April 10, 2001

Welcome

Reed Marbut thanked everyone for coming and encouraged people that were new, to sign-in so that people can receive future ADR mailings.

Dividing the Waters

Reeds briefed the group on the Dividing the Waters Report written by Steve Snyder and Lucy Moore. The Report provides their assessment of various water issues, especially issues relating to the adjudication and ADR. In addition, the Report contains suggestions for ways to deal with negotiation obstacles.

The Report is attached to these minutes.

Bill Kennedy said he had been doing some research regarding Dividing the Waters. He said he can't find any information regarding their status designation, who is on the Board of Directors, etc.

Reed said that Dividing the Waters' involvement with the Klamath Basin is limited to providing funding for the ADR negotiation effort. They are not making any decisions. The Dividing the Waters funding is being used to provide facilitators for the ADR process and the proposed negotiating session.

Roger Nicholson asked if information could be provided regarding Hewlett; a copy of the grant application to Hewlett for the funding; and a list of individuals who are now working for Dividing the Waters.

Reed said yes to the application, but that he would present the question regarding funding to the Arizona Supreme Court who provides accounting and auditing services to Dividing the Waters.

Reed asked Roger to submit his questions in writing so he can present them to the Arizona Supreme Court accounting staff.

Drought Update

Bob Main gave a brief update regarding the drought. A temporary watermaster has been hired for Lake County. This will allow Del Sparks, Watermaster for Klamath County, to focus more on the Klamath County district. Some of the Deschutes Basin counties plan to seek drought declarations.

Bob said that it was his understanding that the ground water aquifers are currently in good shape in the Klamath Basin.

The drought applications are available on the Department's web site. They can be found at:

www.wrd.state.or.us/drought_watch/publications.shtml

Bob said that Jonathan LaMarche will not be doing a consumptive use study in the Sprague River. He feels that the drought would skew the results. Jonathan remains available to answer specific data questions and to prepare specific model runs under the Klamath distribution model.

Bob announced that he will be retiring from the Water Resources Department on May 31, 2001.

Contest Hearing Report

Reed gave a list of contests that have been referred to the hearings officer panel. Contests for the following claims have been referred: National Parks Service, Bureau of Reclamation, US Forest Service - Wild & Scenic Rivers; US Forest Service - Lake Level based upon Multiple Use Sustained Yield Act (MUSYA); US Forest Service MUSYA instream claims. He said they hope to send the Bureau of Land Management claims to the panel soon.

All of those parties involved will be advised as to the contest procedure and schedule. At some point, there needs to be a discussion about whether the ADR should be a forum available to settle contests that are moving forward in the contest process.

Kip Lombard said that there have been pre-hearing conferences on the National Parks Service, BOR, and USFS - Wild & Scenic contests.

Project Demand Reduction Program

Jim Bryant said that the drought didn't look as bad a couple of months ago. It looked as if there may be some water available for irrigation. To help reduce the use of water in the Basin, and pursuant to a federal law that was passed in 2000 (P.L. 10 6-498), the Bureau set aside some money and began a demand reduction program. People were asked to not use water on their land this year in exchange for a one-time payment. Approximately 550 proposals for demand reduction were received by the Bureau of Reclamation. The proposals were reviewed and offers to select proposals were presented. There were 162 offers accepted for a total of 15,500 acres, totaling approximately 30,000 acre-feet of water. Payments totaling approximately $2.8 million are expected. The 162 proposals total approximately 7% of the Project irrigation.

[Since the April meeting, conditions have changed dramatically. There is currently no water available from Upper Klamath Lake for the Project. The results of the demand reduction is going to be hard to evaluate now that the Project has been effectively shut down.]

Jim said the Bureau is still entering into contracts to purchase well water. Primarily ones that discharge directly into the Lost River. The Bureau has worked with the Water Resources Department to obtain limited licenses to allow the wells to pump for instream flows. Since the limited licenses were issued and pumping initiated, many of the well owners have decided they need the water for irrigation and have reduced the amount of water they are willing to provide for instream flow augmentation.

Someone asked if the Bureau was going to offer the same kind of program next year.

Jim said he hopes there is something more permanent in place by next year. He reminded everyone that this year's effort is only a pilot program.

Someone asked where the water that is being put instream from wells is going to end up.

Jim said that the Bureau views this water as an addition to Project supply.

Don Russell asked if, in the past, the Bureau had viewed well water as part of the Project supply.

Jim said yes.

