- TXT
-
PDF
(PDF provides a complete and accurate display of this text.)
Tip
?
115th Congress } { Report
HOUSE OF REPRESENTATIVES
1st Session } { 115-349
======================================================================
SAN LUIS UNIT DRAINAGE RESOLUTION ACT
_______
October 16, 2017.--Committed to the Committee of the Whole House on the
State of the Union and ordered to be printed
_______
Mr. Bishop of Utah, from the Committee on Natural Resources, submitted
the following
R E P O R T
together with
DISSENTING VIEWS
[To accompany H.R. 1769]
[Including cost estimate of the Congressional Budget Office]
The Committee on Natural Resources, to whom was referred
the bill (H.R. 1769) to affirm an agreement between the United
States and Westlands Water District dated September 15, 2015,
and for other purposes, having considered the same, report
favorably thereon with an amendment and recommend that the bill
as amended do pass.
The amendment is as follows:
Strike all after the enacting clause and insert the
following:
SECTION 1. SHORT TITLE; TABLE OF CONTENTS.
(a) Short Title.--This Act may be cited as the ``San Luis Unit
Drainage Resolution Act''.
(b) Table of Contents.--The table of contents for this Act is as
follows:
Sec. 1. Short title; table of contents.
Sec. 2. Definitions.
Sec. 3. Approval of agreement.
Sec. 4. Relief from drainage obligation.
Sec. 5. Drainage implementation.
Sec. 6. Water delivery contracts.
Sec. 7. Repayment obligations.
Sec. 8. Transfer of title to certain facilities.
Sec. 9. Compliance with applicable law.
Sec. 10. No water supply or financial impacts on other Central Valley
Project contractors.
Sec. 11. Restoration Fund payments by Westlands Water District.
SEC. 2. DEFINITIONS.
In this Act:
(1) Central valley project improvement act of 1992
definitions.--As used herein, the terms ``repayment
contractor'', ``water service contractor'', ``water service
contract'', ``exchange contractor'', ``exchange contract'',
``water rights settlement contractor'', ``water rights
settlement contract'', ``refuge contractor'', and ``refuge
contract'' shall have the same meanings respectively as each of
those terms has in title XXXIV of the Central Valley Project
Improvement Act of 1992 (106 Stat. 4706).
(2) Condition of shortage.--The term ``Condition of
Shortage'' means ``Condition of Shortage'' as that term is
defined in existing San Luis Unit water service contracts.
(3) Contracting officer.--The term ``Contracting Officer''
means ``Contracting Officer'' as that term is defined in
existing San Luis Unit water service contracts.
(4) Project.--The term ``Project'' means the Central Valley
Project, owned by the United States and managed by the
Department of the Interior, Bureau of Reclamation.
(5) Project water.--The term ``Project Water'' means all
water that is developed, diverted, stored, or delivered by the
Secretary in accordance with the statutes authorizing the
Project and in accordance with the terms and conditions of
water rights acquired pursuant to California law.
(6) Repayment contract.--The term ``repayment contract''
means the repayment contract converted under section 6(a).
(7) San luis act.--The term ``San Luis Act'' means the Act of
June 3, 1960 (Public Law 86-488), and all Acts amendatory
thereof and supplementary thereto.
(8) San luis unit.--The term ``San Luis Unit'' means those
lands identified in section 1 of the San Luis Act.
(9) Secretary.--The term ``Secretary'' means the Secretary of
the Interior.
(10) Westlands agreement.--The term ``Westlands Agreement''
means the ``Agreement between the United States and Westlands
Water District August 2015'', signed September 15, 2015.
(11) Westlands.--The term ``Westlands'' means the Westlands
Water District (including Broadview Water District lands
annexed within Westlands Water District) located in Fresno and
Kings Counties, California.
SEC. 3. APPROVAL OF AGREEMENT.
Notwithstanding any other provision of law, unless otherwise
specified herein, the Westlands Agreement is approved and the Secretary
is hereby directed to implement the terms and conditions of the
Westlands Agreement.
SEC. 4. RELIEF FROM DRAINAGE OBLIGATION.
The San Luis Act is amended as follows:
(1) In the second sentence of section 1(a) after the words
``related facilities,'', strike ``but'' and add ``but such
features do not include distribution systems or drains within
Westlands, and''.
(2) In the sixth sentence of section 1(a), by inserting the
following at the end of the sentence before the period: ``,
except that the provision of drainage or drainage service under
section 1(a) shall not apply to lands within Westlands''.
(3) In section 5, by striking the first sentence and
inserting ``Notwithstanding any other provision of law, the
Secretary of the Interior shall have no duty to provide
drainage or drainage service to Westlands. Westlands shall be
responsible for the management of drainage water within its
boundaries, in accordance with Federal and California law
consistent with the `Agreement between the United States and
Westlands Water District August 2015', signed September 15,
2015.''.
(4) In the first sentence of section 8 by striking the words
``other than distribution systems and drains,''.
(5) In the third sentence of section 8, strike everything
between the word ``required'' through and including ``(b)'',
inserting a period following the word ``unit'', and striking
the remainder of the proviso in section 8.
SEC. 5. DRAINAGE IMPLEMENTATION.
Upon enactment of this Act, and as provided in the Westlands
Agreement, Westlands shall assume all legal responsibility for the
management of drainage water within its boundaries in accordance with
Federal and California law, provided that Westlands shall not discharge
drainage water outside of its boundaries.
SEC. 6. WATER DELIVERY CONTRACTS.
(a) Contract Conversion.--The Secretary shall convert Westlands'
existing long-term or interim renewal water service contracts entered
into under section 9(e) of the Act of August 4, 1939 (53 Stat. 1196),
to a repayment contract under sections 9(d) and 9(c)(1) of the Act of
August 4, 1939 (53 Stat. 1195, 1194), consistent with the Westlands
Agreement. Such contract shall continue so long as Westlands fulfills
its obligations under the contract.
(b) Allocation Decisions.--
(1) Notwithstanding subsection (a) and as provided in the
Westlands Agreement, the Secretary shall make allocation
decisions in the Project affecting Westlands consistent with
the requirements of all current or future enacted Federal law
including, but not limited, to the Endangered Species Act of
1973 (16 U.S.C. 1531 et seq.), Reclamation law, and all
decisions of the California State Water Resources Control Board
establishing conditions on applicable licenses and permits for
the Central Valley Project.
(2) Conversion of Westlands' contracts in subsection (a)
shall not afford Westlands a greater or lesser right to an
annual allocation of Project Water than it had prior to the
conversion of its contract under this Act.
(3) If there is a Condition of Shortage in the amount of
water available for delivery to Westlands because of errors in
physical operations of the Project, drought, other physical
causes beyond the control of the Contracting Officer or actions
taken by the Contracting Officer to meet legal obligations, no
liability shall accrue against the United States or any of its
officers, agents or employees for any damage, direct or
indirect, arising therefrom.
(c) Water Service Contract for Lemoore Naval Air Station.--
(1) The Secretary shall enter into a contract under section
9(d) and 9(c)(1) of the Act of August 4, 1939 (53 Stat. 1195,
1194), with the Secretary of the Navy for the delivery of
Project Water to the Lemoore Naval Air Station to meet the
needs, as determined under paragraph (2), of Lemoore Naval Air
Station, and all associated remaining repayment obligations
owing to the United States on the date of enactment of this Act
are discharged, and the Secretary shall certify that the lands
within the Lemoore Naval Air Station are free from the
ownership and full cost pricing limitations of Federal
Reclamation law. Such contract shall continue so long as the
Secretary of the Navy pays all applicable charges consistent
with applicable law.
