Opinion ID: 343208
Heading Depth: 2
Heading Rank: 1

Heading: The Law of the Colorado River

Text: 5 Comprehensive development of the Colorado River Basin requires the cooperation of seven states. The Colorado River begins in the mountains of Colorado and flow southwesterly for approximately 1,400 miles through Colorado, Utah, Arizona, along the Arizona-Nevada and Arizona-California boundaries before entering Mexico and emptying into the Gulf of California. Tributaries originating in Wyoming, Colorado, Utah, Nevada, New Mexico and Arizona define the boundaries of the basin, which comprises an area about 900 miles long from north to south and 300 to 500 miles wide from east to west approximately one-twelfth the area of the contiguous United States. The basin is arid and has historically been dependent upon water management practices in order to be productive and inhabitable. H.R.Rep. No. 1312, 90th Cong., 2d Sess. 5-6 (1968), reprinted in 1968 U.S.C.Cong. & Admin.News, pp. 3666, 3671-72; Arizona v. California, 373 U.S. 546, 552, 83 S.Ct. 1468, 10 L.Ed.2d 542 (1963). 6 With the rapid settlement and development of the basin at the end of the nineteenth century it became clear that small scale diversion works would not be sufficient to provide a dependable year-round water supply. The erratic nature of the river flows which could bring either drought or flood, the problem of land erosion and silt deposits, and the physical impediments of deep canyons and long distances from river to community were barriers too great for small groups of farmers or even individual states to surmount. It was soon recognized that the task of constructing storage dams, canals and various irrigation and power works required the economic and engineering resources of the federal government. 4 7 While the prospect of federal intervention and funding was appealing to all of the basin states, it brought to the forefront the competition between the upper and lower basin states for the beneficial use of Colorado River water. Because the prevailing water law of the western states was prior appropriation, rather than riparian rights or equitable allotment, rights to Colorado River water would likely be based on a first in time, first in right principle. 5 The upper basin states thus feared that the surplus waters stored by federal projects would initially be diverted to the more rapidly growing lower basin states, principally California, and thereby permanently appropriated to the exclusion of any future use to meet increased demands in the upper basin states. The states therefore agreed to negotiate an interstate compact for allocation of the water. 6 Congress consented to the negotiations, Act of August 19, 1921, ch. 72, 42 Stat. 171, and in 1922 the states completed an agreement termed the Colorado River Compact. 70 Cong.Rec. 324 (1928) (text of agreement). 8 The Compact failed to allocate the waters on a state-by-state basis but did achieve a compromise position. The basin was divided into two parts at Lee's Ferry, a point on the Colorado River in northernmost Arizona. Art. II(e)-(g). What is referred to as the upper basin is drained by the Colorado River and its tributaries above Lee's Ferry and includes parts of Wyoming, Colorado, Utah, New Mexico and the northeast corner of Arizona. The Compact defines the lower basin as parts of Nevada, California, New Mexico, Utah and substantially all of Arizona. 7 The upper and the lower basin were each apportioned the exclusive beneficial consumptive use of 7,500,000 acre-feet of water a year. Art. III(a). 8 9 The Compact did not at first achieve the required unanimous ratification by the seven states because of Arizona's failure formally to approve. 9 Congress nevertheless consented to the Colorado River Compact and waived the seven-state approval requirement of the Compact when it enacted the Boulder Canyon Project Act (BCPA). Ch. 42, §§ 4(a) & 13, 45 Stat. 1058, 1064 (1928), 43 U.S.C. §§ 617c(a) & 617l (a). California and five states approved the Compact pursuant to the conditions of the BCPA, and the BCPA thereafter became effective by presidential proclamation. 46 Stat. 3000 (1929). 10 10 Section 1 of the BCPA, 43 U.S.C. § 617, authorized the Secretary to construct a Boulder or Black Canyon Dam 11 and other projects in the lower basin for flood control, reclamation and production of hydroelectric power. Importantly, the BCPA resulted in an allocation of mainstream waters among the lower basin states of Nevada, California and Arizona. 12 This allocation had the effect of facilitating development of lower basin water resources by removing an issue of controversy among the lower basin states. 13 11 Lower basin development proceeded at a rapid pace. The lakes behind Parker Dam and Davis Dam 14 on the lower Colorado River joined Lake Mead behind Hoover (Boulder) Dam 15 as major storage reservoirs. These projects provide water and power for large metropolitan areas (such as Los Angeles and San Diego) and extensive agricultural districts in southern California and Arizona. S.Rep. No. 1983, 83d Cong., 2d Sess. 2 (1954). 12 Development in the upper basin, however, moved more slowly. The erratic flow of the river, fluctuating between periods of drought and flood, made it impractical to meet the annual 7,500,000 acre-feet obligation to the lower basin states without river control on a long-term holdover basis. The necessity of holdover storage reservoirs was accentuated by the fact that the periods of high flows do not occur when the demands for the water are greatest. Without such reservoirs, development in the upper basin was limited to small irrigation projects usually constructed by private groups. H.R.Rep. No. 1774, 83d Cong., 2d Sess. 10-11 (1954). 