# Adjustments to 1988 Operating Criteria and Procedures (OCAP) for the Newlands Irrigation Project in Nevada

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URL: https://www.frixlaw.com/law-library/documents/fr%3A97-32795

## Record

- **Collection:** Federal Register
- **Document type:** Rule
- **Published:** December 18, 1997
- **Citation:** 62 FR 66442

## Text

SUMMARY: This rule adjusts the 1988 Operating Criteria and Procedures
(OCAP) for the Newlands Irrigation Project (Project). Adjustments are
made to the Project efficiency requirements, maximum allowable
diversion calculations, and Lahontan Reservoir storage targets in the
1988 OCAP to reflect current irrigated acreage, court decrees which
have lowered the water duty applicable to certain Project lands, and
other factors affecting water demand. To better manage diversions from
the Truckee River to the Project, the rule provides flexibility to
adjust the water supply in response to Project demand, flexibility in
using snowpack and runoff forecasts, and extends the time frame for
storing water in Truckee River reservoirs in lieu of diversions to the
Project from the Truckee River.

DATES: Effective December 16, 1997.

FOR FURTHER INFORMATION CONTACT: Dave Overvold, Acting Area Manager,
Lahontan Area Office, Bureau of Reclamation, P.O. Box 640, Carson City,
NV 89702, telephone (702) 882-3436; or Jeffrey Zippin, Team Leader,
Truckee-Carson Coordination Office, 5665 Morgan Mill Road, Carson City,
NV 89701, telephone (702) 887-0640. Copies of Adjusted OCAP regulations
may be obtained from either office.

SUPPLEMENTARY INFORMATION:

Background

On April 15, 1988, the Secretary of the Interior (Secretary)
implemented new Operating Criteria and Procedures (OCAP) governing
management of water diverted to and used within the Newlands Project.
These 1988 OCAP were approved by the U.S. District Court for the
District of Nevada, subject to a hearing on objections raised by
various parties. In 1990, Congress directed in the Truckee-Carson-
Pyramid Lake Water Rights Settlement Act (Title II of Pub. L. 101-618,
Section 209 (j) (104 Stat. 3294) that the 1988 OCAP remain in effect at
least until December 31, 1997, unless changed by the Secretary in his
sole discretion. Prior to the proposed rule, the 1988 OCAP had not been
published in the Federal Register.
These 1988 OCAP were designed to increase the reliance of the
Project on water from the Carson River, minimize the use of water from
the Truckee River as a supplemental supply, increase efficiency of
water use in the Project, and establish a regulatory scheme to manage
deliveries to Project water users including incentives for efficiency
and penalties for inefficiency.
An environmental impact statement (EIS) was prepared for the 1988
OCAP. That EIS served as the basis for reviewing the environmental
effects of these adjustments. The Department of the Interior (DOI) has
prepared an environmental assessment on the adjustments which tiers off
of the analysis in that EIS. Copies of the environmental assessment may
be obtained from the Truckee-Carson Coordination Office.
The Department is making a number of revisions to the 1988 OCAP to
adjust for changes in use of water rights, to increase flexibility, and
to clarify the language of the OCAP based on experience gained in
administering the 1988 OCAP through nine irrigation seasons. These
revisions are within the basic framework of the 1988 OCAP and its
environmental documentation and are being published for codification.
The need for additional changes to the 1988 OCAP beyond those in
this rule may be appropriate as well, but consideration of such changes
is expected to require further examination including the preparation of
an EIS.

Description of the 1988 OCAP

The 1988 OCAP provisions were preceded by a preamble which is
equally applicable to the Adjusted OCAP. The 1988 OCAP preamble is
reproduced with minor grammatical editing. The following 1988 OCAP
Preamble is taken from the 1988 OCAP:

1988 OCAP Preamble

The development of Operating Criteria and Procedures for the
Newlands Project in western Nevada was initiated in the late 1960's
and has proven to be a divisive, contentious issue for the people in
Nevada who rely on the waters of the Carson and Truckee Rivers.
Competition for the water in the Project's desert environment is
intense and growing. The conflicts among uses are clearly apparent
in the effects forecast on various areas where the DOI has program
responsibilities. The issue is complicated further by the
requirements of the Endangered Species Act and the listing of the
Cui-ui, a fish inhabiting the lower Truckee River and Pyramid Lake.
In order to proceed effectively and fairly, the DOI had to have
guiding principles for the OCAP. These are to:

--Provide water deliveries sufficient to meet the water right
entitlements of Project water users;
--Meet the requirements of the Endangered Species Act as they
specifically relate to the Truckee River/Pyramid Lake Cui-ui;
--Fulfill Federal trust responsibilities to the Pyramid Lake Paiute
Indian Tribe and the Fallon Paiute-Shoshone Tribes;
--Conserve wetland and wildlife values in both the Truckee and
Carson River basins;
--Give cognizance to the State laws affecting water rights and uses;
--Provide for stable economies and improve quality of life in the
region to the extent it is influenced by the DOI-managed resources
and facilities;
--Allow local control and initiative to the maximum extent possible;
and
--Provide stability and predictability through straightforward
operation based on actual versus forecast conditions.

The DOI believes that the proposed OCAP best satisfy these
principles within the limits of the Department's legal authority.
Each of the competing uses for the water is critical in its own
right. They are all essentially separable for decision making
purposes even though they clearly impact upon each other since the
available supply is far less than the demand.
The OCAP deal with the operation and use of Federal facilities
related to the Newlands Project. Therefore, their primary
responsibility is supplying the water rights to the Project water
users. To the extent this can be done effectively and efficiently,
then the remaining water supply is available for other competing
uses. The secondary impacts of the OCAP must, however, act to
support or encourage results which benefit the other competing uses.
The basic structure of the OCAP relies on both rules and
incentives which we believe will ensure reasonable, efficient water
management through reliance on local control and initiatives. The
direct consequences of the OCAP will be delivery of full water
entitlements within the Newlands Project, protection of endangered
species, fulfillment of trust responsibilities, and encouragement
for the protection of other environmental and quality of life
values.

Adjusted OCAP Proposed Changes

The Notice of Proposed Rulemaking for the Adjusted OCAP, published
in the Federal Register, 61 FR 64832, December 9, 1996, proposed a
number of changes to the 1988 OCAP based, in part, on a comparison of
the assumptions in the 1988 OCAP about the size of the Project and
patterns of water use with Project size in 1995 and new patterns of
water use. Specifically, the changes are:
Acreage: The anticipated increase in acreage has not
materialized; actual irrigated acreage in 1995 was 59,075 acres. This
amount reflects efforts of the Bureau of Reclamation (BOR) to limit
irrigation to water-righted lands and that, on average, irrigators have
not

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increased the acreage of lands in production. In the Notice of Proposed
Rulemaking for Adjusted OCAP, the 1995 preliminary estimate of
irrigated acreage for that year was shown in the text as 59,023.
However, modeling was based on 59,075 irrigated acres. In this final
rule, both the text, tables, and modeling consistently use 59,075
irrigated acres for 1995. When this rule becomes effective, the
provisions of section 418.22 will be used to adjust Lahontan Reservoir
storage targets to reflect the current water demand.
Average Water Duty: The average water duty for the project
has been reduced as a result of the so-called ``bench/bottom''
litigation (1995 Order of Judge McKibben, in U.S. v. Alpine, United
States District Court for the District of Nevada No. D-185). This
bench/bottom court ruling approved a change in the designation of some
Project lands from bench lands to bottom lands. Bench lands have a
maximum water duty of 4.5 acre-feet/acre; bottom lands have a maximum
water duty of 3.5 acre-feet/acre. (The Project includes pasture lands
with a duty of 1.5 acre-feet/acre.) The bench/bottom decision
reclassified approximately 9,000 acres of irrigated lands in the
project, reducing Project water entitlements by approximately 9,000
acre-feet. The change in demand is expected to be approximately 5,000
acre-feet of water when measured at the farm headgates. This is based
on historic use of about 90 percent of the headgate entitlement at 4.5
acre-feet/acre versus projected use of 100 percent of the 3.5 acre-
feet/acre entitlement.
Average Use of Entitlement: Actual water use as a
percentage of entitlement is usually less than 100 percent,
historically about 90 percent. The reduced percentage of entitlement
use results from on-farm practices and efficiencies, fallowing of
lands, and varying weather conditions. The current projected percent
use of entitlement is 93.4 percent. This is based on irrigation use of
91.8 percent and 95 percent for Carson and Truckee Divisions,
respectively, and 100 percent water use for pasture lands and wetlands.
Several factors will affect use of entitlement in the future:

--Irrigators whose lands were reclassified from bench lands with a
water duty of 4.5 acre-feet per acre to bottom lands with a 3.5 acre-
feet per acre duty may use more than 90 percent of their entitlement.
--The Fallon Paiute-Shoshone Tribes reservation is within the Project
and the Tribes have a cap on the water they receive. The Tribes are
expected to use their full water entitlement under the cap every
irrigation season.
--The Naval Air Station Fallon, as part of an agreement with the U.S.
Fish and Wildlife Service (FWS), will use less of its irrigation water
and is also developing less water intensive cropping strategies,
decreasing percent use of entitlement.
--The FWS and the State of Nevada are acquiring water rights within the
Newlands Project for restoration of wetlands at Stillwater National
Wildlife Refuge. The FWS has been transferring the consumptive use
portion, 2.99 acre-feet per acre, of the water rights they acquire.
This changes their effective entitlement to 2.99 acre-feet per acre of
which they are expected to take 100 percent, thus increasing percent
use of entitlement.

These and other changes in water use will cause the percent use of
entitlement to vary from year to year. The percent use will be
determined based on actual experience and will be used in calculating
the expected irrigation diversion for each irrigation season.
Efficiency: Within the same size project, more irrigated
acreage results in greater efficiency; with less irrigated acreage
lower efficiencies are expected. Project irrigated acreage never
reached the level anticipated in the 1988 OCAP but the associated
target efficiencies have remained in effect. As water rights are
acquired for Stillwater Wildlife Refuge (Pub. L. 101-618, section 206),
the effect on Project efficiencies may vary at first, but as more water
is acquired and moves to the Refuge, efficiencies should improve
stemming from the concentration of deliveries through the system.
This rule addresses only those adjustments to the 1988 OCAP in the
following areas:
1. Target Efficiency Adjustments (Secs. 418.12 (c)(3), 418.13 (a),
and Newlands Project Water Budget table): The 1988 OCAP envisioned and
allowed for increasing irrigated acreage, assuming the Project would
grow to over 64,850 irrigated acres by 1992 compared to a base of
approximately 60,900 acres being irrigated in 1987. The annual
calculations of the Maximum Allowable Diversion (MAD) to the Project
and efficiency requirements currently in use are based on a Project
consisting of 64,850 or more irrigated acres and a commensurate target
efficiency of 68.4 percent. However, the acreage increase has not
materialized and the 1995 irrigated acreage was approximately 59,075
acres. The Project conveyance efficiency that can be achieved, which is
the relationship between the total annual diversion to the Project and
total delivery to farm headgates, is directly related to irrigated
acreage; efficiency generally decreases as the irrigated acreage in the
Project decreases. The 1988 OCAP does not accurately reflect the
current acreage, and as a consequence, the higher efficiency
requirement remains in effect. This may decrease the water available to
the Project as calculated in the MAD and increases the likelihood of
penalties for inefficiency.
In response to less irrigated acreage and varying water demand, the
DOI will calculate the annual Project water budget for each irrigation
season in accordance with the elements in the Newlands Project Water
Budget table of the Adjusted OCAP. Each year the MAD will be based on
the projected irrigated acreage for that year and applicable water
duties. The other elements in Newlands Project Water Budget, including
appropriate Project efficiency at 100 percent use, would be calculated
to determine the MAD and Project efficiencies for each year. Only the
first 10 lines of the water budget would be calculated before the
irrigation season to determine the MAD, then the remaining lines would
be calculated after the irrigation season to determine target
efficiency. Through this approach, the Project water budget can
accommodate anticipated changes in Project characteristics.
Using the 1995 Actual Acres column from the Newlands Project Water
Budget, Maximum Headgate Entitlement (line 2) is the product of
Irrigated Acres (line 1) and the average water duty (calculated
annually). Variable distribution system losses of Canals/Laterals
Evaporation (line 3), Canals/Laterals Seepage (line 5), and Operational
Losses (line 7) are extrapolated to determine the Total Losses (line 8)
for a given Project size. The combined Maximum Headgate Entitlement
(line 2) and the Total Losses (line 8) determines the MAD (line 9), and
the relationship of Maximum Headgate Entitlement (line 2) to Total
Losses (line 8) estimates Project Efficiencies at 100 percent water use
(line 10). Actual use of entitlement, based on historic patterns, is
less than 100 percent (not all irrigators take all of their entitlement
each year), so the Maximum Headgate Entitlement is adjusted by the
projected percent use of entitlement (calculated annually) to yield
Expected Headgate Entitlement Unused (line 11) and the Diversion
Reduction for Unused Water (line 12). The Diversion Reduction for
Unused Water (line 12) is subtracted from the MAD (line 9) to determine
Expected