Roger Nicholson asked if the Department would issue limited licenses for the Bureau to purchase ground water from private land, thereby potentially depleting the ground water if that application is for instream flow uses to go down Klamath River.

Reed said the Department would not allow the ground water to be unreasonably depleted, especially in the long-term. If the uses are the most junior, and if declines are shown, then they would be immediately discontinued.

Reed said that the Department's Ground Water Section conducts a detailed review on each limited license as to what the aquifers can produce without unreasonable declines or impacts on other wells or surface flows. The Department will not grant a limited license that would injure the aquifer or any other right.

Bill Kennedy asked if the Bureau anticipated reopening the pilot program and whether or not the Bureau was able to compensate irrigators in the Project who may not be given water, thus, will compensation be available through the demand reduction program.

Jim said it would be pretty hard to call it demand reduction at this time. At this point in time, there are no plans to do a compensation package. He reminded people that the Demand Reduction Program is a pilot program.

US Fish and Wildlife Service Biological Opinion

Steve Lewis started by saying that a lawsuit had been filed over the 2001 Operation Plan and the biological opinions that were used to develop the Plan. Therefore, due to this pending litigation, there are limits on what he can discuss.

Steve described the Bureau's news release and 2001 Operation Plan. Within the Plan, there is a table that sets out minimum lake levels and river flows. Steve noted that the table is a good reference tool.

Steve presented an overhead presentation to the audience. The presentation discussed the opinion and planning process and referenced the process timetable. He said the US Fish & Wildlife Service had been working on informal consultation with the Bureau for quite some time. On February 13, 2001, they received the final proposed 2001 Operation Plan. The draft biological opinion became available on February 13; the final BO was published on April 5. Steve Lewis noted that the US F&W Biological Opinion was available on the Bureau's web site.

Bill Kennedy asked ­ with the money that is available for restoration ­ has it been considered to help the private lands that are effected by the decision to deny water and the subsequent effect this will have on the wildlife.

Steve Lewis said that the funds that were allotted for restoration are already gone.

Ed Bartell asked if the news release is available on the Bureau's web site.

Jim Bryant said that the news release is on the web site along with the Operating Plan and the biological opinion.

Steve West asked where and by whom was the lawsuit filed.

Steve Palmer said that the lawsuit was filed in Eugene by the Klamath Water's Association, Tulelake Irrigation District and the Klamath Irrigation District against the Bureau and the Secretaries of Interior and Commerce.

Someone asked what process was used to review the comments that were made on the biological opinions and how do the agencies assess the comments.

Steve Lewis said the comments are addressed in the final BO and all of the comments that are received are a part of the administrative record and are reviewed.

Reed asked how low the lake will be allowed to go, pre-project and how low it is now.

Jim Bryant said that at the bridge going over Moore Park on Oregon Avenue, is the reef reference point. Back in 1994, you couldn't see the reef because of the amount of water going through. Prior to the construction of the Project, in the early 1920's, the lowest point of the reef was about 4137.8 feet.

From the time the Bureau began keeping records, from 1904, until the dam was completed in the early 1920's, the records showed the lake never went below 4140.5. Prior to 1904, there are no records.

Bureau of Reclamation's Operation Plan-Water Forecast

Jim Bryant said that this year's Plan wasn't difficult to write. You take the information from the two biological opinions (US F&W for the sucker and NMFS for the coho); the NRCS's projection for inflow into Upper Klamath Lake, the current storage (April 1), and make some calculations that easily determine there is not enough water even to meet the NMFS flows downstream and the Upper Klamath Lake elevations for the sucker opinion.

Jim stated that, based on the Bureau's position that the Lost River watershed is a hydrologically continuous unit, the Project's plan treats the Lost River system as separated from the Klamath River system. The Bureau said they would make 70,000 feet available for irrigation in the Lost River portion of the Basin. This is typically Horsefly ID, Langell Valley ID, and others in the Lost River area. It also includes using 30,000 acre-feet of water out of Clear Lake to be delivered to the Tulelake Sump through the Lost River. Because of the suckers in the Tulelake Sump, the water level must be maintained.

There is no water for agriculture out of the Klamath River system and a very limited amount from the Lost River system, mainly to be used up in the Horsefly and Langell Valley areas.

Don Russell asked what Clear Lake and Gerber Reservoir would look like at the end of the season.

Jim said that he feels that there will be a dry summer. He said he thinks Clear Lake would finish the year out about 3.0 feet above the biological minimums. Gerber will be very near minimums.

