Petition — California v. United States

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CLERK

in THE MICHAEL RODAK, JR,

Supreme Court of the United States

Oovonwn Tena, LOTT

NO. cccsssss RV7-285

Srare OF CALmonnta, et aly

Petitioners,

va,

Uniren Starne oF AMMHICA,

Respondent,

Petition for Writ of Certiorari to the United States

Court of Appeals for the Ninth Circuit

Divenie Jd, Yourann

Attorney General of the

Mtate of California

Kt, HL, Conner

Awmiatant Attorney General

hopmnick WaALaToN

Deputy Attorney General

icnany C, Jacote

Deputy Attorney General

HOOO Mtate Huilding

Man Praneiaes, CA 4108

Tel: (416) 567-00u0

Attornens for Petitioners

GONG PRINTING CGMPANY GF GALIFGRNIA, O48 FIRET BTREET, GAN FRANC iEe® eaiee

TABLE OF CONTENTS

Page

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Reasons Mor Granting the WIE coer M

1, The Lower Court's Decision Alters Several Deo.

ades of Settled Administrative Practioe, and Has

an Mnormous Impact on the Western States

Whose Waters Are Utilived by the Reclamation

BGS GE TG ccarecsnsnsnsecsnsensestsenenveseeetasensnssnnenacesneesensssnenes 4

2 The Lower Court's Deoision is [neonelatent with,

and Ignores, the Legislative History and Admin

istrative Interpretation and Practice of Seotion & 12

. The Lower Court's Decision Conflicta with This

Court's Analysia in the Nebraska, Ivanhoe and

City Of PrOGNO DOOMONB occ 16

4, The Lower Court's Decision Keaulte in the Crea.

tion of a New Water Doctrine that Ie Uneup-

ported by the Reelamation Aet of 1008... 18

5. Ty Voiding Conditions in State-Held Water

Rights Assigned to the Mureau, the Court Mas

Sanctioned an Unconatitutional Violation of Cali.

fornia’s Property PUBWE commen a1

Appendices

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2, Opinion (on Petition tor Rehearing) mannnanennnee . 12

§, Section &, Reclamation Act of 1908................ 14

TABLE OF AUTIIONITIES CITED

Cane Pages

Arinona v, California, 874 US, 640 (1089) coc, 11

City of Mreane vy, California, 872 U.S, G27 (1008)..17, 18, 20

Mnvironmental Protection Ageney v, California, 426

ULM, yoo (1070, Titiititit it geaaaaccaaaaiaaa ee \ If, 10, 20

Haneook v, Train, 486 US. 107 CUUTO) cc, Vasein

Ivanhoe Ter, Dist, vy, MeCracken, $57 U.S, 875 (1068)

4, 6, 18, 20

National Leagie of Cities vy, Usery, U.S,

44, U.S.LW, avd (1070) TICClelereririciitrreriireiitiiitiitiiiiiy 4

Nebraska vo Wyoming, 205 U8, 40 (1086) ......16, 18, 20

Nebraska v, Wyoming, $04 0,8, 646 (1048)... 16, 18, 20

Prosier v, Hocrignos, 441 U8, 476 (1074)... |

Hosehud Sioux Trihe v Kneip, << U8, a, 46

UALW, 4440 (77) oo. sesasegeseneseunesqnennnansnennnsnsocnseens if

Train ¥, Colorado Pub, Tat, Res, doin 426 U8. 1

ERTTWD cesrareasecesecenensscnenssnneesenentecenenestennenecsesssnnsentnesenseisiennes 1h

Udall v. Tallman, 980 US 1 O9TA) ccc 1h

United States v, Distriet Court, 401 U.S, §90 (it) is

United States v, Gerlach Live Stock Co, $80 U.S, 726

(1080)

Tania ov Avrnonitine Creep iil

Unive States Stature

O8 U.B.C, §1864(2) .... seapasasetnedenenasiiisesnenegesbinbienennsemneniees |

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BR Bead. GOT (OGG) secesrsscssssscssssssescssssssessscessssssssesssessssesscess 4

FE Bead, 1160 (1OGB) seacsrssssssssssssscscsssscssssessssesssscccsssscssssnsssses 4

Cheam, Bap BGs scsi

Vederal Water Pollution Control Act nutiieneeinmeen id

Keclamation Aet of 100%, 42 Stat, 400 (1008), 44

U.S.C, GE 872, BBA (DITO) cocccccccccscccccsneene Mame

Mining Act of 1806, as amended ssunsnsensesnscssonsnenssnsesonseent \4

Desert Land AGt Of MOTT ccccccccscccsccccscssccceccsessceeeecceeeeersceees id

Concnmesional Keoonn

45 Cong, Heo, 6606, H7th Cong, Lat Beas, (1902) occ... i

Canirounta Connie

California Watet COd@ BLQOD cocccccccccen 4

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TID enssecsesieteessereenteemsnsectsiotnnnns 4

Misceitannotia Souncne

Decision 1422, State Water Resources Control

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IN THE

Supreme Gourt of the Uuited States

Octoser TreRM, 1977

State or Cauirornia, et al.,

Petitioners,

vs.

Unitep States oF AMERICA,

Respondent.

Petition for Writ of Certiorari to the United States

Court of Appeals for the Ninth Circuit

OPINIONS BELOW

The decision of the U.S. Court of Appeals has not yet

been officially reported, and is attached hereto. App. 1-16.

JURISDICTION

The final decision of the U.S. Court of Appeals was ren-

dered on August 12, 1977. A petition for writ of certiorari

is due on or before November 10, 1977. This Court has

jurisdiction under 28 U.S.C. § 1257(3).

The decision of the U.S. Court of Appeals invalidates

various California water laws, as applied to the U.S.

Bureau of Reclamation, on grounds that such laws are

repugnant to the Supremacy Clause. Hence, this petition

might properly be considered an appeal, in which case

this Court has jurisdiction under 28 U.S.C. § 1254(2).

2

QUESTIONS PRESENTED

Section 8 of the Reclamation Act of 1902 requires the

U.S. Bureau of Reclamation (the “Bureau”), in operating

federal reclamation projects, to “proceed in conformity

with” state laws relating to the “control, appropriation, use,

or distribution” of water. The questions raised in this

petition are as follows:

1. Does section 8 require the Bureau, in acquiring its

rights to unappropriated water for federal reclamation

projects, to acquire such rights pursuant to the states’

appropriation laws? Or, alternatively, does the Bureau

acquire such rights under the “implied reservation” doctrine

at the time that each federal reclamation project is author-

ized by Congress, notwithstanding the language of section

8?

2. If section 8 requires the Bureau to acquire its water

rights under the states’ appropriation laws, must the

Bureau comply with conditions which the states attach to

such water rights, to the extent that such conditions do not

impair the congressionally-authorized purposes of federal

reclamation projects?

3. If section 8 does not require the Bureau to acquire

its water rights under the states’ appropriation laws, must

the Bureau nonetheless comply with state-imposed condi-

tions attached to water rights which are held by the state,

and which are assigned by the state to the Bureau?

4. If section 8 does not require the Bureau to acquire

its water rights under the states’ appropriation laws, must

the Bureau nonetheless comply with conditions which the

state attaches to the Bureau’s water rights when the

Bureau elects to acquire its water rights under the states’

appropriation laws?

3

FEDERAL LAWS INVOLVED

This case involves an interpretation of section 8 of the

Reclamation Act of 1902, 32 Stat. 390 (1902), 43 U.S.C.

$§ 372, 383 (1970), a copy of which is attached hereto.

App. 16.

STATEMENT OF THE CASE

The primary question raised in this case is whether

section 8 of the Reclamation Act of 1902" requires the U.S.

Bureau of Reclamation (the “Bureau’’), in acquiring the

right to appropriate unappropriated water for federal ree-

lamation projects, to acquire such rights under the states’

appropriation laws, and, if so, the extent to which the

Bureau must comply with the states’ appropriation laws.

1. Facts of the Case.

The Reclamation Act of 1902 authorizes federal construc-

tion and operation of federal reclamation projects in 16

western states.2 Under the act, Congress has authorized

many reclamation projects, the largest of which is a vast

1. Section 8 provides:

“That nothing in this Act shall be construed as affecting or

intended to affect or to in any way interfere with the laws of

any State or Territory relating to the control, appropriation,

use, or distribution of water used in irrigation, or any vested

rights acquired thereunder, and the Secretary of the Interior,

in carrying out the provisions of this Act, shall proceed in

conformity with such laws, and nothing herein shall in any

way affect any right of any State or of the Federal Govern-

ment or of any landowner, appropriator, or user of water in,

to or from any interstate stream or the waters thereof: Pro-

vided, that the right to the use of water acquired under the

provisions of this Act shall be appurtenant to the land irri-

gated, and beneficial use shall be the basis, the measure, and

the limit of the right.” 32 Stat. 390 (1902), 43 U.S.C. §§ 372,

383 (1970). (Emphasis added.)

