Garrison Diversion Overview Committee

GARRISON DIVERSION OVERVIEW COMMITTEE

The Garrison Diversion Overview Committee originally was a special committee created in 1977 by House Concurrent Resolution No. 3032 and recreated in 1979 by Senate Concurrent Resolution No. 4005. In 1981 the Legislative Assembly enacted North Dakota Century Code (NDCC) Section 54-35-02.7, which statutorily created the committee. The committee is responsible for legislative overview of the Garrison Diversion Unit Project and related matters and for any necessary discussions with adjacent states on water-related topics.

Under NDCC Section 54-35-02.7 the committee consists of the majority and minority leaders and their assistants from the House and Senate, the Speaker of the House, the President Pro Tempore of the Senate selected at the end of the immediately preceding legislative session, the chairmen of the House and Senate standing Committees on Natural Resources, and the chairmen of the House and Senate standing Committees on Agriculture.

Committee members were Senators Aaron Krauter (Chairman), Bill Bowman, Randel Christmann, Thomas Fischer, Joel C. Heitkamp, Bob Stenehjem, and Terry M. Wanzek and Representatives Wesley R. Belter, LeRoy G. Bernstein, Merle Boucher, Pam Gulleson, David Monson, Eugene Nicholas, and Earl Rennerfeldt.

The committee submitted this report to the Legislative Council at the biennial meeting of the Council in November 2002. The Council accepted the report for submission to the 58th Legislative Assembly.

HISTORY OF THE PROJECT
Pick-Sloan Plan

The Garrison Diversion Unit is one of the principal developments of the Pick-Sloan Missouri River Basin program, a multipurpose program authorized by the federal Flood Control Act of 1944 [Pub. L. 78-534; 57 Stat. 887]. The Pick-Sloan plan provided for construction of a series of dams on the Missouri River to control flooding, provide power generation, and maintain a dependable water supply for irrigation, municipalities, industry, recreation, wildlife habitat, and navigation. Approximately 550,000 acres of land in the state were inundated by reservoirs on the Missouri River under the Pick-Sloan plan.

One feature of the Pick-Sloan plan was the Missouri-Souris Unit, which was the forerunner of the Garrison Diversion Unit. Under the plan for the Missouri-Souris Unit, water was to be diverted below the Fort Peck Dam in Montana and transported by canal for irrigating 1,275,000 acres; supplying municipalities in North Dakota, South Dakota, and Minnesota; restoring Devils Lake; conserving wildlife; and augmenting the Red River. The building of Garrison Dam changed the diversion point of the Missouri-Souris Unit from Fort Peck Dam to Garrison Reservoir (Lake Sakakawea). After considerable study and review of the Missouri-Souris Unit, Congress reauthorized the project as the initial stage, Garrison Diversion Unit, in August 1965 [Pub. L. 89-108; 83 Stat. 852].

Garrison Diversion Unit

The first detailed investigations of the Garrison Diversion Unit were completed in 1957 and involved a proposed development of 1,007,000 acres. The initial stage of the Garrison Diversion Unit provided for irrigation service to 250,000 acres in the state. This plan involved the construction of major supply works to transfer water from the Missouri River to the Souris, James, and Sheyenne Rivers and the Devils Lake Basin. The plan also anticipated water service to 14 cities, provided for several recreation areas, and provided for a 146,530-acre wildlife plan to mitigate wildlife habitat losses resulting from project construction and to enhance other wetland and waterfowl production areas.

Under the 1965 authorization the Snake Creek Pumping Plant would lift Missouri River water from Lake Sakakawea into Lake Audubon, an impoundment adjacent to Lake Sakakawea. From Lake Audubon the water would flow by gravity through the 73.6-mile McClusky Canal into Lonetree Reservoir, situated on the headwaters of the Sheyenne River. The Lonetree Reservoir would be created by construction of Lonetree Dam on the upper Sheyenne River, Wintering Dam on the headwaters of the Wintering River, and the James River dikes on the headwaters of the James River. Lonetree Reservoir would be situated so that water could be diverted by gravity into the Souris, Red, and James River Basins and the Devils Lake Basin.

The Velva Canal would convey project water from the Lonetree Reservoir to irrigate two areas totaling approximately 116,000 acres. The New Rockford Canal would convey project water for irrigation of approximately 21,000 acres near New Rockford and to deliver water into the James River Feeder Canal for use in the Oakes-LaMoure area. The Warwick Canal, an extension of the New Rockford Canal, would provide water for irrigation in the Warwick-McVille area and would provide water for the restoration of the Devils Lake chain.

A number of concerns slowed or halted construction on the project in recent years, including:

Canadian concerns that the Garrison Diversion Unit would allow transfer of foreign species of fish and other biota to the detriment of Canadian waters in violation of the Boundary Waters Treaty of 1909.
Numerous problems concerning wildlife mitigation and enhancement lands.
Legal suits brought by groups, such as the National Audubon Society, seeking to halt construction of the Garrison Diversion Unit by claiming the project violates the National Environmental Policy Act and to enforce a stipulation between the United States and the Audubon Society to suspend construction until Congress reauthorizes the Garrison Diversion Unit.

Canadian Concerns

Canadian interest in the Garrison Diversion Unit has centered on concerns that because the Garrison Diversion Unit involves a transfer of water from the Missouri River to the drainage basins of the Souris and Red Rivers, the return flows entering Canada through the Souris and Red Rivers would cause problems with regard to water quality and quantity.

In 1973 the Canadian government requested a moratorium on all further construction of the Garrison Diversion Unit until a mutually acceptable solution for the protection of Canadian interests under the Boundary Waters Treaty of 1909 was achieved. The United States government responded by stating its recognition of its obligations under the Boundary Waters Treaty and by adopting a policy that no construction affecting Canada would be undertaken until it was clear these obligations would be met.

During 1974 several binational meetings of officials were held to discuss and clarify Canadian concerns over potential degradation of water quality. An agreement was reached in 1975 between the governments of Canada and the United States to refer to the International Joint Commission the matter of potential pollution of boundary waters by the Garrison Diversion Unit.

The International Joint Commission created the International Garrison Diversion Study Board. The board concluded that the Garrison Diversion Unit would have adverse impacts on water uses in Canada, including adverse effects on flooding and water quality. The board recommended that any direct transfer by the Garrison Diversion Unit of fish, fish eggs, fish larvae, and fish parasites be eliminated by adopting a closed system concept and the installation and use of a fish screen structure.

In August 1984 representatives of Canada and the United States announced a general agreement between the two governments that Phase I of the initial stage of the Garrison Diversion Unit could be constructed. Canada, however, remained firmly opposed to the construction of any features that could affect waters flowing into Canada.

Garrison Diversion Unit Commission

The water and energy appropriations bill signed on July 16, 1984, contained an agreement to establish a commission to review the Garrison Diversion Unit. The Secretary of the Interior appointed a 12-member Garrison Diversion Unit Commission to review the Garrison Diversion Unit in North Dakota. The commission was directed to examine, review, evaluate, and make recommendations regarding the existing water needs of the state and to propose modifications to the Garrison Diversion Unit before December 31, 1984. Construction on the project was suspended from October 1 through December 31, 1984.

