January 9, 2001

Welcome

Mike Golden welcomed everyone. The November 14, 2000, meeting summary was approved.

Hydrology Subcommittee Report

Jonathon LaMarche, per the November 14 meeting discussion of the synoptic measurement study on the Sprague, noted similarities to USGS study done in 1970. However, a difference caused him to double check measurements to make sure error was not in the measurement. WRD found two areas of ground water discharge; at Camcon and McBrady Springs and the other is at Beatty Gap. USGS found discharge areas there also, but identified another site between Lone Pine and Trout Creek. WRD didn't find that initially or on the second set of measurements. Either the USGS study had measurement uncertainty or they were measuring return flows. He noted USGS measurements were done in October and WRD measurements were done in November.

In the Camcon and McBrady Springs area there is a 70 cfs gain from ground water flows. Springs account for about 50 cfs. Between Beatty and past Lone Pine there is no ground water discharge at all. With no ground water going into the area, one of the variables is removed from consumptive use measurements. So in trying to determine where a good site would be for a consumptive use study, that is useful information.

There is a 120 cfs gain in the Sprague near Medicine Spring. In the upper Sprague above Beatty Gap, there is another ground water discharge area that has about 40 cfs gain.

After verifying previous measurements, Jonathon's data reflects a gain of approximately 160 cfs. This accounts for about half of the measurement at the Chiloquin gage. It is useful to determine where there is no ground water discharge so gages can be set up in these areas to measure inflows and outflows. These gages will help determine how much water is actually consumed in that area. Temporary measurement sites will be set up for the next irrigation season.

Next, Jonathon noted that the simulation of the water distribution model to reflect the affect of increasing the capacity of Klamath Lake by two vertical feet on project deliveries is still pending. It entails more work than he initially thought.

Administrative Subcommittee Report - Dividing the Waters Negotiation Session and Representation

Reed Marbut reported that the Dividing the Waters negotiation session is scheduled for April 23 - 27, 2001. The meeting rooms will be at OIT, with space for subgroups and caucuses to meet separately. Since the sessions will be at OIT, participants will need to make arrangements for lodging on their own.

Dividing the Waters will cover all but approximately $4,000 of the cost of the sessions. Other funding opportunities are being explored. The Department is able to cover some of the cost, mostly in services. Included in the funding from Dividing the Waters will be the expense of the two facilitators who attended in June. One of the two will attend either the February or March monthly meeting to help us prepare for the April session. Reed has provided copies of the various documents generated by the administrative subcommittee to the facilitators. They are reviewing the issues that will be on the table in April.

Preparation of a scoping plan for the April session is in progress. This plan will outline the goals of the session. If completed, Reed will distribute the plan to everyone on the general ADR mailing list before the next monthly meeting. Reed is also working to clarify collateral documents presented by the federal participants.

A sub-subgroup of attorneys was formed to work through the remaining issues. The group should be able to get everything finalized by the next meeting.

Walley Watkins asked if Reed would discuss the 15 or 16 members to make up the core-negotiating group.

Reed responded that originally, it was recommended that the group be kept very small to deal with the basic negotiations. It seems that now, after discussion, about 15 interest groups are to be represented by one representative each. The hope is that, although individuals can determine that they are not properly represented, and therefore, not bound if they chose, they will work with their constituent representative in such a way that agreements in principle can be established. Those agreements in principle can then be sent out to the various interested parties. Reed noted that it is virtually impossible to have negotiations in a room with 150 -200 people. It is not even reasonable to think that effective negotiations in a room with 30 or 40 is possible. It is believed that the 15 individuals will offer a fair representation of the interests.

Barbara Scott Brier asked that Reed discuss the 2nd tier concept, so that people understand the 15-member concept, but that they are not the only people in the room.

Reed explained that if for instance, Barbara is at the table for the USBR, other Bureau staff or experts may be in the background for consultation. They can speak with their representative at the table that a proposal is acceptable or not acceptable. The backup is designed to be the best process for technical aspects of negotiations. By the way, this negotiation concept is not an unusual.

Bill Kennedy asked if the Dividing the Water negotiation supplements or replaces ADR and/or the adjudications and/or the Federal process. What authority does the Dividing the Water group have and who gave the authority to negotiate claims?

Reed responded that the Dividing the Waters organization is not serving as negotiators, arbitrators or mediators. They are facilitators ­ simply there to keep order in the process and to make sure everyone has their say. They will not be hearings officers. It is part of the ADR as part of the operating principles because agreements secured through the April session may end up in the adjudication findings.

