The Three-State/Department of the Interior Cooperative Agreement

Work Progressing on Cooperative Agreement

(From The Communicator, Central's newsletter, November/December, 1998)

The Cooperative Agreement started more than four years ago with an agreement among three state governors and the U.S. Secretary of the Interior to try to resolve endangered species issues in the central Platte River region. It developed into a plan for sharing responsibility throughout the basin for protecting these species.

The Cooperative Agreement (CA) among Nebraska, Colorado, Wyoming and Interior is a unique and ambitious pact based on compromise, "fair-share" commitments and recognition of a diverse set of concerns throughout an entire river basin.

The CA also led to a settlement among the parties involved in proceedings at the Federal Energy Regulatory Commission (FERC) about licensing the hydroelectric projects operated by Central and the Nebraska Public Power District. Terms of the settlement were used by FERC staff to complete a final environmental impact statement and licensing order for the Nebraska hydro projects.

The new licenses issued to the two Nebraska utilities last summer contain license conditions built on the foundation of the CA, but a great deal of work remains to implement the CA’s provisions and keep the current license conditions unchanged..

Adaptive management approach

The CA sets out a long-term plan designed to take an incremental approach to achieving its overall objective: making water and land available for endangered species along the central Platte River through cooperation between the three states and the federal government. (As a point of clarification, the CA covers the first three- to four-year period following the agreement, whereas the subsequent 10- to 13-year increment and any subsequent increments are referred to as the "Program.")

The Program set forth in the CA provides land, water and money for habitat along the river based on an "adaptive management" approach. Under adaptive management, the effects of habitat enhancement efforts will be studied and refined over the next 10 to 13 years. Measures that work will continue, while less successful measures will be modified or discontinued in favor of other alternatives.

A 10-member Governance Committee comprised of representatives from state agencies, water users’ organizations, environmental groups and federal agencies administers the CA. Standing committees are working directly with technical, hydrology, land and public outreach issues, while an executive director coordinates the CA’s functions. Outside the CA structure, an environmental impact study manager coordinates preparation of an Environmental Impact Study (EIS) to satisfy federal review requirements and allow federal agencies to participate in the agreement and program.

Environmental Account

The federally-required National Environmental Policy Act (NEPA) analysis of the proposed Program is currently under way, and after the EIS is complete a Program can be put in place. In the meantime, Central’s recently issued FERC license is already in effect for the CA period. Its requirements include measures that will be part of the Program, including the environmental account (EA) of water in Lake McConaughy for habitat purposes. Central will contribute ten percent of storable natural inflows into McConaughy during the non-irrigation season to the EA.

To operate the EA, Central has applied for a water right to release water from Lake McConaughy for habitat purposes. The Department of Water Resources received no objections to the application that, if approved, will protect releases from consumptive diversions through the Chapman reach of the river. The U.S. Fish and Wildlife Service appointed an EA manager who will schedule releases of EA storage water for periods when they will be most beneficial to the wildlife species. The process is similar to the approach irrigation projects use when scheduling releases for irrigation.

If, after the EIS is complete, the states and federal agencies agree to put the proposed Program in place, the first increment of the Program (10 to 13 years) will then commence. Each state will provide a water reregulation project (Nebraska’s is the EA in Lake McConaughy), and a comprehensive water conservation and water supply study is being conducted. Nebraska will be credited for land provided by NPPD, and other funds will be provided by the states and Interior, with most operating cash from Colorado, Wyoming and the federal government. The first increment will include actions to reduce shortages to target flows in the Platte River at Grand Island by an average of 130,000 acre-feet per year and to acquire interests in 10,000 acres of habitat land between the Johnson No. 2 Return (southeast of Lexington) and Chapman.

The Program set forth in the CA addresses both existing and new depletions from the Platte River basin. The states will monitor new water-related activities during the CA and develop plans to offset new depletions. Mitigation for new depletions to Platte River flows will occur during the first increment.