The commission worked under the restriction that any recommendation of the commission had to be approved by at least eight of the 12 members and that should the commission fail to make recommendations as required by law, the Secretary of the Interior was authorized to proceed with construction of the Garrison Diversion Unit as designed.

Congress directed the commission to consider 11 specific areas:

The costs and benefits to North Dakota as a result of the Pick-Sloan Missouri Basin program.
The possibility for North Dakota to use Missouri River water.
The need to construct additional facilities to use Missouri River water.
Municipal and industrial water needs and the possibility for development, including quality of water and related problems.
The possibility of recharging ground water systems for cities and industries as well as for irrigation.
The current North Dakota water plan to see if parts of the plan should be recommended for federal funding.
Whether the Garrison Diversion Unit can be redesigned and reformulated.
The institutional and tax equity issues as they relate to the authorized project and alternative proposals.
The financial and economic impacts of the Garrison Diversion Unit, when compared with alternative proposals for irrigation and municipal and industrial water supply.
The environmental impacts of water development alternatives, compared with those of the Garrison Diversion Unit.
The international impacts of the water development alternatives, compared with those of the Garrison Diversion Unit.

The commission released its final report and recommendations on December 20, 1984. The commission affirmed the existence of a federal obligation to the state for its contribution to the Pick-Sloan Missouri Basin program but recommended that an alternative plan be implemented in place of the 250,000-acre initial stage of the Garrison Diversion Unit. The commission recommended that the Sykeston Canal be constructed as the functional replacement for the Lonetree Dam. While the Lonetree Dam and Reservoir would remain an authorized feature of the plan, construction of that dam would be deferred pending appropriation of funds by Congress and a determination by the Secretary of the Interior that consultations with Canada were satisfactorily concluded. The commission recommended the Garrison Diversion Unit be configured to provide irrigation service to 130,940 acres in the Missouri and James River Basins instead of the initial stage 250,000-acre project. The commission also recommended the first phase of the Glover Reservoir be included as a feature of the plan in lieu of Taayer Reservoir for regulation of flows in the James River.

The commission further recommended the establishment of a municipal, rural, and industrial system for treatment and delivery of quality water to approximately 130 communities in North Dakota. A municipal and industrial water treatment plant with a capacity of 130 cubic feet per second was recommended to provide filtration and disinfection of water releases to the Sheyenne River for use in the Fargo and Grand Forks areas.

An alternate state plan for municipal water development was submitted to the Garrison Diversion Unit Commission by then Governor Allen I. Olson and Governor-elect George A. Sinner, proposing that the state would design and construct the water systems and pay 25 percent of their costs. In return the federal government would provide up to $200 million in nonreimbursable funds for municipal water development projects. The federal government would pay 75 percent of the construction costs of the systems with only the operation and maintenance costs borne by the cities benefited.

Garrison Diversion Unit Reformulation

Following the issuance of the commission's final report, Congress enacted the Garrison Diversion Unit Reformulation Act of 1986 [Pub. L. 99-294; 100 Stat. 433]. This legislation was supported by representatives of the state, the Garrison Diversion Conservancy District, the National Audubon Society, and the National Wildlife Federation.

The legislation addressed the James River by directing a comprehensive study of effects over the next two years during which time construction of the James River Feeder Canal, the Sykeston Canal, and any James River improvements could not be undertaken. Of the 32,000-acre New Rockford Extension included in the Garrison Diversion Unit Commission final report, 4,000 acres were transferred to the West Oakes area and 28,000 acres were authorized for development within the Missouri River Basin.

The legislation also provided for:

130,940 acres of irrigation.
Deauthorization of the 1944 Flood Control Act and the 1965 Garrison authorization.
Preservation of the state's water rights claims to the Missouri River.
Nonreimbursement of features constructed before enactment which will no longer be employed to full capacity, to the extent of the unused capacity.
Acre-for-acre mitigation based on ecological equivalency rather than the 1982 mitigation plan.
Deauthorization of the Taayer Reservoir and purchase of the Kraft Slough for waterfowl habitat.
Continued authorization, but no construction, of the Lonetree Reservoir. The Sykeston Canal was mandated for construction following required engineering, operational, biological, and economic studies. The Lonetree Reservoir could be built if:
1. The Secretary of the Interior determines a need for the dam and reservoir;
2. Consultations with Canada are satisfactorily completed; and
3. The Secretary of State and the Secretary of the Interior certify determinations to Congress and 90 days have elapsed.
No construction of irrigation acreage other than on the Indian reservations or the 5,000-acre Oakes Test Area until after September 30, 1990.
A $200 million grant for construction of municipal and industrial water delivery systems. A $40.5 million nonreimbursable water treatment facility was authorized to deliver 100 cubic feet per second of water to Fargo and Grand Forks. All water entering the Hudson Bay drainage system must be treated and must comply with the Boundary Waters Treaty of 1909.
Municipal and industrial water delivery systems for the Fort Berthold, Fort Totten, and Standing Rock Reservations.
Irrigation soil surveys that must include investigations for toxic or hazardous elements.
Federal participation in a wetlands trust to preserve, enhance, restore, and manage wetland habitat in North Dakota.

Garrison Municipal, Rural, and Industrial Water Supply Program

Included within the Garrison Diversion Unit Reformulation Act of 1986 is an authorization enabling Congress to appropriate $200 million for the Garrison municipal, rural, and industrial water supply program. These funds are for the planning and construction of water supply facilities for municipal, rural, and industrial use throughout the state.

On July 18, 1986, the Garrison Diversion Conservancy District and the State Water Commission entered an agreement for the joint exercise of governmental powers. The agreement allows the district to use the expertise of the commission in developing and implementing the water supply program. In addition the district was to enter an agreement with the Secretary of the Interior which designates the district as the fiscal agent for the state concerning money received and payments made to the United States for the water supply program.

On November 19, 1986, the United States and the Garrison Diversion Conservancy District entered an agreement that designates the district to act on behalf of the state in the planning and construction, as well as the operation and maintenance, of the water systems constructed pursuant to the Garrison Diversion Reformulation Act of 1986. The agreement defines the responsibilities of the United States and the district under the agreement and contains provisions concerning the work to be undertaken by the district, stipulations concerning the transfer of funds, and the procedure for reporting, accounting, and reviewing the planning and construction programs. The agreement also provides that the Southwest Pipeline Project is eligible to receive funding under this program.

PROJECT UPDATE

The committee received updates concerning the Garrison Diversion Unit Project from representatives of the Garrison Diversion Conservancy District, the State Water Commission, and the United States Bureau of Reclamation.