[[Page 66444]]

Irrigation Diversions (line 13). Finally, the adjusted Project demand
(calculated from line 2 minus line 11) is divided by the Expected
Irrigation Diversions (line 13) to determine the Expected Efficiency
(line 14).
The effect of this is to have the Adjusted OCAP more accurately
reflect the Project water demand. Reducing the annual Project
efficiency target will recognize the limitation of the present water
distribution system facilities and assist the Project in achieving
efficiency requirements. No changes are proposed for the 1988 OCAP
relative to how the MAD is calculated and administered, determination
of eligible land, reporting, or calculation of credits or debits.
2. Adjustments to Lahontan Reservoir Storage Targets (Secs. 418.20,
418.21, and 418.22, and tables of Monthly Values for Lahontan Storage
Computations, End of Month Storage Targets for July Through December,
and Adjustments to Lahontan Reservoir Storage Targets): The 1988 OCAP
prescribes when water may be diverted from the Truckee River to
supplement Carson River inflow to Lahontan Reservoir to serve the
Carson Division of the Project. (The Truckee Division of the Project is
supplied entirely by water from the Truckee River.) The Truckee River
diversion to the Carson Division is governed by end-of-month storage
target levels in Lahontan Reservoir. Water is diverted from the Truckee
to the Reservoir only if it is forecast that the storage target will
not be met by Carson River inflow by the end of the month. In years of
low flow on the Carson River, a greater percentage of the Carson
Division Project water supply is diverted from the Truckee River. In
wet years, the Carson Division supply may come entirely from the Carson
River. Thus, storage targets are used to help maintain a steady water
supply despite the natural climatic variability and differences in
annual runoff between the two river basins.
The formula used to determine how much water may be diverted to
Lahontan Reservoir from the Truckee River in January through June
relies, in part, on the runoff forecast for the Carson River. The
imprecision inherent in such forecasting can lead to variable
consequences. Sometimes more Truckee River water is diverted than is
needed to serve Project water users. This is particularly problematic
when the Carson River fills Lahontan Reservoir to the point that water
spills over Lahontan Dam or so that a precautionary spill (release) of
water must be made to avoid later flooding. In either situation,
spilled water that cannot be transported to water-righted lands or
Lahontan Valley wetlands flows into Carson Sink in the desert. This
situation occurred most recently in 1995, 1996, and 1997 with the
consequence that Truckee River water that could have flowed into
Pyramid Lake contributed to water that was spilled.
Because of their imprecision, forecasts for Carson River runoff do
not always reflect actual conditions and the water may not materialize.
If not enough water was brought over from the Truckee River earlier in
the water year, or Truckee River flow is insufficient to make up for
the shortfall from the Carson River, then the water supply may be
inadequate to meet the annual irrigation demand. This situation
occurred in 1994 when the Carson River was forecast to have a 100
percent water year but only produced a 50 percent water supply.
Two of the objectives of OCAP are to minimize spills and moderate
shortages. It is important to note that for the 95 years of records,
the climatic/hydrologic variability of both rivers is so great that
even if there were no limits on the diversion of Truckee River water,
in some years shortages would result. Conversely, even if no Truckee
River water were diverted, in some years Lahontan Reservoir would spill
just from Carson River inflow.
The 1988 OCAP has a June end-of-month storage target of 215,000
acre-feet in Lahontan Reservoir. The 215,000 acre-feet would serve at
least 4,000 to 5,000 more acres of water-righted and irrigated land
than has been irrigated in actual practice. The reclassification of
some bench lands to bottom lands further reduces water demand in the
Carson Division. The difference in headgate demand between what the
1988 OCAP projected and current Carson Division demand is approximately
21,000 acre-feet. The current storage targets permit unnecessary
diversions from the Truckee River to the Project. The proposed Adjusted
OCAP storage targets were based on the lower Carson Division demand and
reducing water loss to seepage, evaporation, and spill. Accordingly,
the proposed end-of-June storage target was adjusted to 174,000 acre-
feet, and the July through December targets were lowered as shown in
Table A. However, in this final rule, the end-of-June storage target is
190,000 acre-feet, as shown in the table Monthly Values for Lahontan
Storage Calculations (section 418.20 of the rule), while the January-
May targets are retained, subject to the adjustment procedures
described below. July and August end-of-month storage targets are also
increased to help maintain recreation levels in Lahontan Reservoir.
This is discussed in the Response to Comments, II.7., in this preamble.
A comparison of the 1988 OCAP, the proposed Adjusted OCAP, and the
final Adjusted OCAP storage targets for Lahontan Reservoir are shown in
Table A of this preamble. In addition, this final Adjusted OCAP, in
response to comments, adopts a flexible storage target regime that can
respond to future changes in Project water demand. This is discussed in
the Response to Comments, II.1, in this preamble and set out in section
418.22 of the rule. The new storage targets will be used to calculate
diversions from the Truckee River in accordance with section 418.20 et
seq. of the proposed rule.

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The storage targets were developed using the Truckee River
settlement negotiations water balance model. The model was used to
examine how different storage targets affected spills, inflow to
Pyramid Lake, and other parameters. Key assumptions used in modeling
were reduced Project water demand from the 1988 OCAP, lower efficiency
targets, current Truckee River operations, and Project shortages
consistent with the 1988 OCAP. The model uses the 95-year (1901-1995)
historic hydrologic record for the Truckee and Carson Rivers.
For the proposed Adjusted OCAP, a series of modeled storage targets
was evaluated based on the degree to which a set of targets reduced
spills, increased inflow to Pyramid Lake, increased the estimated
number of spawning years for cui-ui, increased the estimated number of
cui-ui, reduced Lahontan Reservoir and Truckee Canal seepage and
evaporation losses, and held frequency and magnitude of Project
shortages consistent with the 1988 OCAP. These goals are consistent
with the Secretary of the Interior's responsibilities as the District
Court ruled in Pyramid Lake Paiute Tribe of Indians v. Rogers C.B.
Morton (Tribe v. Morton), 354 F. Supp. 252 (D.D.C. 1973).
Though not a specific feature of the Adjusted 1988 OCAP, the
modeling used in making decisions on this proposed rule took cognizance
of the 4,000 acre-foot minimum pool that the Truckee-Carson Irrigation
District (TCID), the Project operator, voluntarily has maintained in
Lahontan Reservoir to protect fish resources there. Though this action
to maintain a minimum pool is purely voluntary on the part of TCID and
Newlands Project water right holders, it provides environmental
benefits, was assumed to be continued into the future, and was credited
in the modeling used to establish new Lahontan storage targets; that is
to say, the targets would have been somewhat lower to achieve the same
release shortage percentage and Truckee River inflow volume to Lahontan
Reservoir assuming no anticipation of the 4,000 acre-foot minimum pool.
Table A presents the model results examined in developing the
Adjusted OCAP, and the values are averages for the 95-year period of
record. Modeled results for the 1988 OCAP with current hydrology are
compared to the Current Conditions, the proposed Adjusted OCAP, and the
final Adjusted OCAP. In a number of categories, the modeled results
show improvements under the final Adjusted OCAP storage targets as
compared with the 1988 OCAP. For example, there is less Truckee Canal
loss (line 3), less Lahontan Reservoir loss (line 12), and less
Lahontan Reservoir spill (line 14). Compared to the Current Conditions,
the final Adjusted OCAP is an improvement in all areas except for
Project water supply (line 18) and the additional shortage year (line
19). The modeled reduction of water loss and spill from the Project
increases inflow to Pyramid Lake under the final Adjusted OCAP (line
23). Compared to the Current Conditions, approximately 19,800 acre-feet
of water is modeled to be saved from the Truckee River under the Final
Adjusted OCAP from reduced Truckee Canal loss, reduced Lahontan
Reservoir loss, and reduced spills. Of this 19,800 acre-feet of Truckee
River water saved, approximately 2,550 acre-feet of the water saved
reduces Project water supply compared to Current Conditions.
3. Truckee River Storage in Lieu of Diversions (Sec. 418.20 (f)):
Project diversions from the Truckee River may be fine-tuned by
retaining water in upper Truckee River reservoirs that would otherwise
have been diverted to Lahontan Reservoir to meet storage targets.
Depending upon how much Carson River runoff reaches Lahontan Reservoir
and whether storage targets are met by the Carson River inflow, the
water retained in storage may be released later in that year and
diverted to Lahontan Reservoir for delivery to the Carson Division, or
retained for Pyramid Lake if the water is not needed for Carson
Division irrigation.
Under the 1988 OCAP, water was allowed to be stored upstream on the
Truckee River in lieu of diversion only from April to June. In 1995,
this limitation contributed to approximately 80,000 acre-feet of water
being diverted from the Truckee River to Lahontan Reservoir before
March 31, then spilling because of high Carson River runoff. None of
the Truckee River water was needed because the Carson River more than
filled Lahontan Reservoir and precautionary releases were made to avoid
spilling over the dam. While the 80,000 acre-foot-diversion from the
Truckee was controversial, it resulted from managing the diversion in
strict adherence with the 1988 OCAP targets. In the 1996 and 1997 water
years, respectively, 6,000 and 22,000 acre-feet were diverted from the
Truckee River in late fall and winter, and again spilled. It is
possible that a similar occurrence may result in the 1998 water year
from continued application of the 1988 OCAP storage targets. The
proposed Adjusted OCAP provided more flexibility to reduce such
unnecessary diversions.
Consistent with managing Project diversions from the Truckee River,
the proposed Adjusted OCAP expanded the opportunity to credit store
water for the Project in reservoirs on the upper Truckee River by
allowing storage as early as January of each year. In this final
Adjusted OCAP, Truckee River storage would be allowed as early as
November of the previous year. The water would be credited based on
water actually retained in Truckee River reservoirs or, if water was
not being released for Project diversion, credited as Newlands Project
water in Stampede Reservoir adverse to other water (fish water) stored
in Stampede Reservoir. In the latter situation, concurrence by the FWS
will be required. For example, a reduction of diversions in January
through March of 1995, would have required FWS approval to create
Newlands Project credit water out of Stampede Reservoir water because
water was not being released for Project diversion. Newlands Project
credit water could be released for diversion to Lahontan Reservoir, if
needed, as early as July 1 through the end of the irrigation season,
but not thereafter. The water would only be used for the Carson
Division. Water in storage could be exchanged to other reservoirs but
it will not carry over to the next year for use in the Project. If it
is not used in the year in which it is stored, it will not be available
thereafter to the project. To protect the water users, the water held
in storage on the Truckee River would not be reduced by evaporation and
would be gaged at the US Geological Survey gage on the Truckee Canal
near Wadsworth, Nevada, to ensure that diversion to the Project matches
the diversion foregone earlier in the season. Water could spill, but if
spilled, it would be subject to diversion to Lahontan when needed to
meet storage targets. Water stored but not needed for the Project would
be managed to benefit cui-ui and Lahontan cutthroat trout in Pyramid
Lake.
This change provides flexibility to reduce excessive diversions
from the Truckee River. The BOR is expected to use this proposed
provision only in years when Carson River runoff is forecast to be
above average and is intended to fine tune diversions and avoid over-
diversions from the Truckee River. Such storage in Stampede Reservoir
or other Truckee River Reservoirs is not intended to make up for
shortages in drier years.
There is little advantage to foregoing diversions in below average
runoff years if the likelihood is that all the credit stored water
would need to be diverted to the Project in any event. The changes in
Section 418.20 (f) of the rule include provisions for BOR to consult
with

[[Page 66447]]

