Alameda Water & Sanitation Dist. v. Reilly

• Decision Date: 05 June 1996
• Docket Number: Civil Action No. 91-M-2047.
• Citation: 930 F. Supp. 486
• Parties: ALAMEDA WATER & SANITATION DISTRICT, Bear Creek Water & Sanitation District, The Consolidated Mutual Water Company, Platte Canyon Water & Sanitation District, Southwest Group (Bennett Bear Creek Farms Water & Sanitation District, Meadowbrook Water District, and Willowbrook Water & Sanitation District), and Southwest Metropolitan Water & Sanitation District, Plaintiffs, v. William K. REILLY, Administrator of the United States Environmental Protection Agency, the United States Environmental Protection Agency, Michael P.W. Stone, Secretary of the Army, and the United States Army Corps of Engineers, Defendants.
• Court: U.S. District Court — District of Colorado

930 F. Supp. 486

ALAMEDA WATER & SANITATION DISTRICT, Bear Creek Water & Sanitation District, The Consolidated Mutual Water Company, Platte Canyon Water & Sanitation District, Southwest Group (Bennett Bear Creek Farms Water & Sanitation District, Meadowbrook Water District, and Willowbrook Water & Sanitation District), and Southwest Metropolitan Water & Sanitation District, Plaintiffs, v. William K. REILLY, Administrator of the United States Environmental Protection Agency, the United States Environmental Protection Agency, Michael P.W. Stone, Secretary of the Army, and the United States Army Corps of Engineers, Defendants.

Civil Action No. 91-M-2047.

United States District Court, D. Colorado.

June 5, 1996.

COPYRIGHT MATERIAL OMITTED

Marcia M. Hughes, Lakewood, CO, for plaintiff.

Gary S. Guzy, Michael Zevenbergen, United States Department of Justice, Environmental Defense Section, Washington, DC, for defendant.

MEMORANDUM OPINION AND ORDER

MATSCH, Chief Judge.

The plaintiffs are eight of forty-one municipal and quasi-municipal entities providing or distributing water to service areas in the four counties surrounding Denver, Colorado, that signed contracts with the Denver Water Board ("DWB" or "Denver") referred to as the Metropolitan Agreement in 1982 and the South Platte Agreement in 1984. In these inter-governmental contracts the suburban entities agreed to pay Denver eighty percent of all costs, including environmental permitting expenditures, associated with the development of a water project designed to meet the future water needs of the entire metropolitan area. The general objective was to create a master reservoir for the storage of water from natural flows and collection systems. These agreements sought to harmonize efforts to meet the demands of increased population and to replace competition with cooperation in the development of water resources. In April 1982, Denver signed a contract with the United States Army Corps of Engineers ("Corps") to conduct a System-wide Environmental Impact Statement ("EIS"). Between 1982 and 1988 approximately $40 million was spent on the Metropolitan Denver Water Supply EIS and related project development. The suburban share was $26,466,000.

After evaluation of many water supply sources and reservoir sites, a site known as Two Forks was selected for a dam and reservoir. That site is located on the South Platte River approximately one mile downstream from the confluence of the North Fork of the South Platte River with the South Platte River. It is approximately two miles upstream from Denver's Strontia Springs Dam.

The projected reservoir would provide long-term storage of natural flows from the North Fork of the South Platte River and the South Platte River. It would also store water from existing west slope collection systems which deliver water to the North Fork of the South Platte through the Roberts Tunnel. South Platte River flows and West Slope deliveries would be integrated with Denver's north system supplies through Gross Reservoir, increasing system flexibility.

Denver holds conditional water rights for the storage of 336,368 acre-feet of water from the South Platte River. Operation of a 1,100,000 acre-feet reservoir at the Two Forks site would increase the firm annual yield to the Denver system by 98,000 acre-feet per year, expected to be adequate to serve the anticipated demand in the metropolitan area for 33 years.

The parties to the South Platte Agreement expected that the projected construction at the Two Forks' site would allow treatment of water at the Foothills Water Treatment Plant, distribution of the water largely through the complex infrastructure already in place and storage of their respective water rights in this large reservoir on the mainstem of the South Platte River.

Building a dam on a navigable river requires a permit from the Corps under the Federal Water Pollution Control Act, commonly known as the Clean Water Act ("CWA"), 86 Stat. 816, as amended, now codified in 33 U.S.C. § 1251(a). The application for a permit for the Two Forks dam was submitted on March 4, 1986. The application sought approval for placement of 1 million cubic yards of fill in the South Platte River to build a dam standing 615 feet high spanning a crest of 1,700 feet. The dam would create a reservoir with the storage capacity of 1.1 million acre-feet with a surface area of 7,300 acres, or 11.4 miles, flooding more than 30 miles of the river.

