Judge’s Ruling Jolts Basis of Quantification Settlement Agreement

A Sacramento Superior Court judge has tentatively ruled the state’s agreement to pay for Salton Sea environmental miti­gation costs under a historic Colorado River transfer agreement is a constitu­tionally invalid unfunded mandate – a development that has interested parties pondering the future of shared water use.

Judge Roland Candee’s tentative ruling Dec. 10 said the 2003 Quantification Settlement Agreement (QSA) was incon­sistent with state law, which prohibits the incurrence of debt more than $300,000 without appropriation of the Legislature. If the ruling stands, it would invalidate the joint powers authority agreement that was entered into by the federal government, the Imperial Irrigation District (IID), the Coachella Valley Water District, the Metropolitan Water District of Southern California and the San Diego County Water Authority (SDCWA). Candee made no further decisions Dec. 17 after a two-hour hearing. It is unclear when he will issue a final ruling.

The decision will not have an im­mediate impact as appeals are expected to take years in the state and federal court system. “It’s way too premature to push the panic button,” Dennis Cushman, assistant general manager of the San Diego County Water Authority, told the San Diego Union-Tribune.

Nevertheless, the QSA is viewed as the foundation for many of the subse­quent multi-state/federal agreements related to managing the Colorado River in times of surplus and shortage, and the other Colorado River Basin states are closely watching. “[The ruling] just causes so much uncertainty and it desta­bilizes everything at a time when having stability among the states is critically important,” Pat Mulroy, general manager of the Southern Nevada Water Authority told the Associated Press.

News of the tentative ruling came during the annual Colorado River Water Users Association conference. “Reclama­tion has valid and binding agreements with California agencies and plans to stand by those agreements,” U.S. Bureau of Reclamation Commissioner Mike Connor said at the conference.

The QSA quantified how much of the state’s annual 4.4 million acre-feet of Colorado River water was available for the four California water districts, making possible water transfers among them, in­cluding a 35-year transfer (with potential extensions to 75 years) of water from IID to SDCWA. The QSA also commits the state to a restoration path for the environ­mentally sensitive Salton Sea and provides full mitigation for these water supply programs. Restoring the state’s largest lake was a crucial piece of the agreement.

Candee ruled the state improperly agreed to pick up much of the cost of saving the shrinking Salton Sea in the southeastern California desert. The state put no limit on costs, “even if they ulti­mately amounted to millions or billions of dollars,” he wrote. “The Court has no ability to sanction a way to contract around the Constitution.”

Under the QSA, the state committed to pay mitigation costs that exceed $133 million. Candee’s ruling compared that to a “blank check.”
According to news reports, IID will meet with the other QSA parties to discuss how to deal with paying for Salton Sea mitigation, including possible funding from the Legislature to mitigate impacts to the Salton Sea caused by the water transfer.

“Among the options the board will be considering are direct talks with the other parties and the state to address any deficiencies in the Salton Sea mitiga­tion funding mechanism and obtaining a continuing appropriation from the Legislature for impacts to the Salton Sea caused by the water transfer,” IID General Manager Brian Brady said in a statement.

For those familiar with the case, the ruling was unanticipated, although the legal theory (and its possible challenge) regarding the responsibility for Salton Sea restoration always existed. Because the Salton Sea is such a critical piece of any water-sharing agreement, sources said the court ruling poses a direct threat to the peace unless all the involved parties can preserve their position while finding a funding source for the Salton Sea.

“The constraint on IID is that if they don’t transfer they face the … threat of reduction which spurred them in the first instance,” said a source familiar with the case. “The QSA is critical for SDCWA so it may try to corral everyone not to break away.”
In a separate lawsuit filed in federal court Oct. 9, Imperial County and the Imperial County Air Pollution Control District Imperial are challenging the legality of the QSA based on possible adverse impact on air quality as dust is stirred up from the exposed Salton Sea bed. •
– Gary Pitzer