Tehama-Colusa Canal Auth. v. United States Dep't of the Interior

• Decision Date: 02 August 2011
• Docket Number: No. 1:10–cv–0712 OWW DLB.,1:10–cv–0712 OWW DLB.
• Citation: 819 F.Supp.2d 956
• Court: U.S. District Court — Eastern District of California
• Parties: TEHAMA–COLUSA CANAL AUTHORITY, Plaintiff, v. UNITED STATES DEPARTMENT OF the INTERIOR; Kenneth Lee Salazar, in his official capacity as Secretary of the Interior; United States Bureau of Reclamation; Michael L. Connor, in his official capacity as the Commissioner of Reclamation, and Donald R. Glaser, in his official capacity as Regional Director of the Bureau of Reclamation for the Mid–Pacific Region, Defendants,San Luis & Delta–Mendota Water Authority, Defendant–Intervenor,Westlands Water District, Defendant–Intervenor.

819 F.Supp.2d 956

TEHAMA–COLUSA CANAL AUTHORITY, Plaintiff,

v.UNITED STATES DEPARTMENT OF the INTERIOR; Kenneth Lee Salazar, in his official capacity as Secretary of the Interior; United States Bureau of Reclamation; Michael L. Connor, in his official capacity as the Commissioner of Reclamation, and Donald R. Glaser, in his official capacity as Regional Director of the Bureau of Reclamation for the Mid–Pacific Region, Defendants,San Luis & Delta–Mendota Water Authority, Defendant–Intervenor,Westlands Water District, Defendant–Intervenor.

No. 1:10–cv–0712 OWW DLB.

United States District Court, E.D. California.

Aug. 2, 2011.

Steven Paul Saxton, Ellen Lee Trescott, Kevin M. O'Brien, Downey Brand LLP, Sacramento, CA, James Mark Atlas, J. Mark Atlas, Attorney at Law, Willows, CA, for Plaintiff.

David Gehlert, Gov't, United States Department of Justice, Denver, CO, Charles Ray Shockey, United States Department of Justice, Sacramento, CA, for Defendants.

Rebecca Rose Akroyd, Hanspeter Walter, Daniel Joseph O'Hanlon, Kronick Moskovitz Tiedemann & Girard, Sacramento, CA, for Defendant–Intervenor.

MEMORANDUM DECISION ON CROSS MOTIONS FOR SUMMARY JUDGMENT (DOCS. 52, 60, 62) AND MOTION TO STRIKE (DOC. 77)

OLIVER W. WANGER, District Judge.

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                ¦I.  ¦INTRODUCTION                                                    ¦962   ¦
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                ¦II. ¦PROCEDURAL BACKGROUND                                           ¦963   ¦
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                ¦    ¦                                                                ¦      ¦
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                ¦III.¦JURISDICTION                                                    ¦963   ¦
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    A.   5 U.S.C. § 706(2)                                             964
                    B.   5 U.S.C. § 706(1)                                             964
                

                IV. HISTORICAL BACKGROUND                                               965
                

    A.   CREATION OF THE CVP                                            965
                    B.   OPERATION OF THE CVP                                           967
                    C.   ALLOCATION OF CVP WATER                                        967
                    D.   STATE LAW AREA OF ORIGIN STATUTES                              967
                

           1.   THE CALIFORNIA ATTORNEY GENERAL ANALYZES THE AREA OF ORIGIN STATUTES                                                    968
                                THE BUREAU'S PERMITS FOR CVP WATER SUPPLY ARE CONDITIONED TO PROTECT APPROPRIATION OF WATER WITHIN THE AREA OF ORIGIN  
                           2.                                                                                                                           968
                           3.   APPLICATION OF THE AREA OF ORIGIN STATUTES BY SWRCB AND REJECTION OF TCCA CLAIM FORPREFERENCE TO CVP WATER              969
                

    E.   THE DISPUTED CVP WATER SERVICE CONTRACTS                       970
                

 TCCA MEMBERS' RIGHT TO CVP WATER UNDER THEIR LONG–TERM CVP WATER SERVICE CONTRACTS  
                         1.                                                                                                         971
                         2.  INTERIM CONTRACTS                                                                                      972
                             NEGOTIATION OF CURRENTLY OPERATIVE TCCARENEWAL CONTRACTS: THE BUREAU'SINTERPRETATION AND PERFORMANCE  
                         3.                                                                                                         972
                             TCCA ACCEPTS LONG–TERM RENEWAL CONTRACTSWITHOUT PRIORITY ALLOCATION TERMS: THESHORTAGE PROVISIONS  
                         4.                                                                                                         973
                         5.  TCCA MEMBERS' VALIDATION OF ALL RENEWALCONTRACTS IN STATE COURT                                        974
                         6.  EXECUTION BY PERFORMANCE AND CONDUCT UNDER THE TCCA RENEWAL CONTRACTS                                  974
                

