Water development fund a product of compromise
By MITCH LIES
SALEM -- In the legislative session that ended July 8, Oregon lawmakers created the state's first water supply development fund, an accomplishment some herald as "landmark."
Senate Bill 839 was roundly supported by both parties in both chambers. It passed the Senate 29-1 on July 6, and one day later it passed the House 60-0.
The bill, along with a companion bill, provides $10 million in lottery-backed bonds that water users can tap to study alternatives for getting water to farms, add infrastructure, repair storage structures or start work on building new water storage.
From all outward appearances, the bill was a lock from the moment it was first heard in the Senate Environment and Natural Resources Committee on April 10 to when the Senate president and House speaker signed it on July 15.
But, according to some, as recent as one month before the session closed, SB839 was doomed.
In that final month lawmakers not only preserved Oregon's opportunity to create the water supply development fund, they also codified the importance of water storage for economic development. And, according to many involved in behind-the-scenes negotiations on SB839, Oregon has Rep. Cliff Bentz, R-Ontario, to thank.
"Bentz did it," said Roger Beyer, a natural resource industries lobbyist and former state senator. "Without him, we would have gotten nowhere. The bill likely would have died in the Senate, because the votes weren't there to pass it as it was, because it was an environmentalist bill. It was all about in-stream water rights."
Bentz, a former member of the Oregon Water Resources Commission and a lawyer who has litigated water cases, said the bill as originally crafted posed more of a threat to out-of-stream uses such as irrigation than a potential benefit.
"The bill, before I had an opportunity to work on it, was definitely more beneficial for in-stream interests," Bentz said. "So every time I would make a change, it was to move the bill toward a balanced, in-stream/out-of-stream approach."
In all, Bentz said, the bill underwent 47 changes in the final month, almost all of which were aimed at protecting out-of-stream interests.
"The most important thing for all of us in this part of the state was to make sure we weren't creating a fund that would provide in-stream interests with the opportunity to harm out-of-stream interests," Bentz said.
"The very first thing was to make sure that we were designing a system that had balance. And throughout the discussion, we kept coming back to, 'How do we make sure that this bill provides for in-stream and out-of-stream use of the funds,'" he said.
The first issue that piqued Bentz's interest was a phrase stipulating that to qualify for the water-supply-development fund, entities must protect "seasonally varying flows."
The phrase reminded Bentz of a similar phrase from a 2009 bill that essentially rendered a water-supply-development fund obsolete. The phrase in House Bill 3369 required anyone applying for water-supply-development money to ensure projects protected "peak and ecological flows" and to keep in stream 33 percent of the water created through new storage.
First off, Bentz said, no one could afford to build a water-supply project knowing that 33 percent of the water could not be sold for out-of-stream uses. Plus no one knew what it meant to protect "peak and ecological flows."
When Bentz first read SB839, the language defining "seasonally varying flows" was so broad "that you could have used almost all of the winter flow to protect in-stream interests," he said.
One of his first actions was to create a task force to define "seasonally varying flows." The task force will present its findings by July 1, 2014.
A second task force, also with a July 1 deadline, will be formed to determine what the water supply development fund can be used for and to determine criteria for evaluating projects.
To qualify for the fund, projects have to provide economic, environmental and social, or community benefits, according to the bill.
Here again, the qualifying criteria present a challenge that agriculture will need to overcome to access the fund, according to Beyer.
"To build a project that uses any of this money," Beyer said, "automatically two-thirds of it has to be for uses other than agriculture. I don't know how you can ever afford to do that."
Jeff Stone, executive director of the Oregon Association of Nurseries, said creating jobs through building water storage for agricultural purposes can meet the "social, or community, benefit" requirement.
"People can look at it that two-thirds (of the qualifying criteria) are not for agriculture," Stone said, "and some people can look at it that two-thirds are not for the environment. It all depends on what lens you use."
How the bill is interpreted in the rule-making process will go a long way toward resolving the issue, Stone said.
Bentz said the bill is crafted in a way that protects and potentially enhances in-stream and out-of-stream uses of Oregon's water resources. And, he said, it took a team effort to bring balance to the bill.
"No change was made unilaterally," he said. "It was a group effort, and I mean an effort.
"I think everyone realized that at the end of the day, if we don't figure out a way of storing water, everybody is going to be hurt, and that includes the fish," he said.
Bentz said he believes SB839 will be used.
"I think almost immediately you're going to have people applying for those funds and going through this process," Bentz said. "I don't think there is any doubt there will be applications filed."
Beyer is less optimistic SB839 will provide an opportunity for agriculture to increase irrigation water supplies.
"Will 839 be the impetus to actually build any new storage projects for agriculture? I really don't think so," Beyer said. "I think it is weighted too heavily to the other potential uses of water.
"It may take another session or two for the work to be done, and you may have to tweak those (qualifying criteria) formulas or do something else after these studies are done to actually get any projects started," Beyer said. "But at least it is a first step.
"And for the first time in my recollection of being involved in the process over the past 15 or 16 years, this bill actually mentions the importance of storage of water for all uses, including agriculture.
"I think that was one of the key provisions to get into this bill -- that the Legislature finally recognizes the importance of storage of water for something other than fish," Beyer said.