Appropriations

Since 1966 Congress has appropriated $758,478,000 and expended $696,506,177 for the Garrison Diversion Unit Project. The President requested $25.239 million for the Garrison Diversion Unit in his budget request, the Senate version contains $28.577 million and the House of Representatives version contains $27.239 million. The final budget amount will be resolved in conference committee. The funding history of the Garrison Diversion Unit is summarized in the following table:

Garrison Diversion Unit Funding History
Fiscal Year	Appropriated	Expenditured
1966	$500,000	$499,213
1967	2,000,000	1,789,188
1968	4,000,000	2,572,003
1969	5,472,000	4,728,905
1970	6,650,000	7,229,029
1971	12,100,000	9,293,753
1972	11,390,000	11,910,300
1973	20,400,000	17,564,886
1974	17,390,000	13,648,078
1975	13,855,000	14,739,635
1976	11,900,000	15,970,264
1976	2,700,000	4,113,333
1977	23,500,000	14,561,749
1978	18,600,000	9,674,539
1979	0	7,370,922
1980	9,700,000	10,685,735
1981	0	4,715,993
1982	4,000,000	6,424,060
1983	4,000,000	26,440,138
1984	22,330,000	23,915,389
1985	53,580,000	15,493,771
1986	41,300,000	29,873,663
1987	33,000,000	30,351,129
1988	33,000,000	40,440,282
1989	30,000,000	35,217,532
1990	26,580,000	26,993,534
1991	35,000,000	38,328,655
1992	33,000,000	34,702,630
1993	30,000,000	29,632,234
1994	32,000,000	28,580,366
1995	32,000,000	28,598,273
1996	24,900,000	20,317,708
1997	21,600,000	21,744,789
1998	25,900,000	21,922,758
1999	22,700,000	21,999,100
2000	23,494,000	23,157,422
2001	21,416,000	18,865,219
2002	24,000,000	22,440,000
2003	25,239,000*
Total	$759,196,000	$696,506,177
*Executive budget request.
NOTE: These amounts exclude federal expenditures for the $759,196,000 operation, maintenance, and replacement of the Jamestown Reservoir and for Indian municipal, rural, and industrial water supply facilities.

Garrison Municipal, Rural, and Industrial Water Supply Program

The Garrison municipal, rural, and industrial water supply program has an appropriation authorization of $200 million in federal grant funds for the planning and construction of water supply facilities for municipal, rural, and industrial use throughout the state. The Dakota Water Resources Act increases the ceiling for the municipal, rural, and industrial water supply program by $200 million and provides an additional $200 million for the tribal municipal, rural, and industrial water supply program. The state has received $180.3 million in federal grant funds through fiscal year 2002. Projects funded under the municipal, rural, and industrial water supply program are funded using 65 percent federal grant money and 35 percent nonfederal money. The operation, maintenance, and replacement costs for water systems are 100 percent nonfederal costs. The Southwest Pipeline Project has received $69.6 million, the Northwest Area Water Supply Project has received $11.9 million, and other projects have received $98.8 million.

The committee received information that state municipal, rural, and industrial water supply funding is lower than in past years. Typically the state receives approximately $10 million per year, but only $5 million is expected to be available in fiscal year 2003. The State Water Commission budget, as presented to the 57th Legislative Assembly, included a tentative allocation of $15 million for accelerating municipal, rural, and industrial water supply projects. The State Water Commission approved four municipal, rural, and industrial water supply projects--McKenzie rural water system, Ramsey rural water system, Langdon rural water system, and Tri-County rural water system. The Ramsey rural water system is under construction, the Langdon and Tri-County water systems will begin construction this fall, and the McKenzie rural water system is scheduled to open bids this winter.

Southwest Pipeline Project

House Bill No. 1023, enacted by the 57th Legislative Assembly, provided $7.3 million in funding for the Southwest Pipeline Project from the water development trust fund for the 2001-03 biennium. This funding allowed the State Water Commission to expand the Southwest Pipeline Project into what is known as the Bowman-Scranton phase of the project. This phase will serve the city of Scranton and approximately 250 rural users. Once this phase is completed it will complete the south and east portion of the Southwest Pipeline Project, leaving only the Medora-Beach phase of the original project yet to be constructed. Mercer and Oliver Counties have also contracted for water from the Southwest Pipeline Project.

The City of Medora contracted with the State Water Commission on March 23, 1983, to purchase 13 million gallons of water per year at a rate not to exceed 40.3 gallons per minute from the Southwest Pipeline Project. On January 15, 2002, the Medora city council passed a motion to amend the water services contract to provide that the Southwest Pipeline Project be its sole source of water supply under the contract rather than the agreed purchase of a minimum of 13 million gallons of water annually. An initiative petition proposing an ordinance "rejecting contracts with and water from the Southwest Water Pipeline" was filed January 18, 2002, and passed by a vote of the electors June 11, 2002, in accordance with Medora's home rule charter. The State Water Commission expressed concern that if the ordinance was valid, the commission would have to address the issue of the existing water services contract. The Attorney General has since issued an opinion that the initiated city ordinance violated the constitutional prohibitions on impairment of contracts, and is therefore void.

The Southwest Pipeline Project provides water to 22 communities and approximately 1,850 rural water connections. In addition, there are nine businesses or other bulk users being served by the project. The total population presently served is approximately 30,000.

Northwest Area Water Supply Project

Representatives of the State Water Commission reported that the Northwest Area Water Supply Project received final authorization to begin construction on March 28, 2002. Bids for a 7.5-mile pipeline segment had been advertised in December 2001 and a groundbreaking ceremony was held on April 5, 2002, in Minot. Representatives of the State Water Commission reported that the state has taken many precautions with the Northwest Area Water Supply Project to ensure that Missouri River biota is not transferred to Canada. The water will first be pretreated near Lake Sakakawea to disinfect the water. The water will then be transferred through a pipeline to the Minot treatment plant for final treatment. As a final precaution, the water will be treated using ultraviolet radiation. Construction on the first Northwest Area Water Supply main transmission contract is underway. The contractor has completed construction of approximately three miles of the 7.5 miles of pipeline. The contractor has reached the outskirts of Minot and the pace of construction will increase as the number of underground utilities diminishes, and the contractor no longer has to deal with working in paved areas. This contract has a cost of approximately $4.8 million and has a completion date of November 1, 2002. The State Water Commission is considering three Lake Sakakawea intake locations, all near the Snake Creek Pumping Plant. Representatives of the State Water Commission reported that funding is the greatest obstacle to the project at this time. Federal municipal, rural, and industrial water supply funding is less than in the recent past which will lengthen the time to deliver water. The goal is to deliver water to Minot by late 2006, which will require approximately $6 million of federal funds annually.

On October 22, 2002, subsequent to the final meeting of the committee, the Province of Manitoba filed suit in the United States District Court for the District of Columbia seeking to halt construction of the Northwest Area Water Supply Project and to require the Department of the Interior to conduct a more thorough environmental impact study for the project. The province objects to the project because it contends that water to be taken from Lake Sakakawea is not being treated sufficiently to prevent the transfer of biota into the Hudson Bay watershed via the Souris River Basin.

