Rangen, Inc. v. Idaho Dep't of Water Res. (In re Distribution of Water to Water Right Nos. 36-02551 & 36-07694 (Rangen, Inc.)

• Decision Date: 29 February 2016
• Docket Number: No. 42772.,42772.
• Citation: 367 P.3d 193,159 Idaho 798
• Parties: In the Matter of the Distribution of Water to Water Right Nos. 36–02551 & 36–07694 (Rangen, Inc.) IDWR Docket CM–DC–2011–004. RANGEN, INC., Petitioner–Appellant, v. The IDAHO DEPARTMENT OF WATER RESOURCES, Gary Spackman, in his capacity as Director of the Idaho Department of Water Resources, Fremontmadison Irrigation District, and The City of Pocatello, Respondents–Respondents, and Idaho Ground Water Appropriators, Inc., A & B Irrigation District, Burley Irrigation District, Milner Irrigation District, North Side Canal Company, Twin Falls Canal Company, American Falls Reservoir District # 2, and Minidoka Irrigation District, Intervenors–Respondents.
• Court: Idaho Supreme Court

159 Idaho 798

367 P.3d 193

In the Matter of the Distribution of Water to Water Right Nos. 36–02551 & 36–07694 (Rangen, Inc.) IDWR Docket CM–DC–2011–004.RANGEN, INC., Petitioner–Appellant,

v. The IDAHO DEPARTMENT OF WATER RESOURCES, Gary Spackman, in his capacity as Director of the Idaho Department of Water Resources, Fremontmadison Irrigation District, and The City of Pocatello, Respondents–Respondents,andIdaho Ground Water Appropriators, Inc., A & B Irrigation District, Burley Irrigation District, Milner Irrigation District, North Side Canal Company, Twin Falls Canal Company, American Falls Reservoir District # 2, and Minidoka Irrigation District, Intervenors–Respondents.

No. 42772.

Supreme Court of Idaho, Boise, December 2015 Term.

Feb. 29, 2016.

Brody Law Office, PLLC, Rupert, Haemmerle Law Office, PLLC, Hailey, and May, Browning and May, PLLC, Boise, for appellant Rangen, Inc. Robyn M. Brody argued.

Honorable Lawrence G. Wasden, Idaho Attorney General, Boise, for respondents Idaho Department of Water Resources and Gary Spackman. Garrick L. Baxter argued.

Racine Olson Nye Budge & Bailey, Chartered, Pocatello, for respondent Idaho Ground Water Appropriators, Inc. Thomas J. Budge argued.

White & Jankowski LLP, Denver, and A. Dean Tranmer, Pocatello, for respondent City of Pocatello. Mitra M. Pemberton argued.

Rigby, Andrus & Rigby Law, PLLC, Rexburg, for intervenor Fremont–Madison Irrigation District.

Barker, Rosholt & Simpson, LLP, Twin Falls, for intervenors A & B Irrigation District, Burley Irrigation District, Milner Irrigation District, North Side Canal Company and Twin Falls Canal Company.

Fletcher Law Office, Burley, for intervenors American Falls Reservoir District # 2 and Minidoka Irrigation District.

J. JONES, Chief Justice.

Appellant Rangen, Inc., initiated a contested case by filing a petition for a delivery call before the Director of the Idaho Department of Water Resources ("IDWR"), alleging that junior ground water pumping in the Eastern Snake Plains Aquifer ("ESPA") was materially injuring its water rights. Several parties intervened in the delivery call and, after extensive discovery and communications, IDWR Director Gary Spackman ("Director") presided over an evidentiary hearing. The Director subsequently issued a final order and an order on reconsideration. In these orders the Director granted Rangen a curtailment of certain junior priority ground water pumping affecting Rangen's water rights. The Director also interpreted the source and point of diversion elements of Rangen's water rights to have a scope smaller than Rangen's actual historical use.

Rangen and intervenor Idaho Ground Water Appropriators, Inc. ("IGWA") each filed petitions for judicial review. The issues raised by IGWA in its petition for judicial review are not at issue in the present proceeding. Rangen raised various issues related to the interpretation of its water rights and the sufficiency of the evidence before the agency. Specifically, Rangen appealed the Director's determinations that Rangen may divert water only from the mouth of the Martin–Curren Tunnel and only within the ten-acre tract listed on its water right partial decrees. Rangen also appealed the Director's adoption of an adverse expert's analysis and the Director's conclusion that junior priority ground water users are using water efficiently and without waste.

The district court affirmed the Director's orders with respect to each of the issues that are on appeal before the Court in the present proceeding. Rangen appealed to this Court on substantially the same issues with substantially the same arguments.

I.FACTUAL AND PROCEDURAL BACKGROUND

A. Rangen's Facilities and the Eastern Snake Plains Aquifer

Rangen owns and operates a fish research and propagation facility at the head of Billingsley Creek in the Thousand Springs area near Hagerman, Idaho. The facility includes concrete channels for fish rearing ("raceways"), a hatch house, ponds for fish rearing and holding, and a greenhouse. East of the Rangen facility, water emanates from several springs on talus slopes just below a canyon rim. Water also emanates from the Martin–Curren Tunnel, commonly referred to as the Curren Tunnel. The Curren Tunnel is a large, excavated conduit constructed high on the canyon rim that extends 300 feet into the canyon wall.

