PART II
BACKGROUND
Attempts by federal agencies to avoid recognition of non-federal water rights is not a new development in the relationship between states and the federal government. However, Congress has addressed this issue repeatedly, and each time the issue has been resolved in favor of deference to the ability of the states to decide who has a water right, how much it is and how and when it may be exercised. This deference stems, at least in part, from the widely varied ways states have treated the subject, based on differing legal frameworks adopted from antecedent cultures. And even when Congress has acted, directly or impliedly, to reserve unappropriated water on federal lands for use for federal purposes, it has still allowed state courts to adjudicate the existence, quantity, and priority of the federal water rights so that the federal water rights could be established and administered in a way that protected previously existing rights established under state law.
This deference has been longstanding and explicit. Beginning with the 1866 Mining Law, as amended by the Act of July 9, 1870, and followed by the 1877 Desert Land Act, Congress severed water from the public lands and allowed third parties to obtain vested rights to the use of that water. These rights vest as against all other claimants, including the United States. Otherwise, there would have been no reason for the development of the concept of federal reserved rights, which were created in order to remove, or reserve, specified quantities of water from that which is otherwise available for appropriation and use under state law. Even Solicitor of the Interior Krulitz interpreted the 1866 and 1870 Acts to mean that "Congress in effect waived its proprietary and riparian rights to water on the public domain to the extent that water is appropriated by members of the public under state law in conformance with the grant of authority found in these two Act[s]. Thus, these two Acts confine assertion of inchoate federal water rights to unappropriated waters that exist at any point in time." The relevant provisions of the 1866, 1870, and 1877 Acts have not been repealed and thus remain valid federal law today.
The 1897 Organic Administration Act, which created the National Forests, continued this deference, and took the additional step of mandating that the National Forests were to be established "principally as a means of enhancing the quantity of water that would be available to the settlers of the arid west." Accordingly, the creation of the National Forests was not intended to interfere with or limit the exercise of non-federal water rights.
The principle that non-federal water rights are recognized and protected under federal law is proven by the fact that the exercise of federal authority to reserve water for federal purposes is limited to unappropriated waters, which means that federal claims to the use of water are legally subordinate to previously established non-federal water rights. "Even if the 1960 Act expanded the reserved water rights of the United States, of course, the rights would be subordinate to any appropriation of water under state law dating to before 1960."
The existence of the legal distinctions between primary and secondary purposes of the National Forests provides further proof that federal law applicable to the use of water on National Forests protects non-federal uses of water. A federal reserved water right exists for the primary purposes of the National Forests. However, even this federal right is limited to unappropriated water and subordinate to prior non-federal water rights. Secondary purposes of the National Forests, such as protection of aquatic habitat, do not give rise to a federal reserved water right, and water to achieve these purposes must be "acquired in the same manner as any other public or private appropriator." Accordingly, since federal claims to the use of water for the primary purposes of the National Forests are subject to prior allocations of water to non-federal uses, federal claims to the use of water for the secondary purposes of the National Forests are also likewise subject to, and cannot interfere with, the allocation of water to non-federal uses. "Other public or private appropriator[s]" must acquire water in priority under state law, and cannot take it from senior water rights through the use of bypass flow requirements.This conclusion is shared by even those who have asserted that
"[T]he United States also has the right to appropriate water on its own property for congressionally authorized uses [as a matter of and subject to federal, and not state, law], whether or not such uses are part of any "reservation" of the land. This right to use water for congressionally sanctioned purposes is not a "reserved right. . . . Unlike the reserved right this federal right may not predate, in priority, the date action is taken leading to actual use, whether consumptive or nonconsumptive, and it may not adversely affect other rights established under state law. . . . . It is my opinion that, since Congress has vested only the public with the right to appropriate water arising on, under, through or appurtenant to federally owned lands under state law, the United States therefore retains the power to utilize those unappropriated waters to carry out the management directives specified in congressional directives." However, subsequent Opinions of the Solicitor of the Department of the Interior concluded that: "FLPMA . . . does not give an independent statutory basis for claims for water uses inconsistent in any way with the substantive requirements of state law." While these Opinions are by the Department of the Interior, and not the Department of Agriculture, they interpret the very same Act as is applied by the Forest Service.The 1952 enactment of the McCarran Amendment, which waived sovereign immunity so that federal claims to the use of water could be adjudicated and relative priorities established for federal and non-federal water rights, again confirmed federal deference to state water allocation systems. In fact, McCarran was more than an expression of deference to state systems, as it was intended to force federal agencies to obtain water rights they deemed necessary to achieve federal purposes so that these rights could be administered in priority with non-federal water rights. McCarran was therefore an explicit rejection of the attempts by federal agencies to control the use of water irrespective of water rights obtained under state law.
Beginning in 1960, with the Multiple Use and Sustained Yield Act, and then again in 1976, with the Federal Land Policy and Management Act and the National Forest Management Act, Congress instituted management programs for public lands, including national forests, that expanded the roles of federal land managers beyond previous mandates. In doing so, Congress again provided significant recognition of the states’ role in water right matters and gave no explicit instructions to federal land managers in conflict with the federal recognition of water rights created under state law.
Nevertheless, the implementation of these new management programs, coupled with passage of a series of environmental laws, pushed federal land managers toward analysis of water resource needs for newly defined federal purposes. For the Forest Service, this push came primarily from development of forest plans. Identifying perceived needs, the Forest Service found that surface water resources originating on or passing through national forests in the West were, in many instances, already allocated to and owned by others. Thus, a tension built between the Forest Service’s perceived need for additional water to achieve its newly defined management objectives and state-recognized water rights previously granted for other purposes.
Frustrated by the fact that federal water rights must be exercised in priority, and therefore do not allow the Forest Service to control the use of water belonging to senior water rights used for non-federal purposes, the Forest Service has turned to its regulatory authority in an attempt to control the diversion and use of water owned by others. At the same time, the Forest Service appears to have concluded that water rights of all types previously granted to users of forest lands under state laws should be transferred to the Forest Service where state law allows direct federal agency ownership of such rights. Both of these decisions were impelled by a perceived need to directly control water resources to enlarge overall management and control of National Forests, and by the desire to side-step previous allocations of water to non-federal purposes and entities.
.