An assessment will be made of the Program’s accomplishments near the end of the first increment. The possibility exists that all habitat and water provisions will have been met by the end of the first increment, requiring only continuing maintenance thereafter. If additional work is necessary, goals would be established for a second increment of the Program.

Protection for irrigation customers

Based on provisions in the CA and the Program, Central’s board of directors approved the relicensing settlement because it was a better recourse for Central’s irrigation customers than any other potential outcome of the relicensing process. Central and its irrigation customers can bear the costs associated with the license conditions, which was not the case under other relicensing proposals. If the CA fails, Central would be faced with additional costs associated with the new license, which would likely require Central to consider new sources of revenue from a limited number of alternatives.

The agreement also provides much greater protection for the water supply and drought protection than the relicensing options. The EA, which is a significant component of the Program, has less impact on drought protection than the proposed alternatives. Computer models with the EA in effect demonstrate that Lake McConaughy would be able to meet irrigation demands under conditions that double the severity of the drought of the 1950s.

Benefits of the CA and Program

A number of other benefits accompany the CA and the subsequent Program:

• Upstream states agreed to maintain the current "regime of the river;" Colorado and Wyoming are committed to the "no new depletions without mitigation" concept of the CA which provides that any new consumptive uses which reduce the amount of water entering Nebraska must be offset or mitigated. The same concept applies to new depletions in Nebraska and work is currently proceeding to identify possible methods of offsetting new depletions.
  
• Relicensing proposals that preceded the CA and the subsequent relicensing settlement would have required substantial expenditures by Central and NPPD for water conservation activities without providing recognition of the benefits of groundwater recharge and return flows. (To clarify, for example, without the CA Central might be ordered to undertake conservation measures like installing membrane lining in several miles of canals, without an understanding that such activities could disrupt groundwater recharge resulting from surface water operations. Reductions to ground water recharge will potentially reduce the amount of return flows to the Platte River, which would be counterproductive to the goal of providing flows for habitat purposes.

  Under the proposed Program, conservation measures — whether modifications to Central’s surface water delivery system, conversions of on-farm irrigation systems or any of several other measures — will be adopted only when prudent and when they will result in a net savings of water. The cost of such measures will be apportioned among the states and federal agencies. If the CA or Program fails, Central would be faced with additional costs associated with conservation activity.

• Other irrigation projects, particularly those upstream from Lake McConaughy, and private water users will avoid the Section 7 consultation process required by the Endangered Species Act (ESA) by virtue of the states’ participation in the CA.

  The agreement provides that the Program can serve as the "reasonable and prudent" alternative (which addresses any ESA concerns) for any water-related activity in the basin facing ESA consultation, including federal reservoirs and related facilities providing irrigation in Wyoming and the Nebraska Panhandle; projects in the three states requiring federal permits for wetlands and waterways; and hundreds of small projects in all three states. Such projects are incorporated into the CA process rather than being addressed individually, which, as Central learned, can be extremely lengthy and expensive.

• The agreement among the three states and the federal government prevents unilateral action by federal agencies to protect endangered species. In recent years, a number of federally mandated actions related to the ESA have caused controversy in many parts of the country, particularly with regard to personal property rights. The agreement heads off such actions that could affect people who depend on the Platte River.

Compliance with ESA

The ESA was the driving force behind the three-state/federal government agreement. The ESA remains the "law of the land," despite efforts in Congress over the past several years to modify the law’s provisions.

The law’s provisions cannot be circumvented, said Jay Maher, Central’s environmental resources manager. Therefore, it was necessary to find an acceptable way to work within the ESA’s strictures.

"No one wants to deliberately harm a way of life any more than anyone wants to harm a wildlife species," Maher said. "Under the circumstances, this agreement is the best possible scenario to address both issues.