Bureau of Reclamation Activities

Representatives of the Bureau of Reclamation reported on bureau activities. The reports included information on the operation and maintenance of the principal supply works; the Oakes Test Area; the municipal, rural, and industrial water supply program; fish and wildlife mitigation and enhancement; the natural resources trust; the municipal, rural, and industrial Indian grant program; the Standing Rock irrigation project; the recreation component of the Garrison Diversion Unit; and the undesignated 28,000 acres of irrigation. The Snake Creek Pumping Plant began pumping operations in 2002 following the spring thaw on Audubon Lake. Additional pumping was performed throughout the summer to maintain a water elevation of 1847.0 feet mean sea level. The conduit between Audubon Lake and Lake Sakakawea was opened in October 2001 to allow for a slow drawdown of Audubon Lake to elevation 1845.0 feet mean sea level. In addition to the routine operation and maintenance of the Snake Creek Pumping Plant, problems with the concrete deck were identified and studied. A plan is being drafted to monitor the rate of deterioration. Routine operation and maintenance of the McClusky and New Rockford Canals continued under a cooperative agreement with the Garrison Diversion Conservancy District.

Operation and maintenance of the Oakes Test Area is also covered under the cooperative agreement with the Garrison Diversion Conservancy District. The Bureau of Reclamation covers most of the contractual and coordination responsibilities while the conservancy district handles the routine operation and maintenance of the facilities. In 2002 the Bureau of Reclamation issued 13 water service contracts totaling 3,698.6 acres and one water exchange contract for 130.8 acres. Water deliveries are in accordance with the Oakes Test Area operating principles. Irrigation and water demands were met using a combination of surplus James River flows early in the season and releases from the conservation pool at Jamestown Reservoir later in the season.

The wildlife habitat mitigation and enhancement plan consists of three general parts. The wildlife mitigation lands, Lonetree Wildlife Management area, and the Kraft Slough area. The wildlife mitigation lands include the original wildlife tracts acquired under the 1965 plan, lands approximate to the canals acquired in excess of project needs, and scattered wildlife tracts. The plan states that mitigation for project-related impacts be implemented prior to impacts to resources, concurrent with construction, on an acre-for-acre basis, replacing lost lands with their ecological equivalent as determined by the type of wildlife use and equivalent vegetative cover. The objective of the plan is to ensure there will be no net wildlife habitat lost due to the project. Emphasis was placed on acquisition of restorable drained wetland tracts. The Bureau of Reclamation retains a policy of acquiring lands for wildlife purposes from willing sellers to the extent possible. The Bureau of Reclamation acquired 28 tracts totaling approximately 12,700 acres from willing sellers to be developed as mitigation for wildlife habitat impacts associated with the construction of the Garrison Diversion Unit. Willing seller tracts plus the original wildlife lands total approximately 22,120 acres. The lands were developed for wildlife purposes by the Bureau of Reclamation. Development activities include removal of abandoned buildings and trash piles, restoration of drained wetlands, conversion of croplands to native or tame grasses, tree plantings, and construction of boundary fences. Once the tracts are fully developed by the Bureau of Reclamation, the individual tracts are transferred to the United States Fish and Wildlife Service for management. Management of five tracts totaling approximately 2,430 acres is performed by the North Dakota Game and Fish Department by agreement with the Bureau of Reclamation and the United States Fish and Wildlife Service.

In 1969 the Bureau of Reclamation began acquisition of land from willing sellers for the Lonetree Reservoir. The reservoir area contains 32,331.51 acres acquired in fee title from willing sellers, and 830.94 acres that are considered meandered for a total of 33,162.45 acres. The Garrison Diversion Unit Reformulation Act of 1986 directed the Secretary of the Interior to develop the area for wildlife purposes to be managed by the Game and Fish Department. The Dakota Water Resources Act deauthorized Lonetree Reservoir and established permanently its use as a wildlife enhancement area to be managed by the state. The Sheyenne Lake National Wildlife Refuge is contained within the Lonetree Wildlife Management area and makes up 797.3 acres, of which 333.85 acres are upland and 463.45 acres are water. In 1999 and 2000 three tracts totaling 280 acres were purchased as part of mitigation for impacts to the Audubon Game Management area and are marked and managed as part of the Lonetree Wildlife Management area but receive different operation and maintenance payments.

The original plan was to develop the Lonetree Wildlife Management area in five sections and turn management over to the Game and Fish Department as they were developed, with the first transfer of 11,400 acres to take place October 1, 1989, and the final transfer around 1995. Due to complications with the requirement that the Game and Fish Department pay taxes on all its lands, transfer was delayed. While the Lonetree Wildlife Management area was being developed, the land was leased to previous landowners for agricultural purposes. This practice ended on December 31, 1992, when all agricultural leases were terminated. The Lonetree Wildlife Management area development was, for the most part, completed and transferred to the Game and Fish Department for management on January 1, 1997. Development included moving landowners; removing all farm buildings, fences, and utilities; plugging wells; and burying rockpiles. The Bureau of Reclamation constructed new boundary fences, seeded grass, planted trees, restored all drained wetlands, constructed three vault toilets at the campgrounds, constructed 11 parking lots, and reclaimed the Lonetree Dam site. Construction of the management headquarters began in 1990 with the erection of a cold storage building. In 1991 the assistant manager's modular home was moved onsite, and the manager's house was built in 1992. The shop-dormitory and office buildings were constructed in 1993. In 1994 a seed storage building was constructed, and a chemical storage building was constructed in 2001.

The Game and Fish Department uses prescribed burning to manage 1,500 acres annually and sprays up to 3,000 acres of grasslands to control noxious weeds, grazes 200 acres of grass, and hays 1,200 acres of grass as part of its grassland management activities. The department receives an annual operation and maintenance payment of $19.76 per acre for a total of $655,290 plus administrative costs and capital expenditures to manage the Lonetree Wildlife Management area. The department has never requested additional funds to cover administrative costs and capital expenditures. The operation and maintenance payment is based on the average cost per acre of managing a wildlife area in 1982, and was last adjusted in 1987, and is indexed based on the annual rate of inflation. The Dakota Water Resources Act establishes that all development and operation and maintenance costs associated with the Lonetree Wildlife Management area be nonreimbursable.

Representatives of the Bureau of Reclamation also reported on refuge compatability of the Audubon and Arrowwood National Wildlife Refuges. The Arrowwood National Wildlife Refuge lies directly upstream of Jamestown Reservoir, a Garrison Diversion Unit feature and is adversely impacted by reservoir operations. The Arrowwood refuge compatibility project involves construction of a series of bypass channels and subimpoundments to improve water management capability at the refuge as mitigation for impacts caused by the operation of Jamestown Reservoir. The contract for construction of the Jim Lake drawdown channel was completed in 1992. Work is continuing on the Jim Lake bypass channel with a scheduled completion date of April 13, 2003. The contractor has constructed approximately 4.3 miles of the channel embankment in Jim Lake. The contractor has also constructed the 1.1-mile subimpoundment dike embankment. The total project calls for earth work and construction of 4.4 miles of bypass channel and embankment, 1.1 miles of subimpoundment embankment, .8 mile of subimpoundment bypass channel, and three control structures. The contractor is 76 percent complete in 71 percent of the time. Design work is continuing on the 5.5-mile Arrowwood Lake drawdown channel, which will be the next phase of the overall project.