(2) The contract amount of Project Water made available to
the Lemoore Naval Air Station under the contract entered into
pursuant to paragraph (1) shall be determined by the Secretary
through technical analysis in cooperation with the Lemoore
Naval Air Station.
(3) In any year in which there may occur a Condition of
Shortage in the amount of water available for delivery, the
Contracting Officer shall allocate the available Project Water
to Lemoore Naval Air Station in the same percentage as
allocated to municipal and industrial water service contractors
in the San Luis Unit of the Project.
SEC. 7. REPAYMENT OBLIGATIONS.
(a) Suspension of Capital Obligation.--Upon enactment of this Act,
Westlands' capital repayment obligation and payments under its existing
water service contracts and the April 1, 1965, repayment contract
between the United States and Westlands (contract numbered 14-06-200-
2020-A) as further defined in subsection (d), shall be suspended until
the execution of the section 9(d) repayment contract referenced in
section 6(a) of this Act, and upon execution of the section 9(d)
repayment contract, Westlands shall receive a credit against future
operation and maintenance costs payable to the United States in the
amount of the capital costs under the existing water service contracts
and the 1965 Repayment Contract paid by Westlands between the date of
the Westlands Agreement and the date of enactment of this Act.
(b) Costs.--Costs incurred by the United States for purposes of re-
evaluating, planning, or providing drainage service to Westlands shall
be non-reimbursable as set forth in paragraph (9)(C)(iv) of the
Westlands Agreement.
(c) Relief of Capital Repayment Obligations.--
(1) Upon the date of execution of the section 9(d) repayment
contracts referenced in section 6(a) of this Act, and as set
forth in the Westlands Agreement, Westlands shall be relieved
of--
(A) its capital repayment obligations under the June
5, 1963, water service contract between the United
States and Westlands (contract number 14-06-200-495-A)
providing for water service, or any renewals thereof,
and any water service contracts assigned to Westlands,
Westlands Distribution District No. 1, and Westlands
Distribution District No. 2 existing as of the date of
execution of the Westlands Agreement; and
(B) Westlands shall be relieved of any remaining
repayment obligation under the April 1, 1965, repayment
contract between the United States and Westlands
(contract numbered 14-06-200-2020-A).
(2) Repayment relief granted in paragraph (1) shall not
extend to Westlands' operation and maintenance obligations,
whether payable to the United States or to an operating non-
Federal entity, or to construction costs or other capitalized
costs not yet allocated to or incurred by Westlands as of the
date of the Westlands Agreement, respectively, including, but
not limited to costs attributable to the Folsom Safety of Dams
modifications, or the B.F. Sisk corrective action study, or any
Safety of Dams or to the repayment of future capital costs
incurred after the date of execution of the Westlands
Agreement.
(3) Central Valley Project construction costs or other
capitalized costs allocated to Westlands after the date of the
Westlands Agreement, and properly assignable to Westlands,
shall be repaid in not more than 5 years after notification of
the allocation of such amount of less than $5,000,000. If such
amount is $5,000,000 or greater, such cost shall be repaid as
provided by applicable Reclamation law. Any additional costs
that may have been assigned to Westlands pursuant to paragraph
(9)(C)(iv) of the Westlands Agreement related to the Central
Valley Project final cost allocation shall be non-reimbursable.
(d) Applicability of Certain Provisions.--
(1) Reclamation reform act.--Upon discharge of the capital
repayment obligation as provided in subsection (c), the
provisions of section 213(a) and (b) of the Reclamation Reform
Act of 1982 (96 Stat. 1269) shall be deemed to apply to lands
in Westlands, and the ownership and full cost pricing
limitations in any provision of Federal reclamation law shall
not apply to lands in Westlands notwithstanding the subsequent
allocation of construction costs or other capitalized costs to
Westlands. These exemptions shall be carried out in accordance
with the process set forth in the Westlands Agreement.
(2) Other provisions.--Nothing in this Act is intended to
relieve Westlands of any other obligations under Reclamation
law including Restoration Fund charges pursuant to section
3407(d) of Public Law 102-575.
SEC. 8. TRANSFER OF TITLE TO CERTAIN FACILITIES.
(a) In General.--Upon the execution of the section 9(d) repayment
contract, or as soon thereafter as practicable, the Secretary shall
transfer to Westlands title to:
(1) San Luis Canal System, excluding the main canal which is
integrated with the California Aqueduct. These appurtenant
features include:
(A) Internal water distribution system within
Westlands, including approximately 1,045 miles of
buried pipeline.
(B) Pumping plants within Westlands, including: San
Luis Canal Left and Right Bank pumping plants which
includes but is not limited to, Pumping Plants P1
through P38 located at the head end of the gravity
laterals to supply the head required for the ``P''
laterals; and pumping plants, tanks, reservoirs, and
re-lift pumping plants to serve lands west of the San
Luis Canal; and Pumping Plant 7.05 off Lateral 7.
(C) Related structures, appurtenances, pumping
plants, pumps, motors, meters, valves, tanks,
transformers and electrical equipment as specifically
identified through the title transfer process of
federally owned facilities, equipment, and real
property.
(2) Mendota Pool diversion facilities operated by Westlands,
including:
(A) Inlet Canal from the Fresno Slough.
(B) Pumping plants 6-1, 6-2, 7-1, 7-2.
(C) Related structures, appurtenances, pumps, motors,
meters, valves, tanks, transformers and electrical
equipment as specifically identified through the title
transfer process of federally owned facilities,
equipment, and real property.
(3) Pleasant Valley System, including:
(A) Intake canal and pipeline.
(B) Pleasant Valley Pumping Plant.
(C) Coalinga Canal, including related check
structures, turnouts, and headworks.
(D) Pleasant Valley distribution system and pumping
plants along the Coalinga Canal.
(E) Related structures, appurtenances, pumps, motors,
meters, valves, tanks, transformers and electrical
equipment as specifically identified through the title
transfer process of federally owned facilities,
equipment, and real property.
(4) Drainage collection system, including:
(A) Carrier and collector pipelines, sumps, and sump
pumps.
(B) San Luis Drain from Sta 6678+45 to Sta 8520+22.87
(Crossing with DMC to Laguna Ave. crossing).
(C) Related structures, appurtenances, pumps, motors,
meters, valves, tanks, transformers, and electrical
equipment as specifically identified through the title
transfer process of federally owned facilities,
equipment, and real property.
(5) Tranquillity Field Office, including:
(A) Buildings at 32650 West Adams Avenue,
Tranquillity, CA 93668.
(B) All related fixtures and furnishings as
specifically identified through the title transfer
process of federally owned facilities, equipment, and
real property.
(6) Huron Field Office, including:
(A) Buildings at 32450 South Lassen Avenue, Huron, CA
93234.
(B) All related fixtures and furnishings as
specifically identified through the title transfer
process of federally owned facilities, equipment, and
real property.
(7) All real property interests held by the United States in
lands underlying or otherwise associated with the facilities
and equipment listed in this subsection, including all fee
title, easements, and rights of way.
(b) Transfer of Title.--Except as specifically provided in this Act,
any transfer of title to the Pleasant Valley Pumping Plant, the
Coalinga Canal, and any associated facilities shall not relieve any
other Project Water service or repayment contractor of the requirement
to pay any allocated costs associated with those conveyance or pumping
facilities that are properly allocated to those contractors under
existing law and Project rate setting policies.
