Del Puerto Water Dist. v. U.S. Bureau of Reclamat.

• Citation: 271 F.Supp.2d 1224
• Decision Date: 13 May 2003
• Docket Number: No. CIVF025934OWWDLB.,CIVF025934OWWDLB.
• Court: U.S. District Court — Eastern District of California
• Parties: DEL PUERTO WATER DISTRICT, Plaintiff, v. U.S. BUREAU OF RECLAMATION, et al., Defendants, Westlands Water District, Santa Clara Valley Water District and San Benito County Water District, Defendant-Intervenors

271 F.Supp.2d 1224

DEL PUERTO WATER DISTRICT, Plaintiff, v. U.S. BUREAU OF RECLAMATION, et al., Defendants Westlands Water District, Santa Clara Valley Water District and San Benito County Water District, Defendant-Intervenors

No. CIVF025934OWWDLB.

United States District Court, E.D. California.

May 13, 2003.

COPYRIGHT MATERIAL OMITTED

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Michael Victor Sexton, Minasian Spruance Baber Meith Soares and Sexton, Oroville, CA, for Plaintiff.

Maria A. Iizuka, United States Department of Justice, Environment and Natural Resources Div, Sacramento, CA, for Defendants.

Jon-David Rubin, Kronick Moskovitz Tiedemann and Girard, Sacramento, CA, Thomas M. Berliner, Duane Morris LLP, San Francisco, CA, for Defendant-Intervenors.

MEMORANDUM OPINION AND ORDER RE: FEDERAL DEFENDANT'S MOTION TO DISMISS; WESTLANDS WATER DISTRICT'S & SAN BENITO COUNTY WATER DISTRICT'S MOTION TO DISMISS; SANTA CLARA VALLEY WATER DISTRICT'S MOTION TO DISMISS

WANGER, District Judge.

In separate pleadings, Federal Defendants, Defendant-Intervenors Santa Clara Valley Water District, Westlands Water District, and San Benito County Water District, move to dismiss Plaintiff's complaint, under Fed.R.Civ.P. 12(B)(1) and 12(B)(6). See Docs. 28, 30, 31. Plaintiff opposes the motions. See Doc. 38. Defendants and Defendant-Intervenors filed reply briefs December 6 and December 9, 2002. See Docs. 43, 44, 46. The motions were heard March 31, 2003 at 10:00 AM.

I. BACKGROUND

Federal defendants provide the following undisputed overview of the Central Valley Project origin and the issues in this suit:

The Delta-Mendota Canal (DMC) was constructed by the United States Bureau of Reclamation (Reclamation) as one of the initial features of the Central Valley Project (CVP), authorized by section 2 of the Act of August 26, 1937, 50 Stat. 844. The Tracy Pumping Plant, another of the original CVP facilities, lifts water from the Sacramento-San Joaquin Delta into the DMC where some of the water is conveyed southeasterly about 116 miles to the Mendota Pool on the San Joaquin River and some is diverted west to the San Luis Reservoir. The water is conveyed to the Mendota Pool primarily so Reclamation can perform its water right contract with the Exchange Contractors in which reclamation committed to provide `substitute water' from the DMC in exchange for the Exchange Contractors' commitments not to divert water from the San Joaquin River pursuant to their senior water rights on that River, thereby allowing reclamation to store water upstream in Millerton Lake behind Friant Dam. Reclamation also entered into CVP water service contracts with districts adjacent to the DMC such as Del Puerto Water District (Del Puerto) ... and its predecessor districts. The water that is diverted from the DMC and conveyed to the San Luis Reservoir is ultimately used by water users in both the San Luis Unit and the San Felipe division of the CVP. The San Luis Unit of the CVP was authorized by the Act of June 3, 1960, 74 Stat. 156. The statute expressly provided in Section 1 that the San Luis Unit was to be constructed, operated and maintained `as an integral part of the Central Valley project.' The San Felipe division of the CVP was authorized by the Act of August 27, 1967, 81 Stat. 173, which, like the San Luis Act, expressly provided that the Division was to be constructed, operated and maintained `as an addition to, and an integral part of, the Central Valley project.'

Doc. 28 at 1-2.

Del Puerto provides the following undisputed background of the Central Valley Project units:

The CVP consists of nine distinct geographic areas known as Divisions. These are: 1) Trinity; 2) Shasta; 3) Sacramento; 4) American River; 5) Delta; 6) Eastside; 7) San Felipe; 8) West San Joaquin, and; 9) Friant. The Delta Division consists of the Delta Cross Channel, the BUREAU's Tracy Pumping Plant in the South Delta, and the Delta-Mendota Canal. As part of the West San Joaquin Division, the San Luis Unit was authorized in 1960 to be built and operated jointly with the State of California. The San Luis Unit consists of San Luis Dam and Reservoir (joint federal-state facilities), O'Neill Dam, and Forebay (joint federal-state facilities), and related facilities.

Doc. 24 ¶ 12 at 4.