The proposal was evaluated extensively by state and federal governmental agencies with very active public participation in many hearings. Certain mitigations for the site were recommended by the Colorado Wildlife Commission and the U.S. Fish and Wildlife Service. The Colorado Water Quality Control Commission issued the state's certificate under Section 401 of the CWA on August 9, 1989, finding that no significant water quality impacts would be caused by Two Forks.

The EPA participated in the evaluation process and submitted comments to the Corps in response to its public notice of the availability of the draft environmental impact statement and the Section 404 permit application for the dam.

In March 1988, the Corps issued its Final Environmental Impact Statement ("FEIS"). On May 26, 1988, EPA submitted comments on the FEIS, indicating that Two Forks was the most environmentally damaging of the alternatives considered.

On March 15, 1989, the Corps filed a formal Notice of Intent to issue the permit for Two Forks. The Regional EPA Administrator was directed to inform the Corps that the EPA intended to initiate the process for a veto under subsection 404(c) of the CWA. The Regional Administrator removed himself from this process, apparently because of his public comments in support of it, and the EPA selected Lee DeHihns, the Deputy Regional Administrator for EPA Region IV, to conduct the regional phase of the Section 404(c) review. On August 29, 1989, Mr. DeHihns issued a Proposed Determination to veto the Two Forks permit. The EPA published its Proposed Determination in the Federal Register on September 5, 1989.

On March 26, 1990, EPA Region VIII issued a Recommended Determination ("RD") on the Two Forks project, and sent it with the administrative record to EPA headquarters. The RD included a finding that Two Forks would inundate a "diverse riverine and wetland/upland complex with extremely high fisheries, wildlife and recreational values" and a conclusion that construction and operation of the dam would have unacceptable adverse effects on fishery, wildlife and recreation areas. An additional finding was that there were practicable, environmentally less damaging alternatives to Two Forks. Thus, the RD recommended that the Two Forks permit be vetoed.

The Applicants submitted a Corrective Action Proposal ("CAP") to the EPA on July 20, 1990. The CAP reduced the size of the reservoir at the Two Forks site to 450,000 acre-feet of storage, and dedicated 50,000 acre-feet to operation of a flow plan for purposes of fishery mitigation. The CAP attempted to avoid environmental impacts by changing mitigation to preserve Cheesman Canyon and modified the aquatic mitigation to 100%, in-kind mitigation in addition to significant reservoir mitigation. For example, the CAP avoided 35% of the impacts to recreation, the loss of 73 acres of wetlands as well as avoiding impacts to a portion of the known habitat of the Pawnee Montane skipper butterfly. The CAP also required that mitigation be successful before project construction would occur.

The EPA Assistant Administrator for Water issued a Final Determination ("FD") vetoing Two Forks on November 23, 1990. That decision prevented the Corps from issuing a proposed permit for construction of the 1.1 million acre-feet project. The FD also vetoed a 400,000 acre-feet version of Two Forks and the 450,000 acre-feet reservoir in the CAP proposed by the applicants.

The EPA based its decision on findings that any of these Two Forks projects would result in unacceptable adverse effects on fishery areas and recreational areas and that those losses were avoidable because there were less environmentally damaging practicable alternatives to Two Forks. Moreover, the EPA found that the resources which would be lost were so valuable that the project's impacts, even factoring in the proposed mitigation, were unacceptable.

EPA's FD concludes that each of the Two Forks projects "would inundate the South Platte corridor, which supports a vital aquatic ecosystem offering unmatched fishery and recreational values within a single location easily accessible to major metropolitan areas." The EPA found that the projects would have unacceptable adverse effects on aquatics and recreation, and that this damage was avoidable because alternatives to Two Forks existed. EPA also concluded that the adverse effects, even as mitigated, were too significant. One year after EPA issued the FD on Two Forks, plaintiffs filed this lawsuit against the EPA and the Corps challenging the veto under the Administrative Procedure Act.

I. STANDING.

The defendants' initial response in this civil action was a motion to dismiss, challenging the standing of the plaintiff providers to bring this action. That motion was denied by this court's Memorandum Opinion and Order of October 2, 1992, based on a determination that the plaintiffs had adequately alleged that under the two agreements with Denver they had contract rights to compel Denver to build the Two Forks Dam if a permit could be obtained. The defendants now ask the court to again consider the redressability element of standing on the motion for summary judgment under Rule 56. The defendants argue that while general factual allegations suffice to defeat a motion to dismiss, Lujan v. Defenders of Wildlife, 504 U.S. 555, 561, 112 S.Ct. 2130, 2136-37, 119 L.Ed.2d 351 (1992), at this summary judgment stage the plaintiffs must show proof of specific facts to support their...