A concrete collection box referred to as the "Farmers' Box," located near the mouth of the Curren Tunnel, collects water for delivery via pipelines to Rangen and holders of senior priority irrigation water rights. Currently, only Rangen diverts from the Farmers' Box, but senior priority irrigation water right holders may call for delivery of water from the Curren Tunnel in the future. Farther down the slope is a second concrete collection box referred to as the "Rangen Box." Rangen diverts water from the Farmers' Box to the Rangen Box through two plastic tubes. Water is then diverted from the Rangen Box through a steel pipe to raceways. Water can also be spilled out the side of the Rangen Box and returned to the talus slope. Water from the talus slope forms the headwaters of Billingsley Creek. The main diversion for the large raceways is downstream from the talus slope and is commonly referred to as the "Bridge Diversion." This diversion collects and diverts spring flows from the talus slopes, including water spilled from the Rangen Box.

Rangen holds five water rights for the Rangen facility which were decreed through the Snake River Basin Adjudication ("SRBA"). Rangen's petition for delivery call alleged injury only to water rights nos. 36–02551 and 36–07694. Water right no. 36–02551 authorizes a diversion of 48.54 cfs for fish propagation and has a priority date of July 13, 1962. Water right no. 36–07694 authorizes a diversion of 26.0 cfs for fish propagation and has a priority date of April 12, 1977. The source element for water rights nos. 36–02551 and 36–07694 is the Martin–Curren Tunnel. The point of diversion element for these water rights is the ten-acre tract identified as SESWNW T07S R14E S32.

The ESPA is the aquifer underlying the Eastern Snake Plain. The ESPA is about 170 miles long and 60 miles wide, and is defined as an area having a common ground water supply. IDAPA 37.03.11.050. The ground water in the ESPA is hydraulically connected to the Snake River and tributary springs, including the Thousand Springs area where the Curren Tunnel is located. The ESPA is highly productive and is composed predominantly of fractured quaternary basalt, which is generally characterized by high hydraulic conductivity. The amount of water that discharges from the aquifer to hydraulically connected surface water sources is largely dependent on ground water elevations and hydraulic conductance. From October 1980 through September 2008, average annual discharge from the ESPA exceeded average annual recharge by 270,000 acre-feet, which resulted in declining aquifer water levels and declining discharge to the Snake River and tributary springs. Rangen claims that it is not receiving all of the water to which it is entitled under its water rights because of junior ground water pumping in the ESPA.

B. Rangen's Delivery Call

On December 13, 2011, Rangen, Inc. filed a petition for delivery call alleging that junior priority ground water pumping in the ESPA was materially injuring its water rights and requested that the Director distribute water in the ESPA and curtail junior priority pumping. IGWA and a number of other parties intervened in the proceeding,¹ while Pocatello and Fremont–Madison Irrigation District were brought in as respondents.

Prior to the hearing on the delivery call, Rangen moved for partial summary judgment, asking the Director to rule that the source of its water rights was not limited to the mouth of the Martin–Curren Tunnel but instead extended to the greater spring complex supplying the facility. Rangen also sought a ruling that it is entitled to divert water via the Bridge Diversion, despite the fact that the structure is not within the decreed ten-acre tract. The Director ruled that Rangen is not authorized to divert water outside the decreed ten-acre tract, but that material issues of fact precluded summary judgment on whether Rangen's water rights extended to the entire spring complex.

The Director presided over an evidentiary hearing on Rangen's delivery call, held from May 1 through May 16, 2013. The Director issued an order on January 29, 2014, mandating curtailment of ground water rights bearing priority dates after July 13, 1962, with points of diversion located both within the area of common ground water supply and west of the Great Rift.

C. The Curtailment Order

Rangen has measured the water flows through its facility since 1966. Since 1995, Rangen has been required by IDWR to report flow measurements annually to the watermaster of its water district. At the hearing before the Director, parties contesting the delivery call argued that Rangen had historically under-measured its flows and that the United States Geological Survey ("USGS") flow measurements were more representative of actual water flows through the Rangen facility. In his findings of fact, the Director compared Rangen's measurements with the USGS measurements and concluded that Rangen's measurements were inaccurate and resulted in a systematic underreporting of water flows. The Director relied on testimony by Greg Sullivan, an expert witness retained by Pocatello, who estimated that the error in Rangen's measurements was 15.9%, based on a comparison with USGS measurements taken between 1980 and 2012.

However, the Director found that even when applying the 15.9% margin of error, the spring flows in the area of the Curren Tunnel declined significantly from 1966 to 2012, with the annual flow decreasing from 32.1 cfs in 1966 to 4.4 cfs in 2011. The Director concluded that several factors contributed to the decline in water flow to the Rangen facility, including ground water pumping in the...