In 1975 the Bureau of Reclamation raised the water level in Audubon Lake approximately 13 feet. The increased water level resulted in a loss of islands and upland habitat adjacent to the lake. In addition wetland habitat in and adjacent to the lake was decreased, and erosion of remaining islands was accelerated. The Audubon refuge compatibility program is designed to mitigate for these impacts to the Audubon National Wildlife Refuge and the Audubon Wildlife Management area. Although no island stabilization work was performed in fiscal year 2002, two additional one-acre islands were constructed. The 17-acre Shaffer Marsh wetland mitigation project was completed in December 2001. The out-of-kind mitigation, which exchanges wetland sites for peninsula cutoffs, will commence with the scheduled October 2002 construction of the 15-acre Meyers Pond project. Construction of five off-refuge islands is scheduled for this winter. The Bureau of Reclamation has purchased 2,608 acres of land for management by the Game and Fish Department as mitigation for Audubon Wildlife Management area impacts. Acquisition of approximately 160 acres remains to complete the bureau's mitigation requirement for the Audubon Wildlife Management area. The Bureau of Reclamation is developing a cooperative agreement with the Game and Fish Department for management of these tracts.

Representatives of the Bureau of Reclamation also reported on the Kraft Slough National Wildlife Refuge. Kraft Slough was originally the site for the Taayer Reservoir under the 1965 Garrison Diversion Unit plan. However, the Garrison Diversion Unit Reformulation Act of 1986 deauthorized the Taayer Reservoir. The Reformulation Act also directed the Secretary of the Interior to acquire up to 5,000 acres at the Kraft and Pickell Sloughs area to be managed by the United States Fish and Wildlife Service as a component of the National Wildlife Refuge System giving consideration to the unique wildlife values of the area.

The acquisition and development plan for the Kraft Slough National Wildlife Refuge and the Kraft Slough environmental assessment were completed by the Bureau of Reclamation in March 1991. Since that time the Bureau of Reclamation has been negotiating with area landowners for fee title acquisition of land on a willing seller basis. The Bureau of Reclamation holds title to 1,700 acres at Kraft Slough of which 1,520 acres were acquired from willing sellers and 480 acres were withdrawn from the Bureau of Land Management. Acquired lands are comprised of wetlands, native prairie, and agricultural lands. The Bureau of Reclamation has worked with adjacent farmers to seed 595 acres of cropland to native grasses. Old fences, trash piles, and two abandoned farmsteads have been removed. The Bureau of Reclamation has an aggressive program to control Russian olive and noxious weeds such as leafy spurge and Canada thistle on the area. The Dakota Water Resources Act authorized the Secretary of the Interior to trade acquired lands at Kraft Slough with adjacent landowners for property that complements the area. In fiscal year 2003 the Bureau of Reclamation will be working with the United States Fish and Wildlife Service to write a management plan for Kraft Slough with the intent of transferring acquired lands to the Fish and Wildlife Service to be managed as a component of the National Wildlife Refuge System.

Representatives of the Bureau of Reclamation also reported on the status of the North Dakota Wetlands Trust. The North Dakota Wetlands Trust was established pursuant to the Garrison Diversion Unit Reformulation Act of 1986. The purpose of the trust was to preserve, enhance, restore, and manage wetlands and associated wildlife habitat in the state. Originally under the Act the trust was given $12 million in funds from the Bureau of Reclamation's appropriations for the Garrison Diversion Unit and $1.2 million in state funds. These funds were placed in an account and the interest is being used on an ongoing basis to carry out the purposes of the trust. The financial commitment was met by the Bureau of Reclamation January 1996, and all $12 million has been paid to the trust. The trust funds a variety of projects, including educational projects; wetland restorations, enhancements, and creations; no-till drills and zero tillage workshops; the adopt a pothole program; the Prairie Wetland Interpretive Center; and land acquisition.

The Dakota Water Resources Act changed the name of the Wetlands Trust to the Natural Resources Trust. The change involved adding grassland conservation and riparian restoration to its mission of preserving, enhancing, restoring, and managing wetlands and associated wildlife habitat in the state. In addition to having authority to acquire land, interests in land, and water rights, the trust has the power to finance wetland preservation, enhancement, restoration, and management of wetland habitat programs. Additionally the trust now has the power to fund incentives for conservation practices by landowners. Representatives of the Bureau of Reclamation reported that the bureau has prepared and executed a new agreement with the trust. Funding of the trust has been reestablished under this agreement. The amount of the contribution for each year is equal to 5 percent of the total amount appropriated for the Red River Valley and the state municipal, rural, and industrial water supply programs. In fiscal year 2002 the bureau's contribution to the trust was $350,000.

Representatives of the Bureau of Reclamation also reported on the municipal, rural, and industrial Indian grant program. The Standing Rock Sioux Tribe, Spirit Lake Nation, and the Three Affiliated Tribes continue to work toward completion of final engineering reports for their reservation-wide rural water systems. The Three Affiliated Tribes has completed a draft report that is currently under review by the Bureau of Reclamation. Reports were expected from the Spirit Lake Nation and Standing Rock Sioux Tribe by the end of September 2002. The Bureau of Reclamation is also working with the tribes to complete their environmental assessments. The Turtle Mountain Band of Chippewa continues to work toward completion of its needs assessment and expects to begin work on a final engineering report in fiscal year 2003. The environmental assessment has been completed for the Standing Rock irrigation project and a finding of no significant impact is being prepared. The Bureau of Reclamation has reached an agreement with the Standing Rock Sioux Tribe on a schedule and list of activities to complete which will allow construction of the Cannonball Unit in 2003. The tribe has obtained the necessary farm leases in the Cannonball Unit. Final design work for the Cannonball Unit, approximately 700 acres, is scheduled to be completed by November of this year which will allow the tribe to obtain right-of-way easements and conduct cultural resource investigations for construction of the facilities. However, the tribe estimates it only has sufficient funds to construct approximately 1,800 acres and will be seeking indexing of the project or an increase in the funds authorized for this project.

Concerning the recreation component, representatives of the Bureau of Reclamation reported that total funding for the Garrison Diversion Unit recreation program was $13 million under the 1986 Garrison Diversion Unit Reformulation Act, half of which was to be provided by the Garrison Diversion Conservancy District and half by the Bureau of Reclamation. Although many projects are complete, the funding ceiling was no longer sufficient to complete the entire program as originally proposed. The Dakota Water Resources Act raised the recreation program funding ceiling. The Garrison Diversion Conservancy District and the Bureau of Reclamation along with the state Parks and Recreation Department are reviewing the recreation program and developing a plan that is cost-effective and provides the greatest public benefit within existing authorities and the new funding ceiling. The Bureau of Reclamation is preparing a resource management plan and environmental assessment for the McClusky and New Rockford Canals right of ways. The intent of this plan is to identify opportunities to improve recreational use of facilities on the canal right of ways and the chain-of-lakes without interfering with the authorized purposes of the canals.