(c) Condition of Transfer.--Upon transfer of title to any facilities
pursuant to this section, Westlands shall, as a condition to such
transfer, formally agree that as of the date of transfer--
(1) to hold the United States harmless and indemnify the
United States for any and all claims, cost, damages, and
judgments of any kind arising out of any act, omission, or
occurrence relating to the transferred facilities, except for
such claims, costs, damages arising from acts of negligence
committed by the United States or by its employees, agents, or
contractors, prior to the date of title transfer, for which the
United States is found liable under the Federal Tort Claims
Act; and
(2) the United States shall have no responsibility for
correcting and financing any repairs or deficiencies that may
exist at the time of or following title transfer.
(d) Applicable Law.--The Secretary shall transfer title pursuant to
this section consistent with all applicable Federal Reclamation
policies and procedures. The Secretary and Westlands shall comply with
all applicable requirements under Federal and California law before
title to a facility is transferred pursuant to this section.
SEC. 9. COMPLIANCE WITH APPLICABLE LAW.
In implementing the measures authorized by this Act, the Secretary
shall comply with all applicable Federal laws, rules, and regulations,
including the National Environmental Policy Act of 1969 (42 U.S.C. 4321
et seq.) and the Endangered Species Act of 1973 (16 U.S.C. 1531 et
seq.), as necessary.
SEC. 10. NO WATER SUPPLY OR FINANCIAL IMPACTS ON OTHER CENTRAL VALLEY
PROJECT CONTRACTORS.
Implementation of this Act and the Agreements authorized thereunder
shall not--
(1) result in the involuntary reduction in the contract water
allocation to any Project water service or repayment
contractor, water rights settlement contractor, exchange
contractor, or refuge contractor including contractors in the
Friant Division of the Project;
(2) modify, amend or affect any of the rights or obligations
of the parties to any Project water service or repayment
contract, water rights settlement contract, exchange contract,
or refuge contract, including contracts in the Friant Division
of the Project;
(3) alter the repayment obligation, if any, of any Project--
(A) water service or repayment contractor;
(B) settlement, refuge, or exchange contractor; or
(C) preference power contractor receiving water or
power from the Project, or shift any costs to such
contractors that would otherwise have been properly
assignable to Westlands, including operations and
maintenance costs, construction costs, or other
capitalized costs allocated to Westlands after the date
of this Act;
(4) impair the ability of the United States to implement the
Stipulation of Settlement approved by the district court in
Natural Resources Defense Council, et al. v. Rogers, et al.
(Case No. CIV S-88-1658 (LKK/GGH) E.D.Cal.), on October 23,
2006, as authorized to be implemented by title X of Public Law
111-11, including the Restoration Goal and Water Management
Goal; and
(5) diminish, impair, or otherwise affect in any manner any
priorities for the allocation, delivery or use of water under
applicable law, including any purposes of use and priorities
established by sections 3402 and 3406 of the Central Valley
Project Improvement Act (Public Law 102-575; 106 Stat. 4706,
4714).
SEC. 11. RESTORATION FUND PAYMENTS BY WESTLANDS WATER DISTRICT.
For any year in which the allocation of water for south-of-Delta
Project long-term water irrigation service contractors or irrigation
repayment contractors is greater than 75 percent, the Secretary shall
calculate for Westlands a per acre foot Restoration Fund payment based
on a projection that Westlands would take delivery of the full
allocation made to south-of-Delta Project long-term water service
contractors or repayment contractors.
Purpose of the Bill
The purpose of H.R. 1769 is to affirm an agreement between
the United States and Westlands Water District dated September
15, 2015.
Background and Need for Legislation
H.R. 1769 affirms a settlement between the federal
government and other parties in an attempt to bring about final
resolution to decades-long litigation over the federal
government's responsibility to provide drainage for certain
lands in central California.
Public Law 86-488 authorized the San Luis Unit as part of
the Central Valley Project (CVP) on June 3, 1960. The principal
purpose of the San Luis Unit, located in California's San
Joaquin Valley, is irrigation water supply for almost one
million acres of farmland. The federal government and the State
of California joint-use facilities include O'Neill Dam and
Forebay, B.F. Sisk San Luis Dam, San Luis Reservoir and the San
Luis Canal. The federal-only features include the O'Neill
Pumping Plant and Intake Canal, Coalinga Canal and the San Luis
Drain.
Since clay layers beneath the agricultural lands prevent
excess irrigation water from draining deeper into the soil,
construction of the San Luis Drain began in 1968 to collect and
transport subsurface drainage water from the San Luis Unit to
the Sacramento-San Joaquin Bay-Delta. Of the planned 188 miles
of drain, only approximately 80 miles were completed due to
concerns over water quality of the drain water. The unfinished
San Luis Drain ended at Kesterson Reservoir, where the
accumulation of drainage helped contribute to dying waterfowl
and deformed embryos in 1982. In 1985, the Bureau of
Reclamation halted drainage services, closed the Drain and
began cleaning up contaminated ponds at the Reservoir.
A number of irrigation districts relied on the San Luis
Drain and entered into contracts with the federal government to
pay for irrigation water and drainage. One such irrigation
district, the Westlands Water District, entered into contracts
in 1963 and 1965 for these purposes. Westlands is made up of
more than 1,000 square miles of farmland in western Fresno and
Kings Counties in the San Joaquin Valley, and receives a
majority of its irrigation water supply from the San Luis Unit.
Impaired drainage services to the San Luis Unit resulted in
litigation brought by landowners in the Westlands service area.
In 1995, the U.S. District Court for the Eastern District of
California concluded that the San Luis Act (Public Law 86-488)
imposed a mandatory duty on the Secretary of the Interior to
provide drainage service to lands served by the San Luis Unit
(Summer Peck Ranch et al v. Reclamation Bureau et al, No. 1:91-
cv-00048, E. D. CA).
In February 2000, the U.S. Court of Appeals for the Ninth
Circuit upheld this ruling, but held that the Department of the
Interior (DOI) had discretion as to the means of satisfying
this requirement (Firebaugh Canal Co. et al v. United States of
America, 203 F. 3d 568 (9th Cir. 2000)). Later that year, the
Ninth Circuit directed that the Secretary ``shall, without
delay, provide drainage to the San Luis Unit pursuant to the
statutory duty imposed by section 1(a) of the San Luis
Act.''\1\ In 2007, the Bureau of Reclamation signed a Record of
Decision selecting a drainage plan and found that the cost of
providing drainage would be $2.7 billion. Using April 2015 cost
indices, these costs are now estimated to be approximately $3.8
billion.
---------------------------------------------------------------------------
\1\Firebaugh Canal Co. et al v. United States, Case No. F-88-cv-
634-OWWW (E.D. Cal.)
---------------------------------------------------------------------------
In the 2011, individual landowners within Westlands filed a
takings claim in the Court of Federal Claims against the United
States, alleging that the failure by the United States to
provide drainage service caused a physical taking of their
lands without just compensation in violation of the Fifth
Amendment (Etchegoinberry, et al. v. United States, No. 11-564L
(Fed. Cl.)). The takings claim was generally based on the
inundation of lands with drainage water, which rendered such
lands useless for agricultural production. The plaintiffs
brought the suit as a class action on behalf of all landowners
within Westlands ``whose farmlands have not received the
necessary drainage service the United States is required to
provide under the San Luis Act.'' In 2013, a United States
District Court denied the United States' motion to dismiss the
case. In an April 21, 2016, letter to Congressman David Valadao
(R-CA) from then Deputy Secretary of the Interior Mike Connor,
according to the United States, the decision contains
``language sharply critical of the United States' delay in
providing drainage to Westlands.'' The case was stayed by the
Court of Federal Claims to allow for settlement negotiations to
proceed.
