ELR Citation: ELR 20319
No(s). s. 99-2291, -2295 (10th Cir. Oct 25, 2001)

The court affirms a district court grant of summary judgment in favor of two Rio Grande Valley irrigation project water districts who claimed that they were owed revenues under §4-I of the Reclamation Act notwithstanding a 1939 amendment to the Act. The government argued that the amendment terminated all of the water districts' rights to revenues arising under §4-I except for those revenues covered by the amendment's saving clause, i.e., those revenues to which water districts had a preexisting legal or contractual right. The court first holds that the district court correctly held that the amendment did not repeal §4-I in its entirety. The plain language of the amendment does not purport to repeal §4-I. The legislative history demonstrates that the congressional intent behind the amendment was merely to deposit power revenues into the Reclamation Fund and then the general treasury, rather than to recapture all the profits to which the water districts were entitled under §4-I. The amendment does not mention the two other sources of revenue in §4-I: the leasing of project grazing and farm land, and the sale or use of town sites. Furthermore, even if the amendment's wording is confusing, that fact would cut against finding repeal by implication, which must be clear and manifest. The court also holds that the district court properly analyzed the scope of the amendment's modifications to §4-I, and correctly ruled that if the water districts are entitled to credits under §4-I, they are also entitled to credits from the entire Rio Grande project.

The court then rejects the water districts' challenge to the validity of the lease agreement between the Bureau of Reclamation and the Bureau of Land Management for management of grazing lands within the water districts. The districts argued that it was not in the best interest of the project beneficiaries since the lease agreement provided no consideration to them. The federal government, however, owes no fiduciary duty to the water districts. Further, the U.S. Department of the Interior has no obligation to generate profits for the water districts, and the authority of the Secretary of the Interior to administer public lands is broad and unfettered.

The full text of this decision is available from ELR (13 pp., ELR Order No. L-399).

Counsel for Plaintiff
Herman E. Ortiz
Hubert & Hernandez
2100 N. Main St., Ste. 1, Las Cruces NM 88004
(505) 526-2101

Counsel for Defendants
Kathryn E. Kovacs
Environment and Natural Resources Division
U.S. Department of Justice, Washington DC 20530
(202) 514-2000