The Dakota Water Resources Act authorized 75,480 acres of irrigation, of which 28,000 acres were not designated to be developed in specific areas. Two irrigation districts have been formed, the Nesson Valley and the Elk/Charbon irrigation districts, and been approved to be developed, 10,000 acres maximum, as part of the 28,000 acres. The Bureau of Reclamation reported that it has received inquiries from the Horsehead Flats irrigation area, 10,000 to 15,000 acres south of Bismarck, and the Big Bend irrigation area, up to 24,000 acres north of Bismarck, to become part of the remaining undesignated acres. Both areas are currently in the process of forming irrigation districts. All four projects being proposed will be privately funded and constructed but will request federal power for irrigation pumping from the Missouri River.

Representatives of the Bureau of Reclamation reported that at the request of the state and irrigation districts, the bureau is investigating the Nesson Valley and Elk/Charbon irrigation district areas to determine project feasibility, which includes soils classification, drainage and toxic elements investigations, and economic feasibility investigations. Appropriate studies include the bureau's requirements under the National Environmental Policy Act, and contracts will be negotiated providing for the repayment of appropriate assigned costs for power along with the requirements of reclamation law. These projects are eligible for project power, provided the Secretary of the Interior determines the projects are feasible under the terms of the Dakota Water Resources Act. A team has been formed with representatives of the irrigation districts, the State Water Commission, the Garrison Diversion Conservancy District, the North Dakota Irrigation Caucus, and the Bureau of Reclamation to oversee the process and to complete the necessary tasks leading to providing federal pumping power to the irrigation districts.

RECENT DEVELOPMENTS
Dakota Water Resources Act

The Dakota Water Resources Act of 2000 amends the Garrison Diversion Unit Reformulation Act of 1986. The Act outlines a program to meet the water needs of North Dakota, including irrigation; municipal, rural, and industrial water supply projects; fish and wildlife; recreation; flood control; augmented streamflows; and ground water recharge. The Act maintains a multipurpose water project to meet the water needs of North Dakota and to compensate the state for the loss of 550,000 acres to the Garrison and Oahe Reservoirs but changes the focus of water development from large-scale irrigation to the delivery of municipal, rural, and industrial water to communities and the four Indian reservations located in the state. The Act completes the Garrison Diversion Unit Project, while enhancing wildlife habitat and water conservation in North Dakota.

Section 2 of the Act establishes the purposes of the Garrison Diversion Unit Project and adds wildlife enhancement and streamflow augmentation and ground water recharge to the purposes of the Garrison Diversion Unit Reformulation Act of 1986. It provides that the project will be a joint effort between the Secretary of the Interior and the state. It also provides for repayment of appropriate costs, including operation and maintenance costs. It assures compliance with the Boundary Waters Treaty of 1909 by requiring the Secretary of the Interior to determine compliance will be achieved before construction of any features conveying water into the Hudson Bay drainage may begin.

Section 3 of the Act authorizes specific recreation and fish and wildlife enhancement facilities and determines responsibility for the costs of mitigation and enhancement facilities. It authorizes the Bureau of Reclamation to exchange land in order to complete the development of the Kraft Slough Wildlife Refuge. It also deauthorizes Lonetree Dam and Reservoirs as a water supply feature and permanently designates it as a wildlife conservation area. It provides an additional $6.5 million in funding authority for federal recreation programs, with a 50 percent federal cost share.

Section 4 of the Act establishes the process for determining the interest rate for authorized features of the project during construction. It also allows the Secretary of the Interior to declare the facilities complete before they are used for the actual delivery of water.

Section 5 of the Act authorizes 73,100 acres of irrigation on Indian and non-Indian land, none of which will be located in the Hudson Bay or Devils Lake Basins. The funding for development of the non-Indian systems is not included or anticipated. The federal support of the irrigation areas is limited to providing power from the Pick-Sloan Missouri Basin power system. Twenty-eight thousand acres are undesignated, but before those acres can receive federal power, the Secretary of the Interior must prepare a detailed report on the irrigation units proposed and include a finding of their economic, financial, and engineering feasibility.

Section 6 of the Act provides that Pick-Sloan power may be used for the municipal, rural, and industrial water supply systems and irrigation areas. It also freezes current cost allocations associated with the Pick-Sloan Missouri Basin power program.

Section 7 of the Act authorizes continued development of Indian and non-Indian municipal, rural, and industrial water supply systems. It retains a 25 percent nonfederal cost share and authorizes an incentive-based water conservation program. It also provides for an optional revolving loan program.

Section 8 of the Act authorizes a comprehensive environmental analysis and study to determine the best method or methods to meet current and future Red River Valley water supply needs. No features to transfer Missouri River water, as a solution to the needs of the Red River Valley, may be constructed without further authorization from Congress. In-basin solutions may be constructed without further congressional authorization.

Section 9 of the Act authorizes the Secretary of the Interior to negotiate a mutually acceptable agreement for the transfer of the Oakes Test Area facilities to the state. If no agreement is reached, the Secretary of the Interior is authorized to dispose of the Oakes Test Area.

Section 10 of the Act authorizes $200 million to complete facilities to meet Red River Valley water supply needs, $200 million for the state municipal, rural, and industrial water supply program, $200 million for the Indian municipal, rural, and industrial water supply program, $6.5 million for the recreation program, and $25 million for the Natural Resources Trust.

Section 11 of the Act authorizes $25 million for the Natural Resources Trust, formerly the North Dakota Wetlands Trust. It authorizes the establishment of an operation and maintenance account and expands its purposes to include grasslands and riparian habitat.