In 2012, the Westlands Water District filed its own lawsuit
against the United States in the Court of Federal Claims
(Westlands Water District v. United States, No. 12-12C (Fed.
Cl.)). The suit charged that the federal government's failure
to provide drainage service to the Westlands service area
constituted a breach of its 1963 water service and 1965
repayment contracts (including renewals of those contracts). In
2013, the Claims Court dismissed the motion on the grounds that
none of the contracts contained an enforceable promise to
provide drainage to Westlands. Westlands appealed this ruling.
Shortly after this ruling and subsequent appeal, Westlands
and the United States entered into settlement negotiations. In
September 2015, the parties reached a settlement agreement that
required Congressional authorization for full implementation.
On April 21, 2016, DOI transmitted a letter to Congressman
David Valadao (R-CA) outlining the benefits of the settlement
agreement for both Westlands and the federal government.
According to the letter, the agreement relieves DOI of all
drainage obligations imposed by the San Luis Act, including the
2007 Bureau of Reclamation Record of Decision, which found that
the cost of providing drainage to the San Luis Unit would be
$2.7 billion ($3.8 billion in 2015 dollars). Westlands would
seek dismissal of the appeal of the 2012 case, Westlands Water
District v. United States, and would join the United States in
petitioning for vacating the 2000 Order Modifying Partial
Judgment in Firebaugh Canal Co. et al v. United States.
Westlands agrees to waive any and all claims, past, present and
future relating to the provision of drainage service or lack
thereof within the its service area, including claims from
individual landowners, and further agrees to indemnify the
federal government for claims relating to the provision of
drainage service or lack thereof within its service area.
Westlands will retire at least 100,000 acres of lands within
its boundaries (utilizing those lands only for certain purposes
outlined in the Settlement agreement), while also agreeing to
cap its CVP water deliveries at 75 percent of its contract
quantity. Any water savings above the 75 percent cap would
become available to the United States for other CVP authorized
purposes. Westlands also agrees to wheel all CVP water made
available to the Lemoore Naval Air Station under a future water
service contract.
According to the Letter, the benefits to Westlands includes
relief of its current, unpaid capitalized construction costs
for the CVP, which is currently estimated to be $295 million.
Westlands will still be responsible for operation and
maintenance and for future CVP construction charges associated
with new construction for the Project. The Secretary of the
Interior will convert Westlands' current water service
contract, pursuant to section 9(e) of the Reclamation Project
Act of 1939, to a repayment contract pursuant to section 9(d)
of the same Act. The contract conversion will treat Westlands
as a ``paid out'' project; as a result, the Westlands Water
District would receive a contract with no expiration term,
consistent with other paid-out reclamation projects. However,
the contract will contain terms and conditions that are nearly
identical to those in the current 9(e) contract. In addition,
Westlands will be relieved of acreage limitations and full cost
pricing provisions under the Reclamation Reform Act (96 Stat.
1269). Westlands will also take title to certain facilities
including the portion of the San Luis Drain that lies within
its service area.
The DOI letter indicated that several aspects regarding its
obligation to provide drainage were evaluated when determining
the overall net benefit to the United States, including avoided
drainage construction costs, repayment to the United States of
reimbursable costs, relief from Reclamation Reform Act fees,
and unpaid CVP capital obligations. The Department's analysis
concluded that enactment of settlement legislation would save
the United States at least $968.9 million in regard to
Westlands, plus the potential liabilities associated with the
Etchegoinberry et al v. United States claim which the United
states estimates could be as high as $2 billion.
The settlement agreement between the United States and
Westlands, as extended, sets a January 2018, deadline for
Congress to enact settlement legislation before litigation will
continue to move forward. H.R. 1769 provides the Congressional
authorization necessary for full implementation of the
settlement, putting an end to decades-long controversy.
Section-by-Section Analysis
Section 1 sets forth the table of contents and states that
the Act may be cited as the ``San Luis Unit Drainage Resolution
Act''.
Section 2 defines key terms that are used throughout the
Act.
Section 3 directs the Secretary of the Interior to
implement the terms and conditions of the September 15, 2015,
Agreement between the United States and the Westlands Water
District to settle litigation concerning the United States'
duty to provide drainage service.
Section 4 amends the San Luis Act (Public Law 86-488) to
eliminate requirements for the Secretary to provide drainage
services to the San Luis Unit of the CVP within Westlands.
Section 5 asserts that Westlands shall assume all legal
responsibility for the management of drainage within its
boundaries, and shall not discharge drain water outside of its
boundaries.
Section 6 directs the Secretary to convert the Westlands'
Reclamation Project Act of 1939 section 9(e) water service
contract to a section 9(d) and (c)(1) repayment contract. This
section also requires the Secretary to enter into a water
service contract with the Lemoore Naval Air Station to provide
a guaranteed quantity of CVP water to meet the irrigation needs
of the Naval Air Station associated with air operations.
Section 7 suspends Westlands' capital repayment obligation
and payments under its water service contracts and the April
11, 1965, repayment contract with the United States until the
repayment contract is executed. Once the repayment contract is
executed, Westlands will receive a credit against future
operation and maintenance costs payable to the United States
and will be relieved of its capital repayment obligations.
Westlands will still be responsible for operation and
maintenance obligations, and for future construction or other
capitalized costs not yet allocated to Westlands as of the date
of the Settlement.
Section 8 directs DOI to transfer to Westlands the title to
several facilities specified in the Settlement, including a
portion of the San Luis Drain that lies within Westlands'
service area, upon execution of the repayment contract.
Section 9 requires the Secretary to comply with all
applicable Federal laws, rule, and regulations, including the
National Environmental Policy Act of 1969 and the Endangered
Species Act of 1973 when implementing this Settlement
agreement, as necessary.
Section 10 states that implementation of the Settlement
will have no negative impacts on other CVP contractors.
Section 11 directs the Secretary, for any year in which the
allocation for south-of-Delta CVP long-term water service
contractors or repayment contractors is greater than 75%, to
calculate for Westlands a per acre foot Restoration Fund
payment based on a projection that Westlands would take
delivery of the allocation in order to avoid shifting CVP
Restoration Fund payments from Westlands to CVP preference
power contractors.
Committee Action
H.R. 1769 was introduced on March 28, 2017, by Congressman
David G. Valadao (R-CA). The bill was referred to the Committee
on Natural Resources, and within the Committee to the
Subcommittee on Water, Power and Oceans. On April 26, 2017, the
Full Natural Resources Committee met to consider the bill. The
Subcommittee on Water, Power and Oceans was discharged by
unanimous consent. Congressman Doug Lamborn (R-CO) offered an
amendment designated #1; it was agreed to by voice vote.
Congressman Jared Huffman (D-CA) offered an amendment
designated 038; it was not agreed to by a bipartisan roll call
vote of 16 ayes and 24 noes, as follows:
Congressman Huffman offered and withdrew an amendment
designated 039. Congressman Huffman offered an amendment
designated 040; it was not agreed to by a bipartisan roll call
vote of 16 ayes and 24 noes, as follows:
Congressman Huffman offered an amendment designated 041; it
was not agreed to by voice vote. Congressman Jim Costa (D-CA)
offered and withdrew an amendment designated 003. Congressman
Raul M. Grijalva (D-AZ) offered an amendment designated 029; it
was not agreed to by a bipartisan roll call vote of 16 ayes and
24 noes, as follows:
No additional amendments were offered, and on April 27,
2017, the bill, as amended, was ordered favorably reported by a
bipartisan roll call of 23 ayes and 16 noes, as follows:
Committee Oversight Findings and Recommendations
Regarding clause 2(b)(1) of rule X and clause 3(c)(1) of
rule XIII of the Rules of the House of Representatives, the
Committee on Natural Resources' oversight findings and
recommendations are reflected in the body of this report.
