City Council

SEPTEMBER 21, 2015 The City Council of the City of Idaho Falls met in Special Council Meeting (Council Work Session), Monday, September 21, 2015, at the City Council Chambers in the City Annex Building located at 680 Park Avenue in Idaho Falls, Idaho at 3:00 p.m. There were present: Mayor Rebecca L. Noah Casper Councilmember Tom Hally Councilmember Sharon Parry Councilmember Michael Lehto Councilmember Barbara Ehardt Absent: Councilmember Ed Marohn Councilmember David Smith Also present: Randy Fife, City Attorney Kerry McCullough, Public Information Officer Dana Briggs, Economic Development Coordinator Greg Weitzel, Parks and Recreation Director Melanie Marsh, Human Resources Director Chris Fredericksen, Public Works Director Chris Canfield, Assistant Public Works Director David Richards, Water Superintendent Kent Fugal, City Engineer Bryan Clark, Post Register Kathy Hampton, City Clerk Mayor Casper called the meeting to order at 3:10 p.m. with Mayor and Council reports. Mayor Casper reminded the Council of upcoming events including; Pancheri ribbon-cutting on September 25, 2015, the Idaho Falls Power Hydro Heritage and Bond Fire activities on September 25, 2015, and Idaho Falls Power Open House on September 26, 2015. Mayor Casper announced she will be seeking Council approval at the September 24, 2015, Regular Council Meeting for Pamela Alexander as the new Municipal Services Director. There were no items to report from the Councilmembers. Item from Parks and Recreation include: 1-Discussion of Naming or Renaming of City Facilities Resolution: Director Weitzel appeared and stated the Resolution would describe policy and procedure for naming City facilities based on three (3) criteria: Historic Events, People and Places; Outstanding Individuals; and Major Gifts. He stated all applications/proposals would be reviewed by the Parks and Recreation Commission with recommendations provided to Council for final decision. Director Weitzel stated approximately 90% of requests for naming/renaming involve the Parks and Recreation Department. Councilmember Lehto commented there may be instances of naming/renaming a City facility that may not be related to the Parks and Recreation Department. Further discussion followed including possible resolutions for other departments. Mayor Casper believes there should be a unified process. At the 1  SEPTEMBER 21, 2015 request of the Council, Mr. Fife will revise the Resolution for Parks and Recreation Department and draft a similar Resolution for all other requests not pertaining to the Parks and Recreation Department. Item from Public Works include: 2-Municipal Water Discussion: Director Fredericksen and Mr. Richards appeared and introduced Rob Harris from Holden, Kidwell, Hahn & Crapo P.L.L.C. Director Fredericksen stated the presentation will include basic water rights, review of City of Idaho Falls water rights, the Surface Water Coalition (SWC) water call and the effects on ground water appropriations. He also stated there will be discussion of options for the City as well as action items and a proposal to better utilize surface water rights for future annexations of properties. He then turned to the meeting to Mr. Harris. Mr. Harris stated due to the activity of water rights in previous years, he believes a mitigation plan for the City of Idaho Falls will be necessary. He proceeded with the following presentation including general discussion with the Council: WATER LAW BASICS  There are primarily four (4) “A’s” to water law: 1. Appropriation 2. Adjudication 3. Amendment (a “transfer”) 4. Administration  A water right is an appurtenance to real property.  A water right is just as its name suggests—a right to use the State of Idaho’s water for a specific use.  Idaho’s water is owned by the people of the State of Idaho.  But a water right is more than just permission to use the State of Idaho’s water—it is a real property right.  IDWR = Idaho Department of Water Resources  Governed by a director (currently Gary Spackman)  Even though it is a real property right, it is critical to understand that the water right owner does not own the water molecules themselves.  Therefore, while a water right holder has a right to use water, is remains subject to a public trust that the water will be applied to a recognized beneficial use.  In other words, water cannot be used in an uninhibited fashion by the water right holder—there are some limits.  New water rights today can only be obtained through a permitting and licensing process.  