TCID, the Federal Water Master, FWS, Bureau of Indian Affairs (BIA),
and the Pyramid Lake Paiute Tribe before any credit storing is
initiated.
4. Expanded Forecasting (section 418.20 (a)): In calculating the
January to June monthly diversions from the Truckee River, the 1988
OCAP uses the monthly forecast for April through July runoff published
by the Natural Resources Conservation Service (NRCS) (formerly the Soil
Conservation Service). Rather than continuing to rely on that forecast
alone, the proposed Adjusted OCAP provided flexibility to examine other
forecasts and allow the use of a deliberative process to determine how
to manage Truckee River diversions. This provision remains unchanged in
this final Adjusted OCAP. The intent of this change is to allow the BOR
to take advantage of other forecasts and the experience and knowledge
of the Federal Water Master, the TCID water master, and other parties.
The desired effect of this change is to improve precision in
forecasting and managing the Truckee River diversion to the Project to
avoid spills and shortages.
5. Additional Revisions: In addition to the changes identified in
1. through 4. above, a number of minor revisions have been made to the
1988 OCAP. Most changes are editorial and do not affect the meaning of
the text. Some changes provide opportunities for consultation with
interested and affected parties before BOR makes a decision.
A few changes add language to clarify or interpret the meaning of
the 1988 OCAP in light of experience administering the OCAP, passage of
time, or new statutory provisions. Changes to the text of the 1988 OCAP
occur at:
Section 418.2: Other Project purposes are added in accordance with
Pub. L. 101-618, 104 Stat. 3289, Sec. 209 (a) (1).
Section 418.13 (a) (3): Explains the use of efficiencies in
calculating the MAD.
Section 418.18 (b): Calculates terminal flow in the Truckee Canal
by averaging flows during the time when water is not being diverted to
Lahontan Reservoir.
Section 418.24: Water captured in Project facilities from a spill
or precautionary drawdown is used to make deliveries to eligible lands
but does not count as a Project diversion or as Lahontan Reservoir
storage.
Section 418.29: Deletes the reference to the February 14, 1984,
Contract for Operation and Maintenance between the United States and
the District.
Section 418.37 (d): Adds new text clarifying that a natural drought
greater than or equal to the debit will eliminate the debit.
Section 418.38 (b): Allows TCID to divert up to the MAD if needed
to meet headgate entitlements.

Rulemaking Process

The DOI announced in 1995 that it intended to revise the 1988 OCAP
through adjustments to that OCAP. In the summer of 1995 the TCCO held
four public workshops in Fernley, Nevada to invite affected and
interested parties to offer their thoughts on changes to the 1988 OCAP
affecting storage targets, conveyance efficiency, storage in lieu of
diversions, and the use of runoff forecast data.
The Notice of Proposed Rulemaking on the Adjusted OCAP was
published December 9, 1996, with the 60-day comment period scheduled to
close on February 7, 1997. As a result of being preoccupied with the
worst floods in decades on both the Carson and Truckee Rivers in
January 1997, the DOI received many requests for an extension of the
comment period. By notice in the Federal Register on February 18, 1997,
the comment period was extended an additional 60 days until April 8,
1997. The Notice extending the comment period also included frequently
asked questions and answers regarding the Adjusted OCAP, and made known
the availability of general and detailed modeling results related to
the rulemaking.
During the initial comment period, the TCCO conducted an
information briefing for the State of Nevada, TCID, Fallon Tribe, and
Pyramid Lake Tribe. Two public workshops to explain and answer
questions about the proposed rule were held in Fallon and Fernley,
Nevada. The TCCO received 47 written comments on the proposed rule.
Comments addressed the proposed rule and are responded to in this
preamble. Many comments addressed the draft environmental assessment
(EA), which had been made available for review, and have been responded
to with changes in the EA. Two commenters submitted pleadings in
litigation on the 1988 OCAP which were not addressed in this final rule
because they were already addressed in the United States' responsive
pleadings in that case.

Changes Made in This Final Rule

In response to comments and additional information, the DOI has
made several changes in this final Adjusted OCAP rule. The proposed
change in Lahontan Reservoir storage targets received more comments
than any other issue in the proposed rule. This final Adjusted OCAP
addresses two storage target issues raised in comments: future
increases or decreases in Project water demand, and effects of lower
storage targets on recreation. In this final rule, a system of demand
responsive storage targets is implemented to provide a stable water
supply to the Project over a range of water demands that may result
from changes in irrigated acres, use of entitlements, or other
circumstances. In addition, summer storage targets have been increased
to help maintain recreation levels at Lahontan Reservoir, without
substantial effect on Pyramid Lake inflow or threatened and endangered
fish recovery. This also provides a slight benefit to Project water
supply. These changes are described in sections II.1. and II.7. of the
Response to Comments in this preamble and sections 418.20, 418.21, and
418.22 of the rule.
The Adjusted OCAP proposal to extend the period for storage of
Truckee River water in lieu of diversions back to January each year has
been changed in the final rule by extending it back to include November
and December. November and December targets increase significantly to
take advantage of winter flows in the Truckee River when the water will
clearly be needed in the Project. Adding storage in lieu of diversions
in November and December will help avoid a repeat of the situation that
developed in late 1996 and early 1997 when all reservoir storage levels
were up yet diversions from the Truckee River to the Project continued
through the end of December, only to begin spilling as a precautionary
release from Lahontan Reservoir on January 1, 1997. The final rule also
allows Newlands credit water spilled from Truckee River reservoirs to
be diverted to Lahontan Reservoir subject to applicable storage
targets. These changes are described in sections II.5 of the Response
to Comments in this preamble and section 418.20(f) of the rule.
The proposed Adjusted OCAP lowered the Project conveyance
efficiency target based on increases in the percent use of entitlements
and decreases in the Project size. The intent was for the conveyance
efficiency target to be dynamic and continue to vary with the use of
entitlements and the Project size. However, Figure 1, the graph in
Appendix A at the end of the proposed rule, showed target efficiencies
varying only in proportion to percent use of entitlement. This has been
replaced in the rule at section 418.13(a)(4) and by the table Expected
Project Distribution System Efficiency that shows required efficiency
for a range of irrigated acreage and a range of percent use of
entitlement. The table also provides the

[[Page 66448]]

slope and y-intercept so that a new graph may be prepared. Appendix A
in this final rule has a table Calculation of Efficiency Equation which
shows how the Expected Project Distribution System Efficiency is
calculated using a range of percent use of entitlement from 100 percent
to 75 percent.
The proposed Adjusted OCAP made several corrective adjustments to
the 1988 OCAP to have the Adjusted OCAP reflect actual Project
operations. One of these affected how water released into Rock Dam
Ditch was counted. Rock Dam Ditch may receive water directly from
releases at Lahontan Reservoir, or may get water directly from the
Truckee Canal via a siphon pipe under the stilling basin below Lahontan
Dam. In the proposed Adjusted OCAP rule, diversions directly from the
Truckee Canal would have counted against the Truckee Division. As was
noted in comments, this is incorrect, as the water that reaches Rock
Dam Ditch would, in all cases, come from water in Lahontan Reservoir or
destined to arrive in Lahontan Reservoir. This change is noted at
section III.1 of the preamble and in the rule at section 418.23.
Modeling used to compare various OCAP scenarios and storage target
regimes has been updated since the proposed rule was published. The new
modeling retains the Project acreage and water use assumptions from the
proposed rule but is modeled over the 95-year period 1901-1995, it also
includes the additional hydrology for 1995, and does not include
storage in Lahontan Reservoir on the flash boards above 295,500 acre-
feet.
Based on technical comments from the BOR, which will administer
this rule, the language in section 418.13(a) has been revised to
clarify the timing and procedures for recalculating the Project water
budget, the MAD, and the required conveyance efficiency. At the start
of the irrigation season, a provisional water budget and MAD will be
recalculated. After the irrigation season when actual irrigated acres
and percent use of headgate entitlement is known, a final target
conveyance efficiency will be determined from the table Expected
Project Distribution System Efficiency.
This final rule has been revised to conform to numbering and plain
language requirements for publication of the Adjusted OCAP rule in the
Code of Federal Regulations. Some extraneous introductory text has been
removed or incorporated into the preamble. Throughout the text of the
rule, ``must'' or other appropriate wording replaces ``shall'' and
references to ``these OCAP'' has been replaced by ``this part.''
Additional text has been changed only to clarify the meaning. The new
format includes a section on definitions and has moved a few sections
forward as General Provisions of Adjusted OCAP. Also, the rule has been
divided into more sections, each dealing more discretely with each
subject. With these exceptions, the text of this rule appears in the
same order as in the Notice of Proposed Rulemaking and can be easily
compared.

Need for Immediate Effect

This adjusted OCAP rule is effective December 16, 1997, to allow
its provisions to address imminent diversions of water from the Truckee
River to Lahontan Reservoir. Under the Administrative Procedure Act,
sec. 553(d)(3), a rule may have immediate effect when the agency finds
that there is good cause for waiving the normal 30-day period between
publication of the rule and its effective date. This waiver of the
normal 30-day waiting period for this rule to become effective is
critical for the Secretary to meet all obligations in the Truckee River
basin. A 30-day delay in implementation will compromise the
effectiveness of the Adjusted OCAP by allowing unnecessary diversions
of more than 14,000 acre-feet of water from the Truckee River.
Delayed implementation of the rule would be contrary to the public
interest. The Adjusted OCAP more accurately limits Truckee River
diversions to only that amount of water that the water users in the
Project require. In the past three years, the 1988 OCAP storage targets
have allowed Truckee River diversions of about 80,000 acre-feet, 6,000
acre-feet, and 22,000 acre-feet of water that was not needed to satisfy
diversionary rights and which ultimately was spilled during required
precautionary drawdowns of Lahontan Reservoir increasing the danger of
flooding in the Carson River valley.
Immediate implementation will not harm those affected by the rule
because there will be sufficient water available to serve water rights
during the 1998 irrigation season. Lahontan Reservoir storage levels in
November resulted in diversions of nearly 10,400 acre-feet of Truckee
River water under the existing 1988 OCAP storage targets. Projections
for December 16-31, 1997, indicate that an additional 14,000 acre-feet
of water might need to be diverted from the Truckee River to meet 1988
OCAP storage targets. Under the Adjusted OCAP storage targets in this
rule, no water would have been diverted in November or would need to be
diverted in December. Moreover, the November and December diversions
are not needed to serve Project water rights. The 160,000 acre-feet
already in Lahontan Reservoir, less evaporation and seepage, along with
the water that would be available if needed from the Truckee River
based on current water storage in Truckee River reservoirs, indicates
that there will be sufficient water to meet Project requirements for
the 1998 irrigation season. Therefore, immediate implementation is
necessary to prevent the waste of at least 14,000 acre-feet of water
that will be diverted from the Truckee River in December if the
Adjusted OCAP is not in effect. If the rule were not in effect until
January 16, 1998, additional water would be diverted that will not be
needed.
In addition, immediate implementation will benefit Pyramid Lake by
maintaining needed Truckee River flows with no attendant harm to
Project water users, because the Adjusted OCAP does not affect decreed
water rights. Conversely, diversions at Derby Dam in December pursuant
to the existing 1988 OCAP storage targets would significantly decrease
Truckee River flows to the detriment of Lahontan Cutthroat Trout, which
is a threatened species under the Endangered Species Act.
A 30-day delay in implementation would result in an irretrievable
commitment of at least 14,000 acre-feet of water from the Truckee River
to Lahontan Reservoir. Immediate implementation of the Adjusted OCAP
will allow better management of the Project, and will avoid potential
threats to public health and safety due to the increased risk under the
1988 OCAP of flooding those downstream of Lahontan Reservoir.
The main reason for a 30-day waiting period prior to implementation
is to provide affected parties with an opportunity to adjust their
actions. The need for this is obviated by the fact that the Adjusted
OCAP are an outgrowth of the 1988 OCAP. They are designed to fine tune
the 1988 OCAP, not to replace them with an entirely new regulatory
scheme. The revisions fall within the basic framework of the 1988 OCAP,
a regulatory system that the affected parties have been operating under
for nine years. Further, the Adjusted OCAP have been in circulation for
many months, and all affected entities have had ample opportunity to
participate in workshops on the proposed rule and to comment.
The affected parties have participated in the development of the
Adjusted OCAP and are aware of the content of the rule as well as the
approximate time it would be implemented. In spring

[[Page 66449]]

1997, the DOI extended the period for comment on the proposed rule for
60 days to accomodate interested parties who had been preoccupied by
flooding during the original comment period. This 60-day delay should
not be allowed to compromise the rationale underlying the Adjusted
OCAP's development. The potential for harm to the public outweighs any
possible prejudice to the affected parties. Therefore, the Department
finds that there is good cause for the Adjusted OCAP to be effective on
December 16, 1997.