                V.  STANDARDS OF DECISION                                               975
                

VI. LAW AND ANALYSIS                                                    975
                

     A.    STATUTE OF LIMITATIONS                                                                                                 975
                     B.    CVP STATUTES AND SECTION 11460 DO NOT CONTAIN ORSUPPORT THE PRIORITY ALLOCATION RIGHT TO CVPWATER THAT TCCA ADVANCES   975
                

         1.  STATUTORY INTERPRETATION OF THE CVP STATUTES               976
                

             a.  Plain Language                                         976
                             b.  Legislative History of the CVP Statutes                977
                

         2.  STATUTORY INTERPRETATION OF SECTION 11460                  978
                

                         a.      Plain Language                                                                                                                                                                                 978
                                         b.      Decades of Consistent Interpretation By the California Attorney General, the SWRCB, and the Bureau is That Section 11460 Governs Appropriation Not Allocation of Water in the Area of Origin   979
                

             i.   Attorney General Opinion                                                                  979
                             ii.  The Bureau's Interpretation of Reclamation Law                                            980
                             iii. The SWRCB Has Independently Interpreted Section 1146 0 in the same manner as the AG Op.   981
                

 SECTION 11460's INTERPRETATION BY THE AG Op., SWRCB, AND THE BUREAU ARE ALL CONSISTENT WITH THE PERMIT TERMS  
                          3.                                                                                                                 981
                          4.  SUBSEQUENT LEGISLATIVE ACTS                                                                                    982
                          5.  CALIFORNIA CASE LAW                                                                                            982
                

            a.  The El Dorado and Phelps Decisions                          983
                            b.  The SWRCB Cases Provide No Binding Or PersuasivePrecedent   984
                

         6.  Plaintiff's Interpretation of Section 11460 Conflicts With TheCongressional Directive of the 1950 Act   985
                

    C.   CONCLUSION RE: STATUTES                                        986
                    D.   INTERPRETATION OF LONG–TERM CVP WATER SERVICECONTRACTS       987
                

        1.  FEDERAL CONTRACT LAW                                                                          987
                            STANDARDS RE: THE BUREAU'S STATUTORY DISCRETION TO APPORTION CVP WATER IN TIMES OF SHORTAGE  
                        2.                                                                                                988
                        3.  TCCA MEMBER LONG–TERM CVP CONTRACTS: SHORTAGE TERMS                                         989
                

              a.   Discretionary Interpretive Authority in Renewal Contract Shortage Provisions                                            989
                                   The Renewal Contract's Shortage Provisions Are Not aLimitation on the Bureau's Discretion to Apportion Contract Water  
                              b.                                                                                                                           990
                                   Article 18(a) in Not a Limitation on the Bureau's Discretion to Apportion Contract Water  
                              c.                                                                                                                           993
                              d.   Article 3 and 1(u) Are Not a Limitation on the Bureau's Discretion to Apportion Contract Water                          993
                

        4.  CONTRACT NEGOTIATION AND PERFORMANCE                          993
                        5.  CONCLUSION RE: INTERPRETATION OF THE CONTRACT RENEWAL TERMS   995
                        6.  EFFECT OF TCCA RENEWAL CONTRACT VALIDATION                    996
                

    E.   THE BAR OF EQUITABLE ESTOPPEL                                  998
                    F.   PLAINTIFF'S FUTILITY ARGUMENT IS WITHOUT MERIT                 1000
                

                VII. CONCLUSION                                                         1000
                

I. INTRODUCTION.

This lawsuit is brought by an association of Federal Water Contractors for federal water from the Sacramento River Division of the Central Valley Project (“CVP”) north of the San Joaquin–Sacramento Delta against the United States Department of the Interior (“Interior”), its Secretary, the Bureau of Reclamation (“Bureau”), and its Regional Director of the Mid–Pacific Region, and by Defendant–Intervenors, San Luis & Delta–Mendota Water Authority and Westlands Water District, Federal Contractors, who use CVP water on lands south of the Sacramento–San Joaquin Delta, and seeks to establish superior water rights under CVP water service contracts in the Sacramento Valley, which would limit and exclude export of CVP water south of the Delta, until after Plaintiff and its Members first receive 100% of their allocated CVP contractual water supply.

The Plaintiff, Tehama Colusa Canal Authority (“TCCA”), a Joint Powers Authority organized under the laws of the State of California, is comprised of 16 water agency members on whose behalf the case is brought. Cal. Gov't Code § 6500, et seq. Plaintiff filed this suit on February 11, 2010, seeking injunctive and declaratory relief against implementation of the shortage provisions of Federal water service contracts under the Federal Administrative Procedure Act (“APA”), 5 U.S.C. §§ 702 to 706. Specifically, §§ 706(1) and 706(2).

II. PROCEDURAL BACKGROUND

After TCCA filed its complaint February 11, 2010, Defendant–Interven...