There is a moratorium order issued by IDWR that does not allow for issuance of any new permits for development of large-scale irrigation water rights. o However, there is an exception in the moratorium order that allows IDWR to issue new municipal water rights. o It is possible for the City of Idaho Falls to appropriate new municipal water rights, but it is certain it will have to involve a mitigation plan.  A water right must be used for a recognized beneficial use—There is no definitive list of beneficial uses (the list could be added to in the future)—but generally speaking, these are the most common beneficial uses: o Irrigation; Commercial; Industrial; Domestic; Recreation & Aesthetics; Ground Water Recharge. 2  SEPTEMBER 21, 2015 o One of more unique beneficial uses is a municipal beneficial use—It covers virtually all kinds of beneficial uses (irrigation, domestic, commercial, industrial, etc.).  It does not cover ground water recharge.  Water rights in the Snake River Basin were recently inventoried in the Snake River Basin Adjudication (the “SRBA”). o There are no longer any questions about what water rights exist—there are over 158,000 water rights in the Snake River Basin.  Water is allocated and distributed in Idaho under the “prior appropriation doctrine.” o Under this doctrine, the holder of a water right with an earlier priority date is entitled to receive all of the water under the right before the junior right receives any water.  This means that the more senior the water right, the better the right.  The SRBA was a product of a settlement agreement with the Idaho Power Company from 1984 known as the “Swan Falls Agreement.”  For purposes of today’s discussion, there are two important components: o The SRBA. o Establishment of minimum flows that must be met at the Murphy Gage (Murphy is south of Boise) on the Snake River:  At least 5600 cfs must be at the Murphy Gage between November 1st and April 1st of the following year (the non-irrigation season).  At least 3900 cfs must be at the Murphy Gage between April 1st and November 1st (during the irrigation season).**  In order to accomplish the SRBA, a court was established in Twin Falls (the “SRBA Court”).  The SRBA Court is now addressing northern Idaho adjudications.  Also, however, the court is now effectively a “water court”: o All administrative appeals from IDWR actions go there. o The district judge is Eric Wildman.  What does a water right look like? Other than the owner of the water right, there are seven elements: Mr. Harris stated the cubic feet per second (cfs) for the City of Idaho Falls is by far in the best position compared to other eastern Idaho cities regarding water rights.  A water right must be used consistent with its elements, otherwise the use is illegal. o Example: You cannot use an irrigation water right for industrial purposes. This is an “enlargement” of the water right.  However, it is possible to “convert” a water right to another beneficial use or change certain elements of a water right—This is done through a process outlined in Idaho Code § 42-222 in what is called a water right “transfer.”  Water Right Administration: 3  SEPTEMBER 21, 2015 o This refers to IDWR’s statutory responsibility to enforce priority administration, including the curtailment of junior water rights when required to meet senior needs. o This is mostly accomplished by IDWR through organized units called “water districts.” o A water district has a “watermaster” who then employs other staff, including “deputy watermasters,” who are on the ground opening and shutting headgates every day. o Water District 1 is in charge of distribution and accounting of water deliveries within its district.  Water District 1 is the water district that has jurisdiction over all of the diversions on the Snake River and its tributaries (including distribution of storage water) above Milner Dam.  Water distribution is a function of supply and demand, and is very complicated, but Water District 1 is very sophisticated.  Watermaster for WD01 is Lyle Swank.  Water District 1 website: http://www.waterdistrict1.com/  WD01 project priority dates every day: Snake River above Lorenzo 10/11/1900 Henrys Fork 10/11/1900 Fall River 10/11/1900 Teton River 10/11/1900 Teton lower N. Fork 10/11/1900 Willow Creek 10/11/1900 Snake River Lorenzo to Blackfoot 10/11/1900 Snake River below Blackfoot 10/11/1900  WD01 coordinates with the United States Bureau of Reclamation (the “BOR”) for release and accounting of storage water into the Snake River.  Storage water owned by the spaceholder flows past curtailed natural flow rights to the headgates of the spaceholders.  The City of Idaho Falls owns 1,180 shares of stock in Palisades Water Users, Inc. (“PWUI”) which entitled it to a pro rate share of PWUI’s allocation each year.  