National Forest Service At Odds With State Water Laws

National Forest Service’s Proposed Directive

Approximately 121 ski areas, across thirteen states, operate on National Forest Service (“Forest Service”) lands. The Forest Service authorizes these ski areas’ operations by issuing long-term special use permits under federal law. Special use permits do not confer water rights on the holder, but most water rights for snowmaking is necessary for the operation of most ski areas. Ski areas acquire water rights under state law necessary for snowmaking and other general uses. Since 2004, the Forest Service has made a series of revisions to the water rights clauses in ski area permits that limit permit holders’ use and ownership of the water rights.

 

The National Forest Service posted notice of its proposed internal directives amendment on June 23, 2014. The two new clauses constitute the Forest Service fulfilling its mandate to provide recreational use of Forest Service lands. There are six assertions in the second clause of the proposal that directly apply to prior appropriation states, including Colorado.

The Forest Service has the authority under the Organic Administration Act to regulate and condition the use and occupancy of Forest Service lands. More specifically, the Multiple Use Sustained-Yield Act of 1960 authorizes the Forest Service to develop and administer the surface resources of national forests to provide for outdoor recreation, among other uses.

The Forest Service’s 2014 proposed directive contains the provisions of the 2012 Directive, but the Forest Service provided the public an opportunity to participate by publishing the proposal. The 2012 Directive clarified and modified the 2011 Directive, but retained many of the same provisions. First, the 2012 Directive clarified that availability of the water for operation of ski areas would not be adversely affected under the provisions, unless necessary for the Forest Service to fulfill legal requirements. Essentially, the Forest Service is suggesting that the provisions will not interfere with the water availability for ski areas unless it must take action to pursuant to its obligation to maintain federally owned Forest Service ski area water rights. As to ownership, the 2012 Directive next clarified the “joint in tenancy with survivorship” requirement and stated that ski areas could transfer or sever their ownership interests with consent of the Forest Service. Third, the 2012 Directive removed the restrictions on the holder’s ability to sever water rights for water diverted from non-NFS lands for use on NFS lands in the same permit area.

The new proposed directive arose in response to the District Court of Colorado’s 2012 ruling in National Ski Areas v. United States Forest Service. The court in that case vacated the 2012 Directive because the agency failed to comply with procedural requirements in promulgating the rule. In that case, The National Ski Areas Association (“NSAA”) brought suit against National Forest Service seeking an injunction to set aside the 2011 and 2012 Directives. NSAA alleged that the Forest Service should have allowed a notice and comment period. The court ultimately agreed and held that the Agency additionally needed to conduct a Regulatory Flexibility Act analysis of the impact of the directives on small business entities that hold ski area permits. However, the court declined to rule on the substantive aspects of the directives.

The Forest Service subsequently published the 2014 directive for notice and comment in compliance with the APA. This clause first asserts that it supersedes existing national and regional ski area rights clauses in the current Directive. Second, it restricts water rights and water developments under a ski area permit to those that are necessary for and that primarily support the operation of the ski area. Third, it prohibits issuance of new or modified permits to holders not in compliance with all requirements of the directives. Fourth, it does not require the transfer of water rights to the United States under the terms of prior permits. Fifth, it states that the holder of a permit must grant a limited power of attorney to the Agency Officer to execute documents to effectuate any transfers of rights to subsequent permit holders. Sixth, it requires permit holders to waive any right to compensation against the United States for the transfer of water rights as a result of the provisions. The Forest Service states that these revisions are necessary for water availability for ski resorts, as well as for greater accountability and consistency in authorization of water uses and ownership of water rights.

Cory Gardner’s Amendment Aims to Protect State Water Rights

More recently, the Forest Service proposed an amendment to its internal directives that adds two clauses to the Special Uses Handbook, FSH 2709.II, chapter 50, which addresses permit holders of ski area water rights.

Senator Cory Gardner mentioned this recent Forest Service rule in his proposal on the Senate floor of his amendment to the Senate budget. Gardner’s amendment aims to protect the supremacy of state water law, and one provision of the Forest Service proposal provides that the provision would supersede state water law.

Gardner’s amendment itself proposes to establish a deficit-neutral reserve fund relating to “protecting communities, businesses, recreationists, farmers, ranchers, and other groups that rely on privately held water rights and permits from Federal takings.” On Thursday, March 26, Gardner’s amendment to protect private water rights from federal overreach passed by a vote of 59-41.

“Here is a land where life is written in water” began Cory Gardner’s speech on the Senate floor. The quote, he explained, is written on a mural in the Colorado State Capital Rotunda. Gardner moved to the basic justification for his amendment: “to make sure that we are protecting that life blood of Colorado, our water.” Gardner proposes protection against intrusions by the federal government attempting to challenge the supremacy of state water law. Gardner’s proposed amendment challenges federal agency rights by asserting state supremacy to legislate and control water rights. Among others, Gardner mentions the “new Forest Service Ski Area Rule” as an example of an agency seeking to impose a limitation on water rights at the federal level without going through the same water law channels that govern the rightful owners of Colorado water rights and permits.

Effect of the Amendment

Gardner’s recent amendment illustrates the ever-present tension between private ski area water rights holders and federal agencies. The potential magnitude of the effect of Gardner’s amendment is great, particularly because the current prior appropriation doctrine’s relationship with ski area water rights is at stake. However, the Forest Service has demonstrated the need for federal regulation in order to ensure that ski areas have the necessary water for providing future recreational use to the American public.

 

The title image features the iconic Beaver Creek ski resort in Colorado. This file is licensed under the Creative Commons Attribution-Share Alike 2.0 Generic license and the owner does not endorse this blog.


Sources:

Senator Cory Gardner, Gardner Amendment Protects Water Rights, YouTube (Mar. 25, 2015), https://www.youtube.com/watch?v=3vVYI_SjiYA.

 

Notice of Proposed Directive; Request for Public Comment, 79 Fed. Reg. 35513 (June 23, 2014).

161 Cong. Rec. S1807 (Mar. 24, 2015), https://www.congress.gov/congressional-record/2015/03/24/senate-section/article/S1790-1.

Nat’l Ski Areas v. U.S. Forest Serv., 910 F.2d 1269 (Colo. 2012).