"Certainly the Central District and its irrigation customers have a great deal at stake in the matter, but so does Nebraska as a whole. The State of Nebraska has recognized that the CA process is a workable solution to ESA requirements while addressing the diverse concerns of the public. It needs a chance to develop and to work."

The CA can be summarized as a way of assuring a less costly and more secure water supply for Platte River water users. By working cooperatively and avoiding unilateral federal action, the participants in the process gained assurances for adequate drought protection at a reasonable cost, while addressing concerns about endangered species habitat.

Dispelling Misperceptions about the CA

Given the complex nature of the Cooperative Agreement and the many interests and issues involved, it is perhaps understandable that the process has been accompanied by some misperceptions and misunderstandings. The following information is intended to clarify some of the most common misperceptions that have arisen during public meetings of the Governance Committee and the various standing committees.

Land

• The Program will protect 10,000 acres of wildlife habitat between the J-2 Return and Chapman over the next 10 to 13 years. The ultimate goal of the Program is to eventually provide 29,000 acres.

• Of the 10,000 acres, nearly 3,000 is already accounted for by NPPD’s Cottonwood Ranch near Overton. At the end of the first increment, another 10,000 acres or more already managed as habitat by environmental organizations and other entities will be credited toward the 29,000-acre goal.

• The emphasis in the process will be on obtaining leases or easements, rather than on outright purchases, although purchases will remain an option for landowners who prefer to sell. Acquisition of land is to cause no adverse impacts to county tax bases. There will be no restrictions on or consequences for landowners who choose not to participate.

• Water conservation measures under the Program will be incentive-based. In other words, the conservation plan being prepared will offer farmers and others financial incentives to conserve. In return, the resulting water savings will be made available to the Program.

Water

• Surface water users on Central’s system are not the only irrigators with a stake in the process. More than 500,000 acres in Nebraska depend on Lake McConaughy, directly or indirectly, for irrigation water. This figure includes more than 300,000 acres that receive recharge benefits from surface irrigation projects that depend on McConaughy’s storage water.

• Central alone is responsible for providing the Environmental Account with water for environmental purposes.

• The 417,000 acre-feet (af) of water mentioned at recent public meetings is the average annual shortage to target flows once proposed by the U.S. Fish and Wildlife Service, which will be comprehensively reviewed as part of the Program. While these target flows are temporarily being used as a reference point, Fish and Wildlife agreed that the water component of the first increment of the proposed Program need only reduce the supposed shortage by 130,000-150,000 af per year.

• The 130,000-150,000 af reduction in instream flow "shortages" will be achieved through reregulation or retiming of flows already in the river, supplemented by new water conservation/water supply measures. Reregulation projects that have already been identified will account for 70,000 af of the total. Water will be shifted from periods when the river flows are higher and transferred to low-water periods. The reregulated flows will be spread out over an extended period to benefit fish and wildlife species along the river, but in terms of water levels, landowners along the river are not likely to discern variations in flows. Studies are underway to identify water conservation/water supply measures to provide the remaining 60,000 af.

• There is a misperception that higher flows in the Platte River during recent years are a result of the relicensing process and the CA. The higher than normal flows are largely the result of weather factors. The Program has not yet been implemented and operation of the environmental account as part of Central’s new FERC license will not go into effect until next year.

• Ground water wells existing before July 1, 1997 are "grandfathered" and not subject to the "new depletions" provision in the CA. Replacement wells of similar rated capacity would also be exempt. The State of Nebraska will determine a method to mitigate for water pumped from wells drilled after July 1, 1997, if those wells are determined to have a hydrologic impact on Platte River flows. A study being conducted by affected NRDs, irrigation districts and the state, will determine which wells are included in this category.

Money

• Ninety-five percent of Nebraska’s $15 million commitment of cash, land and water to the Program will come from Central and NPPD, who will split the cost 80 percent/20 percent. The federal government is contributing $37.5 million to the $75 million effort; Colorado’s cash/land/water contribution is $15 million and Wyoming’s is $7.5 million.