It’s the Law Article in the Post Register:  Water District #1, based in Idaho Falls, is the instrumentality by which the Idaho Department of Water Resources administers water rights in the Upper Snake River Basin. Water District #1 tracks the accumulation of water during the non-irrigation season to the reservoirs pursuant to the prior appropriation doctrine where the senior storage water right holder is entitled to have its right completely filled before any junior right holder is entitled to accumulate storage at all. Water District #1 then coordinates delivery of the accumulated storage water during the upcoming irrigation season. Water District #1 considers nine reservoirs, which collectively store 4.2 million acre-feet, to be in the Upper Snake River Basin storage system.  These reservoirs, along with the years they were constructed, are: Milner Reservoir (1903-1905), Lake Walcott (1904-1906), Jackson Lake (1912-1916), Henry’s Lake (1922), American Falls Reservoir (1925-1928), Island Park Reservoir (1937-1939), Grassy Lake Reservoir (1937-1939), Palisades Reservoir (1951-1957), and Ririe Reservoir (1970-1977).  Of the nine reservoirs, only Milner Reservoir and Henry’s Lake are privately owned. Milner Reservoir is jointly owned by the North Side Canal Company and Twin Falls Canal Company, and Henry’s Lake is owned by the North Fork Reservoir Company. Storage water accumulated in these private reservoirs is owned solely by these entities.  The remaining seven reservoirs are owned and operated by the United States Bureau of Reclamation (the “BOR”). Water stored in these reservoirs is used by a number of irrigation entities who have contracts with the BOR for use of the storage water. BOR reservoirs were 4  SEPTEMBER 21, 2015 originally constructed with federal funds, and the construction costs were then recouped by the federal government through long-term repayment contracts with water users. The contract holders continue to annually pay their pro rata share of ongoing repair and maintenance of the dam and reservoir. Some reservoirs, such as Island Park, only have one contract holder, while others, such as Palisades, have many contract holders for its use.  If you a senior user and you are not receiving your full supply and your right is in priority, you can place a “call on the river” a/k/a as “delivery call” to enforce your right to receive water.  There are times where closing headgates upstream of a calling diversion will not result in delivery of surface water to diversion points downstream because the water will sink before getting to the diversion. This is a “futile call.”  Once a futile call situation is declared, the watermaster will let the junior turn back on and use water unless the system connects once again.  Water right administration is easy for surface water sources because there are an established number of diversions that can be opened and closed and water can be readily measured.  Water right administration is hard for groundwater sources because the time-delayed impacts from groundwater pumping to senior surface water can’t really be measured to the detailed extent of a surface water diversion. o In other words, the impacts from pumping may not show up for years—so how do you determine when to curtail a junior ground water right by a calling senior surface water right? SWC CALL  Important background: o Our ground water supply comes from the Eastern Snake Plain Aquifer, or “ESPA.”  The ESPA is a large aquifer often referred to as being approximately the size of Lake Erie.  It is the black line on the preceding map.  It will likely be changed in the next legislative session to go up the tributary basins (Big Lost, Little Lost, Teton, Portneuf, etc.). o There is a hydraulic connection between surface water flow in the Snake River and in the ESPA. o This means that there are sections (or “reaches”) of the Snake River that lose water to the ESPA, and there are reaches where water from the ESPA feeds the Snake River.  SWC = the “Surface Water Coalition”  The SWC consists of seven Magic Valley area canal companies and irrigation districts: o Twin Falls Canal Company o Northside Canal Company o Minidoka Irrigation District o American Falls Reservoir District #2 o Burley Irrigation District o A&B Irrigation District o Milner Irrigation District  The SWC developed water rights junior to most surface water rights in the Upper Snake River Valley. o Their best rights have priority dates of October 11, 1900.  This means that when natural flow supplies (which are augmented by reach gains to the Snake River) drop, they rely heavily on storage water to make up the difference.  