2 The 16 states are Arizona, California, Colorado, Idaho,

Kansas, Montana, Nevada, Nebraska, New Mexico, North Dakota,

Oklahoma, Oregon, South Dakota, Utah, Washington and Wyo-

ming. 32 Stat. 388 (1902).

4

array of dams, reservoirs and waterways in California

collectively known as the Central Valley Project (CVP).

See Ivanhoe Irr. Dist. v. McCracken, 357 U.S. 275, 280-284

(1958). One of the units of the CVP is the New Melones

project, authorized in 1944 and re-authorized in 1962. 58

Stat. 887 (1944) ; 76 Stat. 1180, 1191 (1962). The waters of

the CVP, including those of the New Melones project, arise

and flow solely in California.

The Bureau, which will operate the New Melones project

upon its completion, applied to California’s State Water

Resources Control Board (the “State Board”) for the

right to appropriate unappropriated water for the New

Melones project. The right to appropriate water in Cali-

fornia is evidenced by a permit issued by the State Board.

Cal. Wat. Code §§ 1201, 1240, 1375. The State Board issues

the permit if unappropriated water is available, and if the

proposed use is “reasonable and beneficial.” bid. Conditions

may be inserted in the permit to insure that the proposed

use is “reasonable and beneficial.” [bid. California’s permit

system is similar to that of other western states whose

waters are utilized by the Reclamation Act of 1902.

The Bureau’s application for water rights under Cali-

fornia law took two forms. First, the Bureau applied

directly to the State Board for its own appropriative

permits. Second, the Bureau also requested the State Board

to approve the assignment to the Bureau of permit appli-

cations previously filed by another State agency, the State

Department of Finance; the latter agency had agreed to

assign its applications to the Bureau subject to approval

of the State Board. The advantage to the Bureau of obtain-

ing an assignment of these permit applications is that,

upon approval, the permit-holder would have an earlier

priority date than could be obtained directly by the Bureau,

and thus would have seniority over many competing appro-

5

priators.* In essence, the Bureau thus applied directly for

its own water rights, and for the assignment of water

rights held by a State agency under State law.

After extensive hearings, the State Board issued Decision

1422. This decision resulted in (1) the issuance of permits

applied for directly by the Bureau, and (2) the issuance of

permits applied for by the State Department of Finance,

and approval of their assignment to the Bureau. However,

the decision imposed conditions in all permits that, al-

though allowing immediate impoundment of water for cer-

tain project purposes, deferred impoundment of water for

agricultural, municipal and industrial purposes until the

Bureau develops a plan for the use of such water. Basing its

conclusions on the Bureau’s own evidence, the State Board

found that the Bureau had failed to develop such a plan.

Until such a plan is developed, the State Board stated,

the State Board is unable to find that the Bureau’s pro-

posed use is “reasonable and beneficial.” Thus, the State

Board did not deny the Bureau’s right to water, but merely

deferred the right until the Bureau develops a plan for

the use of the water.

2. Positions of the Parties.

The United States filed this action in a federal district

court, alleging that it is not bound by the conditions in Deci-

sion 1422. It alleged that the Bureau need not acquire its

water rights under the states’ appropriation laws. This posi-

tion is consistent with the view, unexpressed in the United

States’ complaint, that the Bureau acquires its water rights

under the “implied reservation” doctrine, since that doctrine

3. Under California law an applicant's priority date depends

on the date of his application, not the date that the application is

approved. Cal. Wat. Code §§ 1450, 1455. The priority date of the

permits held by the State Department of Finance is the year 1927,

since its applications were filed in that year.

6

allows federal agencies to acquire water for use on federal

lands without complying with the states’ water laws.* The

United States also alleged that, if the Bureau elects to

acquire its water rights under state law as a matter of

“comity,” the state must issue an appropriative permit if

unappropriated water is available and cannot impose any

conditions in the permit.

California alleges that section 8 of the Reclamation Act

of 1902 requires the Bureau to acquire its water rights under

the states’ appropriation laws. Under this view, the Bureau

does not acquire its water rights under the “implied reserva-

tion” doctrine. California alleges that, under section 8, the

Bureau is bound by conditions which a state attaches to the

4. Under the “implied reservation” doctrine, Congress has

constitutional authority under the Property Clause to reserve

unappropriated water for use on federal lands that it withdraws

from the publie domain, and presumptively intends to exercise

that authority at the time that it withdraws such lands from the

public domain. See, e.g., Cappaert v. United States, 426 U.S. 128,

138-142 (1976). This Court has suggested that Congress lacks

constitutional authority to override state laws in the reclamation

field. Kansas v. Colorado, 206 U.S. 46, 92 (1907) (“We do not

mean that its [Congress’] legislation can override state laws in

respect to the general subject of reclamation”). Even assuming

that Congress has such constitutional authority, the question re-

mains whether Congress intends to exercise such authority. Section

8 clearly indicates that Congress does not mean to exercise this

authority, for it requires the Secretary of the Interior to acquire

his water rights for reclamation projects under state law. Indeed,

the “implied reservation” doctrine has only been applied in cases

where water is used on federal lands for traditional federal pur-

poses, and the courts should be hesitant to extend the doctrine to

situations where, as here, water is ultimately used off federal lands

by non-federal users.

An additional question raised in this case is whether the “im-

plied reservation” doctrine is even applicable to lands which the

federal government acquires by purchase or condemnation, rather

than withdraws from the publie domain. The doctrine has been

held applicable only when the federal government “withdraws its

lands from the public domain.” Cappaert v. United States, supra

at 138. The lands for the New Melones project, however, were not

withdrawn from the public domain, but were acquired by pur-

chase and condemnation. See Defendants’ Exh. 3.

7

water right granted to the Bureau, to the extent that such

conditions do not impair the purposes of the federal recla-

mation project. California alleges that the conditions in the

permits issued under Decision 1422 do not impair the pur-

poses of the New Melones project. California also alleges

that, regardless of the effect of section 8, the Bureau is

bound by conditions imposed in state-created water rights

which are held by the state, and which are assigned to the

Bureau at its request.

3. Ninth Circuit's Decision.

The federal district court granted summary judgment for

the United States. 403 F. Supp. 874 (E.D. Cal. 1975). On

appeal, the Ninth Circuit ruled that section 8 requires the

Bureau to comply with the “forms” of state law by obtain-

ing an appropriative permit from the State Board, thus

rejecting the United States’ position that it acquires its

water rights independently of state law. App. 6-7. How-

ever, the court ruled that the state must grant the permit if

unappropriated water is available; it rejected California’s

position that the Bureau must comply with conditions in

state-issued permits to the extent that such conditions are

not inconsistent with the purposes of the federal project.

App. 6-7. The court also ruled that the Bureau is not bound

by conditions in permits which are granted to a State agency

and assigned to the Bureau at the latter’s request. App. 12-

16. Accordingly, it was held, the Bureau need not comply

with the conditions in Decision 1422.5 The court did not con-

sider whether the conditions were consistent with the pur-

poses of the New Melones project.