Del Puerto Water District filed this action for declaratory and injunctive relief on August 1, 2002. Doc. 1. Del Puerto filed its First Amended Complaint October 10, 2002. Doc. 24. Del Puerto avers federal jurisdiction exists under 28 U.S.C. § 1331, 43 U.S.C § 390uu and the APA, 5 U.S.C. § 701 et seq. Id.

Del Puerto's 1953 contract with the Bureau of Reclamation for water delivery service expired February 28, 1994.¹ Since then, Del Puerto has been operating under a series of interim 2-year delivery contracts. In 1992, Congress enacted the Central Valley Improvement Project Act (CVPIA), which in part requires no new water delivery contracts exceed a term of twenty-five years. CVPIA 3404(c), Pub.L. 102-575, 106 Stat. 4600. The Act also requires the government engage in appropriate environmental review prior to renewing any long-term contracts:

No such renewals shall be authorized until appropriate environmental review, including the preparation of the environmental impact statement required in section 3409 of this title, has been completed. Contracts which expire prior to the completion of the environmental impact statement required by section 3409 may be renewed for an interim period not to exceed three years in length and for successive interim periods of not more than two years in length until the environmental impact statement required by section 3409 has been finally completed at which time such interim renewal contracts shall be eligible for long-term renewal as provided above.

CVPIA 3404(c), Pub.L. 102-575, 106 Stat. 4600. The Bureau of Reclamation (Defendant) is currently negotiating water delivery contracts with Del Puerto and Intervenor-defendants. These contracts are not expected to near the finalization stage until mid-2004. Doc. 44 at 4.

Del Puerto complains defendants must recognize and grant Del Puerto water contract delivery priority, in the to-be-finalized contracts, over contractors in the San Luis Unit of the Central Valley Project (CVP). Del Puerto alleges the San Luis Unit was formed "to receive supplemental water that was in excess of that needed to meet the BUREAU's obligation to the Exchange Contractors and DMC water service contractors, such as DEL PUERTO." Doc. 24 ¶ 14 at 4 (emphasis added). Del Puerto, as a DMC contractor, therefore has allegedly enjoyed a "course of dealing," which creates "federal contract priority" to water over San Luis Unit contractors. Del Puerto contends,

[w]ater demands for the DMC and San Luis Unit are composed of two separate types: CVP water service contractors and Exchange Contractors. The Exchange Contractors conditionally exchanged their senior water rights to water in the San Joaquin River for a CVP water supply from the Delta. The DMC water service contractors also receive their water supply from the Delta. The DMC contractors and Exchange Contractors began receiving water from the Delta at or about the same time, circa 1951.

Doc. 24 ¶ 13 at 4. Del Puerto asserts its original contract "was intended to provide that the total quantity of water available at Mendota Pool and from the Delta-Mendota Canal in excess of the quantity required to meet the Exchange Contract obligation was to be equally apportioned among existing and future Mendota Pool and Delta-Mendota Canal (DMC) contractors only[,] based upon their contract quantity." Id. ¶ 18 at 6 (emphasis added). Therefore, "by definition and in point of time, the original DEL PUERTO shortage provision contract language excludes apportionment with non-Mendota Pool and/or non-DMC contractors," such as San Luis Unit contractors. Id. ¶ 18 at 6.

Del Puerto's first claim for relief alleges the Secretary and Regional Directors' "intended revision to the DEL PUERTO long-term water service contract pursuant to which the BUREAU intends to pro-rate available water supplies equally between DEL PUERTO and San Luis Unit contractors[,] is contrary to the provisions of the DEL PUERTO water service contracts." Doc. 24 ¶ 31 at this 9. This claim requests an injunction, which would forbid the Bureau from treating the San Luis Unit contractors "on an equal footing with that of Del Puerto." Id. ¶ 33 at 9. Del Puerto's second claim for relief is identical to the first claim for relief, except that it requests declaratory relief "concerning the BUREAU's obligation to apportion the available water supply among the DMC and San Luis Unit contractors." Id. ¶ 37 at 9. Del Puerto claims declaratory relief is required because it has "exhausted any and all administrative remedies available."² Id.

Del Puerto's third claim for relief alleges the Secretary and Regional Directors' intended revision "is contrary to state law governing priority of appropriative use." Doc. 24 ¶ 38 at 10. Del Puerto contends it has appropriated water to beneficial use since 1950, and this use is prior in time to the San Luis Unit contractors. Id. ¶ 39 at 10. Del Puerto alleges this "prior use" entitles it to an absolute priority in time over any "junior appropriator(s)." Id. Del Puerto claims "first in time, first in right" law governing water appropriation rights applies to it through the Bureau's State Water Control Board permits:

The BUREAU obtained its permits to appropriate water for the CVP subject to state law. Under state law, appropriators may only appropriate that water that is put to beneficial use. With the exception of lands not in issue in this action, the Bureau does not put the water appropriated to beneficial use directly, but does so through the use by its contractors. Therefore, the Bureau's right to water depends solely on its contractors' beneficial use thereof. In this capacity, the Bureau must apply state water priority...