Walley Watkins asked how the individuals "at the table" in April would be picked.

Reed explained that the representatives would be selected by the respective interest groups.

Mike Golden is leaving the ADR process, so a replacement facilitator will be sought. Mike said he still supports the process, but other opportunities have come up that he is interested in pursuing.

Contest Hearing Report

Reed said the contest process is moving along with due speed. Two contests have been referred to the hearing panel and are under review. Some scheduling notices have been sent out for pre-hearing conferences.

The Adjudicator has an on-going set schedule for referring the contests to the hearing panel to move them along. He is grouping them in various categories of contests and claims. The hearing panel process was created during the last legislative session under HB 2525. There will be a learning curve for everyone. Reed said he met a number of the panel hearing officers and was impressed with their quickness regarding the issues with the adjudication process.

Reed asked Kip Lombard to explain the process that is going to take place from his perspective.

Kip said that the first group of contests that were assigned to a hearing officer was the group that contested the National Park (Crater Lake NP) claims. Those individuals who represent various contestants, were served by certified letter during the month of December with a notice advising them that a pre-hearing conference was scheduled for that month. In advance of that pre-hearing conference, they were to prepare a pre-conference statement in which they were to identify all issues, advise of their position on these issues, the legal authority behind the positions, and identify all witnesses and what they would say. A motion was filed with the hearing panel for clarification for a number of issues along with a notice for continuance of the pre-hearing conference. There is a feeling that there are a lot of procedural matters that need to be resolved in advance of going to the pre-hearing conference.

Another notice was sent after the National Park's claim contest notice, by another hearings officer regarding the grouping of all of the contests against the U.S. Bureau of Reclamation (BOR) claims. Motions for clarifications and continuance were also filed in this case.

Barbara Scott-Brier said that she, Kip Lombard and Richard Fairclo agreed that they were going to start looking at a way to interact with the hearing officer panel about getting a uniform, consistent, efficient process for the adjudication. If there are others who are interested in joining in on these discussions, let one of them know. Bud Ullman and Mike Gehleta said they were interested in participating in those discussions.

Legal/Legislative Subcommittee Report

Kip said that at the Legislative/Legal Subcommittee meeting, it was discussed that the procedures under the pre-hearing conferences and the pre-conference hearings should be uniform. They should be operating under the same guidelines. Kip said he is not sure this is what is happening. The Legislative/Legal Subcommittee agreed to contact the hearing officer panel to arrange a meeting in which to discuss some uniform procedural rules so that everyone has the same understanding as to what is expected.

Kip said that the hearing officers are ready to set time-lines and have everyone comply with those time lines. Notices will be going out on some of the Forest Service contests (Wild & Scenic River Issues) shortly. The same hearing officer that is assigned to the BOR contests will work on the Forest Service contests.

Kip noted that the hearing officers are suggesting that all of the evidence be submitted in writing in advance of any oral hearing along with all rebuttal testimony. This is also an issue that will be discussed with the hearing officer panel.

Kip Lombard said that the Subcommittee discussed a couple of draft proposed legislative concepts that Water for Life submitted to an interim committee. This committee agreed to introduce the bills during this legislative session. The drafts will be put into bill form soon.

Kip gave a brief explanation of the proposed legislation. One bill addresses the procedure under current law concerning regulation under the Adjudicator's order of determination at the time it is submitted to the Klamath County Circuit Court. The current law says that the Department must regulate water use including those water uses that have been determined in that order of determination. The proposed legislation seems to change the regulatory system to exempt previously decreed rights in the Basin from regulation while the order of determination is pending in Circuit Court. (The upper branches of the Sprague and the streams on the west side of the Wood River have been previously adjudicated.)

The other bill addresses the issue of bonding in the adjudication process. Under current law, after the order of determination has been submitted to the Court, the operation of the order may be stayed upon filing a bond or an irrevocable letter of credit. The current law leaves it up to the judge in the case to prescribe the amount of that bond and allows aggrieved parties to pursue damage claims beyond the bond amount if necessary. The proposed legislation sets a limit of $25,000 for the bond. Any person could obtain and file such a bond if they wanted to get a stay of the enforcement of the order of determination that regulates their water right. In addition, the party is potentially protected against damage claims beyond the amount of the bond under the proposed legislation.

