Sacramento River Settlement Contractors Ask U.S. Supreme Court to Review Scope of Endangered Species Act

Water Law  

July 15, 2014

On July 15, 2014, the Sacramento River Settlement Contractors, agricultural and municipal water users who collectively divert up to approximately 2.2 million acre-feet of water annually directly from the Sacramento River, filed a petition for a writ of certiorari with the Supreme Court of the United States.  The Contractors ask that the Court review the Ninth Circuit’s decision that the United States Bureau of Reclamation was required to consult under the Endangered Species Act when it renewed settlement contracts with senior water right holders on the Sacramento River. Natural Resources Defense Council, et al. v. Jewell, et al., No. 09‑17661 (9th Cir. April 16, 2014)The Settlement Contractors contend that the Ninth Circuit’s decision conflicts with existing Supreme Court law and the decision of at least one other court of appeal. 

Reclamation operates the Central Valley Project, a large reclamation project that delivers approximately seven million acre-feet of water to northern and central California.  In order to obtain the water right permits necessary for Project operations, state and federal law required Reclamation to enter into settlement agreements with holders of senior water rights on the Sacramento River nearly 50 years ago, prior to the passage of the Endangered Species Act.  When those original contracts expired in 2005, Reclamation renewed the settlement contracts in order to ensure continued compliance with state-imposed conditions on its water right permits. 

In renewing those contracts, Reclamation determined that it did not have the requisite discretion to trigger the requirements of Section 7(a)(2) of the Endangered Species Act.  The Ninth Circuit disagreed and held that Reclamation had discretion to renegotiate certain terms of the contracts in a manner that would benefit the endangered delta smelt.  The Settlement Contractors argue that this decision is in conflict with the Supreme Court’s seminal decision in National Association of Home Builders v. Defenders of Wildlife, 551 U.S. 644 (2007), that Section 7(a)(2) discretion does not apply to actions that an agency is required by statute to do—such as the requirement that Reclamation renew the settlement contracts in order to remain in compliance with its state water right permits. A decision from the Supreme Court on whether it will review the case is expected in early fall 2014.