Updates

SB 1010

Jim Carpenter said that the first public review of the draft plan is available. There will be another scheduled public meeting soon. Any interested parties can pick up a copy of the draft plan at the Soil and Water Conservation Office on 6^th Street in Klamath Falls.

Legal Legislative Report

Reed said that there are two bills before the Legislature that affect the Klamath Basin. They are SB 17 and SB 18. No hearings have been scheduled.

Paul said the Department's concerns and positions have been shared with Legislators.

Reed said the other issue is the Federal legislation. That is the augmentation bill (P.L. 106-498) that Senator Gordon Smith has pushed through. There has been testimony taken on the issue and Congress was urged to keep that augmentation long-term stuff on the radar screen while the crisis is worked through in Oregon.

Roger Nicholson said that everyone is supportive of long-term augmentation.

Administrative Subcommittee Report

Reed said the topic of the ASC discussion was the report from Dividing the Waters and where we should go from here.

The ASC does not want the ADR participants to forget the future while we concentrate on the current crisis in the Basin. What should the ADR forum make available both in the near-term and in the long-term? In the near-term, the Adjudication, and its contest hearings are moving along. The ASC felt that to have the ADR available to resolve contests is a viable and beneficial effort. The Subcommittee felt the ADR should move forward in that area. This year has highlighted the issue of conservation and efficiency. A portion of that issue is water measurement. It was suggested that at the next ADR meeting, the Department could prepare a report on water diversion control (headgates) and measuring devices, and on conservation and efficiency measures that have occurred in other areas of the state. Suggestions on what could be a beginning effort in the Klamath Basin are welcome.

The participants returned to the Dividing the Water Report. The discussion focused on whether to move forward with a negotiation session for some other form of a settlement framework. The ASC felt that the participants should not lose site of the settlement efforts. Long-range discussions will need to be initiated in order to get settlement planning. The ASC agreed to ways to re-schedule the negotiation session.

Reed said that the ASC endorses Oregon's recommendation that all future biological work be reviewed by an independent science team, similar to what has been done in the Columbia River Basin and the Oregon Plan for salmon and watershed.

Steve Kandra asked who be able to participate on such a team.

Paul said that an independent science team already exists. In the Columbia, various interests agreed on who would be appointed to the team. They were appointed for varying terms. There is a statewide team used for the Oregon Plan. These were appointed by the Governor.

Reed said that if there is a need for an independent science team, then they should get the parties together and determine how that team is going to be formed. It should include the necessary participants so that when it is done, it is a user friendly product. Oversight by an independent science team would allow people to understand from the beginning, how decisions are made.

Bill Kennedy feels that until the working relationship and trust with the tribes is developed again, there is no reason to have another ADR meeting.

Roger Nicholson agreed with Bill Kennedy regarding the continuation of the ADR process.

Allen Foreman (Klamath Tribes) said that anyone can come talk at anytime.

Bill Kennedy said that it was his observation that the trust level is now in the basement.

Allen said the doors have been open all the way through this crisis. They threw out ideas to be discussed in their settlement framework.

Elwood Miller (Klamath Tribes) said that if the Tribes talk to some of the Project irrigators, it would be understood that it is a two-way street.

Bill Kennedy agreed with Elwood that there is not a good level of trust. He said he thinks it is time for the Tribes to take some action ­ some step ­ that will demonstrate their sincerity and their interest in working with the irrigated agricultural community.

Ed Bartell said that his recollection of the meeting is different than Elwood's. He said that he attended all the meetings and felt that there was a good relationship until the Tribes elected to sue the agricultural community. He feels that the level of trust is gone. He doesn't think it's proper to lay it on the irrigator's shoulders.

Someone asked what the Tribes think about the removal of the Chiloquin Dam to improve the sucker recovery.

Elwood said that the Tribes are favorable of the removal of the Chiloquin Dam. They feel that the necessary studies must be completed before removal can be initiated. There are a lot of issues that need to be discussed before the dam is removed.

Someone said those individuals who have lived in the Basin a long time, know that this water shortage isn't new. There are other states who also have a shortage of water. Why isn't someone developing a plan to promote the products that they are growing. He says to look at the big picture of what is happening.

Ed Bartell said he wants to stop the division between the Upper and Lower Basin. He thinks that the Tribe is trying to drive the nail in the agricultural coffin.