During peak irrigation demand, the natural flow supply in the Snake River is almost entirely diverted above American Falls Reservoir.  In fact, the Snake River just south of Blackfoot can go dry.  Because of this reality, the SWC relies upon two major sources of water for its needs: 5  SEPTEMBER 21, 2015 o Reach gains from springs and tributary underflow to the Snake River into American Falls Reservoir and other springs.** o Release of storage water.  There are discrete discharge sites (Springfield (near Aberdeen) and Thousand Springs) into the Snake River, but also non-visible discharge (reach gains) to the Snake River.  The hydraulic connection between the ESPA and the Snake River has been known for more than a century, but it was not until 1994 that the State of Idaho developed Rules for Conjunctive Management of Surface and Groundwater Resources (the “CM Rules”).  “Conjunctive Administration” (sometimes incorrectly referred to as “Conjunctive Management”) refers to administration of ground water and surface water rights by priority. o Rather than treat surface and ground water sources as separate sources, both sources are treated as the same water source—the difficult question then becomes how that is done.  Once the CM Rules were adopted, spring users (fish farmers) and others used them as a basis for filing delivery calls with IDWR. o The first call was the “Musser Call” filed in 1993 (this forced IDWR to adopt the CM Rules).  The CM Rules provided a serviceable structure from responding to delivery calls, but they lacked any judicial precedent—in other words, there was a period of unknowns.  Some calls were filed in the late 1990s, but were put on hold by IDWR.  The surface water entities were well organized, but what about the groundwater users? o Statutes were added in 1995 to allow for the formation of “Ground Water Districts.” o The main intent of ground water districts was to band ground water users together in order to levy assessments to raise funds to respond to delivery calls and implement mitigation measures. o A number of ground water districts have been formed.  The ground water districts function together under an umbrella organization known as the Idaho Ground Water Appropriators, Inc., or “IGWA.”  Since 2003, IGWA has defended fifteen different delivery calls made by senior surface, spring, and groundwater right holders. o IGWA has spent millions of dollars on mitigation measures, water right buyouts, and fish farm buyouts.  Most of the calls were from spring users, and did not implicate the City of Idaho Falls. o There is a lingering issue over the “trim line” used in the Rangen Call that is before the Idaho Supreme Court.  The call that has implicated, and therefore threatens, the City of Idaho Falls most is the SWC Call.  The SWC Call was filed in January of 2005 and is ongoing.  Why did they file? o Drought between 2001-2004 which caused reduced water supply resulting in impacts to farmers’ operations, decreasing reach gains, and lack of aquifer management.  As a result of the SWC Call, IDWR developed a “methodology order” used to essentially require the SWC to provide information to IDWR support its irrigation demand plus what it should be able to reasonably carry over in reservoir storage water (“reasonable carryover”)(collectively, the “demand”), and IDWR developed a forecast methodology to determine the runoff, or the “supply.” o If supply exceeded demand, then the ground water users could irrigate that year with no mitigation obligation. o However, if demand exceeded supply, the difference between demand and supply was the amount of “material injury.”  Proof of the ability to mitigate must be provided within fourteen (14) days of IDWR’s order.  IDWR also developed and has fine-tuned the Eastern Snake Plain Aquifer Model, or “ESPAM”.  This model predicts the decrease in reach gains to the Snake River as a result of ground water pumping. 6  SEPTEMBER 21, 2015  The courts have said this is the “best available science,” meaning that despite inherent limitations in models, it does not matter—the ESPAM will be used for conjunctive administration.  Between 2005 and 2015, this water call has been extensively litigated. o Any defense you can think of has been raised by IGWA, and the court has ruled on it.  While the litigation has been ongoing, IDWR has used its methodology to determine material injury. o In some years, there was no injury and therefore no mitigation obligation. o In other years there has been injury and therefore a mitigation obligation.  