Kip said that any questions regarding these pieces of legislation are to be directed to either Roger Nicholson or Ed Bartell.

Ellen Weidum asked what legislator would be in charge of this legislation?

Kip said that if the legislation were introduced, the Interim Committee on Agriculture and Natural Resources would introduce it at the request of Water for Life.

Updates

SB1010

Jim Carpenter said that the SB 1010 group met yesterday. He said that there would be another meeting next month to work on plan language. Then it can be passed out to the larger community. He said that there are a lot of people who don't understand SB 1010. It's going to be a hard sell. The work that is being put forth is to make it more user friendly and understandable.

Ambrose McAuliffe said that the group has been meeting in Chiloquin for a number of months. He said that there is feeling of optimism that they are moving forward and are going to achieve some significant progress. He thanked Jim Carpenter for his patience and help in this process.

Don Russell, Chairman of the SB 1010 Committee, said they are currently on the 10th draft of the plan. They are about to the point where they are going to resubmit a proposal to the Cattlemen and the Farm Bureau. It has been an interesting experience.

Mike Golden said that he heard that there going to be some proposed changes to this process during this Legislature.

Williamson Negotiating Group

Reed announced that the group has a meeting scheduled for January 11, 2001, at 10:00 a.m., at the Chiloquin City Hall.

Other Business

1. Introduction of Mike Connor.

Reed introduced Walter Echo-Hawk, Attorney for the Klamath Tribes to introduce Mike Conner, Director of the Indian Settlement Office in Washington D.C. (U.S. Department of the Interior).

Walter Echo-Hawk introduced Mike Connor who is taking over the position of Chairman of the Interior Department's Indian water right settlement group. Bob Anderson, who used to fill that position, has taken another job.

Mike Connor said he appreciated the opportunity to talk to the group. Mike said there were a couple of things he would like to discuss. First, continuity, particularly from the Indian Water Rights Program at the Interior. They want to keep the focus on settlement of Indian water right claims. Mike said that their views on Indian water rights settlements would resolve a lot of other issues that are of concern to everyone. Second, with respect to the change of administration, he is going to continue in his role as Director of the Indian Water Rights Office for some time. There is going to be support to carry on with settlements at this time. There has been a lot of success in the program in the last four years. Mike's sense is that there is a lot of interest in continuing the program at the level it has been.

2. The U.S. v. Adair Case.

Roger Nicholson said that he has heard that the Department of the Interior intends to reopened the Adair case. He felt that a discussion would be in order as to why the federal government deems it necessary to go back in to federal court in this case. How does this fit together with everything that is happening in the adjudication and the ADR?

Walter Echo-Hawk provided a brief update on the Adair action. He said that the Tribes were very disappointed in the Adjudicator's October 4, 1999, Preliminary Evaluation (PE) of the Tribes' instream claims. The Tribes felt that the PE was an incorrect interpretation of the Adair case. The United States agrees with the Tribes' position. He thinks the Adair action is a very constructive step. What he thinks they are trying to do, is to get a definitive, controlling determination of the controlling legal standard for the Tribes claims as quickly as possible.

In brief, what is of concern to the Tribes is: If an erroneous legal standard of the Tribes claim goes all the way through the administrative phase of the Adjudication, goes into State Court, and then we are told that we have used the wrong legal standard, then everyone has to do everything a second time. He thinks that one problem in the State system is that the State Adjudication does not have any mechanism for an interim ruling of legal issues. Going to the federal court will actually facilitate the State Adjudication by getting early ruling on some of the controlling legal standards. This way everyone only has to go through the process one time. The Tribes are looking at this as constructive.

The Oregon Department of Justice legal analysis on the Tribes' claims said the Adair rulings were unclear and that there were interpretations on both sides of that opinion that were equally plausible. It is an uncertain, unclear legal standard that is trying to be clarified here. Walter thinks that it can go forward in a constructive way. It will facilitate the Adjudication and expedite final resolution. The Tribe remains firmly and fully committed to the ADR process and also to the State Adjudication.

Walter said that it is unfortunate that from time-to-time some of the parties have felt that during this ADR process, the need to go to court or to the State Legislature to change the existing framework or go to court to protect their various interests. From day one of the ADR, there have always been one or more cases pending. There is nothing in the ADR principles that prevent any party from going to court or to the Legislature when they feel the need. The Tribes understand the need of parties to do that. He said that there are always cases pending that relate to water rights. He thinks that it is a constructive step that will facilitate the adjudication.