5. The decision was written by the senior judge of the panel.

A second judge wrote a coneurring opinion. App. 7-8. The third

judge wrote a concurring and dissenting opinion, arguing that the

Bureau need not even obtain a permit under state law. App. 8-11.

writ

1, The Lower Court's Decision Alters Several Decades of Settied

This ie a case of historic eignifieanee in the feld of federal

and atate water relations, Mor three quarters of a eontury,

the Mureau and ite predecessor agencios have complied with

the appropriation lawe of the weatern atates, and with the

pormit avatome that underlio theae laws, in acquiring the

rieht to appropriate unappropriated water for federal ree.

lamation projects.” In California, for example, the Mureau

has acquired 41 appropriative permite, each containing

conditions, eines TS) it has, watil recently, consiatently

sompliod with the conditions in the permite, See Defend.

ant’e Mixhe 1, O(a), 0b), The Seeretary of the Interior

and the Mureau have frequently expressed the view that

sootion & of the Reclamation Aet of 1002 requires the

Hurean to comply with the etates’ appropriation lawe in

nequiring ite water rights, See n, 6, eupra, For example,

the Commissioner of Reclamation etated in LOTS,

“Hach atate has the duty to determine under ite own

statutes how ite tinappropriated water le to be uaed,

i, See eg, Defendant's Baha, 1, AUT O(b)) Hearings on S,

VTS before Subcommittee on Terigation & Reclamation, Sen, Conn,

on Tit, & Tie, Affairs, 88th Cong, td Sows, $99, 908 (1004), United

States v, Gerlach Live Stock Co, no U8, 725, TAG nn, O16 (LMAO),

Aa early ae 1905, the Reclamation Service, the predecessor of the

Hiureau, reviewed the various apereparetige lawa of the states,

and concluded that the Reelamation Service “must conform to

the law and the rewulations [of the states) in all partioulans ae

far oa it in powible under the operations of the reclamation act,”

U8, Department of the Interior, Proceedings of Second Conference

of Rngtneers “ the Reclamation Service 229 (1008), Tn 1048, the

Seoretary of the Interior atated that “the righta of the United

States to store, divert, and wae water wader the law of California

.. have thelr ineeption in certain applications... whieh have

boon or are to be assigned... to the United States, [and] in eer

tain applications made by the United States itwelf" TLR, No,

410, 84th Cong, Yd Sew, 810-818 (1000),

Since 1902, the Bureau has conaiatently taken the posi:

tion that it will obtain under etate law ite rights to

store and divert water for ite projecta recommended

for Congressional authorisation.” Defendant's Mxh,

op 4&

Tn thie ease, however, the United States eeoke to reverse

thie historic praction, Tt argues that section 8 does not re

quire the Bureau to acquire ite water rights under atate

law, and that the Bureau acquires ite water righte inde

pendently of atate law, The United States thus seeke to

alter the historic relationship that hae guided federal and

state agencies in the reclamation fleld eines 1902,

The Ninth Clreuit's decision rejeote the positions of both

the United States and California, Tt rejecta the United

States’ position that the Bureau acquires ite water rights

independently of atate law, holding that the Bureau mut

acquire ite water rights under atate law, However, it rejects

California's position that the Mureau must comply with con

ditions which the atates attach to the Bureau's water rights,

The decision thus effectively frees the Bureau of all condi.

tions on ite atate-iaaued water rights in the weatern atates,

conditions with whieh, in California, the Bureau has com.

plied ainee 1925, The decision thus alters several decades

of settled adminiatrative practice,

The Ninth Clreuit's deelsion, if left etanding, will have

an enormous impact on the weatern etates whose waters

are utilined under the Reelamation Act of 1902, Thee atates

have adopted appropriation lawa, conaiating of permit eve

tome, that allow the atates to impose conditions on atate.

jnevied water riehta that are necessary to protect the “hene.

felal use” of water, The power to impose conditions ta the

power to participate in determining the use and allocation

4

10

of water from federal reclamation projects,’ Tt te eritioally

important to these atates that they participate in aueh de.

terminations, Water from federal reclamation projects is

not wed on federal lands for traditional federal purposes,

Hie in those cases which have recognived federal water rights

under the “implied reservation” doetrine, See n, 4, eupra,

Kather, thie water ie ultimately used off federal landa by

economic and municipal entition-farmers, industries, cities

and villages—whoae aetivitios are linked with the growth

anc development of the atates, Moreover, the weatern atates

have traditionally controlled the tae of water by theae

entities, See n, 10, infra” Thus, the tates have a vital

interest in the vee and distribution of water from federal

reclamation projecta, California ta vitally interested, for

example, in whether water from the Central Valley Project

ie Heed to promote urban growth in ite congested metro.

politan areas or to promote agrioultural production in ite

interior valleya,

It ia not tincommon for Congress, in authoriving a federal

reclamation project, to decide where, or for what purposes,

project water ahould be teed, or how much water ehould be

impounded, We do not assert the power to alter these or

7, Th thie ease, however, California does not seek to control

the wie and allocation of water, but only seeka to require the

urea to develop a r for the uae of water before fully

impounding the project's waters,

8 Th California, for example, the State Moard haw laued other

(leelaiona, Deelsiona 1470 and 1400, that impowe conditions in per

Wits jawed to the USP that require the release of water from

ipatroam atorage facilitiog In order to proteet downatream eoonomle

and ceolowleal interesta threatened by salinity intrusion, and tn

order to inane aufflelont flows of water to protect downatream Mah

andl wildlife, The allocation of water for these purpose laa

question that la of vital importance in California, but waa not

vidrewead by Congr in authorieing the various unite of the

Central Valley Project,

iI

other congressional decisions, Rather, we assert only the

power to make decisions that have not been made by Con-

ress, and that do not impair the purposes of ite reclama-

tion projects, The Ninth Ciroult held that the states lack

thie limited, but vital, power, Tte decision thus prevents the

states from having a voice in decisions that affect their dea

tiny, even where Congress has not apoken,

Although the Ninth Cireuit rejected the United States’

position that the Bureau acquires ite water rights inde

pendently of atate law, the United States’ position, if ae-

cepted, would make it difleult for the western states to

effectively manage their water resources, The tates’ ap-

propriation lawa, consisting of their permit syateme, not

only allow the etates to participate in determining the tse

and allocation of project water; these ayatemea aleo enable

the atates, by using efleient administrative procedures, to

quantify the amount of unappropriated water that should

he allocated to an applicant for a water right, and thus to

quantify the amount of unappropriated water that remains

available for use by others, However, if the Bureau need

not comply with the atates’ permit eyeteme, the states would

he unable to adminiatratively quantify the amount of unap-

propriated water that should be allocated to the Bureau,

The only alternative method for quantifying the Bureau's

rights would be by an adjudication of the Mureau's rights

in relation to those of competing users, a process whieh ts

invariably protracted, See, ¢g., Arieona v, California, 878

U.S, 646 (1008), The atates would thus lack a ready, eMfelent

method for quantifying the amount of unappropriated

waters that are available for uae by non-federal weera,

They would lack information that ia necessary in determin:

ing whether to grant or deny new applications for water

iP

rights, and thie would be unable to properly allocate

their waters, Moreover, non-federal users who have already

aequired appropriative rights would have no assurance

that the Bureau might not subsequently claim the water

necessary to satiefy their rights, on grounds that the Bureau

acquired senior rehte to an unquantified amount of water

tinder the “lmplied reservation” doetrine, Thus, the United

States’ position would injeet confusion and uneertainty

into weatern water law, a result that hae heen avoided

hocntive of the Mureau's historic praction of acquiring ite

water rights under the states’ appropriation laws,

Therefore, thie le a ease of historic aignifieance that will

determine whether federal and state oficiale are to embark

on a new, tineharted course in the fleld of reclamation, or are

to continue on the same course that has been followed ainee

102, The ease thie merite the attention of thie Court,

2, The Lower Court's Decision Is Inconsistent with, and ignores,

the Legislative History and Administrative Interpretation of

Section 0.

Section 8 of the Teelamation Aet of 1902 requires the

Secretary of the Tnterior, in operating federal reclamation

projects, to “proceed in conformity with" atate lawa relating

to the “control, appropriation, use, or distribution” of water,

Meo nt, eupra, ‘The section, on ite face, thie requires

federal compliance with the states’ “appropriation” laws,

Under the states’ appropriation lawa, the states grant a

water right, consieting of a permit, to a water appropriator

who proposes to put water to a beneficial use, and attach

conditions to the right to insure that the proposed tee ta,

and remaina, beneflelal, Thus, seetion & requires federal

compliance with the atates’ permit ayatenme,

is

This conclusion is supported even more strongly by the

legislative history of section & During the 1902 eongres-

sional debates, section & was opposed by representatives

who argued that, if the federal government is to build and

operate the projects, it should control the appropriation,

use and distribution of project water, See, ¢g,, 45 Cong,

Tee, 6606, 57th Cong, lat Seas, (1902) (remarks of Rep,

tay). The section was supported, however, by other repre-

wentatives who argued that, since the weatern states would

be vitally affected by the projects, the states should control

the appropriation, use and distribution of water, See eg,

id, at GO77.0070 (remarkea of Top, Mondell).® The latter

group emphasized that the western states had traditionally

controlled the use of water by non-federal aera (even on

federally-owned publie domain lands) under congressional

0, Senator Clark es chief apokeaman for the reclamation bill

in the Benate, ata

“Hut in the distribution of these waters, .. it le right a

proper that the various poets pes and Territories should eontre

distribution.” 45 Cong, Nee, 2229,

tative Mondell, the ehief spokeaman for -y reelama:

tion DIN in the House of tatives, commented at length on

the meaning of section & Te atated that “Meetion "follows the

well-eatabl precedent in national legislation ining

looal and atate lawa relative to the appropriation and diate bution

of water,” that under the bill “the ecreta of the Interior would

) to make the app tion of the necessary water by

wiving the notice and compl with the forma of law of the Mtate

ov Territory in which the works were located,” and that the seetion

a conalatent with the acta of 1866, 1870 and 1877 in "“recogniaing

the eontrol of the Mtates over the use of waters within thelr bor:

