the [State Board],” the Department’s interpretation is wrong, the court ruled, because it “incorrectly presumes that the highest beneficial use of water is for the preservation of fish and wildlife.”  Finding this to be “contrary to the Legislative declarations . . . that the first highest and best use of water is for domestic purposes and the second is for agricultural purposes,” the court observed that the Legislature has declared conservation and preservation a beneficial use of water, but has not given it “a priority as a higher use, as [it] has agricultural use,” except in the specific instance of rivers designated under the Wild and Scenic Rivers Act.

Finding that section 1602 does not require someone to notify the Department before extracting water pursuant to a valid water right where there is no alteration of the bed, bank, or stream, the court enjoined the Department from bringing enforcement action against agricultural water diverters for failing to notify the Department of such diversions.

The decision is the first by a court confirming that the Department cannot use section 1602 to regulate landowners’ exercise of their water rights absent some physical alteration of a river, stream, or lake.  While an appellate court will have the last word if the Department appeals, in the meantime, the decision may well influence the Department’s interpretation and application of section 1602 across the state.  Or if not, and someone asks another superior court to rule on the issue, the decision will lend weight to the effort.  If the court’s holding stands, the next issue confronting courts likely will be how to handle water diversions that also involve physical alterations of the beds or banks of streams:  What, if any, authority does section 1602 afford the Department over diversions of water pursuant to valid water rights in such circumstances?  Should the environmental effects of diversions of water be attributed to the physical alterations of beds and banks and included among the effects the Department may endeavor to mitigate in streambed alteration agreements?  Or should the Department focus only on the environmental effects of the physical alterations apart from the effects of the diversions of water?

David Ivester
Briscoe Ivester & Bazel LLP
155 Sansome Street, 7th Floor
San Francisco, CA 94104
Telephone: (415) 402-2700
Fax: (415) 398-5630

Disclaimer: In our Newsletters and Bulletins, Briscoe Ivester & Bazel LLP intends to present general information to the public and does not intend to provide legal advice pertaining to a particular situation.

 

Stay Informed

Subscribe to our e-Newsletter.

[customcontact form=2]
Unsubscribe from our mailing list