What options were there for responding to an injury determination? o Rent storage water and provide it to the SWC.  This has been the major source of mitigation water.  Renting storage water is not always easy to do because of the “last to fill” rule. o Undertake other measures to reduce pumping from the ESPA.  CREP and other programs. o Ground water recharge.** o Shut off wells.  The benefits that would accrue to the Snake River are calculated using ESPAM.  IGWA’s goal was for ground water users to never be curtailed, and they have done a very good job—no well has ever been curtailed as a result of the SWC Call. o But wells were almost curtailed in the Rangen Call. o IDWR is serious about curtailment and will do it.  Director Spackman has said that the courts have given him no choice.  What has the City of Idaho Falls been doing during the SWC Call? o The City is not a member of the Bonneville-Jefferson Ground Water District, and therefore, is not a member of IGWA. o In 2007, the City purchased 1,000 shares of PWUI stock.  In the event IGWA could not meet its mitigation obligation, the City had this supply to provide mitigation from once IDWR made a determination of what the City’s pumping impacts to the Snake River were.  PWUI leased water to IGWA in some years to help them meet their mitigation obligation. o The City has been monitoring the legal/technical developments in the SWC Call.  IDWR would send out “warning letters” each year predicting a priority cut-off date.  Why not join a ground water district? o Because municipal use is different than agricultural use, and focus of ground water district is on irrigation use. o Once you are annexed into a ground water district, it is extremely difficult to get out if you want to petition out of the district later on. SWC Call – The Perfect Storm in late 2014-2015  In the Fall of 2014, Judge Wildman held that IDWR’s methodology order did not respect prior appropriation enough. Over the winter, IDWR developed a third methodology order based on this decision. o This was bad for ground water users. o The third methodology order was issued on April 16, 2015. o It effectively determined that IDWR had been underestimating impacts from ground water pumping by 50,000 acre-feet. o It also allowed IDWR to “revisit” water supplies on July 1st and readjust IGWA’s mitigation obligation. o Director Spackman: “Under this new methodology, the mitigation obligation for ground water users will occur more frequently and be of greater magnitude by about 50,000 acre- feet.” 7  SEPTEMBER 21, 2015  Thus, there is more assurance and larger determination of injury for the benefit of the senior.  Warm weather in 2015 and changing water conditions. o The rains in 2014 left reservoir levels high, but a warm early spring resulting in the highest demand for water in late March and early April that WD01 had ever seen.  The result was a material injury determination of 89,000 acre-feet.  If mitigation was not provided, in order to generate 89,000 acre-feet of benefit to the Snake River, all water rights junior to approximately 1982 would be curtailed.  The water rights which were subject to curtailment equaled approximately 86,000 acres.  The material injury determination could now be revisited—and could be much worse:  IGWA could not meet the mitigation obligation.  This forced a settlement discussion, primarily because of the involvement of Speaker of the House Scott Bedke.  Why wasn’t this settled long ago? o It depends on who you talk to.  Speaker Bedke mediated a settlement agreement.  We have a declining aquifer, but it is not all the ground water users’ fault. o Conversion of most farm ground from flood irrigation to sprinkler. o Winter water savings program with the BOR (this stopped diversion of storage water during the winter, which recharged the aquifer. o Ground water development was encouraged by Idaho Power Company and others. SWC CALL AGREEMENT  Disaster was averted.  Settlement Agreement addressed issues in 2015 (near-term) and beyond (2016 and forward).  Settlement has now been approved by all of the ground water districts, subject to more detail being developed on one major item—the reduction of 240KAF of consumptive use each year on the ESPA. SWC SETTLEMENT TERMS 8  SEPTEMBER 21, 2015  Objectives o Mitigation o Safe Harbor o Stabilize aquifer levels and increase water supplies o Minimize economic impact o Increase reliability of measurement/compliance/enforcement  Near Term Practices o 110,000 acre-feet of storage water o $1.1 Million towards existing conversions  Long Term Practices o Ground water diversions reduced by 240,000 acre-feet/year o 50,000 acre-feet/year of storage water o Continue existing conversions o Shorten irrigation season (April 1 – October 31) o Measuring devices by 2018 o State sponsored recharge equal to 250,000 acre-feet/year SWC CALL AGREEMENT  SWC-IGWA Agreement should be celebrated, but there are no specific provisions for municipalities.  