1

r congreaamen milar commenta, Mor exam

pentative Hurkett stated that, under section 4, ‘distribution should

he. , regulated and cont by State lawe and by State boarde

of neers " f.. ae A724,

Th supported &7 resident Theodore Hoosevelt,

who Rw y that oie distribution } oy the division of the

atreama among lerigatora, should be left to the settlers themaelven,

in conformity with tate =. "Td, at 6776,

\4

acts passed in 1866, 1870 and 1877," and argued that the

states should have equivalent control over water ultimately

made available to non-federal users under the 1902 aet; as

state lawe were the souree of water rights under the pre-

1902 net, they should be the source of water rights ander

the 1902 net ae well, See n, 0, supra, The latter group pre-

vailed, and section 8 was included in the act as passed. No

senator or congressmen suggested that section & would have

any effeet other than providing for broad state control of

water under the 1902 Aet, The Ninth Cireuit's decision, by

denying the states any diseretionary control of eneh water,

is consistent with the result that wae favored by the con-

dreasional opponents of section 4, and that wae rejected by

Congress as a whole,

The Ninth Cirewit ignored this legislative history. It

eqiially ignored the historie administrative practice of the

urea in complying with the states’ permit eyetems. The

court instead rested ite decision primarily on thie Court’s

recent companion decisions in Maneock v, Train, 426 U.S.

107 (1970), and Puvironmental Protection Ageney (EPA)

', California, 420 U.S, 200 (1976), involving interpretations

of the Clean Air Act and the Federal Water Pollution Con-

trol Act, In Hancock and BPA, it was held that the states,

which are authorived under the aete to adopt permit pro-

rane for the control of alr and water quality, eannot apply

their permit programe to federal agencies, heeatiae such

10, The Mining Aet of 1866, as amended in 1870, and the Desert

land Aet of 1877 “severed” the water from the publie domain

lande of the weatern states, and required non federal water users

on the publie demain lands to comply with «tate appropriation

lawa even though they aequired their landa under federal law.

Thus, the neta gave the atates broad, even sm ,"" eontrol over

the use of water on nonfederal lands, Mee Call orale Oregon Power

Co, ¥, Beaver Portland Cement Co, 206 U8. 148 (1086); Jennison

vw Kirk, O8 TM, 4608 (1878),

15

authority was not spelled out in “clear and unambiguous”

terms, 426 U.S. at 179, 211. Neither case involved an inter-

pretation of section 8. Ignoring that distinction, the Ninth

Circuit held that, since section 8 does not specifically refer

to the states’ permit systems, the section does not require

federal compliance with the states’ permit systems. If

this is so, it is difficult to understand the basis for the

court’s conclusion that the section requires federal com-

pliance with the “forms” of the states’ permit systems.

More importantly, section 8 clearly and unambiguously

requires federal compliance with the states’ permit sys-

tems. The legislative history and administrative inter-

pretation of the section indicate that the Bureau must

comply with the states’ appropriation laws; since the states’

permit systems are the essence of their appropriation laws,

the only way that this congressional objective can be real-

ized is by federal compliance with the permit systems. This

Court has stated, more than once, that a statute must be

interpreted consistently with its legislative history, see,

e.g., Train v. Colorado Pub. Int. Res. Group, 426 U.S. 1

(1976), and that weight must be given to the administrative

interpretation of a statute, see, e.g., Udall v. Tallman, 380

U.S. 1 (1976). The Ninth Cireuit reached its result only by

ignoring those rules of statutory construction. It overturned

a clearly-stated congressional objective only because Con-

gress did not think to mention the precise procedures by

which this result would be accomplished, procedures that

were then in a state of development. However, this Court

recently observed that, as Justice Holmes remarked, “We

are not free to say to Congress ‘We see what you are driving

at, but you have not said it, and therefore we shall go on as

before.’” Rosebud Sioux Tribe v. Kneip, ........ a

45 U.S.L.W. 4349 (1977).

16

The Ninth Circuit appeared to assume that the Hancock

and EPA decisions establish a rule of law that operates

independently of the normal guides to statutory analysis.

That assumption finds no support in the Hancock and EPA

decisions, however. There, the Court stated that the legis-

lative history in question supported the position of the fed-

eral agencies rather than the states, 426 U.S. at 187-190,

215, and that its decisions were consistent with the adminis-

trative practice of federal agencies under the acts, id. at

226-227. Thus, the decisions do not support the Ninth Cir-

cuit’s decision, and are not relevant here.

3. The Lower Court's Decision Conflicts with This Court's Analy-

sis in the Nebraska, Ivanhoe and City of Fresno Decisions.

In Nebraska v. Wyoming, 295 U.S. 40 (1935), this Court

described the effect of section 8 as follows:

“All of the acts of the Reclamation Bureau in oper-

ating the reservoirs so as to impound and release

waters of the river are subject to the authority of

Wyoming... . [T]he Secretary and his agents, acting

by authority of the Reclamation Act and supplemen-

tary legislation, must obtain permits and priorities

for the use of water from the State of Wyoming in the

same manner as a private appropriator or an irriga-

tion district formed under the state law.” 7d. at 42,

43. (Emphasis added.)

Substantially the same language was repeated in Nebraska

v. Wyoming, 304 U.S. 545, 629 (1945). The Ninth Cir-

cuit’s decision is inconsistent with these decisions,

This Court has limited the effect of state law under sec-

tion 8 in instances where state laws conflict with a specific

provision of federal reclamation law. In Jvanhoe Irr. Dist.

v. McCracken, 357 U.S. 275, 291 (1958), it was held that,

notwithstanding section 8, state law cannot override the

17

“specific and mandatory” provisions of section 5 of the

Reclamation Act of 1902, which limits the availability of

water under the act to lands not in excess of 160 aeres.”

In City of Fresno v. California, 372 U.S. 627 (1963), it

was held that, notwithstanding section 8, state law cannot

prevent the Bureau from exercising its powers under sec-

tion 7 of the Reclamation Act of 1902 to acquire water

rights by condemnation.’* These cases indicate that state

law must yield when it conflicts with a “specific and manda-

tory” federal reclamation law, notwithstanding section 8.

This result is consistent with the rule that, in conflicts

between a general statute (such as section 8) and a specific

statute (such as a specific federal reclamation law) con-

cerning the same subject matter, the specific statute con-

trols. See, ¢.g., Preiser v. Rodriguez, 411 U.S. 475, 488-490

(1973).

In this case, however, there is no conflict between state

law and federal law. Nothing in federal law authorizes the

Bureau to acquire unappropriated water without complying

with state law; in fact, the only provision authorizing the

Bureau to acquire unappropriated water—section 8—

specifically mandates it to comply with state law. Further,

nothing in federal law precludes a state from deferring the

11. The Court stated:

“Without passing generally on the coverage of § 8 in the

delicate area of federal-state relations in the irrigation field,

we do not believe that the Congress intended § 8 to override

the repeatedly reaffirmed national policy of § 5.” Id. at 292.

The State of California joined with the United States in urging

that state law could not override the acreage limitation in § 5,

prompting the court to observe that “there is no clash here be-

tween the United States and the State of California.” Jd. at 279.

12. The Court stated :

“Section 8 does not mean that state law may operate to

prevent the United States from exercising the power of

eminent domain to acquire the water rights of others.” Id.

at 630.

18

acquisition of such water by the Bureau until it develops

a plan for the use of the water. Hence, there is no conflict

between the conditions in Decision 1422 and the purposes

of the new Melones project. Nor does the United States

argue otherwise; in fact, it concedes that it is barred from

making such an argument. App. 9. Thus, the analysis in

the Ivanhoe and City of Fresno cases, coupled with the

analysis in the two Nebraska decisions, affirms the validity

of the conditions in Decision 1422. The Ninth Cireuit’s de-

cision, which fails to consider whether the conditions are

inconsistent with specific federal laws or specific project

purposes, thus conflicts with the analysis in all these deci-

sions.

4. The Lower Court's Decision Results in the Creation of a New

Water Doctrine That Is Unsupported by the Reclamation Act

of 1902.