Becky Hatfield-Hyde said that the Project irrigators were the ones who helped to implement their negotiations with the Tribes. During these negotiations, they discussed things that are critical to the future of the community. It has a lot to do with water, but it also has a lot to do with the importance of relationships, children, and their future. She expressed her concern for others in the Basin. She said that she hoped people can get to a place where they stop the lawsuits and start putting their actions where the words are. The level of importance people express at the ADR meetings can make a difference.

Reed said that the Department is more than willing to continue the ADR. If the ADR is producing something helpful and it seems to have a future, then the Department will make it available for the participants to use to best possible benefit. The discussions that take place at the ADR are healthy. It allows people to speak their minds. He hopes people can think about the longer-term future and not just the next month or two. People need to make themselves as drought proof and market proof as they can. He recommends to keep the ADR forum available. At least to hopefully settle some contests and claims to get the Adjudication to move smoothly and inexpensively for the participants. He hopes that the ADR process will lead to more independent contacts between claimants and contestants.

Earl Miller said that he would like to see the ADR continue and put together the settlements on the issues that they can, and thereby reduce the number hearings that need to take place. He recommends an emphasis on Walton Claims that aren't connected with some of the issues.

Reed said that the Department has agreed to come back to one of the next ADR meetings with a grouping of contests that are amenable to some discussions, and have a community discussion about where to proceed. He said that in regards to measuring, conservation and efficiency they would bring back some information regarding how it works and set up recommendations for some local workshops.

Ed Bartell asked why not ask or wait until someone has something to discuss at the meeting instead of meeting and not moving anywhere.

Reed said that he felt the process moved along ways at this meeting and if people don't want to come, they don't have to.

Ned Livingston said he would like to see the management side of the ADR process as an agenda item sometime.

Reed said that there was evidence in the Dividing the Waters Report that there needs to be a better interface with the federal agencies. We want to build on the concern that has been demonstrated in Washington, D.C. to see if we can't get a more active participation by high level discussion makers in the various federal agencies.

Roger Nicholson asked a two part question. 1) Why measuring is being incorporated into the ADR when the Department already has the legal authority to regulate water use? 2) Does the Department support the mandatory measurement statute that has been introduced by WaterWatch of Oregon at the request of Representative Jan Lee?

Paul Cleary said that the Governor had declared a state drought emergency in Klamath County, which opens up some special provisions for emergency ground water permits and emergency water transfers. It also triggers authority for conservation plans, municipal/domestic and industrial use for curtailment plans. One of the components of a conservation plan is trying to encourage people to use water wisely and as efficiently as possible.

Paul said that the Department was asked to relay how other basins in the State have dealt with conservation efficiencies and measurement being a component. That information will be shared through an ADR forum on how the Department deals with measurement in other basins. The Water Resources Commission is very interested in encouraging people to use water as efficiently and wisely as possible. The Department recognizes that we need to have the cooperation of the water users. The Department wants to encourage people to measure, and wants them to see the benefits of measurement.

Paul said there are two bills that are moving forward that have some measurement components to them. One is a bill that allows split-season leasing of water where an irrigator could use water on the land and then lease the remaining water instream. In association with this concept is a measurement cost-sharing bill, that was initially targeted at measurement associated with the streamflow restoration initiatives, but is being considered for expansion to allow for cost-share measurement devices.

Governor's visit to Klamath Basin

Paul Cleary said that on April 12, 2001, Governor Kitzhaber, Senator Walden and Senator Wyden will be in Klamath Falls for the ESI. The Governor will meet at the County Fairgrounds to discuss with agriculture interests on short-term relief issues. He wants to hear from the community on the impacts and concerns related to the drought emergency and 2001 Operating Plan. The Governor wants to hear from the community on efforts that need to be initiated, stepped up or funded in order to begin work on the long-term sustainability.

Paul reported that he suggested to the Governor, the idea of a disaster response fair that was used in response to the 1996 flood in the western counties. All the state and federal agencies were brought into the schools and they set up tables for the public to go and find out what options were out there from a particular agency.

Steve Kandra says that Governor needs to be able to answer the question of why it has taken him so long to come to the table, why he hasn't interfaced with federal agencies regarding assertions of state's rights on behalf of the citizens of the State of Oregon. He said they want to hear from the Governor regarding how he thinks things are going in the Basin and where are they going from here. Steve asked what was the State's role in the Biological Opinion's process. How was the State involved in this process.

Steve Lewis said the Department of Fish and Wildlife provided draft copies of the biological opinion, pre-draft copies, final draft and comments to review.

There being no further business, the meeting was adjourned.