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<p class=MsoNormal><st1:country-region w:st="on"><st1:place w:st="on"><strong><b><font
size=4 face=Tahoma><span style='font-size:13.5pt;font-family:Tahoma'>U.S.</span></font></b></strong></st1:place></st1:country-region><strong><b><font
size=4 face=Tahoma><span style='font-size:13.5pt;font-family:Tahoma'> to Pay
$16 Million in Water Rights Case</span></font></b></strong><font size=4><span
style='font-size:13.5pt'><o:p></o:p></span></font></p>
<p class=MsoNormal><strong><b><font size=4 face=Tahoma><span style='font-size:
13.5pt;font-family:Tahoma'>Feds settle with <st1:place w:st="on">Central Valley</st1:place>
farmers who sued when deliveries were cut to help endangered fish.</span></font></b></strong><font
size=4><span style='font-size:13.5pt'><o:p></o:p></span></font></p>
<p class=MsoNormal><st1:City w:st="on"><st1:place w:st="on"><strong><b><font
size=4 face=Tahoma><span style='font-size:13.5pt;font-family:Tahoma'>Los
Angeles</span></font></b></strong></st1:place></st1:City><strong><b><font
size=4 face=Tahoma><span style='font-size:13.5pt;font-family:Tahoma'> Times -
12/22/04</span></font></b></strong><font size=4><span style='font-size:13.5pt'><o:p></o:p></span></font></p>
<p class=MsoNormal><strong><b><font size=4 face=Tahoma><span style='font-size:
13.5pt;font-family:Tahoma'>By Bettina Boxall, staff writer</span></font></b></strong><font
size=4><span style='font-size:13.5pt'><o:p></o:p></span></font></p>
<p><font size=4 face="Times New Roman"><span style='font-size:13.5pt'>The Bush
administration announced Tuesday that it has agreed to pay $16.7 million to a
group of <st1:place w:st="on">Central Valley</st1:place> farmers and irrigation
districts whose water deliveries were cut to protect endangered fish.<o:p></o:p></span></font></p>
<p><font size=4 face="Times New Roman"><span style='font-size:13.5pt'>State
officials had strongly urged the administration not to settle the farmers'
claims, arguing that such a precedent could make it prohibitively expensive to
protect endangered species. <o:p></o:p></span></font></p>
<p><font size=4 face="Times New Roman"><span style='font-size:13.5pt'>But the
payment was immediately hailed as a significant victory by property rights
advocates and critics of the Endangered Species Act.<o:p></o:p></span></font></p>
<p><font size=4 face="Times New Roman"><span style='font-size:13.5pt'>"This
is a very strong precedent," said Brian Kennedy, a spokesman for the House
Resources Committee, which is headed by one of the act's most vocal detractors,
Richard W. Pombo (R-Tracy). "This should really fire a shot across the bow
of federal regulators, reminding them that their actions have consequences and
their actions cost money."<o:p></o:p></span></font></p>
<p><font size=4 face="Times New Roman"><span style='font-size:13.5pt'>The U.S.
Department of Justice settled the case despite widespread warnings that it
would lead to a flood of similar claims. The <st1:State w:st="on"><st1:place
w:st="on">California</st1:place></st1:State> attorney general's office, the
Schwarzenegger administration and attorneys for the National Oceanic and
Atmospheric Administration all wrote the Justice Department in the last year,
asking the Bush administration to appeal a U.S. Court of Claims ruling in favor
of the farmers.<o:p></o:p></span></font></p>
<p><font size=4 face="Times New Roman"><span style='font-size:13.5pt'>Justice
officials had little comment on their decision not to heed those
recommendations. "This settlement is the result of careful and deliberate
negotiations between the parties," said department spokesman Blain
Rethmeier.<o:p></o:p></span></font></p>
<p><font size=4 face="Times New Roman"><span style='font-size:13.5pt'>The <st1:Street
w:st="on"><st1:address w:st="on">Claims Court</st1:address></st1:Street> ruling
came in a lawsuit filed by Roger Marzulla, a former Justice Department official
in the Reagan administration who is pursuing similar claims in three other
cases. Although the settlement contains language stating that it establishes no
legal precedent, Marzulla said the case "establishes the fundamental
principal that the government is free to protect the fish; it simply has to pay
for the water it takes to do so.<o:p></o:p></span></font></p>
<p><font size=4 face="Times New Roman"><span style='font-size:13.5pt'>"The
federal government," he added, "has recognized it can't come on like
a bull in a china shop and seize all the water it wishes without paying for
it."<o:p></o:p></span></font></p>
<p><font size=4 face="Times New Roman"><span style='font-size:13.5pt'>Calling
the ruling "ill-conceived and poorly reasoned," state Chief Deputy
Atty. Gen. Richard Frank said the Bush administration's decision to settle the
case was disappointing. "I'm not going to say it will produce a sea change
in federal law and policy, but it will generate additional claims and
controversy." <o:p></o:p></span></font></p>
<p><font size=4 face="Times New Roman"><span style='font-size:13.5pt'>In a
statement, Sen. Dianne Feinstein (D-Calif.) said the settlement was a
"mistake that will establish a precedent that could require the public to
pay tens of millions of dollars to water users in many cases where even a small
portion of their anticipated deliveries are needed to protect endangered salmon
or other fish." <o:p></o:p></span></font></p>
<p><font size=4 face="Times New Roman"><span style='font-size:13.5pt'>The case
grew out of a drought in the early 1990s, when the State Water Project reduced
deliveries to irrigation contractors to aid two fish species protected by the
federal Endangered Species Act, the delta smelt and the Chinook salmon.<o:p></o:p></span></font></p>
<p><font size=4 face="Times New Roman"><span style='font-size:13.5pt'>Marzulla,
a leader in the property rights movement, argued that the farmers had a
property right to the water and that when federal environmental protections forced
a reduction in deliveries, that amounted to a taking under the U.S.