The Ninth Cireuit’s decision results in the creation of a

new, aberrational water doctrine, one that is without prece-

dent in western water law. This new doctrine, based on

section 8, requires the Bureau to acquire a water right

under state law, but not to comply with conditions attached

to the water right. As noted by this Court, there are three

major types of water rights in the western states: appro-

priative rights, riparian rights and reserved (or “implied

reservation”) rights. See United States v. District Court,

401 U.S. 520, 524 (1971). The water right which the Bureau

must acquire under the majority opinion, however, does not

fall into any of these categories. Since the Bureau must

acquire a state-issued water right, it does not have a re-

served right. Since it need not comply with conditions

attached to the right, it dees not have an appropriative

right. Thus, the majority opinion results in the judicial

19

creation of a fourth type of water right, one that is a blend

of an appropriative right and a reserved right. If such

a water right is to be judicially created, certainly its genes-

is deserves to come from the nation’s highest judicial body.

It is difficult to understand how section 8 supports the

creation of the new water doctrine suggested by the Ninth

Cireuit. As nothing in the section specifically refers to a

permit, nothing therein can be construed to support a dis-

tinction between a permit and its conditions. Hence, if

the section is sufficiently “clear and unambiguous” to re-

quire federal acquisition of a permit, it is sufficiently “clear

and unambiguous” to require federal compliance with con-

ditions in the permit. Thus, it can logically be concluded

only that the Bureau must fully comply with state permit

systems, or that it is wholly immune from such systems;

it cannot logically be concluded that the Bureau must com-

ply half-way with these systems, as the Ninth Circuit has

done. The lower court’s decision thus represents more a

judicial rather than a legislative philosophy of reclamation.

Judge Wallace, in his concurring and dissenting opinion,

correctly notes that the majority opinion results in the

development of a new “federal common law,” and ex-

presses doubts whether the court should engage in “judicial

rulemaking in an area as complex and sensitive as state-

federal relations over water.” App. 10. He also recog-

nizes that the United States’ position would result in

“great potential for uncertainty,” because of the states’

inability to quantify their unappropriated water under that

position. App. 9-10. However, he embraces the United

States’ position “with reluctance,” because he believes that

this Court’s recent decisions in Hancock and EPA offer no

other choice. App. 8. The resulting “problem,” he writes,

20

will have to be changed by Congress. App. 11. Judge

Wallace’s observations show how a rigid application of

the Hancock and EPA analysis in this case leads to a di-

lemma, in that the court must either re-write federal recla-

mation law or embrace a concededly harmful result that

requires legislative correction. The majority chose the for-

mer, and Judge Wallace the latter.

There is another judicial recourse that avoids the dilemma

posed by Judge Wallace. Section § should be interpreted as

requiring the Bureau to comply with state appropriation

laws, including state permit systems, but only to the extent

that the purposes of federal reclamation projects are

unimpaired. This approach fully protects the federal inter-

est in reclamation, by insuring that the states cannot inter-

fere with that interest. It also protects the state interest in

reclamation, by allowing the states to act in instances where

the federal interest is neutral. Above all, it gives meaning

to both the letter and spirit of section 8, by respecting the

accommodation between federal and state interests worked

out by Congress in 1902. Thus, this approach does not

attempt to re-write the federal reclamation laws, as does

the majority opinion below, or reach a concedediy harmful

result that will have to be rectified by Congress, as does

Judge Wallace’s opinion.

This suggested approach is consistent with this Court’s

decisions in the two Nebraska cases, where the Court

stated that the Bureau must obtain permits under Wyoming

law and that the “impound[ment] and release [of water]

. is subject to the authority of Wyoming.” 295 U.S. at

42, 43. This approach is also consistent with this Court’s

analysis in the Jvanhoe and City of Fresno cases, where

the Court held that the states’ authority under section 8

21

is subject to the “specific and mandatory” provisions of

federal reclamation law. 357 U.S. at 291. This approach

is essentially an application of the doctrine of preemption

in the interpretation of section 8.1* That is, a state law

should be upheld to the extent that it is not preempted by

a specific act of Congress, including the specific purposes

of its reclamation projects. In applying the preemption

doctrine, the Court frequently interprets federa! statutes

in a manner that avoids state intrusions on federal interests,

and yet accommodates state interests to the extent that

no such intrusions occur. The same approach should be

followed in interpreting section 8. This approach respects

history, and does not attempt to re-write it.

5. By Voiding Conditions in State-Held Water Rights Assigned to

the Bureau, the Court Has Sanctioned an Unconstitutional

Violation of California's Property Rights.

The Ninth Cireuit held that the Bureau is not bound by

conditions attached to water rights held by an agency of

the State of California, and assigned by California to the

Bureau at its request. The question is one cf importance,

for a substantial portion of the water rights held by fed-

eral agencies in California are based on similarly-assigned

13. Under the preemption doctrine, assuming that Congress has

not occupied the field, a state law is invalid if it conflicts with a

specific federal law. See, e.g., New York State Dept. of Social

Services v. Dublino, 413 U.S. 405 (1973) ; Goldstein v. California,

412 U.S. 546 (1973). This Court has recently shown greater willing-

ness to sustain state laws against challenges that they have been

preempted by federal laws, now requiring “a flexible conception

of federal-state relations rather than one of absolute federal supre-

maey.” Note, “The Preemption Doctrine: Shifting Perspectives on

Federalism and the Burger Court,” 75 Colum. L. Rev. 623, 641

(1975). In particular, federal] laws will not be deemed to preempt

a field “traditionally occupied by the States” in the absence of a

“elear and manifest purpose of Congress.” Jones v. Rath Packing

_ Sen , 45 U.S.L.W. 4323, 4324 (1977).

ws

water rights’ This question is one that has never been

addressed by this Court,

According to the Ninth Cireuit, the State agency's rights

wore inchoate at the time that they were assigned to the

Bureau, sinee the rights were based on applications that

were not yet approved by the State Board; the righta were

not perfeeted until the State Board approved the applica.

tions, and at that time the rights were held by the Bureau,

The court stated that, at the time that the assigned appli.

cations were approved, the Bureau “was acting in the same

oapacity as when it Aled ite own applications,” and that

ite “substantive rights arose from the Congressional logis

lation, not from the assignment.” App, 14, Henee, the court

concluded, the Bureau ia not subject to conditions attached

to the approved applications, App, 12-16,

Hlowever, the decision overlooks the fact that the right

vealed to the Hureau, however inchoate, has the ineident

of an early priority date, based on the vear—10U7-—that

the State ageney fled ite applications, This early priority

date is an important feature of the perfeeted right now

held by the Bureau, for it enables the Bureau to defeat the

claima of competing water users with poat.1027 priority

‘lates, This important feature ie a product of state law,

not feceral law, Federal law, at moat, authorizes the Mureau

to obtain a priority date based on the date of ite own

applications, even assuming that it ia not bound by eondi.

tions in atate-iasned permite, Tlowever, federal law clearly

14. ‘The total amount of water whieh te subject to Statefled

applications awened to federal ageneloa in California, and hence

subject to potential use, la approximately 9,000,000 acre-feet in

atorage, The total amount of water aetwally used by the Bureau in

the CVE in 1072 waa approximately 6,000,000 aere-feot, The total

amount of water aetually used by af? usera in California in 1072

was approximately 27,000,000 acre-fect, Memorandum, “Water

Supply and Water Righta Data,” Governor's Commiasion to Re.

view California's Water Righta Law, August 4, 1077,

a3

does not authorive the Bureau to obtain an earlier priority

date based on the applications of the State itself, The

Hureau can acquire the latter benefit only by electing to

wacquire ite water rights under atate law, independently of

ite righte uncer federal law, The Bureau could not have

obtained the LWL7 priority date without obtaining the assign.

ments, tenes, the cdeeision is fundamentally wrong in

stating that the Bureau's “substantive rights arose from

the Congressional legislation, not from the assignment,”

App, i& Tt rights arose directly from the assignments,

Therefore, ae an assignee, the Bureau could not obtain

roater rights than were held by the assignor, the State

agency, Tt ia thus limited by conditions in the permit, just

ae the assignor would have been,

The Ninth Cirenit has confused the difference between a

water right aequired by the Bureau under federal law

pursuant to section 8, and a water right acquired wider

state law independently of section & Tf it eleets to obtain

one auch right, it cannot obtain the benefite of the other,

If it acquires a right under federal law, it obtains a

pormit free of conditions, according to the court's decision

however, it cannot obtain the 1927 priority date that be

longa to the State, Conversely, if it acquires an assigned

right under State law independently of section & it obtains

the 1927 priority date, but is bound by conditions whieh the

State attaches to the right, The Ninth Clreuit's deelsion

awards the Bureau the benefits of both federal and state

law, by allowing the Bureau to obtain a condition.free per.