Garrison Diversion Draft Reassessment Report

Representatives of the Garrison Diversion Conservancy District presented a draft reassessment report to the committee. Representatives of the conservancy district reported that the district has undertaken a strategic planning initiative to examine the future of the district and reassess its programs in light of the activities of others and the recently enacted Dakota Water Resources Act. The Garrison Diversion Conservancy District Board of Directors addressed four main areas of responsibility: agriculture and natural resources; Red River Valley water supply studies; municipal, rural, and industrial water supply; and recreation. The board suggested 25 initiatives for consideration. The board of directors committed itself to support these initiatives and the new direction that the Garrison Diversion Unit Project may take as a result of their implementation. The seven initiatives reflecting the Garrison Diversion district's commitment to supporting the state's character as a setting for healthy agriculture, business, and wildlife are to develop and enhance irrigation programs in North Dakota, support irrigation on Indian reservation land, access project pumping power for North Dakota use, seek out partnerships designed to enhance wildlife habitat, create a long-term operation plan for the Oakes Test Area, support alternative and increased funding of research in irrigated agriculture, and to take a more active role in support of integrated water management programs. The three initiatives relating to the Red River Valley study are to renegotiate the management agreement on the Red River Valley study, reconsider specific elements of the Red River Valley study, and to help develop an official state position on water needs for the Red River Valley. The five initiatives relating to municipal, rural, and industrial water supplies include planning for the distribution of non-Indian municipal, rural, and industrial water supply allocations; planning for the distribution of Indian municipal, rural, and industrial water supply allocations; continuing to serve as the repayment, construction, and operating entity for facilities associated with wholesale water supply as the district has in the past with the features of the Garrison Diversion Unit; developing a statewide analysis of water needs; and assessing opportunities to make use of a larger variety of federal programs to aid in the solution of water problems. The five initiatives identified in the recreation area of responsibility are to plan for the future growth of nature-based tourism in North Dakota, review Garrison Diversion Conservancy District recreation criteria for funding, develop a working agreement with the Division of Tourism and the Parks and Recreation Department on statewide tourism recreation planning, pursue opportunities for a more active relationship with the North Dakota Natural Resources Trust, and provide a program of education that promotes North Dakota resources. The five initiatives identified with administrative and legislative considerations are to plan for budget changes that reflect an increased level of activity, plan for changes in staffing and support services, plan for statewide responsibilities and a growing role in state water management, consider how changes in state statutes might help pave the way for the district's changing role, and explore further improvements to the Dakota Water Resources Act to reflect the changing needs of North Dakota and the growing understanding of the impact of federal legislation.

Red River Valley Water Supply Study

The Dakota Water Resources Act calls for a study to determine the water needs of the Red River Valley and a thorough environmental impact study of all the proposed solutions. The Bureau of Reclamation, the State Water Commission, and the Garrison Diversion Conservancy District are managing the study and have agreed to involve federal, state, and international interests and take advantage of the wide variety of resources available to each party in this diverse group. A technical team consisting of representatives from state, federal, Canadian, environmental, and local agencies is expected to review the various elements of the study as it progresses. The three-year project is expected to consist of four overlapping studies culminating in a proposed solution for the water needs in the Red River Valley and an environmental impact study to affirm the proposed solution's appropriateness to the ecosystem of the Red River Valley. These include a hydrological study, an engineering study, an environmental study, and a needs assessment study. The goal is to offer a final, comprehensive, complete, long-term, environmentally friendly, functional, and efficient water management and delivery solution to the people of the Upper Great Plains.

The Bureau of Reclamation and the Garrison Diversion Conservancy District have agreed to terms included in three agreements, a memorandum of understanding for the Red River Valley Water Supply Project environmental impact statement, a master cooperative agreement for the Dakota Water Resources Act, and a cooperative agreement for the Red River Valley Water Supply Project. The memorandum of understanding establishes the Bureau of Reclamation and the conservancy district as co-lead agencies to jointly prepare the environmental impact statement. The cooperative agreements provide a means to fund activities of the conservancy district associated with assisting the Bureau of Reclamation in activities authorized under the Dakota Water Resources Act.

Devils Lake

The State Engineer provided updates throughout the interim concerning the Devils Lake flood situation. Devils Lake is normally considered a closed subbasin of the Red River of the North Basin. However, evidence suggests that Devils Lake, on several occasions during the past 10,000 years, has reached its spill elevation of approximately 1,459 feet mean sea level and overflowed into the Sheyenne and Red Rivers. Geologists have concluded that Devils Lake water levels naturally vary widely due to climatic swings. Beginning 130 years ago with the first recorded level of 1,438.4 feet mean sea level, lake levels fell until the lake reached its recorded low of 1,401.9 feet mean sea level in 1940. From that point the lake has followed a rising trend reaching the modern high and current level of 1,447.2 feet mean sea level. At this elevation the lake has a surface area of 125,000 acres and is storing 2.45 million acre-feet of water. The State Engineer reported that Devils Lake continues to flow east through the Jerusalem Channel into Stump Lake. Currently, approximately 20 cubic feet per second is being measured by the United States Geological Survey's gauge. Stump Lake has risen 1.5 feet since May 1, 2002, and the current elevation of Stump Lake is 1,413.6 feet mean sea level. The State Engineer reported that the State Water Commission continues to pursue both the federal and state outlets for Devils Lake but the federal outlet has had an unexpected delay. On August 12, 2002, the Governor was notified that the United States Army Corps of Engineers has delayed its recommendations regarding the permanent outlet until January 2003. After that the outlet project will be forwarded to the International Joint Commission for review, which is estimated to require 6 to 12 months. The result of this development is that the spring of 2004 will be the earliest construction could begin on the federal outlet. In addition Senator Kent Conrad announced in August 2002 that he no longer has confidence that the United States Army Corps of Engineers will build the federal outlet and has provided his support for the state outlet. As a result of these actions the State Water Commission at its meeting on August 15, 2002, approved moving forward with the state outlet by completing the design and bidding the grading of the Round Lake Pumping Plant site. The current estimated cost of the state outlet project is $25 million for a 100 cubic feet per second outlet.

Devils Lake Litigation

The Attorney General provided updates concerning litigation involving the ownership of the Devils Lake lakebed, Spirit Lake Tribe v. State of North Dakota, United States of America, et al. The Attorney General reported that litigation over title to Devils Lake has been ongoing for nearly 20 years. In 1986 the Spirit Lake Tribe, then known as the Devils Lake Sioux Tribe, sued the state, the United States, and several private landowners seeking title to Devils Lake. The basis for the tribe's claim is the 1867 treaty creating its reservation. The treaty defines the northern boundary of the reservation as "along the waters" of the lake. If "along the waters" means the lake's north shore then Devils Lake is within the reservation's boundaries. If the phrase means the south shore then the lake is outside the reservation.

The tribe asserts that "along the waters" means the north shore. The defendants, private landowners who farmed and ranched the dry lakebed for decades, the state of North Dakota (which has exercised jurisdiction over the lake and lakebed), and the United States (which holds title to much of the lakebed under a 1971 state deed) assert that "along the waters" means the lake's south shore. The state also asserts that it took title of Devils Lake at statehood under the equal footing doctrine, a doctrine that gives title to navigable bodies of water to the states as they enter the Union.

In 1989 the federal district judge dismissed the suit on a summary judgment motion, ruling that the tribe was paid for the lake in a 1977 settlement of its aboriginal land claim action that it had brought before the Indian Claims Commission. Having been paid for the lake once, the federal judge ruled that the tribe could not sue for it again. The United States Court of Appeals for the Eighth Circuit reversed, saying that factual questions precluded summary judgment and that a trial needed to be held to fully develop the facts.

What followed was a long period of on-again, off-again negotiations by which the state and tribe tried to negotiate a settlement. A final agreement was not reached, so the litigation was reactivated.

The United States, relying on a statute requiring that property actions against it be brought within 12 years, filed a motion in which it argued that the suit against it must be dismissed because the tribe had not sued in time. The state supported the motion and also filed a motion asking that the court declare Devils Lake navigable.