Response to Comments on Proposed Rule

The proposed rulemaking provided a 60-day public comment period
which was later extended another 60 days to end on April 8, 1997. The
Truckee-Carson Coordination Office (TCCO) received 46 letters from
commenters during the comment period. One additional commenter
submitted late comments that TCCO received on April 9, 1997, and
accepted for review, for a total of 47 comments. Fifteen comments were
from an irrigation district, twelve from interested parties, seven from
local governments, six from organizations or public interest groups,
three from Nevada State agencies, two from Tribes, one from a public
utility, and one from a Federal agency.
We reviewed and analyzed all comments, and in some instances
revised the final rule based on these comments. The following is a
discussion of the comments received and our response. First, we
addressed general comments and concerns. Second, we responded to
specific comments referred to by regulation section.

I. General Concerns

1. Why Propose These Changes? Some commenters asked what the
purpose and need was for making adjustments to the 1988 OCAP. One
commenter asked when the continued encroachment on water rights by
successive OCAP's will end. Other commenters said that the proposed
Adjusted OCAP rule does not meet the goals stated in the 1988 OCAP
regarding service of water entitlements, conservation of wetlands and
wildlife, Trust obligations to the Fallon Paiute-Shoshone Tribes
(FPST), stable economies, and stability of operations. Other commenters
argued that the diversion and subsequent spill of more than 100,000
acre-feet of Truckee River water in the past three seasons points to
the need to adjust the 1988 OCAP to avoid a recurrence of such
diversions and spills. Finally, one commenter suggested that instead of
having an OCAP, that a discussion process be used to determine the need
for fall or winter diversions from the Truckee River.
Response: As explained in the preamble to the proposed Adjusted
OCAP rule published in December 1996, the primary purpose of this rule
is to adjust the OCAP to reflect the fact that demand for water to meet
Newlands Project water rights is less than projected at the time the
1988 OCAP were adopted and the OCAP can be adjusted to better reflect
new water demand assumptions which will increase Newlands Project
reliance on the Carson River as the primary source of water for the
Carson Division. Other adjustments are made to provide flexibility in
operations to help conserve water based on experience gained in the
past nine years. The changes in this rule are designed to reduce
diversions from the Truckee River in such a way that approximately 87
percent of the reduction comes from reduced Truckee Canal loss, reduced
reservoir loss, and reduced spills. For the reasons explained above
under the heading, ``Adjusted OCAP Proposed Changes,'' demand for water
to serve water rights has been less than anticipated in the 1988
decision which means that more water is being diverted from the Truckee
River under the 1988 OCAP than is necessary to serve Newlands Project
water rights. This is inconsistent with the Secretary's trust
responsibility as spelled out in the Gesell decision in Tribe v. Morton
to ensure that only the water needed to serve Project water rights is
diverted from the Truckee River and away from Pyramid Lake. As such,
this is not an encroachment on Newlands Project water rights, but a
limited refinement of diversion criteria to assure that Project water
rights are met but with maximum reliance on the Carson River.
This final OCAP rule is consistent with the 1988 OCAP goals. Water
entitlements in the Newlands Project are served subject to such
regulations or requirements as the Secretary may impose. This final
rule is the Secretary's OCAP regulation for the Project, provides for
the full service of water rights so long as the water is available,
meets the OCAP goal of satisfying entitlements, and therefore, fulfills
the Alpine and Orr Ditch decrees. The Adjusted OCAP is not expected to
interfere with efforts to restore Lahontan Valley wetlands and wildlife
resources because the proposed Adjusted OCAP was considered in the
decision making process for the FWS Water Rights Acquisition Program
(WRAP) EIS and it is being considered as the FWS develops its
comprehensive management plan for Stillwater National Wildlife Refuge.
The DOI is negotiating an agreement with the FPST on a number of issues
including maintaining the Tribe's irrigation water supply. This
agreement with the FPST is expected to help ensure that the DOI will
meet its trust responsibilities to the Tribe under the Adjusted OCAP.
The Adjusted OCAP decreases slightly-- from 98.41 percent to 97.48
percent--the average water supply in the Carson Division of the Project
and would have an effect on farm production, profits, and income in
drought years (see response to I-12). However, the modeled average
water supply under Adjusted OCAP is similar to the modeled supply in
the 1988 OCAP EIS assumptions under current conditions (1988 OCAP in
Table A), therefore the economic stability of the Project is not
expected to change compared to 1988 OCAP projected conditions. Finally,
the Adjusted OCAP rule does not impose new operational requirements and
is, therefore, consistent with the goal of stability in operations.
This Adjusted OCAP addresses the comment regarding the need to
manage early season diversions of Truckee River water to Lahontan
Reservoir to avoid subsequent spills. We believe the proposed storage
target regime in the rule will minimize, but cannot eliminate, the
possibility of Truckee River diversions being spilled later. We
believe, further, that we cannot legally abandon OCAP in favor of a
discussion process as the basis for controlling Truckee River
diversions.
2. Why Change the OCAP Now? A number of commenters questioned why
the DOI is changing the OCAP at this time. They cite the December 31,
1997, expiration of the prohibition on litigation on the 1988 OCAP in
Section 209 of the Truckee-Carson-Pyramid Lake Water Rights Settlement
Act (Pub. L. 101-618), the absence of any court order for a new OCAP,
and question why the DOI was moving ``swiftly'' on Adjusted OCAP in
light of numerous concerns. Some commenters questioned the timing and
need for the Adjusted OCAP in light of the DOI's announced plans to
develop a revised, long-term OCAP. Other commenters asked to have the
Adjusted OCAP rule in effect by October 1, 1997, to avoid potentially
unnecessary diversions from the Truckee River.
Response: Section 209 of Pub. L. 101-618 allows the Secretary to
decide, in his sole discretion, that changes to the OCAP are necessary
to comply with his obligations. No court order is needed to

[[Page 66450]]

make these changes. The experience of initially seven and now nine
years implementing the 1988 OCAP indicates that a number of changes
could be made to save additional diversions of Truckee River water
within the framework of the 1988 OCAP. The timing of this rulemaking
relative to December 31, 1997, is coincidental since the rulemaking
started in 1995. The DOI announced its intent to develop an interim or
Adjusted OCAP in March 1995, held public planning workshops on Adjusted
OCAP in August 1995, published a proposed rule in December 1996, held
public workshops on the proposed rule in December 1996 and January
1997, and extended the comment period by 60 days in February 1997. We
believe this history reflects the ample opportunities for public input
and the deliberative pace of rulemaking to allow due consideration of
issues.
The DOI's intention to develop a revised OCAP was also announced in
March 1995. Unlike the Adjusted OCAP which makes some changes in the
1988 OCAP as an interim correction, the revised OCAP contemplates more
fundamental changes to OCAP, will take a number of years to develop,
and will be the subject of an EIS that also considers other related
water management issues. The fact that the DOI conducted EIS scoping
meetings for this EIS during the comment period on the Adjusted OCAP is
more a reflection on the lengthy EIS process than on the DOI's intent
to rush into the next OCAP before this rulemaking is concluded.
As to when the rule will go into effect, it had been the DOI's hope
to have the Adjusted OCAP in effect prior to when Truckee River
diversions might have begun under the current OCAP storage targets.
3. What is the legal authority for changing OCAP and for making
OCAP a regulation? A number of commenters questioned the DOI's
authority and the legal basis to make changes to the 1988 OCAP and to
do so via rulemaking. One commenter made the point that this rulemaking
will ``grandfather'' the 1988 OCAP which never was published in the
Federal Register, never underwent notice and comment rulemaking, and
which has not undergone judicial review. Another commenter asked if the
Secretary had the approval of the Pyramid Lake Paiute Tribe (PLPT) to
change OCAP.
Response: The Secretary of the Interior is authorized to promulgate
regulations for the operation of irrigation projects under the
Reclamation Act of 1902, as amended. Promulgation of the Adjusted OCAP
rules replaces the existing 1967 OCAP regulations and a number of court
approved OCAPs. Promulgation of Adjusted OCAP affords the public a
formal opportunity to participate and have their concerns considered in
the rulemaking process.
The Adjusted OCAP is based on the 1988 OCAP framework with changes
in efficiency requirements, storage targets, upstream storage, and
forecasting. It is correct that the 1988 OCAP was not published in the
Federal Register, was not included in the Code of Federal Regulations,
and has not gone completely through judicial review. However, Congress,
through Pub. L. 101-618, directed the 1988 OCAP to remain in effect
until changed by the Secretary, at his sole discretion, and to be
barred from judicial review until December 31, 1997. The public law
also declared valid all actions taken by the Secretary under any OCAP
prior to that law, including implementation of the 1988 OCAP, and not
subject to judicial review.
Newlands Project OCAP may be implemented through approval by the
Tribe versus Morton court, or with the approval of the PLPT. The DOI
believes it has received the approval of the PLPT through the Tribe's
comments on the proposed Adjusted OCAP rule.
4. Adjusted OCAP Violates Water Rights under the Alpine and Orr
Ditch Decrees: A number of commenters contend that the Adjusted OCAP
reduces the water supply to the Newlands Project, and that any
reduction in water supply affects water rights in violation of Nevada
water law. These commenters also view this as a violation of water
rights adjudicated under the Orr Ditch and Alpine decrees. Several
commenters cite the court's decision in Tribe v. Morton which said that
OCAPs should not alter the Orr Ditch or Alpine decrees.
Response: Under Nevada water law, water rights holders are entitled
to a certain water duty per acre which represents the maximum amount of
irrigation water that can be beneficially used on water righted lands.
This water duty is neither a minimum amount of the entitlement that
must be received, nor is it a guarantee that that amount of water will
always be available. As the Carson and Truckee Rivers' runoff varies
from year to year, so too does the water supply, resulting in full
years serving up to the water duty, and in drought years where the
available water supply serves less than the water duty.
As shown in Table A, line 19, under final Adjusted OCAP there is an
additional shortage year compared to the current condition. The
additional shortage year results from reduced carry over storage of
Truckee River water in Lahontan Reservoir. Under Judge Gesell's
decision in Tribe v. Morton, the Truckee River water left in Lahontan
Reservoir at the end of the irrigation season is water that was not
needed to serve water rights, and the Project is not entitled to this
water.
Nothing in the Adjusted OCAP changes anyone's water right or
affects the Orr Ditch or Alpine decrees. What OCAP does is determine
under what conditions Truckee River water may be diverted to Lahontan
Reservoir to supplement the water supply from the Carson River for
purposes of serving such rights that year. That combined supply in
Lahontan Reservoir is the water supply available to meet the water
demand in the Carson Division in a given year. Our modeling analysis of
the Adjusted OCAP, which considers the hydrologic record for the Carson
and Truckee Rivers from 1901 to 1995, indicates that in more than 9 out
of 10 years Lahontan Reservoir has enough water to fully satisfy the
Carson Division demand, with an average water supply of more than 97
percent of demand. This combined use of Carson and Truckee River
ensures a more secure and consistent water supply for the Carson
Division than most other Alpine decree water rights holders experience
on the Carson River.
5. The Adjusted OCAP Affects Property Rights: Commenters have
expressed concern that Adjusted OCAP may cause shortages that are a
taking of property rights. A State Agency believes that any action by
the Federal government that results in water rights holders not
receiving their legal entitlement of water is a taking of personal
property. Also, because the State Agency is a holder of water rights in
the Newlands Project, it says that Adjusted OCAP may devalue its water
right holdings when they receive less water than is available in the
system. Other commenters say this is stealing water or a taking without
just compensation.
Response: Newlands Project irrigators do indeed have a property
right in their water rights, as do other water rights holders in
Nevada. However, as pointed out in the response to issue number 4, the
Adjusted OCAP has no effect on water rights or on the Alpine and Orr
Ditch decrees. In addition, these water rights are not an entitlement
to a certain amount of water every year, but rather an entitlement to
receive up to a certain amount of water, when that water is available.
In drought years, water may not be available to serve all entitlements.
Thus, the water that reaches and is retained in Lahontan

[[Page 66451]]

