Idaho Power Co. v. State, By and Through Dept. of Water Resources, U-1006-124
| Decision Date | 31 March 1983 |
| Docket Number | No. U-1006-124,D,No. 13794,U-1006-124,13794 |
| Parties | IDAHO POWER COMPANY, Plaintiff-Appellant-Cross-Respondent, v. The STATE of Idaho, acting By and Through the DEPARTMENT OF WATER RESOURCES, the Idaho Water Resource Board, and its Executive Director, C. Stephen Allred, in his official capacity, Defendants-Respondents-Cross-Respondents, and The State of Idaho, acting by and through the Idaho Public Utilities Commission, and Commissioners, Robert Lenaghen, Conley Ward, and Ralph Wickberg in their official capacities; and Matthew Mullaney, John Peavey, Charles Hisaw, Diane Plastino, Jeff Fereday, Billie Thompson, L.N. "Bud" Purdy, John Falkner, Bill Arkoosh, Eslie Heinz, Harold Ingram, Ralph Ingram, Harold Huyser, Mary Mech, Gerald Tews, John Bryngelson, Clive Schell, Defendants-Respondents- Cross-Appellants-Cross-Respondents, and David Mickelsen, A.W. Molyneux, Morgan & Shillington, a partnership, Defendants-Respondents-Cross-Respondents, and Fred Tiede, Gary Tiede, Otto Tiede, James Tiede, Ferdinand Gehring, Melvin Funk, Sid Allen, Jim Pahl, Lenard Schritter, Alfred Fothergill, Marcia Pursley and J.W. Swan, as Complainants in P.U.C. Complaint, Caseefendants-Respondents, Cross-Respondents-Cross-Appellants, and Murphy Water Company, Crane Falls Mutual Irrigation Co., Defendants- Respondents-Cross-Respondents, and Nelda E. McAndrew, Defendant-Respondent-Cross-Appellant-Cross-Respondent, and Pilgram Irrigation Company and Enterprise Acres, Defendants-Respondents-Cross- Respondents, and Upper Grand View Canal Company, Defendant-Respondent-Cross-Respondent, and Martin K. Slane, and Mountain View Irrigation Company, Inc., aka Yahoo Company, Inc., Ronald H. Warrick, Defendants-Respondents-Cross-Respondents, and Cottonwood Canal Company, Defendant-Respondent-Cross-Appellant, and John Doe, and the State of Idaho, acting by and through the Department of Fish & Game, acting through its Executive Director Joseph Greenley, in his official capacity; John Peavey, Picabo Livestock, Inc., Faulkner Land & Livestock, Bill Arkoosh, Ralph |
| Court | Idaho Supreme Court |
Thomas G. Nelson of Nelson, Rosholt, Robertson, Tolman & Tucker, Twin Falls, for Idaho Power Company.
David H. Leroy, Atty. Gen., Josephine P. Beeman, Howard Carsman, Deputy Attys. Gen., Boise, for C. Stephen Allred, et al.
Phillip Barber, Boise, for Water Resource Bd.
David H. Leroy, Atty. Gen., and Michael S. Gilmore, Deputy Atty. Gen., Boise, for Idaho Public Utilities Com'n. Jeffrey R. Christenson of Anderson, Kaufman, Ringert & Clark, Boise, for Mud Flat Canal Co., Cottonwood Canal Co., Nelda E. McAndrew and Upper Grand View Canal Co.
Matthew J. Mullaney, Jr., Boise, for Paragraph XX defendants and pro se.
Ben Cavaness, American Falls, for Picabo Livestock.
Severt Swenson, Jr., Gooding, for Faulkner Land & Livestock.
Larry R. Duff of Goodman, Duff & Chisholm, Rupert, for Morgan Shillington Farm Co.
David H. Leroy, Atty. Gen. and John Vehlow, Deputy Atty. Gen., Boise, for Idaho Dept. of Fish & Game.
Lloyd J. Walker, Twin Falls, for Pilgrim Irrigation Co. and Mountain View Irrigation Co., Yahoo Co., Inc.
Jack Murphy, Shoshone.
Fred Stewart, pro se.
ON DENIAL OF PETITION FOR REHEARING
This case involves a series of appeals from an order of the district court which granted certain motions for summary judgment, disposed of all the issues raised, and constituted a final judgment. Narrowly stated, the case involves the validity of Idaho Power's water rights at its Swan Falls power plant on the Snake River, and the case arose when Idaho Power brought the action seeking a determination of the validity of those water rights, and that they were not subject to future upstream depletion. More broadly stated, the case involves conflicting claims to utilization of the waters of the Snake River between competing interests of power generation and agricultural irrigation. The issues involved are of large significance to the majority of the people of the state. We affirm in part and reverse in part.
