Roosevelt Irrigation Dist. v. United States
| Decision Date | 30 September 2017 |
| Docket Number | No. CV-15-00448-PHX-JJT,CV-15-00448-PHX-JJT |
| Parties | Roosevelt Irrigation District, Plaintiff, v. United States of America, et al., Defendants. |
| Court | U.S. District Court — District of Arizona |
NOT FOR PUBLICATION
At issue are the following motions: Defendants and Counterclaimants Salt River Project Agricultural Improvement and Power District ("the District") and Salt River Valley Water Users' Association's ("the Association") (collectively "SRP")1 Motion for Partial Summary Judgment (Doc. 108, SRP MSJ), to which Defendants the United States, Department of Interior, and the Bureau of Reclamation (collectively, "Federal Defendants") filed a Response in Support (Doc. 110, Fed. Def. Resp.), the Plaintiff Roosevelt Irrigation District ("RID") filed a Response (Doc. 170, RID MSJ), and SRP filed a Reply (Doc. 187, SRP Reply), which the Federal Defendants joined (Doc. 189, Fed. Def. Reply Joinder); RID's Motion for Partial Summary Judgment (Doc. 170, RID MSJ), to which SRP filed a Response (Doc. 207, SRP Resp.), which the Federal Defendants joined , and to which RID filed a Reply (Doc. 225, RID Reply).
The Court heard oral argument on the Motions for Summary Judgment on August 31, 2017. Subsequently, the Court requested that the parties submit briefing addressing this Court's subject matter jurisdiction should it determine that the Warren Act does not govern the contracts at issue (Doc. 262), to which the parties filed supplemental briefing .
For the reasons that follow, the Court denies SRP's Motion for Summary Judgment. The Court further grants in part and denies in part RID's Motion for Summary Judgment.
Put simply, the matter before the Court today concerns the rights and obligations of the parties under agreements entered into by the Association and RID in 1921, 1927, and 1950 (collectively, "Contracts at issue"). The procedural history has woven between multiple state and federal actions. RID first filed an action in Maricopa County in the Superior Court of Arizona to determine whether the Contracts at issue provided RID a permanent water supply (the "State Court Action"). The Superior Court, however, dismissed the action, finding that the United States was an indispensable party under Arizona Rule of Civil Procedure 19. Roosevelt Irrigation Dist. v. Salt River Valley Water Users Ass'n, CV2014-008706 (Ariz. Super. Ct. dismissed Oct. 31, 2014). The Superior Court directed RID to bring suit in Federal District Court, which it did by filing the pending declaratory action, naming the Association, the District, the United States, the Department of the Interior, and the Bureau of Reclamation as defendants. RID simultaneously brought an action for quiet title against the United States (the "Quiet Title Action"). See Roosevelt Irrigation District v. United States, 15-cv-00439-JJT (D. Ariz. filed Mar. 11, 2015).
RID's Complaint in this case sought the three following judicial declarations with respect to the Contracts at issue: (1) that "RID's right to pump groundwater from its East Side Wells and to transport that water for use within the District does not terminate . . .on or after October 26, 2020"; (2) "that pursuant to A.R.S. § 45-494, RID's right to pump groundwater from its East Side Wells and to transport that water for use within the District does not terminate on or after October 26, 2020"; and (3) "that there are no legal impediments to RID's continued pumping of the East Side Wells and the right to transport that water for use within the District on or after October 26, 2020." (Doc. 1, Compl. at 14.)
Concurrently with its Complaint, RID filed a Motion to Determine Jurisdiction in this Court. (Doc. 3, Mot. to Determine Juris.) Therein, RID argued that this Court lacked jurisdiction to adjudicate the contractual dispute because the Contracts at issue were not Reclamation contracts and because the United States has sovereign immunity. (Mot. to Determine Juris. at 7.) The United States filed an additional Motion to Dismiss and joined in RID's Motion as to the second part, arguing that this Court lacked jurisdiction on the basis of sovereign immunity. (Doc. 32, U.S. Mot. to Dismiss at 3-5.) SRP then answered, adding its own counter-claims against RID. (Doc. 34, SRP Answer.) In particular, SRP sought judicial declarations that (1) "[t]he 1921 Agreement, as supplemented, is a Warren Act contract and is subject to the requirements and restrictions of the Warren Act"; and (2) that the "1921 Agreement does not exist in perpetuity and expires in 2020, 2024, 2026, or after a reasonable term." (SRP Answer at 41-47.) This Court then found that, based on the allegations and information before it, 43 U.S.C. § 390uu applied to the parties, as the contracts were executed pursuant to Federal reclamation law, thus waiving the United States' sovereign immunity.2 (Doc. 57, Order.) Accordingly, the parties proceeded to discovery.