In December 1999 the federal judge granted the state's motion and declared the lake navigable. The federal judge also granted the United States' motion and dismissed the United States from the suit because of the tribe's failure to sue within 12 years. The federal judge stated that long-standing use of the lake and lakebed by the United States, the state, local governments, and non-Indian farmers and ranchers put the tribe on notice of the United States' adverse claim.

After dismissing the suit against the United States, the federal judge then dismissed it against the state and private landowners. The judge ruled that the United States is an indispensable party to litigation interpreting the treaty. Because the United States has been dismissed, the suit against all the other defendants must also be dismissed. The tribe then appealed. On August 17, 2001, a three-member panel of the United States Court of Appeals for the Eighth Circuit affirmed the district judge's decision. The panel agreed that before 1974, the tribe had notice of adverse claims to the lake and, therefore, filing its complaint in 1986 was outside the 12-year statute of limitations. One judge dissented, arguing that the tribe did not have notice of the United States' adverse claim until the early 1980s.

On September 26, 2001, the tribe filed a petition for rehearing with the Court of Appeals asking that the entire court rehear the case. The state filed a reply petition and the court denied the petition for rehearing. The tribe then filed a petition with the United States Supreme Court seeking a writ of certiorari. The state responded and the United States Supreme Court subsequently denied the petition seeking a writ of certiorari. The tribe has since approached the Governor and requested that the Governor enter negotiations with the tribe to resolve its claim and this longstanding tribal-state dispute.

Section 404 Program

Section 404 of the Federal Water Pollution Control Act [33 U.S.C. 1344], commonly known as the Clean Water Act, requires permits to discharge dredged or fill material into navigable waters at specified disposal sites. The Section 404 program is administered by the United States Army Corps of Engineers, but states may request the Environmental Protection Agency to delegate the Section 404 program to them. In 1993 the Legislative Assembly enacted legislation authorizing the state to assume jurisdiction over the Section 404 program. However, this legislation provided the effective date of the Act is when the state receives approval from the Environmental Protection Agency and adequate funds have been made available from the federal government or other sources to fund the program as determined by the State Engineer and approved by the Emergency Commission. This effective date was amended in 1995 to provide the effective date of the assumption of the Section 404 program of the Clean Water Act is when the State Engineer certifies to the Governor and the Secretary of State that the state has received adequate funds from the federal government or other sources to fund the program as determined by the State Engineer and approved by the Legislative Assembly. This effective date was repealed by 2001 Senate Bill No. 2285 which also appropriated $800,000 to the State Water Commission for the purpose of assuming jurisdiction over and administering the Section 404 program of the Clean Water Act. However, Senate Bill No. 2285 does not become effective until the State Engineer certifies to the Governor that a program has been designed to effectively assume responsibility for the Section 404 program of the Clean Water Act, and the State Water Commission is ready to assume those responsibilities.

Representatives of the State Water Commission reported that staff members have met with representatives of the Environmental Protection Agency and the Solicitor General's office concerning assumption of the Section 404 program. One of the primary points of discussion during the meeting with the Environmental Protection Agency was the option of implementing a state wetland regulatory program as an interim step toward assumption of the Section 404 program. Under this option, the United States Army Corps of Engineers would continue to administer the Section 404 program during the interim period. The Environmental Protection Agency noted that only two states--Michigan and New Jersey--have successfully assumed the Section 404 program, and both had state wetland regulatory programs in place before submitting a complete application for assumption of the federal program. Representatives of the State Water Commission reported that Oregon is working toward assumption, and that state has also implemented a state wetland regulatory program. While running a concurrent state wetland regulatory program as an interim step toward assumption is not a specific requirement within the federal regulations, Environmental Protection Agency representatives have indicated that it would facilitate approval of state assumption by providing an opportunity for development of a track record and an opportunity for the state to better define the resources required to successfully operate a Section 404 program. Draft administrative rules have been distributed for review and comments from other state and federal agencies, including the Environmental Protection Agency. When the comments have been received, the State Water Commission intends to proceed with the rule adoption process. Members of the committee expressed concern, however, that it was not the intent of the Legislative Assembly that the State Water Commission administer a wetland regulatory program in tandem with the Section 404 permit program, and if the Environmental Protection Agency is insisting the state do so in order to gain approval for assumption of the Section 404 program, the state may reassess the assumption.

Missouri River Issues

Representatives of the State Water Commission provided updates concerning Missouri River issues and revision of the United States Army Corps of Engineers Master Manual. The United States Army Corps of Engineers manages the six main stem dams and reservoirs on the Missouri River pursuant to the Missouri River Master Water Control Manual (Master Manual). The Master Manual was developed in 1960 and with only slight revisions, the last of which occurred in 1979, is used to manage the river today. In response to a lawsuit filed by the Upper Missouri River Basin states against the United States Army Corps of Engineers, however, the Corps of Engineers has undertaken a process to revise the Master Manual. The Master Manual has been under review by the corps since 1989. The first proposed revisions to the Master Manual were released in 1994 but were not supported by the Upper Missouri River Basin states.

Representatives of the State Water Commission reported that drought conditions persist in the Missouri River Basin. On July 31, 2002, system storage in the six main stem reservoirs was 48.3 million acre-feet, or 13.5 million acre-feet below the average system storage for that day. Lake Sakakawea was at an elevation of 1,831.4 feet mean sea level, 11.7 feet below its average end of July elevation. The elevation of Lake Oahe was 1,590.8 feet mean sea level on July 31, 2002, 17 feet lower than its average end of July elevation.

In April 2002 the state of South Dakota filed suit against the Corps of Engineers requesting the federal district court to issue a restraining order preventing Lake Oahe from being drawn down during the smelt spawn. The court granted South Dakota's request and enjoined the corps from lowering the water level of Lake Oahe. To make up for water released from Lake Oahe, the corps increased releases from Lake Sakakawea and from Fort Peck Lake. North Dakota filed suit to prevent loss of the smelt spawn in Lake Sakakawea. Montana then followed suit to protect Fort Peck Lake. A federal district court in Nebraska then issued an injunction requiring the corps to operate the system in accordance with the current Master Manual and to maintain navigation on the lower river. Although the spawn is over and the restraining orders regarding Lake Sakakawea and Lake Oahe have expired, the lawsuits continue. The corps has appealed the district courts' judgments and maintains that the corps' decisions concerning water levels in the reservoirs and the river are not reviewable by a court. North Dakota has amended its complaint in the original lawsuit asking the court to order the corps to complete the Master Manual revision and treat all users equally instead of providing preferential treatment to navigation.

Concerning the Master Manual, the Corps of Engineers was scheduled to release the final environmental impact statement on the Master Manual review in May 2002. The corps did not meet that schedule. Instead the corps began consulting with the United States Fish and Wildlife Service regarding the impacts of the proposed revision on the threatened and endangered species in the Missouri River system resulting in an indefinite delay of the Master Manual revision.

CONCLUSION

The committee makes no recommendation concerning its statutory responsibilities.