Reservoir constitutes the available water for Newlands Project
irrigators in the Carson Division. Further, these water rights are
subject to applicable laws, rules, and judicial decrees. The supply of
water in Lahontan Reservoir, out of which Carson Division water rights
are served, is subject at least to the segmentation and priority
provisions of the Alpine decree for the Carson River, and to the
Floriston flow rate and priority provisions of the Orr Ditch decree for
the Truckee River. Under Pub. L. 101-618 and Tribe v. Morton, OCAP may
not affect the decrees; it merely provides that the deliveries be
limited to those actually needed to serve water rights. As such, this
is not a taking of a constitutionally protected property right by the
Adjusted OCAP.
6. The Adjusted OCAP Denies Carry Over Storage Rights: Carry over
storage refers to the ability to store in a reservoir water that is not
needed in one year for use in the next year, if needed. Five commenters
believe the Adjusted OCAP, as well as the 1988 OCAP currently in place,
take away carry over rights in Lahontan Reservoir by limiting the
diversion of Truckee River water. They contend the diminution of carry
over storage under Adjusted OCAP erodes the principle of storing in
times of plenty for times of drought. Further, one commenter contends
that carry over storage is a right that was given to irrigators when
they traded their pre-Project vested water rights to the Federal
government for water rights in Lahontan Reservoir. In contrast, one
commenter felt that the proposed end-of-month storage target for
October of 52,000 acre-feet was too high because it could allow carry
over of Truckee River water diverted right at the end of the irrigation
season.
The Adjusted OCAP provides for storage of Truckee River water in
Stampede Reservoir in lieu of diversions to Lahontan. One commenter
asked why the Adjusted OCAP would not allow carry over storage of
Newlands Project water in Stampede Reservoir.
Response: All water remaining in Lahontan Reservoir at the end of
the irrigation season does carry over to the next year and this is not
changed by the Adjusted OCAP. The Project water users benefit from
carry over storage of all the Carson River water that remains in
Lahontan Reservoir and provides protection against future droughts.
However, to the extent that any portion of the water remaining in
Lahontan Reservoir is water that had been diverted from the Truckee
River, such water is, by definition, water that was not needed to serve
Project water rights. It is the presence of this Truckee River water in
Lahontan Reservoir at the end of the irrigation season that Adjusted
OCAP seeks to minimize because it conflicts with the court's basic
requirement of OCAP: that the Newlands Project receive only the Truckee
River water needed to serve water rights so that the Secretary's trust
responsibility to the PLPT may be fulfilled. Likewise, for Newlands
Project water stored in Truckee River reservoirs, any water left over
at the end of the season is water that was not needed to serve Project
water rights and, therefore, should go to Pyramid Lake.
The goal of OCAP is to divert just that amount of Truckee River
water needed to serve water rights in the Project and to let the rest
continue to Pyramid Lake. The ideal OCAP would be based on demand and
only allow diversions of Truckee River water to Lahontan Reservoir when
it was actually needed for the Carson Division, and then, in quantities
sufficient to always meet the water demand. This would ensure serving
all water rights all the time with no over-diversions of water and no
Truckee River water spilled from Lahontan Reservoir. Unfortunately, our
analysis indicates that such a ``demand only'' OCAP would not serve
water rights because of the variability in the amount of water
available for diversion from the Truckee River from month to month, and
because of the capacity limits of the Truckee Canal.
Instead of a demand-only OCAP, the Adjusted OCAP rule continues to
allow diversions of Truckee River water to Lahontan Reservoir, even at
times when the water is not immediately needed to serve water rights at
the time of diversion, as a safeguard for a water supply later in the
year against the unpredictability of the runoff from the Carson River.
This is why the Adjusted OCAP includes a storage target greater than
zero for October. The modeling analysis of the Adjusted OCAP indicates
that it provides a water supply for the Newlands Project consistent
with the water supply evaluated in the 1988 OCAP, even though the
supply is less than under current (i.e., 1997) conditions.
7. There was Inadequate Information Provided to Evaluate the
Proposed Rule: Eight commenters raised questions and concerns about the
amount of information made available by the DOI in support of the
Notice of Proposed Rulemaking. These concerns centered on modeling
evaluations of the proposed Adjusted OCAP and alternative OCAP
scenarios that had been considered. Some commenters believe that due
process is being ``trampled'' or that modeling results were skewed
because all of the information in the government's possession was not
made public. Others questioned how the proposed rule could be evaluated
without foundational data and assumptions. Yet another commenter chided
DOI for manipulating data to achieve a predetermined result. Specific
questions were posed regarding the need for a modeling scenario that
allowed Lahontan Reservoir to fill without storage target limits and
another modeling scenario for current conditions.
Response: In developing the Adjusted OCAP rulemaking, the DOI
evaluated five OCAP alternatives based on different storage target
regimes. These were modeled and compared with modeled scenarios for
current conditions and for the 1988 OCAP with 1988 time frame
assumptions and 1994 time frame assumptions. In all, nine modeling runs
were examined. The printout from each modeling run is approximately 400
pages long. To facilitate comparisons of the modeling runs a single
summary table labeled Table 9 was prepared listing 9 input assumptions
and 53 key output parameters for each run. The DOI did not model a
``full reservoir'' scenario because it would not be consistent with the
decision in Tribe v. Morton and would serve no practical purpose.
In response to requests for information on modeling runs considered
by the DOI, Table 9 was made available to all parties. In response to
requests for more detailed information, we also provided copies of the
full 400-page proposed rule modeling run and a 36-page document of 94
years of modeled monthly output for 29 parameters. Table 9 was made
available at three public workshops on the proposed rule and the
availability of the remaining materials was announced in a Federal
Register notice dated February 18, 1997, extending the comment period
on the proposed rule by 60 days. The DOI believes that the modeling
information provided was specific to the proposed rule and sufficient,
when used in conjunction with the Notice of Proposed Rulemaking, to
allow the public to evaluate and comment on the proposed rule.
8. OCAP Modeling: Many questions and comments were received
regarding the Truckee River operations model used in developing the
Adjusted OCAP. Commenters noted concerns both with the model itself and
with DOI's use of the modeled data. One commenter noted that DOI is
relying on a long string of assumptions in using the

[[Page 66452]]

model, and that the model cannot be used to determine the water supply
for decreed rights. Another believes the operations model to be a
product of collusion between the United States, the Pyramid Lake Paiute
Tribe of Indians, and Sierra Pacific Power Company.
Several commenters wanted to know if and how the operations model
had been calibrated or verified. There were also questions about the
reliability of the model's estimates of parameters like seepage and
evaporation, sensitivity to various parameters, and about the
uncertainty these parameters create in the modeled output. One
commenter asked if the model was available for review.
Another series of comments questioned why ``real data'' were not
used and the model generates certain input data for missing stream
gauges or extrapolates reservoir operations for time periods when the
reservoirs were not in existence. Commenters also questioned why the
model examines a 94 year time period instead of the last 30 years,
especially when early stream gauges were not accurate.
Commenters also addressed the modeling results. Several noted that
the modeled results do not match what actually occurred in some years
and asked if DOI would monitor the actual Project hydrology, and if DOI
would change the OCAP if it did not match what actually happens.
Modeling was also thought by some to underestimate or to cover the
actual effects of shortages that result from not achieving high
efficiency requirements. One commenter suggested that the model does
not show the economic effect of lower Lahontan Reservoir storage on
hydropower generation, and does not account for the effect of upstream
storage in lieu of diversions to the Project. Some recommended
identifying shortages, or using the first year of a drought instead of
listing average shortages because averages do not show the one in ten
year event.
Response: The Truckee River operations model, a monthly river and
reservoir operations accounting model, was developed by the BOR and has
been added to and upgraded by contractors and BOR staff. The model is
in the public domain and has been used as an analytical tool in a
number of negotiations in western Nevada and has been accepted by
parties to these negotiations as the best modeling program available
for evaluating various Truckee River and Newlands Project operating
scenarios. Over the years, various versions of the model have been made
available to many organizations to use independently, including Sierra
Pacific Power Company, the Pyramid Lake Paiute Tribe, TCID, and the
States of Nevada and California.
Critics of the model point out that it does not use ``real'' data
and its results do not replicate the historic record. The reason is
that the model uses historic hydrology of the Truckee and Carson Rivers
starting with 1901, but has to extrapolate to fill data gaps from the
early 1900's. Also, the Truckee River operations and hydrology are
modified in the model to assume that all the reservoirs and operations
in place today have been in place since 1901, which is not this case.
This allows the model to keep a single accounting book of reservoir
records rather than having a new set of accounting books added to the
program when each new reservoir was built. Thus, modeled output
reflects operating the rivers with today's reservoirs and physical
features in place using 94 or 95 years of hydrology. Though suggestions
have been made to use a shorter time period such as 30 years of
hydrology, we believe the longer time period is a more robust data
base.
The model has undergone reviews by a number of modeling peers and
users of the model and has been evaluated for sensitivity to certain
parameters. Its input parameters for terms like seepage and evaporation
are based on field tests and observations. Because the model has been
widely accepted for use as a comparative tool for examining different
water management scenarios, it has not been calibrated for or verified
against any particular year or period of record.
The model uses historic hydrology, so it cannot be used
predictively, and by standardizing physical features, it cannot be used
to create an accurate hindcast. However, standardizing the river and
reservoir operations allows users to look prospectively at what might
happen in the future if the range of hydrology of the past is
representative of what might happen in the future.
By holding the physical features and hydrology constant, the DOI
uses the model to examine, compare, and contrast different operations
scenarios. The modeling is only used for comparative purposes and not
to suggest a specific future condition will exist. Operations under the
Adjusted OCAP will be monitored, but not for the purpose of comparing
the day to day operations in the Project with modeled results. As one
commenter noted, upstream storage in lieu of diversions to Lahontan is
not accounted for in the model. Upstream storage is intended to refine
the Truckee River diversion so that there is no inadvertent over
diversion. Because the model does account for forecasting errors and so
allows occasional over diversion, it may overestimate the water supply
in years when upstream storage might be used. Also, the model does not
consider the effects of lower reservoir levels on hydropower
production; this is considered in the environmental assessment for the
Adjusted OCAP rulemaking.
The DOI has examined and considered the severity of drought years
besides looking only at average water supplies. Table B shows the
modeled water supply for drought years in four modeled scenarios: 1988
OCAP assumptions with current hydrology; the Current Conditions,
Proposed Adjusted OCAP, and Final Adjusted OCAP. The Project water
supply under Final Adjusted OCAP is comparable to, though slightly
better than, what was modeled for the 1988 OCAP with the demand
assumptions for 1992, however it is less than the Current Condition
water supply. In the nine driest years, Final Adjusted OCAP is better
than what the Project is modeled to experience under the 1988 OCAP, but
worse than Current Conditions by 27,000 acre-feet on average for those
nine years. The additional shortage is the result of reduced carry over
of Truckee River in Lahontan Reservoir at the start of each year under
Adjusted OCAP.