On October 24, 2016, SRP filed its Motion for Partial Summary Judgment on Count One of its Counterclaim seeking a determination "whether the 1921 Agreement . . . was authorized, entered into, and approved by the Secretary of the Interior [] pursuant tothe Warren Act." (SRP MSJ at 2.) Subsequently, RID filed its own Motion for Partial Summary Judgment on the claims in its Complaint, in addition to Counts One, Two, Three, and Four of SRP's Counterclaim. (RID MSJ at 2.)
In 1902, Congress passed the Reclamation Act, a comprehensive statute designed to promote the irrigation and development of arid lands in the Western United States by making federal loans available for the construction of water storage and distribution projects. See 43 U.S.C. §§ 371-616. The following year, a conglomerate of land owners in the then-Territory of Arizona banded together to incorporate as The Salt River Valley Water Users' Association. (Doc. 109-2, SRP Separate Statement of Facts ("SRP SSOF") Ex. 1 ¶ 8.) The organization was designed, in part, to allow it to enter into contracts to secure the aid of the United States—under the Reclamation Act—in constructing dams, reservoirs, canals, or other works to allow for the distribution and delivery of water to the lands of Association shareholders. (Doc. 109-2, SRP SSOF, Ex. 3 at2, § 2.) The following year the organization would enter such an agreement pursuant to the Reclamation Act, contracting with the United States for the construction of the Salt River Federal Reclamation Project (the "1904 Contract"). (Doc. 109-2, SRP SSOF Ex. 2.)
In exchange for the construction of irrigation works along the Salt River, the Association agreed that the Secretary of the Interior would approve certain Association actions and processes, including adoption of rules and regulations "concerning the use of water by its [the Association's] shareholders and concerning the administration of the affairs of the Association, to effectually carry out and promote the purposes of its organization, within the provisions of said Articles of Incorporation." (Doc. 109-2, SRP SSOF Ex. 2 ¶ 8.) The 1904 Contract also provided that the rights of the Association members "are to be defined and determined and enjoyed by and under the provisions of the said Act of Congress [Reclamation Act] and of other Acts of Congress on the subject of the acquisition and enjoyment of the rights to use water." (Doc. 109-2, SRP SSOF Ex. 2 ¶ 10.) Lastly, the 1904 Contract obligated the Association to follow any "rules andregulations for the administration of the water to be supplied from said proposed irrigation works" that the Secretary of the Interior approves and promulgates. (Doc. 109-2, SRP SSOF Ex. 2 ¶ 11.) After completing the Roosevelt Dam, Reclamation continued to operate the Project for several years. (Doc. 109, SRP SSOF ¶ 5.)
In 1917, the United States and the Association entered into an additional contract (the "1917 Contract") to supplement the parties' 1904 Contract. (Doc. 109-2, SRP SSOF Ex. 5.) As such, the 1917 Contract provided that the 1904 Contract "shall not be held or deemed in any wise to be affected changed or abrogated . . . except . . . by the express terms of this agreement or by reason of irreconcilable inconsistencies." (Doc. 109-2, SRP SSOF Ex. 5 ¶ 2.) In exchange for certain concessions by the Association, the United States agreed to "turn over and vest in the [] Association, the care, operation, and maintenance of the irrigations works known as the Salt River Project." (Doc. 109-2, SRP SSOF Ex. 5 ¶ 3.) In addition, the 1917 Contract contained an express provision requiring that the Association "make no substantial change in any of the said works, without first having obtained the consent thereto, to be expressed in writing, of the Secretary of the Interior." (Doc. 109-2, SRP SSOF Ex. 5 ¶ 6.) The 1917 Contract, however, permitted the Association to "construct additional works at its own cost" without approval as long as those additions did not "impair or diminish the present efficiency or adequacy of the project." (Doc. 109-2, SRP SSOF Ex. 5 ¶ 6.)
In 1937, the Association, with the approval of the Secretary of the Interior, contracted with the newly formed Salt River Project Agricultural Improvement and Power District ("the District") to transfer Association property to the District. (Doc. 109-2, SRP SSOF Ex. 6.) Under the terms of the 1937 Contract, the Association continued to operate the Project as an agent of the District. (Doc. 109-2, SRP SSOF Ex. 6 ¶ 11.) The Association and the District amended the 1937 Contract in 1949, with approval of the Secretary, to allow the District to operate the Project electrical system and dams upstream from the Granite Reef Dam. (Doc. 109-2, SRP SSOF Ex. 6.) The Association and the District continue to operate in this manner to this...
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