March 10, 2014
Oregon Water Resources Department Denies Water Permit to Willamette Water Company
Victory for McKenzie River and WaterWatch
On March 7, 2014, the Oregon Water Resources Department issued a final order denying the Willamette Water Company’s controversial application for a permit to withdraw 34 cubic feet per second (22 million gallons per day) from the McKenzie River. The state’s decision follows the recommendation issued by an administrative law judge in April of 2012.
“Oregon Water Resources Department made the right choice here in denying this speculative water proposal by Willamette Water Company,” said Lisa Brown, Staff Attorney for WaterWatch of Oregon. “Under Oregon law, Oregon’s waters belong to the public – not to private water companies hoping to profit by monopolizing the resource for future sale.”
The company’s application proposed to lock up a large amount of McKenzie River water, but failed to identify any committed customers, failed to show plans for necessary water infrastructure, and still lacks the needed land use approvals for developing the water project. The applicant also challenged the fish protection conditions recommended by the Oregon Department of Fish and Wildlife and proposed by the Oregon Water Resources Department.
“Oregon Water Resources Department correctly found that Willamette Water Company’s proposal was illegal because it was attempting to tie up a large block of water for undefined future sale, rather than proposing to use the water beneficially as required by law,” added Brown. “The Department agreed with the judge that what the company was proposing was not a beneficial use but rather was speculative and therefore wasteful.”
The permit application drew considerable local media attention and inspired community concern regarding one of the public’s most valuable resources – water – in one of the state’s most iconic waterways. The harmful proposal threatened a river prized by fishermen, boaters, and nature enthusiasts from around the world. The McKenzie’s renowned beauty, along with the fish and wildlife it supports, in turn help sustain jobs and economic activity in the region.
WaterWatch protested the permit application on March 12, 2010, on grounds that it did not conform to state requirements and that the applicant showed no need for the water. The judge, Jim Han, stated in the April 27, 2012 order that the “[a]pplication proposes a speculative use for more water than the Company could establish it could put to actual beneficial use” as required by law. He found that granting the permit would impair or be detrimental to the public interest and that the permit application should be denied. The state has now agreed with him.
Parties have 20 days to file objections to the state’s denial of the permit, after which the state could modify its decision and issue a new order. After that process ends, parties can appeal the state’s denial to the Oregon Court of Appeals.
Select Quotes from the Final Order
“The evidence at the hearing established that the proposed use did not comply with the Commission’s rules requiring the applicant to show land use compatibility.” p. 33
“…the ALJ concluded that the Company did not provide information sufficient for the Department to address compatibility because the [land use compatibility statements] forms from Springfield and Lane County ‘showed that discretionary land use approvals may be required, but the Company has not yet designed the proposed diversion and delivery system and has not applied to Springfield and Lane County for land use approvals.” p. 37
“Because the outright land use approvals do not address the Applicant’s proposed water use, the Department may not conclude that the land use to be served by the proposed water use is allowed outright.” p. 38
“Because the Department must receive information from affected local governments indicating compatibility (or that an applicant is pursuing necessary approvals) before it issues a water use approval, the Department may not approve the water use now and hope that at some point, all necessary approvals will eventually be obtained.” p. 40
“…the Department adopts the ALJ’s conclusion that none of the Department’s statutes authorize a conditional use of the proposed water use absent necessary land use compatibility findings.” p. 44
“…the Department must have at least some idea of what the place of use constitutes before it may determine the quantity of water necessary to serve the use proposed by the Company as the service provider. At this point, it cannot.” p. 48
“…[T]he evidence produced at hearing, and namely evidence that the Company has not developed plans for its [points of diversion] nor begun seeking the approvals it needs for such [points of diversion], has not pursued necessary land use approvals, and has not established any certainty regarding the place of use where it may deliver water, leads the Department to conclude that applicant could not begin or complete construction within five years of permit issuance, but rather intends to rely on an unlimited number of extensions to begin and complete construction of its works and apply water to beneficial use.” p. 53
“In sum, where, as in this case, it is clear than an applicant cannot commence and complete construction of works within five years of permit issuance, the proposed use appears to be a reservation of a large block of water for future use rather than an appropriation for beneficial use.” pp. 53-54
“…[T]he ALJ found that although the type of use is beneficial, the proposed use is not a beneficial use because it is speculative and therefore wasteful.” p. 55
“The applicant seeks to set aside with a priority date of 2008, 34 cfs of water for a use that it contemplates may take as long as 50 years to develop if it can be developed at all. This reflects not a contemplation of the application of water to beneficial use upon specific lands, but a monopoly of the waters of a stream for later indeterminate sale.” –page 56
“Merely holding water rather than using water constitutes waste because it precludes others from making beneficial use of it.” p. 57
“The applicant in this case seeks a protracted development time and flexibility regarding its place of use that it may not exercise. The proposed use is, therefore, inconsistent with the Commission’s policy…” p. 62