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9. OCAP Development and Alternatives Selection: When it was first
announced in March 1995 that the DOI would be making adjustments to the
1988 OCAP, then Assistant Secretary for Water and Science Betsy Rieke
made a commitment to the TCID and Newlands Water Protective Association
(NWPA) that they would be consulted about changes the DOI was
considering before any decisions were made. Several commenters have
argued that the government did not fulfill this commitment, while
others have asked for a new proposed rule to be developed in
cooperation with all parties. One commenter objected to the rulemaking
process because they were not invited to a briefing on the proposed
rule after the Federal Register notice was published. Another commenter
asked if the State of Nevada had been informed about the proposed rule.
One commenter viewed the proposed rulemaking as a ``take it or leave
it'' ultimatum without consideration of reasonable alternatives, and
suggested that a new proposal should be developed in cooperation with
other parties. Two commenters believe the attorney for the PLPT had
``inside knowledge'' of the proposed rule and that TCID and NWPA were
excluded from participation while the PLPT and DOI developed the rule.
Another cited DOI's alleged fiduciary responsibility to water right
owners that the DOI must fulfill. Yet another commenter supported the
proposed rule but thought that DOI should have selected an alternative
that provided more benefits to Pyramid Lake. A State agency recommended
delaying the rule for more complete environmental and economic
evaluations and to await completion of negotiations between TCID and
PLPT. Commenters also suggested that the DOI take notice of the draft
Truckee-Carson River Basin Study for the Western Water Policy Review
Advisory Commission.
Response: The rulemaking was conducted in accordance with
Administrative Procedure Act requirements, which included notice
published in the Federal Register and an opportunity for comment by all
interested parties, as detailed in the Rulemaking Process section of
the preamble. In addition, certain parties were advised early in 1995
that before a decision was made, they would have an opportunity to
review changes DOI was considering making to the 1988 OCAP. The DOI
honored this by meeting with TCID, NWPA, PLPT, FPST, the State of
Nevada, and other parties to brief them on the content of the proposed
rule after it was published in the Federal Register. For interested
parties that did not attend this briefing, the same presentation was
made later at two public workshops on the proposed rule.
The view that the Adjusted OCAP is a ``take it or leave it''
proposal without considering alternatives presumes that the proposed
rule was a negotiating position. It was not. The DOI has been
unsuccessful in several multiparty efforts to negotiate an OCAP
settlement for the Newlands Project. The most recent effort, outside of
current ``out of court'' discussions to settle pending litigation, was
a facilitated negotiation that ended in March 1995, after which the DOI
announced its intention to proceed with changes to the 1988 OCAP. In
developing the Adjusted OCAP rule, the DOI has examined a wide range of
alternatives, including those that were presented during the
facilitated negotiations. The DOI held four well-attended public
workshops in August and September 1995 to discuss possible changes to
the 1988 OCAP and afford the public early input to developing the
Adjusted OCAP. With the exception of these public workshops, no outside
parties participated in DOI's development of the Notice of Proposed
Rulemaking. As well, to our knowledge, no outside party has
participated or been privy to development of this Notice of Final
Rulemaking.
The DOI has reviewed and takes notice of the draft Western Water
Policy Review Advisory Commission report.
The DOI selection of Alternative D for the proposed Adjusted OCAP
and as the basis for the final Adjusted OCAP is primarily based on the
mix of water savings and water supply impacts this alternative
provides. The obligation owed to the water rights holders in the
Newlands Project is a contractual obligation, not a fiduciary
obligation. In evaluating OCAP alternatives, the DOI must seek to
satisfy its contractual obligation to serve water rights, and to meet
its Trust responsibility to the PLPT. Also, the DOI has completed both
environmental and economic analyses in promulgating this rule.
10. Relationship of OCAP to the Truckee River Operating Agreement:
Three commenters raise concerns regarding ongoing Truckee River
Operating Agreement (TROA) negotiations which address, in part, storage
in Truckee River reservoirs. Their concerns fall into three areas.
First, that absent the TROA, the DOI has no authority to implement the
upstream storage provisions necessary for storage in lieu of
diversions, and therefore the Adjusted OCAP cannot precede TROA.
Second, that until the TROA is completed there is no way for the DOI to
evaluate opportunities for storage in lieu of diversions or assess what
impact TROA may have on Truckee River flows available to the Project.
Third, that the relationship of OCAP storage to other storage under
TROA is not clear, and OCAP storage cannot adversely affect existing
storage agreements.
Response: The Adjusted OCAP rule does not establish credit storage
in lieu of diversions; that was established in the 1988 OCAP already in
effect. This Adjusted OCAP rule extends the time period during which
water may be credit stored, from April-June, to November-June, and it
clarifies the procedures for storage in lieu of diversions. Therefore,
the TROA negotiations need to address OCAP storage regardless of
whether the 1988 OCAP is replaced by Adjusted OCAP or not. Also, the
United States already has the authority to capture this water in
Stampede Reservoir or to credit store the water out of fish water in
Stampede by exchange and does not need TROA to be in place.
Modeling for the Adjusted OCAP does not assume that the TROA is in
effect and therefore does not assess whether the TROA would have any
impact on the Newlands Project. However, Pub. L. 101-618 mandates that
the TROA must not adversely affect water rights. Preliminary modeling
results for the draft TROA EIS indicate that flows in the Truckee River
are affected by increased water use over time in the Truckee Meadows,
and by effluent reuse programs associated with the Water Quality
Settlement Agreement.
The effect of OCAP storage is unclear, but the DOI has agreed
preliminarily that it will not credit store water in lieu of diversions
if such credit storage would adversely impact the storage, retention,
or use of other categories of credit water under TROA. The text of the
Adjusted OCAP in section 418.3(e)(8) has been modified to ensure that
OCAP storage does not interfere with other storage in Truckee River
reservoirs. It should be noted that TROA is the subject of continuing
negotiations among many parties and that its timing and configuration
are not yet known.
11. Compliance with National Environmental Policy Act (NEPA): The
DOI received many comments on the draft EA that accompanied publication
of the proposed Adjusted OCAP rule. Those comments, including
recommendations for mitigation of environmental effects, are addressed
in the final EA.
Eight commenters questioned the DOI's preliminary determination
that

[[Page 66455]]

the Adjusted OCAP is not a significant Federal action requiring
preparation of an EIS, citing general impacts to wildlife, wetlands,
ground water, and socio-economic effects. One commenter suggested that
because the Adjusted OCAP violated laws related to water rights, this
must be considered a significant impact under NEPA. Several commenters
cited the need for a programmatic EIS to be prepared on the Adjusted
OCAP and all other actions under Pub. L. 101-618.
Response: All comments received regarding environmental effects
have been considered and addressed in the EA. While the EA does discuss
possible effects on wildlife, wetlands, ground water, and socio-
economic impacts, none of these were considered to be significant for
NEPA purposes. Further, nothing in this Adjusted OCAP rule causes a
violation of law. Where appropriate, mitigation measures and their
environmental benefits are discussed in the EA.
A number of parties have advocated that the DOI must prepare a
single, programmatic EIS on all actions under Pub. L. 101-618,
including for the Adjusted OCAP. The DOI disagrees with this position.
This issue was the subject of litigation brought by Churchill County
and the Town of Fallon, was dismissed by the U.S. District Court for
Nevada, and is currently the subject of an appeal to the United States
Court of Appeals for the Ninth Circuit.
12. Compliance with Executive Orders: One commenter questioned
whether this rulemaking complies with various Executive Orders that
must be considered in promulgating regulations. This person believes
the more than 120,000 acre-foot reduction in storage targets in
Lahontan Reservoir poses an unreasonable cost on society and triggers
the need for the rule to be reviewed by the Office of Management and
Budget (OMB) in accordance with Executive Order (E.O.) 12866. Under
E.O. 12612 on Federalism, the commenter questions whether the DOI has
properly evaluated the need for Federal action and the impacts of the
Adjusted OCAP on the State of Nevada's sovereignty and costs or burdens
on the State. The commenter asks that DOI not adopt the Adjusted OCAP
rule until it completes the requirements of E.O. 12606 on the Family,
particularly with respect to impacts on family earnings. The commenter
also believes the Adjusted OCAP rulemaking does not comply with E.O.
12988 on Civil Justice Reform because of the likelihood that the DOI
will be sued on the rule.
Response: The cited change in Lahontan Reservoir storage targets is
inaccurate and is not a basis for review of the Adjusted OCAP
rulemaking by OMB. The proposed Adjusted OCAP reduced the key January
to June storage target from the 1988 OCAP level of 215,000 acre-feet to
174,000 acre-feet, a reduction of 41,000 acre-feet. The reference to
``more than 120,000 acre-feet'' assumes a reduction from the reservoir
capacity of 295,000 acre-feet to 174,000 acre-feet. The changes in
storage targets only affect the trigger points for diversion of Truckee
River water to Lahontan Reservoir. The storage targets do not impose
any limit on the amount of Carson River water or the total amount of
water that can be held in Lahontan Reservoir. Further, in response to
comments, the DOI has revised the end-of-June storage target to 190,000
acre-feet, though retains the January-May targets at 174,000 acre-feet,
subject to the adjustment procedure in section 418.22 of the rule.
The economic threshold for OMB review under E.O. 12866 is if the
proposed rule is anticipated to have an economic impact of $100 million
or more on a single entity or an economic sector. The economic impact
of the Adjusted OCAP rule is based on average changes to the water
supply and its effects on foregone production of alfalfa. These effects
would only be experienced in drought years, the intensity of which
would determine any actual changes in production. The average effect is
calculated to be in the range of $561,000 to $283,000 per year, gross,
to the agricultural sector. This estimate reflects the price of alfalfa
without subtracting production costs. A 1994 study by the University of
Nevada Cooperative Extension (Fact Sheet 94-22, Alfalfa Production
Costs for Fallon, Nevada Area, by Wheeler and Meyer) concluded that the
per acre profit for alfalfa was approximately $220 per acre which
places the economic impact of the Adjusted OCAP at approximately
$160,380 based on the rule having a water supply impact that might
otherwise have served 729 acres. Nor does the Adjusted OCAP rule meet
any of the other criteria for significance under E.O. 12866 regarding a
serious conflicting action with another Federal agency, creating a
budgetary impact, or raising novel legal or policy issues.
The Adjusted OCAP makes changes to four existing provisions of the
1988 OCAP. It neither creates any new requirement affecting the
sovereignty of the State of Nevada, nor changes the role of the State
or its rights and responsibilities with respect to regulating the
Newlands Irrigation Project. The State was notified of the DOI's intent
to proceed with the Adjusted OCAP rulemaking in 1995, participated in
workshops on developing the proposed rule, and was consulted with
before publication of the proposed rule. The DOI believes the
requirements of E.O. 12612 on Federalism have been satisfied.
The DOI has examined the impact on family income as a result of the
Adjusted OCAP in accordance with E.O. 12606. The economic impact of the
Adjusted OCAP, which is experienced only within the Carson Division of
the Project and only during the first year of a drought, translates
into an estimated average economic impact on production of between $10
and $5 per acre per year, and an impact on profits of approximately
$2.90 per acre per year. This cost is neither considered to have a
significant impact on family budgets, nor expected to have any effect
on any other family criteria under E.O. 12606. In addition, each
farmer's strategy for managing a reduced water supply in a drought will
affect their costs of production, which are typically $450 to $476 per
acre, and gross receipts, which may mitigate or exacerbate the effects
of the rule. If a farmer's net return is $220 per acre as noted, it is
possible that leasing water in a drought year would generate more
profit than alfalfa production in a full water year. However, none of
these economic assessments includes the costs of replanting crops which
might be necessary following severe droughts or leasing water. While
the precise impact to each family budget is unknown, the DOI is
cognizant of and has considered these overall effects in this
rulemaking.
The applicable standards of E.O. 12988 on Civil Justice Reform do
not set a threshold on the possibility of litigation as a consequence
of the rulemaking. While we seek to avoid litigation, we recognize that
all rulemaking holds the possibility of litigation by an allegedly
aggrieved party. The DOI does not consider the litigious and turbulent
history of Newlands Project OCAPs to be dissuasive in pursuing its
responsibilities.

II Adjusted OCAP Issues

1. Project Acreage Base: The adjustments to the 1988 OCAP are
based, in part, on anticipated increases in irrigated Project acreage
that did not take place under that OCAP and some changes that did take
place. The 1988 OCAP anticipated and was based upon the acreage in the
Project increasing to 64,850 acres with an attendant headgate
entitlement of 237,485 acre-feet and a total diversion demand of
346,985 acre-feet. Instead, the project acreage is

[[Page 66456]]

currently approximately 59,000-60,000 acres with a headgate entitlement
of approximately 206,500-210,000 acre-feet and a total diversion demand
of approximately 301,900-307,000 acre-feet. The current diversion
demand figures for the Project are the result of a smaller acreage base
than had been anticipated in the 1988 OCAP, reduced entitlements based
on the so-called ``bench/bottom'' litigation (1995 Order of Judge
McKibben, in U.S. v. Alpine, United States District Court for the
District of Nevada No. D-185), ongoing water transfer litigation, a cap
on water use by the Fallon Paiute-Shoshone Tribes, and a transfer rate
of 2.99 acre-feet per acre for acquired wetland water rights as has
been transferred to date instead of 3.5 or 4.5 acre-feet per acre. In
response to the reduced water demand, the Adjusted OCAP changes the
Lahontan Reservoir storage targets to provide a commensurate reduction
in water supply from the Truckee River.
The DOI has received comments from eight parties objecting to the
proposed storage targets using a 1995 acreage base of 59,075 water-
righted, irrigated acres, when there are nearly 73,000 acres in the
Project assessed annual charges for operations and maintenance (O&M).
Commenters also disagree with BOR's determinations as to which lands
are eligible for water deliveries. They contend that acreages and
entitlements could change as a result of rulings favorable to
irrigators in the transfer litigation and individual readjudications of
the bench/bottom decision.
Response: The DOI agrees that the Project water demand may change
over time. When the Notice of Proposed Rulemaking was published, the
DOI assumed that changes affecting water demand might not occur for
some years. It appears, now, that resolution for some proposed water
rights transfers may occur sooner. Also, the 1995 actual irrigated
acreage figure used in developing the Adjusted OCAP may have been
depressed following several years of drought. The irrigated acreage
reported for 1996 and estimated for 1997 has increased somewhat. On the
other hand, additional acreage has been acquired for wetlands use at
2.99 acre-feet per acre which would tend to reduce water demand on the
Project.
In response to these comments, the DOI is adopting, in effect, a
sliding scale of storage targets predicated on holding the water supply
available to the Project commensurate over a range of water demands.
The table Adjustments to Lahontan Reservoir Storage Targets in the rule
shows targets corresponding to water demands from 249,800 acre-feet to
290,200 acre-feet, and section 418.22 includes formulae for demands
below and above those levels. For all levels of demand, the average
annual water supply is about 97.4 percent. As an example of using the
storage targets to match demand, Table C shows key modeling results for
two demand levels below the Adjusted OCAP level and two above the
Adjusted OCAP. In the four variations, the water supply to the
individual irrigators remains at approximately the same level
consistent with the proposed Adjusted OCAP water supply level.