Roger Nicholson said that because of the arguments that were brought forth about the Indian water rights in the Adjudication itself, they are being forced into being involved in a case that hasn't even been heard. This came from federal court rather than state court.

Paul Cleary said that nothing has been filed in court as of now. A notice of potential filing has been received. The initial response will be, is there a way to resolve this without going to court. First, when the Water Resources Department goes to court, we have to start paying the Department of Justice, which affects the Department's ability to continue to do jobs in other areas. Another part of the Department's initial response would be, is there some way to address these four issues that are identified in this motion without asking the court or others to step in. If it is decided that the United States wants the court to attempt to exercise jurisdiction, the Department will take a position that it has an ongoing Adjudication and it believes that's the arena where these issues need to be resolved. Paul thinks there is a legitimate dispute over whether the Court's Adair jurisdiction can be reinitiated at any time or whether it gets reinitiated only when the State adjudication process is completed.

Reed said the Department would see if there were other ways to resolve the issues and concerns. If not, is this disruptive of the process, as Roger described? Is it necessary? The Department's attorney's are evaluating the case.

Roger indicated that many parties may feel they must pull out of the ADR Process. It is very difficult for claimants to participate in the Adjudication, the ADR and now a federal court case.

Reed said he could understand how people would not feel that it is productive for them to go on with ADR discussions as long as they are going to be involved in related litigation.

Wally asked Walter if there has been anything like this ever filed in another adjudication process. If so, what was the length of time involved?

Walter said that all Indian Water Right Settlements have been responded with ongoing litigation, and that other state adjudication processes provide for such interim judicial rulings. It is hard to answer regarding length of time.

Reed said that Oregon has a very unique process. The Legislature of 1909 decided on a one-time up process. The entire adjudication and all factual and legal issues go to the state circuit court at one time. There is no interlocutory appeal process in Oregon. This may be good and it may be bad; however, it is the process. He pointed out that the provisions for interlocutory appeals in other states ­ Arizona, Idaho and Wyoming ­ have not produced quick adjudications. It is our obligation to defend Oregon's process.

Mike Conner said that the United States is going to be fully committed to the settlement process.

Bob Hunter wanted people to know that the other process that's out there does not preclude the ADR. There is nothing that limits the parties from going forward with what is being planned in April.

Barbara supported Walter Echo-Hawk and Bob Hunter. The reason for filing the lawsuit now is because the Adjudication is moving forward, and what the court is being asked to do is to look at a decision it rendered. That's where this adjudication started many years ago. The United States went to federal court for declaration of the Tribes' water rights. At the same time the State initiated its basin adjudication. The Federal court then deferred quantification ­ figuring out the amount of water rights - to the State. The Federal court did make its determination in Adair, which is the standard being used in this Adjudication. It became clear there was a wide-range of opinions as to what Adair resolved.

Becky Hyde said that she felt this whole thing was extremely disappointing.

Ed Bartell said that this is disruptive to the ADR process.

Jim Ottoman said that he thinks this is bad time to move forward in the ADR process. What is happening is that the gates are being opened up for all the federal agencies in the United States.

Reed said that this issue would be put on the next month's agenda for more discussion.

Paul Cleary said that lawsuits or legislative proposals from any side have a chance of torpedoing this process. The Department hopes to be able to defer this for a while to allow parties to focus on the ADR settlement opportunities.

Paul wanted to let everyone know that the Legislative Session has begun. He noted that the Committees assignments have been set. In the Senate, there is one committee, Senate Natural Resources, Agriculture, Salmon and Water, which is chaired by Senator Messerle. In the House, there are three committees that could deal with water issues. They are the House Water and Environment Committee, chaired by Representative Close; House Agriculture and Forestry Committee, chaired by Representative Kropf; and House Stream Restoration and Species Recovery Committee, chaired by Representative Jenson.

Paul said that the Department has a few bills that were pre-session filed. Others have came out of the Department's Endangered Species Work Group, which will be worked on with individual Legislators. There is one on Split-Season Leasing proposals that may be of interest in the Basin.

Wally Watkins announced that there would be a public meeting at Medford City Hall. Sen. Wyden and Sen. Smith will attend this meeting.

Bob Main said they would also be in Bend for the same type of town hall meeting.

There being no other business, the meeting was adjourned with everyone expressing their appreciation for the job Mike Golden performed as ADR facilitator.