Constitution. U.S. Claims Court Judge John Paul Wiese agreed, awarding the
plaintiffs $14 million, plus attorneys fees and interest. Attorneys in the case
expected that to total $26 million.<o:p></o:p></span></font></p>
<p><font size=4 face="Times New Roman"><span style='font-size:13.5pt'>The
settlement leaves it up to plaintiffs and attorneys to decide how to divvy up
the $16.7 million. The plaintiffs include the Kern County Water Agency, several
farm operations and the Tulare Lake Basin Water Storage District, which serves
mega-farmer J.G. Boswell.<o:p></o:p></span></font></p>
<p><font size=4 face="Times New Roman"><span style='font-size:13.5pt'>Sue Ellen
Wooldridge, solicitor for the U.S. Interior Department, which oversees the
Endangered Species Act, said she didn't think the case would have a broad
effect because federal water contracts have shortage provisions that effectively
insulate them from takings claims.<o:p></o:p></span></font></p>
<p><font size=4 face="Times New Roman"><span style='font-size:13.5pt'>"I
think the ramifications are limited," she said. "The federal
contracts contain the shortage provisions which the courts have interpreted as
allowing [the U.S. Bureau of Reclamation] to protect the species without causing
a taking."<o:p></o:p></span></font></p>
<p><font size=4 face="Times New Roman"><span style='font-size:13.5pt'>In urging
an appeal of Wiese's decision, state officials said it undermined state law by
finding that the end user of the water, the irrigation districts, held a
property right to the water. Under <st1:State w:st="on"><st1:place w:st="on">California</st1:place></st1:State>
law, they said, the Department of Water Resources holds the rights to the water
it diverts for farm and municipal use.<o:p></o:p></span></font></p>
<p><font size=4 face="Times New Roman"><span style='font-size:13.5pt'>Environmentalists
condemned the settlement, saying it amounted to an invitation for more claims. <o:p></o:p></span></font></p>
<p><font size=4 face="Times New Roman"><span style='font-size:13.5pt'>"By
settling rather than fighting this case, the Bush administration is simply
encouraging more of these legal attacks against our water quality laws and
other public safeguards," said Hal Candee, senior attorney for the Natural
Resources Defense Council. "That hurts the taxpayers as well as the
environment."<o:p></o:p></span></font></p>
<p><font size=4 face="Times New Roman"><span style='font-size:13.5pt'>Marzulla
has filed similar takings claims for $1 billion in the <st1:PlaceName w:st="on">Klamath</st1:PlaceName>
<st1:PlaceType w:st="on">Basin</st1:PlaceType>, where fish protections forced
irrigation cutbacks on the Oregon-California border, and for the city of <st1:City
w:st="on">Stockton</st1:City> and irrigators who lost deliveries from the New
Melones Dam in the <st1:place w:st="on">Central Valley</st1:place>. He said he
is preparing another case in <st1:place w:st="on"><st1:PlaceName w:st="on">Ventura</st1:PlaceName>
<st1:PlaceType w:st="on">County</st1:PlaceType></st1:place>.<o:p></o:p></span></font></p>
<p><font size=4 face="Times New Roman"><span style='font-size:13.5pt'>"I
think it is helpful to have this case resolved so we can pursue resolution of
the other cases," Marzulla said.<o:p></o:p></span></font></p>
<p><font size=3 face="Times New Roman"><span style='font-size:12.0pt'>Interior
Secretary Gale Norton previously served as a legal advisor to a property rights
group founded by Marzulla's wife, Nancie. But Marzulla said Norton recused
herself from the <st1:City w:st="on"><st1:place w:st="on">Tulare</st1:place></st1:City>
case and played no role in it. "She has had nothing to do with the
prosecution of the <st1:City w:st="on"><st1:place w:st="on">Tulare</st1:place></st1:City>
case," he said</span></font><font size=4><span style='font-size:13.5pt'><o:p></o:p></span></font></p>
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<p class=MsoNormal><st1:PersonName w:st="on"><em><i><font size=3 color=gray
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<p class=MsoNormal><em><i><font size=3 color=gray face="Times New Roman"><span
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