mit with a 1927 priority date, Thus, the Bureau ls allowed to

ain the benefit of a right that belongs to the State, without

complying with the burdens whieh the State attaches to

the right,

This result sanctions an unconstitutional invasion by

the federal government of the property rights held by the

a

State of California, a result whieh should not be tolerated

by a Court which has recently reaffirmed the states’ im:

munity from euch invasions, See National League of Cities

0 User, oo UB, 44 US DW, 4074 (1976), This result

allowa a federal ageney to acquire a valuable property

right held by the State without complying with State.

imposed limitations on the right, simply beeause the right

in “inehoate” at the time of ite acquisition, However, the

inchoate nature of the right ie irrelevant, Tt ia only relevant

that the right is valuable, and belongs to the State, Suppose,

for example, that a atate holds an option to buy a building,

and agrees to sell the option to a federal ageney on condi.

tion that the federal ageney complios with the atate's soning

laws, Clearly the federal ageney is constitutionally required

to comply with the state's yoning lawe if it purchases the

option, notwithatanding the inchoate nature of the option,

This ia not to sugweat that the federal agency may lack

wuthority to independently aequire the building under its

constitutional powers, and thus avoid the encumbrance of

the atate’s soning laws, However, if the federal ageney

elects to proceed under atate law in order to gain the bene.

ite of that law, it ie clearly bound by the encumbrances

of atate law, Such ia the constitutional imperative of the

Tenth Amendment, Cf, United States v, Gerlach Live Stock

Co,, S80 U8, 725, 786, 799, 742 (1950),

ee

15. The court's deelsion waa premised on several incorrect state

mente af the record, Kor onainiple, the court atated that, “when the

State applied for water righta in 1909," Congress had alread

wuthorised federal construction of the project, an event while

ooourred in 1idd. App, 16, (Mmphasia added.) Accordingly, the

court stated, the State agency fled ite applications in the expecta.

tion that they would be awigned to the Mureau, App, 1415, In faet,

the State agency filed ite applications in 1927, not 1068, Defend.

want's xh, h 1, At the time that the applications were fled, it

waa expected that the projects would be built by the State rather

than the federal government, and hence it waa not expected that

the applications would be assigned to the Bureau,

26

CONCLUSION

For the foregoing reasons, it ia respectfully requested

that the petition for writ of certiorari be granted,

Roapectfully submitted,

Diver J, Younrown

Attorney General of the

Miate of California

ht, Hl, Connwrr

Analatant Attorney General

Ronee Wataron

Deputy Attorney General

Rienann C, Jaconsa

Doputy Attorney General

Attorneys for Petitioners

Purther, the court stated that the applications of the State De.

partment of Finance “were assigned by the Department to the

Hureau of Reclamation,” and that “there la no contention that the

dwal@nment was oxpronsly conditioned upon acceptance of whatever

permit con titions the State might impos,” App, 14-14, However,

thin statement overlooks the fact that the assignments did not be

come effective witil thelr approval by the State Board, at whieh

time the State clearly expected that the Bureau would be bound by

the conditions therein, Moreover, the Bureau, in applying to the

State Board for approval of the assignments, expresaly agreed that

the rowulting permite “shall inelude the enumeration of conditions

therein whieh in substance ahall inelude all of the provisions of this

article,” and that the permit shall be effective Insofar an it la in

conformity with thin division of the [California] Water Code,”

Defendant's Wah, (a), O(b),

Appendix 1

Wilode-Ape L 1077

Hmil 6, Melfi, Jr,

Clerk, U.S, Court of Appeals

United States Court of Appeals

for the Ninth Cirewit

United States of America,

Plaintiff Appellee,

va,

The State of California, State Water He. N

sources Control Board, W, W, Adama, 1h anne

Chairman, Ronald 1, Hobie, Viee Chair. :

man, Roy 1, Dodson, Jean Auer, and

Ww, Don Mau han, as members of the

State Water Resources Control Hoard,

Defendants Appellants,

OPINION

Appeal from the United States Distriet Court

for the Hastern Diatriet of California

Before; DUNTWAY, CARTER and WALLACEK,

Cireuit Judges

DUNIWAY, Cireuit Judge:

The State of California and ite State Water Resources

Control Board appeal from a judgement for the United

Staten entered by the Distriet Court for the Kastern Din

trict of California, The opinion and judgment of that court

| Appendia

are reported in United States v, State of California, E.D.

Cal, 1075, 408 ¥, Supp, 874, The judgment of the district

court appears at 403 F, Supp, 002-05, The prineipal ques-

tions are (1) whether Seetion 8 of the Reclamation Act of

1902, 12 Stat, 988, now 45 U.S.C, § 983, requires that the

United States apply to the California State Water Re-

sources Control Board for a permit to appropriate unap-

propriated water from the Stanislaus Kiver for the New

Melones project, and, (2) if ao, what conditions, if any, the

Hoard can attach to a permit that it grants, The questions

are of great importance, and we have given them eareful

attention,

Our study of the record and the law convinces us that

the judement muat be alfirmed, substantially for the reasons

stated by Judge Maetiride in his opinion,

Two recent decisions of the Supreme Court strengthen

our convietion, In Haneock v, Train, 1076, 426 0,8, 167, the

question was whether § 118 of the Clean Air Aet, 42 U.S.C.

(18970, permite a state to require federally owned or

operated installations to obtain a permit to operate, as

required by the state's federally approved plan for assuring

alr quality, The pertinent language of § 118 reade:

Jach department, ageney, and inatrumentality of the

executive, legislative, and judicial branches of the

Vederal Government (1) having juriedietion over any

property or faeility, or (2) engaged in any activity

resulting, or whieh may result in the discharge of air

pollutants, shall comply with federal, State, interstate,

and local requirements reapecting control and abate-

ment of air pollution to the same extent that any per-

won ie subject to such requirements,

42 U.S.C, § 1807¢,

The Court etates ite holding as follows:

Kentucky, like the Court of Appeals for the Fifth

Cireuit in Alabama v, Seeber, 002 2d 1298, 1247-1248

Appendix 3

(1974), finds in § 118 a sufficient congressional author-

ization to the States, not only to establish the amount

of pollutants a federal installation may discharge, but

also to condition operation of federal installations on

securing a state permit. We disagree because we are

not convinced that Congress intended to subject federal

agencies to state permits. We are unable to find in

§$ 118, on its face or in relation to the Clean Air Act as

a whole, or to derive from the legislative history of the

Amendments any clear and unambiguous declaration

by the Congress that federal installations may not

perform their activities unless a state official issues a

permit. Nor can congressional intention to submit

federal activity to state control be implied from the

claim that under Kentucky’s EPA-approved imple-

mentation plan it is only through the permit system

that compliance schedules and other requirements may

be administratively enforced against federal installa-

tions. 7d. at 180-81.

In view of the undoubted congressional awareness of

the requirement of clear language to bind the United

States, our conclusion is that with respect to subjecting

federal installations to state permit requirements, the

Clean Air Act does not satisfy the traditional require-

ment that such intention be evinced with satisfactory

clarity. Should this nevertheless be the desire of

Congress, it need only amend the Act to make its inten-

tion manifest. Jd. at 198 (footnotes omitted).

In Environmental Protection Agency v. California ex rel.

State Water Resources Control Board, 1976, 426 U.S. 200,

the Court reached a similar conclusion as to the effect of

$ 313 of the Water Pollution Control Act Amendments of

1972, 86 Stat. 816, 33 U.S.C. § 1323. That section provides

that federal installations must “comply with Federal, State,

interstate, and local requirements respecting control and

4 Appendiz

abatement of pollution to the same extent that any person

is subject to such requirements.” California and Washing-

ton sought to apply the permit requirements of their pro-

grams. We held that they could do so (511 F.2d 963), but

the Supreme Court reversed. Applying the principles of

Hancock, supra, the Court said:

Our decision in this case is governed by the same

fundamental principles applied today in Hancock r.

Train, ante, at 179: federal installations are subject to

state regulation onlv when and to the extent that

congressional authorization is clear and unambiguous.

Td. at 211.

Except for the reference to service charges, § 313 is

virtually identical to $118 of the Clean Air Act, 42

U.S.C, $1857f. Taken alone, § 313, like $118 of the

Clean Air Act, states only to what extent—the same as

any person—federal installations must comply with

applicable state requirements. Section 313 does not

expressly provide that federal dischargers must obtain

state NPDES permits. Nor does § 313 or any other

section of the Amendments expressly state that obtain-

ing a state NPDES permit is a “requirement respect-

ing control or abatement of pollution.”