The condition requiring ground water district members to reduce pumping by 240KAF could effectively mean that a municipality can no longer grow. 240kAF REDUCTION ALLOCATED BY DISTRICT Current AF % Share of Future AF District % Reduction AF Reduction Diverted* 240kAF Diverted A&B ID 173,384 7.7% 10.7% 18,588.09 154,796 Aberdeen-American Falls GWD 303,532 13.6% 10.7% 32,540.96 270,991 Bingham GWD 469,143 21.0% 10.7% 50,295.72 418,847 Bonneville-Jefferson GWD 117,800 5.3% 10.7% 12,629.06 105,171 Carey Valley GWD 7,995 0.4% 10.7% 857.13 7,138 Fremont-Madison ID 13,600 0.6% 10.7% 1,458.02 12,142 Jefferson-Clark GWD 333,467 14.9% 10.7% 35,750.22 297,717 Madison GWD 86,448 3.9% 10.7% 9,267.89 77,180 Magic Valley GWD 332,327 14.8% 10.7% 35,628.00 296,699 North Snake GWD 209,758 9.4% 10.7% 22,487.66 187,270 Raft River GWD 20 0.0% 10.7% 2.14 18 Southwest ID 191,172 8.5% 10.7% 20,495.10 170,677 TOTALS 2,238,646 100% 240,000.00 1,998,646 *Presently calculated based on IDWR crop irrigation requirement data; will be replaced with actual measured diversions for each district (data being collected) SWC CALL  Draft Mitigation Plan at 4: o “Unfortunately, there are no specific provisions in the SWC-IGWA Agreement that address issues specific to municipalities, municipal water use, the unique dual nature of municipal water rights possessing consumptive and non-consumptive components, the water use patterns of municipalities, the inherent growth that municipalities will face in the future, 9  SEPTEMBER 21, 2015 how future growth can occur under the settlement framework, and the relatively overall minor percentage of ground water use from municipalities as compared to ground water usage for irrigated agriculture. While the terms of the SWC-IGWA Agreement fit nicely into an agricultural-based framework, the terms do not fit as well for municipalities.”  No “Safe Harbor”: o If you do not sign on to the SWC-IGWA Agreement, your water rights will effectively be managed as though you were not part of the Agreement.  In other words, you face the possibility of curtailment each year.  City of Idaho Falls Options: o Submit the City’s own CM Rule 43 mitigation plan. o Join the Bonneville-Jefferson Ground Water District for mitigation purposes and be subject to the SWC-IGWA Agreement.  You will pay an assessment each year to pay for BJGWD’s pro rate share of expenses associated with the Agreement. o Do nothing and hope for an ample water supply.  IDWR will curtail municipal water rights.  Recommendation: Submit a CM Rule 43 Mitigation Plan. o A coalition of southern Idaho cities have already submitted theirs, and it has been protested. A pre-hearing conference has been scheduled for October 6, 2015. o The cities are Bliss, Burley, Carey, Declo, Dietrich, Gooding, Hazelton, Heyburn, Jerome, Paul, Richfield, Rupert, Shoshone, and Wendell.  Review of City of Idaho Falls CM Rule 43 Mitigation Plan. o Credit for return flows from City’s wastewater treatment facility. o Use of storage water allocated to the City’s PWUI shares for direct delivery to injured members of the SWC. o Ground water recharge activities. o Delivery of unused irrigation district water allocated to City property. o Rental of water from the Idaho State Water Supply Bank or the Water District 1 Rental Pool. o Private lease for either surface or ground water rights. Director Fredericksen stated he will be requesting Council approval for submittal of a Water Mitigation Plan and also requesting Council approval to allow staff to collect surface water rights once final plats are approved. After brief discussion, the Council requested adequate time to review the Water Mitigation Plan and will schedule the approval at the October 8, 2015, Regular Council Meeting. After further discussion, it was moved by Councilmember Parry, seconded by Councilmember Hally, to include as condition on plat that water rights would not be petitioned out and the City would retain and take over assessment. Roll call as follows: Aye: Councilmember Parry Councilmember Ehardt Councilmember Hally Councilmember Lehto Nay: None Motion carried. There being no further business, it was moved by Councilmember Hally, seconded by Councilmember Ehardt, that the meeting adjourn at 5:43 p.m., which passed by unanimous vote. 10  SEPTEMBER 21, 2015 CITY CLERK MAYOR 11