Compliance With House Rule XIII and Congressional Budget Act
1. Cost of Legislation and the Congressional Budget Act.
With respect to the requirements of clause 3(c)(2) and (3) of
rule XIII of the Rules of the House of Representatives and
sections 308(a) and 402 of the Congressional Budget Act of
1974, the Committee has received the following estimate for the
bill from the Director of the Congressional Budget Office:
U.S. Congress,
Congressional Budget Office,
Washington, DC, July 7, 2017.
Hon. Rob Bishop,
Chairman, Committee on Natural Resources,
House of Representatives, Washington, DC.
Dear Mr. Chairman: The Congressional Budget Office has
prepared the enclosed cost estimate for H.R. 1769, the San Luis
Unit Drainage Resolution Act.
If you wish further details on this estimate, we will be
pleased to provide them. The CBO staff contact is Aurora
Swanson.
Sincerely,
Keith Hall,
Director.
Enclosure.
H.R. 1769--San Luis Unit Drainage Resolution Act
Summary: H.R. 1769 would ratify a settlement agreement
negotiated in 2015 between the United States and the Westlands
Water District (district) in California and would amend current
law in accordance with provisions of that agreement.
Specifically, the bill would:
Eliminate the statutory requirement for the
United States to provide drainage services for farmland
irrigated within the district's boundaries;
Direct the Bureau of Reclamation (BOR) to
enter into a water contract with the district
consistent with the terms of the settlement agreement;
Cancel the district's obligation to repay
the federal government for its share of constructing
the Central Valley Project (CVP) and the costs
allocated to the district to plan and design drainage
infrastructure; and
Require BOR to apply a credit against the
district's CVP operating costs equal to payments the
district made for its capital obligations between the
date of the settlement agreement (September 2015) and
enactment of the legislation.
CBO estimates that enacting the legislation would reduce
offsetting receipts (which has the effect of increasing direct
spending) by $309 million over the 2017-2027 period. Because
enacting H.R. 1769 would affect direct spending, pay-as-you-go
procedures apply. Enacting the bill would not affect revenues.
CBO also estimates that implementing the legislation would
reduce the need for discretionary appropriations to construct
the drainage facilities in the district. CBO expects that those
facilities will take more than a decade to complete under
current law. According to estimates from BOR, completing the
part of the project that will provide drainage for the district
will cost about $2.5 billion. By relieving the federal
government of those obligations, CBO estimates that
implementing H.R. 1769 would reduce spending subject to
appropriation for the project by about $1.5 billion over the
next ten years (and by $1 billion in later years). Under
current law, the district water users are required to repay
those costs in the decades following the project's completion
(that is, after 2027).
Under the 2015 settlement agreement that would be ratified
by H.R. 1769, the district would cooperate with the federal
government to resolve pending litigation stemming from the
government's failure to provide drainage services to the
district. The outcome, timing, and amount of judgments or
settlements, if any, that would resolve the litigation under
current law are highly speculative. Consequently, this cost
estimate does not reflect any potential savings to the federal
government from avoiding such litigation. However, on the basis
of information from the Department of Justice (DOJ), BOR, and
other stakeholders, CBO estimates that the cost of such
judgments or settlements to resolve ongoing litigation under
current law could range from $0 to $2 billion.
Further information about the potential costs of the
pending litigation against the federal government is included
below under the heading ``Additional Information.''
CBO estimates that enacting the bill would not increase net
direct spending or on-budget deficits by more than $5 billion
in any of the four consecutive 10-year periods beginning in
2028.
H.R. 1769 contains no intergovernmental or private-sector
mandates as defined in the Unfunded Mandates Reform Act (UMRA)
and would impose no costs on state, local, or tribal
governments.
Estimated cost to the federal government: The estimated
budgetary effects of H.R. 1769 are shown in the following
table. The costs of this legislation fall within budget
function 300 (natural resources and environment).
Basis of estimate: For this estimate, CBO assumes that H.R.
1769 will be enacted near the end of 2017 and that the
provisions of the settlement agreement will be implemented as
required by the legislation.
TABLE 1--ESTIMATED BUDGETARY EFFECTS OF H.R. 1769
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
By fiscal year, in millions of dollars--
-----------------------------------------------------------------------------------------------------------------------------------
2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2017-2022 2017-2027
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
INCREASES IN DIRECT SPENDING
Capital Obligation Canceled:
Estimated Budget Authority.............................. 26 26 26 26 26 26 26 26 26 26 26 157 288
Estimated Outlays....................................... 26 26 26 26 26 26 26 26 26 26 26 157 288
Planning Costs Canceled:
Estimated Budget Authority.............................. 3 1 1 1 I 1 1 1 1 1 1 6 9
Estimated Outlays....................................... 3 1 1 1 1 I I 1 1 1 1 6 9
Credit for CVP Operating Costs:
Estimated Budget Authority.............................. 9 4 0 0 0 0 0 0 0 0 0 13 13
Estimated Outlays....................................... 9 4 0 0 0 0 0 0 0 0 0 13 13
Total Costs:
Estimated Budget Authority.......................... 38 31 27 27 27 27 27 27 27 27 27 176 309
Estimated Outlays................................... 38 31 27 27 27 27 27 27 27 27 27 176 309
DECREASES IN SPENDING SUBJECT TO APPROPRIATION
Estimated Budget Authority.................................. 0 -100 -100 -150 -150 -200 -200 -250 -250 -300 -300 -700 -2,000
Estimated Outlays........................................... 0 -30 -50 -80 -100 -140 -160 -190 -210 -240 -260 -400 -1,460
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Notes: CVP = Central Valley Project. Components may not sum to totals because of rounding. Enacting the bill also would increase direct spending by about $96 million atter 2027 from additional
costs related to canceling the district's capital obligations and repayment of planning costs.
Increases in direct spending
Capital Obligation Canceled. H.R. 1769 would direct BOR to
cancel the district's remaining obligation to repay the federal
government for a share of the costs to construct the CVP. That
cancelation would be contingent upon BOR and the district
negotiating a new contract to repay the costs of supplying
irrigation water to the district consistent with the terms
specified in the settlement agreement.\1\ BOR also would
transfer to the district title to seven facilities located
within the district's service area. The district has already
assumed the responsibility for operating and maintaining those
facilities.
---------------------------------------------------------------------------
\1\The proposed repayment contract would replace existing water
service contracts between BOR and the district. Typically, agreements
between the federal government and water contractors to deliver water
for irrigation, municipal, and industrial purposes from federally built
projects are governed by either water service contracts or repayment
contracts. Water service contracts are used when a construction project
is still in progress and the final costs--including the contractors'
share of those costs--are not yet known. They are also used when a
contractor does not want a permanent contract. Repayment contracts are
available to contractors when final construction costs and the
contractor's share of those costs are known.
---------------------------------------------------------------------------
Based on an analysis of information from BOR about the
district's remaining obligation to the government for repaying
the cost of constructing the CVP, CBO estimates that canceling
annual payments from the district to the federal government for
those obligations would increase direct spending (by reducing
offsetting receipts) by $288 million over the 2017-2027 period
and about $78 million after 2027.