13 A significant barrier to comprehensive upper basin development was overcome by ratification of the Upper Colorado River Basin Compact in 1948. 16 This compact apportioned among the states of Arizona, Colorado, New Mexico, Utah and Wyoming the consumptive use of waters allocated to the upper basin by the Colorado River Compact. Over 99 per cent of the upper basin allotment was divided among the so-called upper division states 17 of Colorado, New Mexico, Utah and Wyoming. 18 This apportionment made possible the Colorado River Storage Project Act in 1956. See Friends of the Earth v. Armstrong, 485 F.2d 1, 4-6 (10th Cir. 1973), cert. denied, 414 U.S. 1171, 94 S.Ct. 933, 39 L.Ed.2d 120 (1974). 14 CRSP provided a plan for long-term development. It authorized construction of a number of projects for flood control, reclamation and extended irrigation, municipal and industrial water needs, and hydroelectric power. A series of holdover storage reservoirs with hydroelectric plants, transmission facilities, and incidental works were authorized. The legislation also established priorities for planning and constructing additional reclamation works that would serve as participating projects. §§ 1-2, 43 U.S.C. §§ 620-620a. In regulating the flow of the upper Colorado for beneficial consumptive uses and for the generation of hydroelectric power, 19 all authorized projects were to be operated in conformity with the law of the Colorado River i. e., the Colorado River Compact, Upper Colorado River Basin Compact, Boulder Canyon Project Act, Boulder Canyon Project Adjustment Act, and certain other agreements. §§ 1, 7, 9, 14, 43 U.S.C. §§ 620, 620f, 620h, 620m. 15 Four hydroelectric facilities subject to the CRSP Marketing Criteria have already been constructed. The largest is Glen Canyon Dam on the Colorado River just below the Utah-Arizona border and north of Lee's Ferry. Flaming Gorge Dam in Utah is located on the Green River just below the Wyoming-Utah border. The Curecanti unit is composed of three dams and reservoirs on the Gunnison River in Colorado: Blue Mesa and Morrow Point Dams, both completed, and Crystal Dam, presently under construction. The Glen Canyon and Flaming Gorge dams and the Curecanti units will have a combined firm electric power 20 generating capacity of about 1,260,000 kilowatts, with Glen Canyon having the largest capacity, 900,000 kilowatts. The Bonneville unit of the Central Utah participating project, which is yet to be constructed, is also included in the CRSP Marketing Criteria. 21 16 Although CRSP describes the generation of hydroelectric power as an incident of the storing of water for flood control, reclamation and other consumptive uses, § 1, 43 U.S.C. § 620, power production is nevertheless a principal purpose of the legislation. H.R.Rep. No. 1774, supra, at 11; cf. Friends of the Earth v. Armstrong, supra, 485 F.2d at 4, 6. Congress intended CRSP hydroelectric power to serve not only as an energy source for the ever-increasing demands of the upper basin area but also as a revenue producer that would repay the federal investment in the power features of the project. Indeed, surplus power revenues were projected to help reimburse the costs of CRSP attributable to irrigation features and to aid in funding an Upper Colorado River Basin Fund that would defray the costs of basic units and participating projects of CRSP. §§ 5, 6, 13, 43 U.S.C. §§ 620d, 620e, 620l. Congress considered power revenues to be the most important financial aspect of CRSP. 22 17 Power generated by CRSP facilities is sold by the Bureau of Reclamation to power utilities who in turn wheel and sell the power to the ultimate consumers. CRSP provides two general guidelines for the sale of power. The first is set out explicitly in Section 7 of the Act: CRSP plants are to be operated so as to produce the greatest practicable amount of power and energy that can be sold at firm power and energy rates consistent with the law of the Colorado River. 43 U.S.C. § 620f. The second guideline is referred to in Section 4 of the Act: absent exculpatory provisions, CRSP plants are to be operated in conformity with federal reclamation law. 43 U.S.C. § 620c. Section 4 therefore incorporates Section 9 of the Reclamation Project Act of 1939, ch. 418, 53 Stat. 1193, 43 U.S.C. § 485h(c). 18 This section of the Reclamation Project Act (§ 485h(c)) imposes a number of restrictions on the marketing of power. It defines a class of preference customers who shall have the first opportunity to purchase hydroelectric power generated by federal reclamation projects. This class of preference customers comprises: 19 municipalities and other public corporations or agencies and . . . cooperatives and other nonprofit organizations financed in whole or in part by loans made pursuant to the Rural Electrification Act of 1936. 20 Id. The priority accorded to public utilities (preference customers) is by now an important aspect of federal reclamation projects. Section 485h(c) also sets a maximum term of forty years for contracts for the sale of power or lease of power privileges and sets out criteria for rate-making. Furthermore, Section 485h(c) forbids the making of any contract relating to electric power or power privileges unless, in the judgment of the Secretary, it will not impair the efficiency of the project for irrigation purposes. Neither Section 7 of CRSP nor Section 485h(c) makes any reference to the impermissibility of geographic preferences in the sale of power.