Id. at 212-13 (footnote omitted).

The language of $8 of the Reclamation Act of 1902, set

out in the opinion of the district court, 403 F. Supp. 885, is

no more specific in subjecting federal projects to state

permit requirements than are the statutes construed in the

foregoing cases. Our view that the judgment in this case

should be affirmed is, we think, supported by the principles

applied in those cases. Indeed, we find that California’s

claim in this case that the United States must obtain a

permit and comply with conditions embodied in it is less

Appendiz 5

supportable than the claims of Kentucky in Hancock, supra,

and of California and Washington in Environmental Pro-

tection Agency, supra. In each of those cases, it could more

plausibly be argued that Congress did intend to subject

federal installations to state permit requirements than in

this case. When the Congress enacted § 118 of the Clean Air

Act and § 313 of the Water Pollution Control Act Amend-

ments of 1972, the use by the states of the permit device as

a means of enforcing their laws in these areas was well

known. The language of the two Acts, subjecting federal

instrumentalities to state laws, is very broad. Yet the Court

declined to read either section as requiring compliance with

state permit requirements.

On the other hand, when § 8 of the Reclamation Act was

adopted in 1902, California’s permit requirement did not

exist. At that time, under the Civil Code of 1872, §§ 1410-

1422, surplus water was appropriated by the physical act

of taking and diverting it to beneficial use. An appropriator

could post a notice of taking at the point of diversion and

record a copy with the county recorder. If the appropriator

was diligent in completing the work for the diversion, his

rights would date back to the posting of the notice. The

statute did not create appropriative rights; it merely pro-

vided evidence of the date of appropriation. A fortiori,

then, we cannot read § 8 as requiring compliance with Cali-

fornia permit requirements that did not exist when § 8 was

adopted.

In 1913, California enacted the Water Commission Act

(Cal. Stats. 1913, e. 586) which created the State Water

Commission and provided a statutory procedure that could

he followed in the appropriation of unappropriated water

flowing in any natural channel “for useful and beneficial

6 Appendiz

purposes.” The Act became effective, following a referen-

dum vote, in 1914. In 1923, an amendment made the statu-

tory procedure the exclusive method of appropriating water.

(Cal. Stats. 1923, ce. 87.) The Act, as amended, is now part

of the California Water Code, Divisions 1 and 2.

As the district judge concluded, a major purpose of § 8

of the 1902 Act was to recognize and protect state water

law, particularly the state law doctrine of appropriative

rights to water. 403 F. Supp. at 888. Similarly, the Clean

Air Act and the Water Pollution Control Act amendments

give effect to state law and require compliance with it by

federal installations. Indeed, those acts are more specific

than § 8 of the 1902 Act. Yet the Court has declined to read

them as subjecting federal installations to state permit

requirements, even though the use of permits by the states

as a means of enforcing their clean air and water pollution

laws was known. To read § 8 of the 1902 Act as requiring

compliance with laws that did not then exist and procedures

not made compulsory by California until 1923—over 20

years later—would fly in the face of the Hancock and

Environmental Protection Agency decisions. We could only

do so if the language of § 8 were much more specific than it

is.

Tn one respect, however, we disagree with Judge Mac-

Bride’s decision. He says, 403 F. Supp. 889-90:

Tndeed, while the Congressional history of the 1902

Act indicates broad federal purpose and authority in

the operation and control of federal reclamation

projects, the comity inherent in a federal system

would not permit an overbroad usurpation of state

sovereignty. Accordingly, the federal government is

required, when acquiring water for federal reclamation

projects, to comply with the forms of state law, includ-

oe 2 ae enemas Oe ate. ee

Appendix 7

ing application to state water boards where necessary,

for two purposes: (1) to enable the state to determine,

according to its law, whether there is sufficient unap-

propriated water available for the project; and (2) to

give notice to the state of the scope of the project.

His judgment provides:

(1) The United States can appropriate unappro-

priated water necessary for use in any federal reclama-

tion project within the State of California, but must

first, in accordance with comity, apply to the California

State Water Resources Control Board for a determina-

tion by that Board of the availability of unappro-

priated water.

(2) When the United States submits applications to

the California State Water Resources Control Board,

that Board must grant such applications if unappro-

priated waters are available.

We agree with this result, but we do not agree that the

requirement is one of comity. It is a legal requirement of

§ 8.

Under § 8, the national government, in constructing and

administering reclamation projects, must recognize and .

cannot nullify either water rights created by state laws or

the laws that create them. But enforcement of the govern-

ment’s duty via the permit device is not handed over to the

state.

The phrase “in accordance with comity” is stricken from

paragraph (1) of the judgment. In all other respects, the

judgment is affirmed.

CARTER, Circuit Judge, concurring specially :

I concur in the above opinion. Hancock v. Train, 426

U.S. 167, 44 U.S.L.W. 4767 (June 7, 1976), and Environ-

8 Appendiz

mental Protection Agency v. California ex rel. State

Water Resources Control Board, 426 U.S. 200, 44 U.S.L.W.

4781 (June 7, 1976), make improper, under existing stat-

utes, any state requirements in the nature of permits. The

cases hold that it is for the Congress to explicitly determine

whether to subject federal agencies to state permits.

I would suggest, however, that it may be one thing for

the Congress to provide that a state may require a permit

to assure proper air or water quality standards of a fed-

erally-owned or operated installation; it is quite another

thing to permit a state to require permits for the very

operation of such a facility. I cannot envision the Congress

providing that the states, by a permit process, may control

the operation of federally constructed, funded, and oper-

ated water and power projects.

WALLACE, Cireuit Judge, Concurring and Dissenting:

Although recent Supreme Court decisions leave me with

no clear concept of what Congress must say in order to

require the federal government to comply with state law,

IT am persuaded that the language of the state reviewed

here is insufficient to validate California’s permit procedure.

While the “shall” in section 8 of the 1902 Reclamation Act

appears to be mandatory, and while the Bureau of Recla-

mation’s conduct over nearly three-quarters of a century

indicates that it had no doubt of the necessity for compli-

ance with state law, I cannot say that the language of the

section is any clearer or less equivocal than that rejected

as insufficient in Hancock v. Train, 426 U.S. 167 (1976),

and EPA v. California ex rel. State Water Resources Con-

trol Board, 426 U.S. 200 (1976). Thus, with reluctance T

concur that the statute does not require the Bureau of Rec-

Appendiz 9

lamation to secure, pursuant to state law, the permit in

question.

However, unlike the majority,’ I would go no further.

Nothing in Hancock or EPA necessarily forecloses federal

compliance with state-imposed requirements not involving

permits. Indeed, the more than 70 years of cooperative

development of water resources in the West under the Ree-

lamation Act attest to the wisdom in providing non-exclu-

sive control over this limited asset.

Also, I believe that we must disapprove that portion

of the district court’s order that requires the federal gov-

ernment, “in accordance with comity, [to] apply to the

California State Water Resources Control Board for a

determination by that Board of the availability of unappro-

priated water” and that requires the Board to “grant

such applications if unappropriated waters are available.”

United States v. State of California, supra, 403 F. Supp. at

902. By construing section 8 under compulsion of Hancock

and EPA as not requiring Bureau of Reclamation com-

pliance with state appropriation procedures, we bring an

element of uncertainty to the administration of water re-

sources, Absent some mechanism to convey the information,

the states cannot know what amount of unappropriated

1. The majority’s approach to the permit issue seems to be

premised on the belief that the impermissible aspect of the state’s

scheme is not the permit requirement but rather the conditions the

state has attached to the permit. California has conceded all along

that, although the Bureau must seek and secure a permit, the state

has no power to attach to the permit conditions inconsistent with

or contradictory to congressional purposes underlying the particu-

lar reclamation project. California believes, however, that no such

conflict exists in this case.

In a proceeding before a state agency, it was determined that the

conditions imposed by California were valid. The federal govern-

ment did not appeal this decision. Accordingly, the government

conceded at oral argument that it is precluded by the doctrine of

res judicata from raising the issue anew in this case.

10 Appendix

water remains for private use in a watershed after a por-

tion is appropriated by the Bureau. The “comity” theory

and application/notice requirement of the district court are

an effort to patch this tear caused by the new construction

of section 8.

It is a wayward effort. Comity is a concept of deference

and voluntary action. Zink v. Estelle, 403 F. Supp. 656,

659 (S.D. Tex. 1975) ; Galloway v. Watts, 395 F. Supp. 729,

731 (D. Md. 1975). To use such a concept as a basis for

requiring affirmative federal action seems peculiarly in-

congruous. Accordingly, I agree with the majority’s dis-

approval of the district court’s comity theory.