Planning Costs Canceled. Under current law, the costs to
plan and design facilities to drain irrigation water are an
obligation of the beneficiaries of the federal irrigation
project. The district's share of those costs total $24 million
and will be repaid in annual installments of $600,000 over a
40-year period. Under the bill, that obligation also would be
canceled. Additionally the bill would cancel the district's
obligation to pay BOR $3 million for a portion of costs to
operate and maintain a subsurface drainage project that
protects wildlife refuges and wetlands in the region.
In total, CBO estimates that enacting those provisions
would reduce offsetting receipts by $9 million over the 2017-
2027 period and about $17 million after 2027.
Credit for CVP Operating Costs. The settlement agreement
between the district and the federal government was signed in
September 2015. Since then the district has paid the federal
government $13 million toward its share of CVP's construction
costs. H.R. 1769 would require BOR to credit those amounts
against the district's share of the project's future operating
costs. On the basis of information from BOR about the
district's annual payments for operating the CVP, CBO estimates
that enacting this provision would reduce offsetting receipts
by $9 million in 2017 and $4 million in 2018.
Decreases in spending subject to appropriation
Under current law, BOR is required to provide services to
drain waste water from irrigated farmland in the San Luis Unit
(SLU). In 2000, the Ninth Circuit Court of Appeals ordered BOR
to provide that service promptly; the ruling stems from
litigation (Firebaugh Canal Co. v. United States) brought
against the federal government for failure to provide drainage
pursuant to the San Luis Act (Public Law 86-488). The court
temporarily postponed that requirement until January 2018 to
allow time to negotiate the settlement and pass related
legislation.
In 2012 the district also sued the United States claiming
that the federal government's failure to provide drainage
services constituted a breach of contract (Westlands Water
District v. United States). In January 2013 the Court of
Federal Claims determined that water contracts between the
government and the district did not include an enforceable
promise to provide drainage to the district and the United
States' request to dismiss the district's claim was granted.
The district appealed the decision to the Federal Circuit,
which also stayed that case until January 2018.
Under current law, after the stays expire in January 2018,
the drainage system could be constructed over the following 10
to 15 years, assuming the Congress appropriated the necessary
amounts and the district agreed to repay those costs. Under the
bill, CBO estimates that by eliminating that requirement, the
federal government would no longer have to spend $1.5 billion
in appropriated funds over the 2018-2027 period (and the
district would no longer be obligated to repay those costs in
later years).
Pay-as-you-go considerations: The Statutory Pay-As-You-Go
Act of 2010 establishes budget-reporting and enforcement
procedures for legislation affecting direct spending and
revenues. The net changes in outlays that are subject to those
pay-as-you-go procedures are shown in the following table.
TABLE 2--CBO ESTIMATE OF PAY-AS-YOU-GO EFFECTS FOR H.R. 1769, AS ORDERED REPORTED BY THE HOUSE COMMITTEE ON NATURAL RESOURCES ON APRIL 27, 2017
--------------------------------------------------------------------------------------------------------------------------------------------------------
By fiscal year, in millions of dollars--
-------------------------------------------------------------------------------------------------------------
2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2017-2022 2017-2027
--------------------------------------------------------------------------------------------------------------------------------------------------------
NET INCREASE IN THE DEFICIT
Statutory Pay-As-You-Go Impact............ 38 31 27 27 27 27 27 27 27 27 27 176 309
--------------------------------------------------------------------------------------------------------------------------------------------------------
Increase in long-term direct spending and deficits: CBO
estimates that enacting H.R. 1769 would not increase net direct
spending or on-budget deficits by more than $5 billion in any
of the four consecutive 10-year periods beginning in 2028.
Intergovernmental and private-sector impact: H.R. 1769
contains no intergovernmental or private-sector mandates as
defined in UMRA and would benefit the Westlands Water District
in California's Central Valley. Any costs incurred by the
district associated with implementing the terms of settlement
agreement would result from voluntary commitments.
Additional information:
Background
The SLU of the Westlands Irrigation District consists of
about 500,000 acres of irrigated farm land within the CVP. In
1960, the San Luis Act, which established the SLU, required
that water delivered to the unit for irrigation purposes also
include services to drain waste water and prevent salt from
accumulating in the soil. Despite the 2000 court decision, to
date BOR has not provided consistent or comprehensive drainage
services and some local landowners contend that the lack of
drainage has caused salt to accumulate in the soil, limiting
its usefulness for farming.
Some landowners have sued the federal government alleging
that damage to the soil from failing to provide drainage has
caused them financial harm. Under current law, the Court of
Federal Claims may find the federal government owes the
landowners compensation for the loss in their property value.
However, the statutory requirement for the United States to
construct drainage facilities would persist absent the pending
settlement agreement and enactment of H.R. 1769.
Enacting H.R. 1769 and implementing the settlement
agreement in accordance with the legislation aims to resolve
the existing litigation related to drainage in the SLU.
Litigation
In 2011 landowners within the district filed a claim
against the United States (Etchegoinberry v. United States)
alleging that the government's failure to provide drainage
services damaged nearly 200,000 acres of farm land resulting in
a partial physical taking of their property without just
compensation. DOJ and other stakeholders have estimated that
the federal government's liability for the pending case could
range from nothing to as much as $2 billion to resolve the
claim.
To date, the Etchegoinberry court has not issued a decision
on the merits, and there is no direct precedent for the claim.
Additionally, there is a history of litigation delays, a
significant likelihood of appeals, and these parties have been
litigating related issues for nearly two decades. For these
reasons, it is unclear whether the plaintiffs would ultimately
prevail in the takings case, the amount of the damages
assessed, if any, and when that litigation would finally be
resolved.
A previous settlement reflects one possible outcome. In
2002 the federal government settled a similar takings lawsuit
involving landowners in the district for about $4,200 per acre.
Extrapolating from that settlement and assuming additional
amounts for appreciation in the market value of farmland, the
potential exposure for the pending takings case would total
about $1 billion, roughly in the middle of the range of
possible outcomes.
If the federal government incurs compensation costs related
to the pending 2011 lawsuit--through a settlement or court
order--payments would come from the Judgment Fund (a permanent,
indefinite appropriation for claims and judgments against the
United States) and would increase direct spending. However,
because of uncertainty about the outcome, timing, and magnitude
of a potential judgment or settlement payment, CBO has no basis
for assessing the outcome of this litigation.
Estimate prepared by: Federal costs: Aurora Swanson; Impact
on state, local, and tribal governments: Jon Sperl; Impact on
the private sector: Amy Petz.
Estimate approved by: Theresa A. Gullo, Assistant Director
for Budget Analysis.
2. General Performance Goals and Objectives. As required by
clause 3(c)(4) of rule XIII, the general performance goal or
objective of this bill is to affirm an agreement between the
United States and Westlands Water District dated September 15,
2015.
Earmark Statement
This bill does not contain any Congressional earmarks,
limited tax benefits, or limited tariff benefits as defined
under clause 9(e), 9(f), and 9(g) of rule XXI of the Rules of
the House of Representatives.
Compliance With Public Law 104-4
This bill contains no unfunded mandates.
Compliance With H. Res. 5
Directed Rule Making. This bill does not contain any
directed rule makings.
Duplication of Existing Programs. This bill does not
establish or reauthorize a program of the federal government
known to be duplicative of another program. Such program was
not included in any report from the Government Accountability
Office to Congress pursuant to section 21 of Public Law 111-139
or identified in the most recent Catalog of Federal Domestic
Assistance published pursuant to the Federal Program
Information Act (Public Law 95-220, as amended by Public Law
98-169) as relating to other programs.
Preemption of State, Local or Tribal Law
This bill is not intended to preempt any State, local or
tribal law.