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The BOR will determine at the end of each irrigation season what
change, if any, is to be made to the monthly Lahontan Reservoir storage
target for the next year, starting with the November end-of month
storage target. Changes in the storage targets shall be implemented in
whole increments of 1,000 acre-feet as indicated on the Table. For
water demands above or below the values shown on the table Adjustments
to Lahontan Reservoir Storage Targets, the two formulae associated with
the table will be used to calculate the target adjustments, but will
only be implemented in whole units of 1,000 acre-feet.
Carson Division water demand from the previous full water year (100
percent supply) will be the basis for changes in storage targets.
Following any water year there will be a one-year lag in water demand
data because verification of the irrigated acreage cannot be determined
until about March for the prior irrigation season ending in October.
For example, the Carson Division water demand for the 1997 irrigation
season, a full water year, will not be known until March 1998. Under
this rule, any further adjustments to storage targets could not go into
effect before November 1998.
These flexible storage targets in Adjusted OCAP will address the
concern that the DOI has selected an unreasonably low acreage or is
relying on an inflexible demand base for setting Lahontan Reservoir
storage targets. This provision assures the irrigators a consistent
water supply as Project acreage changes.
2. Changes in Storage Targets: The Adjusted OCAP change Lahontan
Reservoir storage targets to bring the water supply in Lahontan
Reservoir in line with the Carson Division water demand in a manner
that is consistent with the 1988 OCAP. The DOI received specific
comments from nine parties, some saying that this change in storage
targets will cause shortages and artificial droughts. Some comments say
the reduced December and winter storage targets will cause diversions
to begin later in the spring and summer when less water is available in
the Truckee River. This will cause shortages that will prevent water
entitlements from being satisfied or will satisfy entitlements in
normal water years but leave less water in storage at the end of the
irrigation season creating new droughts or worsening droughts in future
years. In turn, this will reduce crop yields, and in drought years,
more farmland will be fallowed, requiring larger capital investment to
replant after a drought. One commenter asked if DOI only looked at
elements that might reduce Truckee River diversions rather than
increase them. It appears to some that the DOI is deliberately creating
shortages in the Project water supply by only adjusting OCAP provisions
that increase shortages, and asking the water rights owners to bear
these shortages and the related economic effects. After all, one asks,
isn't the goal to reduce risks of shortages? Another commenter said
basing reduced diversions on trust obligations is disingenuous because
the real reason is to allow growth in the Reno and Sparks area.
Another area of stated concern in comments is that the change in
Lahontan Reservoir storage targets is unjustified because the
percentage reduction in storage targets exceeds the percentage
reduction in Project acreage. One commenter asks whether DOI is
assuming a 1:1 relationship of storage targets to water demand and
whether that same relationship applies to the current project acreage.
Other commenters suggest that the Adjusted OCAP storage targets are
too high and the October storage target should be reduced to 4,000
acre-feet, the November and December targets reduced, and, in years of
high precipitation, the October to December targets reduced. One
suggests that the 4,000 acre-foot minimum pool in Lahontan should be
eliminated or maintained out of water rights acquired for that purpose,
otherwise it is, in effect, maintained out of the Truckee River by a
higher storage target.
Response: The Adjusted OCAP do not lower storage targets for the
purpose of creating water shortages in the Project. The purpose of
lower targets is to reduce unnecessary diversions of water from the
Truckee River. The storage targets are calibrated to meet the
Secretary's trust responsibility to minimize Truckee River diversions
while satisfying the Secretary's contractual obligation to provide an
appropriate water supply to serve Project water rights. Also, the
benefits of reduced Truckee River diversions accrue to water users
downstream of Derby Dam and to Pyramid Lake. Reno and Sparks derive no
benefits from Adjusted OCAP.
The 1988 OCAP established a set of Lahontan Reservoir storage
targets that were expected to satisfy the existing and increasing
future water demands of the Newlands Project. It was assumed that the
Project would grow to 64,850 acres and be served in the Carson Division
by the 215,000-acre-foot-storage-target set defined in the 1988 OCAP.
Modeling indicates that the 1988 OCAP with conditions projected for
1992 would provide approximately a 97.27 percent water supply. However,
the Project did not attain the size envisioned. The fortuitous
consequence for the Carson Division water users has been to have the
current acreage level and corresponding water demand served out of a
water supply capable of serving a larger Project. Thus, the Project
today enjoys an average water supply modeled at 98.34 percent, but also
increased spills and other losses at the expense of the Truckee River
and Pyramid Lake. The proposed Adjusted OCAP would have provided an
average water supply of 97.38 percent, a reduction from current
conditions by about 2,550 acre-feet on average. This Adjusted OCAP
final rule, by increasing the end-of-June storage target to 190,000
acre-feet, provides a modeled average water supply of 97.40 percent,
which is approximately the same supply the 1988 OCAP would have
provided with expected growth.
The lower Lahontan Reservoir storage targets do reduce, as noted in
comments, the available Project water supply, but still serve water
right entitlements for full water years in nine out of ten years, based
on the historic hydrologic record. Lower storage targets also result in
less water remaining in the Reservoir at the end of each season which
means that in the approximately one year in ten when there is a
drought, there is less water carried over to cushion the Project from
the drought, as shown in Table B. Generally, if a drought lasts for
more than one year, the storage targets have no effect on the Project
water supply because the target limits are never met and TCID can
continue diversions of water from the Truckee River that may be
available, subject to higher priority Orr Ditch water rights. Any
additional shortage resulting from Adjusted OCAP has an economic
effect, which is discussed in I.12. of this preamble.
Regarding percentage reductions in acreage and targets, there is
not a one to one relationship between Project acreage and storage
targets under the Adjusted OCAP or the 1988 OCAP. Storage target levels
determine when TCID can divert water from the Truckee River to Lahontan
Reservoir. Under the Adjusted OCAP, during January through May when
Lahontan Reservoir storage is forecast to be below 174,000 acre-feet at
the end of June, TCID may divert Truckee River water to Lahontan. If
the water level in Lahontan Reservoir is forecast to be above the
storage level of 174,000 acre-feet at the end of June, then TCID may
not divert Truckee River water to Lahontan. The 174,000-acre-foot
target is not a new limit on how much water Lahontan Reservoir may

[[Page 66459]]

hold. Lahontan Reservoir can still fill to capacity with Carson River
water, as it has done, for instance, in the past three years.
The percentage change in Project acreage from a projected 64,850
acres to 59,075 acres is an 8.9 percent reduction. Acreage is directly
related to water demand and OCAP's goal is to provide the appropriate
water supply to meet the demand for water righted acreage in
irrigation. In the Adjusted OCAP rule, storage targets are adjusted so
that in most years, the Project water supply in Lahontan matches or
exceeds (based primarily on Carson River inflow) the water demand at
current acreage levels. The corresponding percentage reduction in
average water supply from the 1988 OCAP with 1992 assumptions to the
Final Adjusted OCAP (from Table A) is modeled to be about a 7 percent
reduction (284,020 acre-feet and 263,950 acre-feet, respectively).
Separate from the percentage reductions in acreage and water demand,
the OCAP determines how to get enough water in Lahontan Reservoir to
satisfy the water demand. Lahontan Reservoir receives an average annual
inflow of approximately 355,000 acre-feet of which, on average, about
80 percent is Carson River inflow and 20 percent Truckee River
diversions to Lahontan. Therefore, a given percentage reduction in the
storage target for Truckee River diversions has a much smaller
percentage effect on the total water supply in Lahontan Reservoir. For
example, a 50 percent reduction in storage targets would still provide,
on average, about a 90 percent supply to the Project; a 100 percent
reduction in storage targets (no Truckee River water) would still leave
an 80 percent water supply, on average.
On the issue of maintaining a 4,000 acre-foot minimum storage in
Lahontan Reservoir, that is not a provision of OCAP, but rather appears
to be an informal agreement between TCID and the Nevada Department of
Conservation and Natural Resources to provide some water for fish in
the Reservoir. Although Lahontan Reservoir was designed for irrigation
water storage, Pub. L. 101-618 expands the authorized purposes of the
Newlands Project to include recreation and fish and wildlife (Section
209 (a)), though no water rights have been transferred to the Reservoir
for that purpose. The DOI supports maintenance of the recreational
fishery at Lahontan Reservoir, and by modeling the Reservoir with a
4,000 acre-foot minimum level, the DOI acknowledges that this amount of
water is, in effect, unavailable for use in the Project. Also, the
minimum reservoir pool is beneficial to dam safety and operations
because both the dam and the valves and packing in the outlet works
perform best if kept wet instead of being subject to frequent wetting
and drying.
3. Project Conveyance Efficiency: The Adjusted OCAP does not change
the assumptions underlying the conveyance efficiency provision in the
1988 OCAP, but it does reduce the conveyance efficiency requirement
based on less Project acreage than was envisioned in the 1988 OCAP. The
basis for the new, lower conveyance efficiency requirement is that
conveyance efficiency generally decreases as the irrigated acreage in
the Project decreases because conveyance losses (seepage and
evaporation) are about the same even though deliveries to headgates
decrease.
Thirteen commenters questioned why DOI was continuing to rely on
the efficiency assumptions in the 1988 OCAP. The comments focus on a
table of 22 Potential Water Conservation Measures for the Newlands
Project first published as Table 4 in the 1988 OCAP and republished in
a modified form in the Adjusted OCAP proposed rule. Commenters object
to using this table because the conservation measures, many of which
were implemented by TCID, have not always achieved the water savings
predicted in the 1988 OCAP. Some stated that continuing to cite these
conservation measures perpetuates in the Adjusted OCAP the errors from
the 1988 OCAP. Some feel that DOI has not recognized the efforts of
TCID in trying to achieve the conveyance efficiency requirements by
relying on these conservation measures. One commenter stated that DOI
had used these conservation measures to justify unreasonable conveyance
efficiency requirements in the 1988 OCAP, while another commenter
stated that the requirements were made artificially high to run up
Project debits. Another commenter stated that the conservation measures
had interfered with getting irrigation deliveries at the optimum times
for plants. Several commenters wanted to know what other irrigation
projects the Newlands Project had been compared to in determining what
level of conveyance efficiency was possible.
Five commenters raised questions about how the Adjusted OCAP
conveyance efficiency was developed, whether DOI had considered the
1994 Report to Congress on the Newlands Project Efficiency Study, how
the lower storage targets relate to efficiency, and if we can be very
accurate in measuring conveyance efficiency.
Two commenters stated that the conveyance efficiency requirement
should not be lowered because the 1994 BOR Efficiency Study shows that
efficiencies could be increased to 75 percent, and that lower
efficiencies were inconsistent with BOR policy on water conservation.
Response: In planning the adjustments to be made to the 1988 OCAP,
the DOI identified four changes within the scope of the 1988 OCAP:
adjustments to Lahontan Reservoir storage targets based on current
irrigated acres, conveyance efficiency requirements based on current
irrigated acres, extending the time period for storage in lieu of
diversions to avoid winter over diversions, and giving BOR flexibility
in determining what snowpack/runoff forecasts to use. The DOI was asked
to consider more fundamental changes to the 1988 OCAP approach to
conveyance efficiency; however, the suggested changes were far beyond
the scope of the Adjusted OCAP analysis. The DOI has committed to a
review of conveyance efficiency requirements and conservation measures
as part of long-term revisions to OCAP, but not as part of Adjusted
OCAP.
The expected water savings from the 22 conservation measures
identified in Table 4 in the 1988 OCAP were based on information
available at the time. Many of those measures were suggested as a
relatively inexpensive means to achieve the conveyance efficiency
requirements in the 1988 OCAP. Some of the measures in Table 4 were
expensive and some of the predicted savings have not been achieved in
practice. Many of the 22 measures were implemented by TCID, although
not always consistently, but the predicted water savings were not
realized in all cases. In its 1994 Efficiency Study, the BOR recognized
the differences between the water savings predicted in the 1988 OCAP
and what had been achieved. It also identified other measures, some at
quite low cost, that could increase project efficiency. The Adjusted
OCAP incorporates the new information from the 1994 Efficiency Study
and updates the table on Potential Water Conservation Measures.
However, the 1988 OCAP neither required those specific measures from
Table 4 to be implemented nor precluded the Project from implementing
any other measures to improve water conservation and meet the
efficiency requirement. The conservation measures are not a means of
justifying conveyance efficiency requirements but were suggested as a
way to achieve those requirements. Nor are the conveyance efficiency
requirements a way to increase debits in the Project.