But the majority does no better in its effort for it pro-

vides no defensible basis for requiring federal agency

action. Accordingly, I must reject that portion of the ma-

jority’s opinion which directs the federal government “to

comply with the forms of state law” (emphasis added) be-

cause “[i]t is a legal requirement of § 8.” Majority op. at 6.”

Concededly where two sovereigns, acting independently,

administer water rights in the same watershed, there is a

great potential for uncertainty. But that is what our Han-

cock- and EP4A-inspired construction of section 8 means.

2. While the majority fails to provide us with any legal reason-

ing for requiring compliance with “the forms of state law,” I ean

only assume that the requirement is derived from federal common

law. Before embarking on this new and uncharted course of con-

strueting common law, I would ask: Do we have the legal compe-

teney to fashion any rules in this area? Even if we do, is it wise

for us to undertake the task? While I entertain doubts that the first

question can be answered affirmatively, I am convinced that we

ought not undertake the task of judicial rulemaking in an area as

complex and sensitive as state-federal relations over water.

If my assumption regarding the federal character of the applica-

tion/notice requirement is incorrect, then that requirement must

be viewed as one of state law. If derived from state law, there would

be an ineonsisteney with the majority’s initial conclusion that see-

tion 8 does not require federal agency compliance with state permit

procedures.

bs Rn.

a ee

Appendix 11

The majority has failed to find a defensible legal basis to

give effect to its desire to avoid this problem. Unfortu-

nately, I can see no such basis either. Accordingly, we

have, I believe, no alternative but to leave it to the legisla-

tive branch to devise a solution. Therefore, I would go no

further than to disapprove the permit procedure in question.

Appendix 2

United States Court of Appeals

For the Ninth Circut

AUG 12 1977—

Emil E. Melfi, Jr. Clerk

U.S. Court of Appeals

United States of America,

Plaintiff-Appellee,

vs.

The State of California, State Water Re- N

sources Control Board, W. W. Adams, 15 anne

Chairman, Ronald B. Robie, Vice Chair- "

man, Roy E. Dodson, Jean Auer, and

W. Don Maughan, as members of the

State Water Resources Control Board,

Defendants-Appellants.

OPINION

Appeal from the United States District Court

for the Eastern District of California

On Petition for Rehearing

Before: DUNIWAY, CARTER and WALLACE,

Circuit Judges

DUNIWAY, Circuit Judge:

In its petition for a rehearing, California relies upon

an argument that it made, but did not emphasize, in its

briefs on appeal, an argument that we overlooked. It points

ree

Appendiz 13

to the fact that certain of the permits involved in this case

had their origin in two applications filed by the State De-

partment of Finance. These applications were then assigned

by the Department to the Bureau of Reclamation. The State

points out that its Department of Finance, had it prose-

cuted the applications to the obtaining of permits, would

certainly have been bound by whatever conditions the State

Board might impose. It follows, says the State, that the

Bureau, assignee, is also subject to those conditions because,

as assignee, it could acquire no greater rights than its

assignor. The argument is superficially appealing, but, on

reflection, we reject it.

The argument overlooks two considerations, The first

is that the assignment was of an application, not of a permit

containing conditions. The second is that the assignee was

the Bureau, a Federal agency exercising powers conferred

upon it by the Congress of the United States, whose valid

enactments are “the supreme law of the land” (U.S. Const.

Art. VI, § 2).

Under California law, an application for a permit to

appropriate surplus or unappropriated water confers noth-

ing upon the applicant as against the state; all that it con-

fers is a priority over later applicants if the application

is granted. Cal. Water Code § 1450 states:

Any application properly made gives to the applicant

a priority of right as of the date of the application

until such application is approved or rejected. Such

priority continues only so long as the provisions of

law and the rules and regulations of the board are fol-

lowed by the applicant.

Cal. Water Code § 1455 then adds: “The issuance of a

permit continues in effect the priority of right as of the

date of the application. ...”

14 Appendix

The Supreme Court of California interpreted these pro-

visions in Madera Irrigation District v. All Persons, 1957,

47 Cal.2d 681, 690, 306 P.2d 886, rev’d on other grounds,

Ivanhoe Irrigation District v. McCracken, 1958, 357 U.S.

275. There the court stated:

The filing of an application under the present law is

comparable and of like effect to the posting and re-

cording of notice or commencement of actual con-

struction work under the rules which had previously

prevailed. ... The Water Code provides that the effect

of filing an application confers, for all practical pur-

poses, a priority only.

To the same effect, see United States v. Fallbrook Public

Utility District, S.D. Cal., 1958, 165 F. Supp. 806, where

Judge James M. Carter stated (at 855) :

Until the application to appropriate is acted upon by

the State Water Rights Board favorably to the appli-

cant, and the issuance of a permit is directed, the appli-

cant has no property right of any kind as against the

state. He has an inchoate, incipient, conditional right

of procedural priority over later applicants. .. .

That is all that the State Department of Finance had, and

all that it could assign to the Bureau.

When the Bureau became the assignee of that “inchoate,

incipient, conditional right,” it was acting in the same

capacity as when it filed its own applications. It was acting

under the same Federal laws, and, absent those laws, it

would have had no right to appropriate any water. Its sub-

stantive rights arose from the Congressional legislation,

not from the assignment. There is no contention that the

assignment was expressly conditioned upon acceptance of

whatever permit conditions the State might impose. On the

contrary, the State’s briefs make it clear that the State

Department of Finance filed the applications for one pur-

pose only, to obtain, not for itself, but for the Bureau when

Appendix 15

the project finally went forward, a priority date as appro-

priator.'

We conclude that the Bureau, as assignee of an applica-

tion, is no more subject to the imposition of conditions by

the Board than it is as an original applicant.

The petition for a rehearing is denied.

WALLACE, Cireuit Judge, concurring in part:

I concur in part. Concluding that the first of Judge Duni-

way’s reasons to deny the petition is more than adequate

1. Originally, the Central Valley Project, of which New Melones

is a part, was to be constructed and operated by the State. There-

fore, as California told us in its opening brief, its Department of

Finance began in 1927 filing applications for permits to appropri-

ate water for the Central Valley Project,

so that the State—in anticipation of State construction of the

CVP—could obtain a prior right to the use of water, as

against private appropriators who submitted later applica-

Es a a

(Brief, page 5)

As noted earlier, Decision 1422 approved the assignment of

two applications to the Bureau, and issued permits to the

Bureau on the basis of these applications; these applications

had originally been filed by a State agency for the purpose of

obtaining an early priority date.

(Brief, pages 83-84)

There is a similar assertion in California’s Reply to Response to

Petition for Rehearing, page 6:

[T]he State Department of Finance, in applying for water

rights in 1927, did not apply for the purpose of ultimately

encumbering the Bureau’s water rights. Rather, it applied be-

cause it was expected that the State rather than the federal

government would build and operate the Central Valley Proj-

ect, and the State wanted to obtain the earliest possible pri-

ority dates in its own water rights.

(footnote omitted)

It was apparent in 1944 that New Melones was to be built and oper-

ated as a Federal Project. It was authorized in the Flood Control

Act of 1944, 58 Stat. 887. See also § 203 of the Flood Control Act

of 1962, 76 Stat. 1191. Thus, when the State applied for water

rights for New Melones in 1952, its purpose was, as it says, to obtain

early priority dates, and its intent must have been to do what it

ultimately did, to assign its applications to the Bureau of Reclama-

tion, which was to build and operate the project.

16 Appendiz

(“the assignment was of an application, not of a permit

containing conditions’’), I would not reach the constitutional

issue. See Ashwander v. Tennessee Valley Authority, 297

U.S, 288, 341 (1936) (Brandeis, J., concurring).

Appendix 3

Section 8 of the Reclamation Act of 1902:

“That nothing in this Act shall be construed as

affecting or intended to affect or to in any way inter-

fere with the laws of any State or Territory relating to

the control, appropriation, use, or distribution of water

used in irrigation, or any vested right acquired there-

under, and the Secretary of the Interior, in carrying

out the provisions of this Act, shall proceed in con-

formity with such laws, and nothing herein shall in anv

way affecting any right of any State or of the Federal

Government or of any landowner, appropriator, or

user of water in, to, or from any interstate stream or

the waters thereof: Provided, That the right to the use

of water acquired under the provisions of this Act shall

be appurtenant to the land irrigated, and beneficial use

shall be the basis, the measure, and the limit of the

right.” 32 Stat. 390 (1902); 48 U.S.C. §$ 372, 383

(1970).