Changes in Existing Law Made by the Bill, as Reported
In compliance with clause 3(e) of rule XIII of the Rules of
the House of Representatives, changes in existing law made by
the bill, as reported, are shown as follows (existing law
proposed to be omitted is enclosed in black brackets, new
matter is printed in italic, and existing law in which no
change is proposed is shown in roman):
PUBLIC LAW 86-488
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled, That (a) for
the principal purpose of furnishing water for the irrigation of
approximately five hundred thousand acres of land in Merced,
Fresno, and Kings Counties, California, hereinafter referred to
as the Federal San Luis unit service area, and as incidents
thereto of furnishing water for municipal and domestic use and
providing recreation and fish and wildlife benefits, the
Secretary of the Interior (hereinafter referred to as the
Secretary) is authorized to construct, operate, and maintain
the San Luis unit as an integral part of the Central Valley
project. The principal engineering features of said unit shall
be a dam and reservoir at or near the San Luis site, a forebay
and afterbay, the San Luis Canal, the Pleasant Valley Canal,
and necessary pumping plants, distribution systems, drains,
channels, levees, flood works, and related facilities, [but]
but such features do not include distribution systems or drains
within Westlands, and no facilities shall be constructed for
electric transmission or distribution service which the
Secretary determines, on the basis of an offer of a firm fifty-
year contract from a local public or private agency, call
through such contract be obtained at less cost to the Federal
Government than by construction and operation of Government
facilities. The works (hereinafter referred to as joint-use
facilities) for joint use with the State of California
(hereinafter referred to as the State) shall be the dam and
reservoir at or near the San Luis site, forebay and afterbay,
pumping plants, and the San Luis Canal. The joint-use
facilities consisting o ? the dam and reservoir shall be
constructed, and other joint-use facilities may be constructed,
so as to permit future expansion; or the joint-use facilities
shall be constructed initially to the capacities necessary to
serve both the Federal San Luis unit service area and the
State's service area, as hereinafter provided. In constructing,
operating, and maintaining the San Luis unit, the Secretary
shall be governed by the Federal reclamation laws (Act of June
17, 1902 (32 Stat. 388), and Acts amendatory thereof or
supplementary thereto). Construction of the San Luis unit shall
not be commenced until the Secretary has (1) secured, or has
satisfactory assurance of his ability to secure, all rights to
the use of water which are necessary to carry out the purposes
of the unit and the terms and conditions of this Act, and (2)
received 'satisfactory assurance from the State of California
that it will make provision for a master drainage outlet and
disposal channel for the San Joaquin Valley, as generally
outlined in the California water plan, Bulletin Numbered 3, of
the California Department of Water Resources, which will
adequately serve, by connection therewith, the drainage system
for the San Luis unit or has made provision for constructing
the San Luis interceptor drain to the delta designed to meet
the drainage requirements of the San Luis unit as generally
outlined in the report of the Department of the Interior,
entitled ``San Luis Unit, Central Valley Project,'' dated
December 17, 1956, except that the provision of drainage or
drainage service under section 1(a) shall not apply to lands
within Westlands.
(b) No water provided by the Federal San Luis unit shall be
delivered in the Federal San Luis service area to any water
user for the production on newly irrigated lands of any basic
agricultural commodity, as defined in the Agricultural Act of
1949, or any amendment thereof, if the total supply of such
commodity as estimated by the Secretary of Agriculture for the
marketing year in which the bulk of the crop would normally be
marketed and which will be in excess of the normal supply as
defined in section 301(b) (10) of the Agricultural Adjustment
Act of 1938, as amended, unless the Secretary calls for an
increase in production of such commodity in the interest of
national security.
* * * * * * *
Sec. 5. [In constructing, operating, and maintaining a
drainage system for the San Luis unit, the Secretary is
authorized to permit the use thereof by other parties under
contracts the terms of which are as nearly similar as is
practicable to those required by the Federal reclamation laws
in the case of irrigation repayment or service contracts and is
further authorized to enter into agreements and participate in
construction and operation of drainage facilities designed to
serve the general area of which the lands to be served by the
San Luis unit are a part, to the extent the works authorized in
section 1 of this Act contribute to drainage requirements of
said area.] Notwithstanding any other provision of law, the
Secretary of the Interior shall have no duty to provide
drainage or drainage service to Westlands. Westlands shall be
responsible for the management of drainage water within its
boundaries, in accordance with Federal and California law
consistent with the ``Agreement between the United States and
Westlands Water District August 2015'', signed September 15,
2015. The Secretary is also authorized to permit the use of the
irrigation facilities of the San Luis unit, including its
facilities for supplying pumping energy, under contracts
entered into pursuant to section 1 of the Act of February
21,1911 (36 Stat. 925; 43 U.S.C. 523).
* * * * * * *
Sec. 8. There is hereby authorized to be appropriated for
construction of the works of the San Luis unit, including
joint-use facilities, authorized by this Act, [other than
distribution systems and drains,] the sum of $290,430,000, plus
such additional amount, if any, as may be required by reason of
changes in costs of construction of the types involved in the
San Luis unit as shown by engineering indexes. Said base sum of
$290,430,000 shall, however, be diminished to the extent that
the State makes funds or lands or interests in land available
to the Secretary pursuant to sections 2 or 3 of this Act which
decrease the costs which would be incurred if the works
authorized in section 1 of of this Act (including provision for
their subsequent expansion) were constructed solely as a
Federal project. There are also authorized to be appropriated,
in addition thereto, such amounts as are required [(a) for
construction of such distribution systems and drains as are not
constructed by local interests, but not to exceed in total cost
the sum of $192,650,000, and (b)] for operation and maintenance
of the unit.[: Provided, That no funds shall be appropriated
for construction of distribution systems and drains prior to
ninety calendar days (which ninety days, however, shall not
include days on which either the House of Representatives or
the Senate is not in session because of an adjournment of more
than three calendar days to a day certain) after a contract has
been submitted to the Congress calling for complete repayment
of the distribution systems and drains within a period of forty
years from the date such works are placed in service. All
moneys received by the Secretary from the State under this Act
shall be covered into the same accounts as moneys appropriated
hereunder and shall be available, without further
appropriation, to carry out the purposes of this Act.]
DISSENTING VIEWS
H.R. 1769 would approve a legal settlement between the
federal government and the Westlands Water District
(Westlands). Unfortunately, the agreement is missing
significant budgetary, public health, and environmental
safeguards, including several previously deemed essential by
the Obama Administration. As such, we oppose H.R. 1769 and the
Westlands Settlement Agreement it would approve.
The San Luis Act of 1960 authorized construction projects
to provide irrigation water for the San Luis Unit, which is
comprised of the Westlands Water District and three smaller
water districts. The 600,000-acre Westlands Water District is
the largest irrigation district in the United States and covers
approximately three-quarters of the San Luis Unit's service
area. Westlands contracts with the U.S. Bureau of Reclamation
to deliver water primarily to agricultural water users that
produce an average of $1 billion in crop sales each year.\1\
H.R. 1769 would relieve the federal government of an obligation
under the San Luis Act to build agricultural drainage for
Westlands in exchange for taxpayer-financed benefits.
---------------------------------------------------------------------------
\1\Westlands Water District Homepage, available at: http://
wwd.ca.gov/about-westlands/.
