Merced Irrigation Dist. v. Cnty. of Mariposa
Decision Date | 04 March 2013 |
Docket Number | CASE NO. 1:12-cv-01645-LJO-SKO |
Court | U.S. District Court — Eastern District of California |
Parties | MERCED IRRIGATION DISTRICT, a California Irrigation District, Plaintiff, v. COUNTY OF MARIPOSA, a political subdivision of the State of California, Defendant. |
Plaintiff Merced Irrigation District ("MID") filed a declaratory relief action against the County of Mariposa ("Mariposa") in Merced County Superior Court on September 5, 2012. On October 5, 2012, Mariposa removed Plaintiff's declaratory relief action to this Court. (Doc. 1.) On November 2, 2012, MID filed a motion to remand the action to Merced County Superior Court. (Doc. 13.) Mariposa filed a brief in opposition to MID's motion on December 5, 2012, and MID filed a reply brief on December 12, 2012. On December 18, 2012, the Court ordered the parties to submit additional briefing. On January 4, 2013, Mariposa filed a supplemental brief and on January15, 2013, MID filed a supplemental brief. (Docs. 24, 25.) For the reasons set forth below, the undersigned RECOMMENDS that MID's motion to remand be GRANTED.
MID owns and operates the Merced River Hydroelectric Project (the "Project"), located in Mariposa County. (Doc. 1-1 (Cmplt.), ¶ 9.) The Project impounds waters of the Merced River to form Lake McClure behind the New Exchequer Dam, and Lake McSwain behind the McSwain Dam. (Cmplt., ¶ 9.) The Project provides irrigation waters for agricultural farmland in Merced County, Lakes McLure and McSwain provide recreational benefits to the residents of Merced and Mariposa counties, and the Project includes a hydroelectric power generation output capacity of 103 megawatts. (Cmplt., ¶ 9.)
The contract at dispute between the parties in this litigation arises out of the original permitting and construction of the Project. In December 23, 1954, MID filed applications with the California Water Rights Board (now known as the State Water Resources Control Board) for appropriation of water from the Merced River to be diverted for the Project. (Cmplt., ¶ 10.) The first application (No. 16186) sought to appropriate 900,000 acre feet ("AF") of water per year from the Merced River for irrigation and domestic use. (Cmplt., ¶ 11.) The second application (No. 16187) sought a permit to use the same 900,000 AF per year appropriation for power generation. (Cmplt., ¶ 11.) In March 1955, MID filed an application with the Federal Power Commissioner (now known as the Federal Energy Regulatory Commission ("FERC")) for a preliminary permit for development of the hydroelectric generation components of the Project. (Cmplt., ¶ 12.)
Mariposa objected to MID's water applications to the California Water Rights Board and the application for a license from FERC. Mariposa asserted it had a senior right to use the waters of the Merced River that MID was proposing to use for its Project. (Cmplt., ¶¶ 13, 17.) At that time,Mariposa was analyzing its own plans for water diversion projects, which involved diversions of approximately 100,000 AF of water per year from the South Fork of the Merced River. (Cmplt., ¶ 14.)2
MID and Mariposa engaged in extended negotiations, and on March 1, 1960, executed an agreement that Mariposa would withdraw its opposition to MID's applications to the California Water Rights Board and to MID's FERC licensing application (the "1960 Agreement"). (Cmplt., ¶¶ 15-26.) In relevant part, the 1960 Agreement provides:
(Cmplt., Doc. 1-2, Exhibit A.)
To finance the construction of the New Exchequer Dam component of the Project, MID issued bonds from the revenues generated by the sale of hydroelectric power from the New Exchequer Dam. (Cmplt., ¶ 37.) MID's repayment of this indebtedness and retirement of the bonds to finance the Project are expected to be concluded on or about July 1, 2014. (Cmplt., ¶ 37.)
In 1968, following the parties' 1960 Agreement, Congress enacted the WSRA, 16 U.S.C. §§ 1271-1287, in an effort to identify and protect certain "rivers which, with their immediateenvironments, possess outstandingly remarkable scenic, recreation, geologic, fish and wildlife, historic, cultural, or other similar values." 16 U.S.C. § 1271. Section 7 of the WSRA provides that "no department or agency of the United States shall assist by loan, grant, license, or otherwise in the construction of any water resources project that would have a direct and adverse effect on the values for which such river was established, as determined by the Secretary charged with its administration." 16 U.S.C. § 1278(a). Section 7 requires the Secretary of the Interior to evaluate whether a "water resources project . . . would have a direct and adverse effect" on the river's values. When a water resources project is found to have a "direct and adverse effect" on a wild and scenic river, the project cannot be authorized or funded absent congressional intervention. Id. Town of Summersville, W.Va. v. FERC, 780 F.2d 1034 (D.C. Cir. 1986) (citing 16 U.S.C. §§ 1275, 1278(a)).
In 1987, the South Fork of the Merced River was designated as "wild and scenic" under the WSRA. Pub. L. No. 100-149, 101 Stat. 879 (Nov. 2, 1987) ( ).5 MID's complaint alleges that the 1987 legislation deferred wild-and-scenic designation as to an eight-mile segment "of the South Fork of the Merced River," from the town of Briceburg to the point of maximum flood control...
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