The Snake River system rises in the easternmost part of Idaho and the adjoining area and flows westward across the entire breadth of the state. Thereafter it turns northward, forming Idaho's western border, and ultimately falls into the Columbia River, of which it is a principal tributary. Hence, the Snake River and its use has exercised and will continue in the future to exercise an enormous influence over a very substantial portion of Idaho and its people.
The roots of this litigation stretch back to the early days of the state and the background must be set out in some considerable detail. The Trade Dollar Consolidated Mining Company constructed the first hydroelectric dam on the Snake River at the Swan Falls site in 1901. It originally provided power to the mines of the Silver City area, which service was later shifted to the towns which lay to the north. At that time there were a number of small scale companies supplying electric power in that region, and eventually five of those companies came to dominate the electric power supply market for southern Idaho. In 1915 those five companies merged to form Idaho Power Company, and in the merger Idaho Power acquired the Swan Falls dam and power plant, as well as others which had been built in the interim. See R. Sessions, Idaho Power Co., 43-54 (1939).
Idaho Power had secured a federal court decree which, together with state water licenses, granted Idaho Power water rights at Swan Falls of 9450 cfs with priority dates ranging from 1900 to 1919. However, it is undisputed that the Swan Falls power plant's hydroelectric capacity is 8400 cfs, and therefore the water rights at Swan Falls are limited to 8400 cfs.
Congress, in 1890, had passed legislation prohibiting construction of obstructions to navigation without the approval of the Secretary of War. 26 Stat. 454 (1890). That legislation was superseded by a provision of the 1899 Rivers and Harbors Act which, in part, made it unlawful to build dams on navigable rivers without the consent of Congress and approval of the plans by the Corps of Engineers and Secretary of the Army. 33 U.S.C. § 401. In 1920 Congress enacted the Federal Water Power Act, now known as the Federal Power Act, 16 U.S.C. §§ 791a-825r, and thereafter created the Federal Power Commission (FPC) to administer the Act. One of the stated purposes of the FPC was, in conjunction with the Corps of Engineers, to issue licenses for construction and operation of dams and other hydroelectric projects. 16 U.S.C. § 797(e). It does not appear from the record before us that such a license was obtained for Swan Falls until an operating license was granted in 1928. That license by its terms expired in 1970, but annual renewals have kept it in force. The record here reflects only that Idaho Power's application for a new license for Swan Falls is presently pending before the FERC. 1
Thereafter, in the late 1920s and the 1930s, new dams and improvements on existing facilities were constructed on the Snake River. Following the Second World War, Idaho Power undertook a massive dam building campaign, and between 1948 and 1952 five additional dams (Upper and Lower Malad, Lower Salmon Falls, Bliss, and C.J. Strike) were constructed on the central portion of the Snake River. See G. Young & F. Cochrane, Hydro Era: The Story of Idaho Power Company, 46-53 (1978).
With the completion of the C.J. Strike dam in 1952, it became apparent that the Snake River was no longer inexhaustible and concerns began to be expressed as to the usage of the remaining finite flow of the river. Reflective perhaps of those concerns were provisions that began to be placed in FPC licenses and in state water licenses, known as "subordination" clauses. Therein water rights of power companies did not contain the customary total priority of right but, rather, would be inferior to future upstream depletion. The validity and scope of those subordination clauses have become the principal issues of this appeal.
The license obtained by Idaho Power in 1928 for operation of the Swan Falls dams and generating facility which was granted by the FPC contained a provision forbidding Idaho Power from objecting to use of water by others, "provided such use will not materially reduce the amount of power produced." The Idaho Power license granted by the FPC for the Twin Falls dam (1934) provided that its water rights were subordinate to present and future irrigation uses, except that Idaho Power could use its water stored at the American Falls reservoir some distance upriver and any water entering the river below Milner dam (approximately half way between Twin Falls dam and American Falls dam), but stated that the license affected water rights at no other point. Of the other licenses granted Idaho Power for dam construction prior to 1952 which appear in the record here, neither FPC project licenses nor state water licenses appear to contain any subordination language.
The FPC license granted Idaho Power in 1928 for operation of the Swan Falls project also provided that the licensee "will, during the period covered by this license, retain possession of all project property ... including ... water rights; and that none of such properties valuable and serviceable to the project ... will be voluntarily sold, transferred, abandoned, or otherwise disposed of without the approval of the Commission." That provision appears to have become a standard form attached to later FPC licenses and appears in the record relating to the licenses for several other dams.
When Idaho Power sought a license for the C.J. Strike project, a...
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