---------------------------------------------------------------------------
Recognizing that much of the land in the San Luis Unit has
saline and poorly drained soil, the San Luis Act required the
state of California or the federal government to agree to build
a drainage system. The U.S. Bureau of Reclamation eventually
agreed to build a drain after the legislation passed and in
1968 began construction of a 200-mile drain to transport
drainage wastewater from the San Luis Unit and discharge it
into the Sacramento-San Joaquin River Delta (Delta). After
significant public concerns were raised about dumping drainage
wastewater into the Delta--California's most important drinking
water source the federal government halted construction of the
drain at a place called the Kesterson Reservoir.
In the 1980s, field studies by the U.S. Fish and Wildlife
Service revealed that drainage wastewater from Westlands and
the San Luis Unit contained a highly toxic element called
selenium, which is common to the soils of the San Luis Unit,
and is deadly in high concentrations to humans and wildlife.
The drainage wastewater killed thousands of waterfowl and
caused severe wildlife deformities at the Kesterson Reservoir.
As a result, the U.S. Bureau of Reclamation closed the San Luis
Drain, litigation against the federal government ensued, and
court rulings subsequently found that unless the San Luis Act
of 1960 is amended, the Department of Interior is still
obligated to finance drainage for Westlands and San Luis Unit
water contractors.
H.R. 1769 rightfully amends the San Luis Act of 1960 to
remove the federal government's drainage obligation for
Westlands (though not for the rest of the San Luis Unit);
however, the legislation also includes several harmful
provisions and lacks other necessary provisions previously
identified by the Obama Administration as necessary for any
balanced drainage settlement.
For example, the Obama Administration previously stated
that any settlement should require the Westlands Water District
to prepare a comprehensive drainage management plan ``with
measurable environmental objectives, including water quality
and specific, enforceable performance measures.''\2\ The
current settlement agreement approved by H.R. 1769 includes
neither.
---------------------------------------------------------------------------
\2\Letter from Michael L. Connor, Commissioner of the Bureau of
Reclamation, to Senator Dianne Feinstein, September 1, 2010.
---------------------------------------------------------------------------
The Obama Administration also called for the Westlands
Water District to ``permanently retire a minimum of 200,000
acres of the most drainage impaired lands''\3\ to reduce the
amount of drainage wastewater being generated. The current
settlement agreement calls for the permanent retirement of just
100,000 acres, much of which has already been retired according
to the Department of Interior.\4\ In addition, the George W.
Bush Administration previously recommended the retirement of
194,000 acres of land within Westlands and found 308,000 acres
of land retirement to be the National Economic Development
Alternative.\5\
---------------------------------------------------------------------------
\3\Ibid.
\4\Briefing held by Department of the Interior officials for House
and Senate staff on September 21, 2015.
\5\United States Bureau of Reclamation (2007). San Luis Drainage
Feature Re-evalaution Record of Decision. Available at http.//
www.usbr.gov/mp/mp150/envdocs/San_Luis_Drainage_Feature_Re-
evaluation_ROD.pdf.
---------------------------------------------------------------------------
The Obama Administration previously called for reducing the
water contract quantity for Westlands ``to an annual amount of
806,000 acre-feet of Project Water for irrigation.''\6\ The
current settlement agreement would not reduce Westlands'' 1.193
million acre-feet contract amount. The Environmental Protection
Agency (EPA) has stated that Westlands' current contract
quantities are ``unrealistic given the current and anticipated
restraints on deliveries of an oversubscribed Delta
system.''\7\ The Hoopa Valley Tribe and other water users have
rightly raised concerns about the settlement agreement's
potential to lock in unsustainable water diversions to meet
Westlands' water demands.
---------------------------------------------------------------------------
\6\Letter from Michael L Connor, Commissioner of the Bureau of
Reclamation, to Senator Dianne Feinstein, September 1, 2010.
\7\United States Environmental Protection Agency Associate Director
Karen Schwinn. April 16, 2008 Letter to United States Bureau of
Reclamation.
---------------------------------------------------------------------------
The Obama Administration previously called for requiring
the Westlands Water District's total water contract quantity to
``remain subject to renewal in the future.''\8\ The current
settlement agreement does not include provisions that the
contract quantity be subject to renewal in the future.
---------------------------------------------------------------------------
\8\Letter from Michael L. Connor, Commissioner of the Bureau of
Reclamation, to Senator Dianne Feinstein, September 1, 2010.
---------------------------------------------------------------------------
H.R. 1769 also forgives approximately $375 million owed by
Westlands, a water district that boasts of billion dollar crop
sales every year, gives Westlands a permanent water contract,
hands over federal facilities worth millions, and exempts large
agribusiness in the Westlands service area from legal
restrictions meant to limit taxpayer subsidies for large
industrial farms.
While proponents of H.R. 1769 have claimed that the
taxpayer costs of the bill would be outweighed by the cost
savings from settling litigation, the Congressional Budget
Office (CBO) found in a preliminary estimate last year that
enacting legislation to approve the Westlands settlement would
result in ``a loss of offsetting receipts [to the federal
government] totaling roughly $300 million over the 10-year
budget window from debt relief and other concessions to the
Westlands Water District.'' CBO said further that while there
could be savings from enacting settlement legislation, there is
``significant uncertainty about the likelihood, timing, and
amount of any savings'' and ``CBO expects any potential savings
would not fully offset the more certain costs.''\9\
---------------------------------------------------------------------------
\9\November 9, 2016 email correspondence from Congressional Budget
Office to House Natural Resources Committee staff.
---------------------------------------------------------------------------
Drainage wastewater from Westlands and the San Luis Unit
can cause serious damage and H.R. 1769 has no specific
enforcement and performance standards to ensure that Westlands
pays for a drainage system that protects California's
environment and drinking water. The need for robust enforcement
and performance standards is especially evident in light of
charges last year against the Westlands Water District by the
Securities and Exchange Commission for ``misleading investors
about its financial condition.''\10\
---------------------------------------------------------------------------
\10\March 9, 2016 United States Securities and Exchange Commission
Press Release, available at: https://www.sec.gov/news/pressrelease/
2016-43.html.
---------------------------------------------------------------------------
Several amendments were offered during Committee markup to
improve H.R. 1769. One amendment offered by Ranking Member
Grijalva would have required federal agencies to certify that
the Westlands Settlement Agreement is a net-benefit for
American taxpayers before the settlement is enacted. Chairman
Bishop has established a similar requirement for committee
consideration of water settlements for Indian tribes. Committee
Republicans rejected the amendment.
An amendment offered by Water, Power, and Oceans
Subcommittee Ranking Member Huffman would have prohibited self-
dealing by barring former employees and registered lobbyists
for the Westlands Water District from enforcing and carrying
out the settlement agreement should they join the Trump
Administration. Last month, President Trump nominated a former
Westlands lobbyist to be the Deputy Secretary of Interior.
Committee Republicans rejected Representative Huffman's
amendment.
Other amendments offered by Representative Huffman would
have required the United States to be indemnified against all
drainage-related litigation before settlement enactment and
would have required the development of a comprehensive drainage
management plan to protect human health, the environment, and
water quality. Committee Republicans rejected these amendments
as well.
Without significant changes, H.R. 1769 constitutes a bad
deal for taxpayers, the environment, and public health and
should be rejected by Congress.
Raul M. Grijalva,
Ranking Member, House
Committee on Natural
Resources.
Jared Huffman,
Ranking Member, Subcommittee
on Water, Power and
Oceans.
Colleen Hanabusa,
Member of Congress.
Darren Soto,
Member of Congress.
Grace F. Napolitano,
Ranking Member.
Donald S. Beyer, Jr.,
Member of Congress.
Nanette Diaz Barragan,
Member of Congress.
A. Donald McEachin,
Ranking Member, Subcommittee
on Oversight and
Investigations.