[[Page 66460]]

As suggested in a comment, it is difficult to know with precision
how a particular conservation measure improves conveyance efficiency.
One of the problems--and one of the twenty-two conservation measure
suggestions--is the inaccuracy of measuring deliveries to headgates. As
a result of the new Project O&M contract, TCID is undertaking
installation of water measurement devices to improve measurement of
headgate deliveries. The efficiency study estimates that this will
actually increase efficiency by about 7.5 percent because the current
measurement is inaccurate and seems to produce systematic over-
diversions to Project irrigators.
In formulating the conveyance efficiency requirements for the 1988
OCAP, BOR compared the Newlands Project to two other irrigation
projects concerning the conveyance efficiencies that might be achieved.
The BOR looked at the Payette Division of the Boise Project and the
South Side Pumping Division of the Minidoka Project, both in Idaho. The
observed conveyance efficiency in the Payette Division is 66.3 percent
and in the South Side Pumping Division 64.4 percent. As might be
expected, the Newlands Project shares some characteristics with these
projects and is different from them in other ways. The 1988 OCAP
considered these to be ``comparable'' projects, but no assessment has
been made of the validity of any comparisons.
The Adjusted OCAP reduction in the conveyance efficiency
requirement is calculated based solely on the current Project acreage
compared with the 1988 OCAP acreage assumptions and is unrelated to the
calculation of the Adjusted OCAP storage targets. The conveyance
efficiency requirement will be extrapolated each year using the 1988
OCAP acreage assumptions and the current acreage.
The DOI believes the reduced efficiency requirement to be
consistent with other changes in the Adjusted OCAP based on Project
acreage. This change recognizes the difficulty in meeting the
efficiency requirements when headgate deliveries are lower. It is not a
windfall for the irrigators because the reduced efficiency requirement
still cannot be met without physical or operational improvements in the
Project, although there is a benefit because it will reduce the debit
the Project may incur in certain years.
4. Effects of Other Actions on Efficiency: One commenter noted that
various water rights acquisition programs could result in the
acquisition and transfer out of the Newlands Project of a significant
portion of the water rights in the Truckee Division. The conveyance
efficiency in the Truckee Division is approximately 74 percent, and
this higher conveyance efficiency improves the overall Project
conveyance efficiency. The commenter is concerned that Truckee Division
water rights acquisitions will shift more of the burden of meeting
efficiency targets to the less efficient Carson Division.
Four other commenters say that the wetlands water rights
acquisition program managed by the FWS to acquire water rights for
Stillwater National Wildlife Refuge will make it difficult to achieve
the required efficiencies. The wildlife refuge is at the end of the
Project delivery system and commenters contend delivering increasing
amounts of water to the end of the system will reduce conveyance
efficiency. Another concern is that the pattern of water rights
acquisitions may eliminate deliveries to some properties along a
delivery lateral and result in less efficient water deliveries to other
remaining properties on the lateral. One commenter disagreed with the
assumption that the water rights acquisition program will, over time,
help to improve conveyance efficiency in the Carson Division, and cited
the 1994 BOR Efficiency Study to support this claim .
Response: While the concern for conveyance efficiency is
legitimate, the specific argument is questionable considering that
wasteful deliveries occur, including one at no more than about five
percent efficiency.
The DOI continues to believe that the pattern of purchases,
predominantly in the Stillwater and St. Clair Districts, the areas
closest to the wetlands, will improve Project efficiencies by
concentrating deliveries through the system. This is consistent with
the 1994 BOR Efficiency Study which states that delivery of more water
to wetlands should not affect seepage because the canals used to
deliver water to the wetlands are generally full throughout the
irrigation season, and that the wetted area of the canal and not flow
determines seepage.
The DOI recognizes that absent targeted water rights acquisitions,
the FWS may buy water rights in other areas of the Project. It is the
DOI position that if, at some appropriate point in the future, water
rights acquisitions in the Truckee Division or the Carson Division are
shown, on the whole, to have a demonstrable adverse effect on Project
conveyance efficiency, the calculation of Project conveyance efficiency
may be adjusted. This would be done solely at the discretion of the BOR
and only if a feasible technical approach can be developed to remove
the inefficient component of the delivery system from the calculation
of conveyance efficiency.
This should not affect the Secretary's carrying out his trust
obligations to the PLPT because each wetlands acquisition reduces the
demand for Truckee River water in the Project by transferring to the
wetlands only 2.99 acre-feet of every 3.5 or 4.5 acre-feet acquired.
Also, the conveyance efficiency improvements from concentrating
deliveries to the wetlands further reduces the demand for Truckee River
water in the Carson Division.
5. Credit Storage in Lieu of Diversions: The proposed Adjusted OCAP
rule extended the time period during which water might be stored in
Stampede Reservoir on the Truckee River in lieu of diverting that water
to Lahontan Reservoir. The 1988 OCAP allowed storage in lieu of
diversion from April through June. The proposed rule extended storage
in lieu of diversion to begin as early as January each year.
Six commenters raised a number of questions, foremost seeking a
better description of when credit storage provisions would be utilized,
how much water could be stored, when it would be released from storage,
and how it relates to storage targets. Another question was why DOI was
using credit storage to address unique events like high runoff years,
but not drought years. One commenter suggested that there would be
little benefit for the Truckee River or Pyramid Lake if credit storage
is only used in years that are full water years or better. Some
comments expressed concern for water levels in Lahontan Reservoir when
water was being stored in Truckee River reservoirs, and saw the
potential for less carry over storage in Lahontan and more diversions
from the Truckee River. One commenter questioned why unused Newlands
Project water could not be carried over to the next year in Truckee
River reservoirs. Another commenter asked why the credit water could
only be used in the Carson Division when the greater need for the water
might be in the Truckee Division.
Two commenters recommended that the credit storage in lieu of
diversions start in October to avoid excess diversions, particularly in
November and December. One commenter suggested that storage in lieu of
diversions should be done whenever possible, regardless of runoff
forecasts, and that credit water only be taken to Lahontan Reservoir
after June and then only to meet storage targets.
One commenter was concerned about the effects of storage in Truckee
River

[[Page 66461]]

reservoirs and recommended that water be stored in all Truckee River
reservoirs, not just Stampede reservoir, and that unused portions of
the credit storage should revert to the reservoir in which the water
would have been captured. The commenter wanted the storage priority for
OCAP credit water to be junior to all existing categories of stored
water and junior to all future storage under the TROA, and that it not
be stored adverse to Floriston rates without a hydropower waiver from
Sierra Pacific Power Company. Also, they indicated that the OCAP credit
storage should be subject to reductions by evaporation and spills.
Response: Extending the time period during which the credit storage
provision is applicable is intended to fine-tune the amount of water
the Project receives from the Truckee River. It is a way to avoid
excess winter diversions of Truckee River water that ultimately spills
from Lahontan Reservoir, as occurred in 1995, 1996, and 1997. The
following discussion is intended to clarify when and how the credit
storage provision (Sec. 418.20 (f)) will be used. In response to
comments received, and in consideration of the experience in December
1996 when approximately 22,000 acre-feet of water was diverted from the
Truckee River to Lahontan Reservoir and then was spilled in January
1997 due to high Carson River runoff, the Adjusted OCAP rule extends
credit storage in lieu of diversion to include November and December.
October was not included because it is during the irrigation season and
because it is the month with the lowest storage target--52,000 acre-
feet--so there is little risk that Truckee River diversions to meet
that target would result in a spill. As revised, this Adjusted OCAP
rule provides the BOR flexibility to determine, in consultation with
other parties, whether to initiate credit storage any time from
November through June of the next year.
Under this credit storage provision, water that otherwise would
have been released for diversion to Lahontan Reservoir that is actually
retained in Truckee River reservoirs would be credited as Newlands
Project credit water. Also, water that could be diverted to Lahontan
Reservoir but is allowed to pass Derby Dam may be credited as Newlands
Project credit water in Stampede Reservoir from the fish water stored
in Stampede Reservoir. In the latter situation, concurrence by the FWS,
and as appropriate, the PLPT, will be required because they control the
use of fish water, and the storage would have to be accomplished by
exchange with water dedicated to help restore endangered and threatened
fish at Pyramid Lake. For example, a reduction of diversions in January
through March of 1995, would have required FWS approval because water
was not being released for Project diversions.
Newlands Project credit water could be exchanged to other special
categories of water in Truckee River reservoirs such as project water
held for fish recovery, and can be retained in storage until the end of
the irrigation season. The number of categories available for such
exchanges is expected to increase if the TROA currently in negotiation
is completed and entered into effect.
Newlands Project credit water that spills may be captured and
diverted to the Project at Derby Dam if the diversion is within the
applicable OCAP storage targets. However, Newlands Project credit water
remaining in storage at the end of the Project irrigation season will
be managed to benefit threatened or endangered fish in Pyramid Lake.
Newlands Project credit water may be released for diversion to
Lahontan Reservoir, if needed, as early as July 1 through the end of
the irrigation season, but not thereafter. Credit water can be diverted
to Lahontan Reservoir only to meet applicable storage targets during
the irrigation season. Newlands Project credit water will not carry
over to the next year for use in the Project, therefore, if it is not
used in the year in which it is stored, it will not be available
thereafter to the Project. To protect the water users, the Newlands
Project credit water held in storage on the Truckee River will not be
reduced as a result of seepage or evaporation. If Newlands Project
credit water spills from Truckee River reservoirs it can be diverted at
Derby Dam for Lahontan Reservoir subject to applicable storage targets.
If the entire amount in credit storage is needed to meet Lahontan
Reservoir storage targets, then the amount of water released from
Truckee River reservoirs will be the amount actually captured in
storage. If the Newlands Project credit storage is based on water that
was allowed to pass Derby Dam, then sufficient water will be released
from credit storage to ensure that the diversion to the Project, as
measured at the U.S. Geological Survey gauge on the Truckee Canal near
Wadsworth, Nevada, matches the diversion foregone earlier in the
season.
The BOR is expected to apply this provision starting in November or
December only in years when the water levels in Lahontan Reservoir and
Truckee River Federal reservoirs are high enough to indicate that a
normal or near normal water year would be expected to satisfy Project
water demand. For example, there would be no point in credit storing
potential Truckee River diversions in November or December if Lahontan
Reservoir were nearly empty due to a drought in the preceding
irrigation season. Thereafter, Newlands Project credit water will be
stored in lieu of diversion if the Carson River runoff is forecast to
provide a full supply of water to Lahontan Reservoir.
The reason Newlands Project credit storage is not allowed to carry
over to subsequent years is because, by definition, the water left in
storage at the end of the irrigation is water that was not needed to
serve Project water rights. In accordance with Tribe v. Morton, the
credit water remaining is water that must flow to Pyramid Lake.
The effect of this provision on water levels in Lahontan Reservoir
will vary from year to year, depending on the amount and timing of the
Carson River spring runoff. The information on storage levels in Table
D does not include any effects from storage in lieu of diversion. If,
as expected, credit storage is exercised only during above average
water years, it may have little effect on recreation levels in Lahontan
Reservoir. Credit storage will tend to reduce water levels in Lahontan,
particularly in the spring and early summer recreation seasons, but if
the credit water is needed and taken to Lahontan later in the summer it
will increase water levels. The fine tuning facilitated by credit
storing will tend to reduce carry over of Truckee River water in
Lahontan and this will decrease spills.

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The Newlands Project credit water is not intended to be used to
balance the water supply between the Truckee and Carson Divisions of
the Project. The credit storage is created out of water that would have
gone to Lahontan Reservoir. If the credit water is needed to meet
storage targets in Lahontan Reservoir but it is instead diverted for
use in the Truckee Division, that leaves the Reservoir below targets
and places an additional call on Truckee River water. On the other
hand,

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Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/fr%3A97-32795. Public record. Not legal advice.