BILL REQ. #:  S-4343.2 

READ FIRST TIME 02/03/12.   

     AN ACT Relating to streamlining water right permitting and appeals; amending RCW 90.03.320, 90.80.070, 90.80.080, 90.80.090, and 43.21B.305; adding a new section to chapter 90.80 RCW; creating a new section; and providing an expiration date.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:

NEW SECTION.  Sec. 1   The legislature finds that the ongoing economic recession has prevented water right holders from completing projects with existing water right permits, and that existing law allows such permits to be extended without increasing or decreasing the quantity of water authorized. The legislature also finds that the ongoing economic recession has impacted state agency budgets, including the department of ecology's water resource program and environmental and land use hearings office.
     Therefore, it is the intent of the legislature to enact temporary water rights permitting reforms to enable the department of ecology's water permitting staff to focus on substantive permitting matters that do not duplicate other permit review procedures.

Sec. 2   RCW 90.03.320 and 1999 c 400 s 1 are each amended to read as follows:
     (1) Actual construction work shall be commenced on any project for which permit has been granted within such reasonable time as shall be prescribed by the department, and shall thereafter be prosecuted with diligence and completed within the time prescribed by the department. The department, in fixing the time for the commencement of the work, or for the completion thereof and the application of the water to the beneficial use prescribed in the permit, shall take into consideration the cost and magnitude of the project and the engineering and physical features to be encountered, and shall allow such time as shall be reasonable and just under the conditions then existing, having due regard for the public welfare and public interests affected. For good cause shown, the department shall extend the time or times fixed as aforesaid, and shall grant such further period or periods as may be reasonably necessary, having due regard to the good faith of the applicant and the public interests affected. Good cause includes prevention or restriction of water use by operation of federal laws for the time or times fixed for commencing work, completing work, and applying water to beneficial use otherwise authorized under a water right permit issued for a federal reclamation project. In fixing construction schedules and the time, or extension of time, for application of water to beneficial use for municipal water supply purposes, the department shall also take into consideration the term and amount of financing required to complete the project, delays that may result from planned and existing conservation and water use efficiency measures implemented by the public water system, and the supply needs of the public water system's service area, consistent with an approved comprehensive plan under chapter 36.70A RCW, or in the absence of such a plan, a county-approved comprehensive plan under chapter 36.70 RCW or a plan approved under chapter 35.63 RCW, and related water demand projections prepared by public water systems in accordance with state law. An existing comprehensive plan under chapter 36.70A or 36.70 RCW, plan under chapter 35.63 RCW, or demand projection may be used. If the terms of the permit or extension thereof, are not complied with the department shall give notice by registered mail that such permit will be canceled unless the holders thereof shall show cause within sixty days why the same should not be so canceled. If cause is not shown, the permit shall be canceled.
     (2) Notwithstanding the provisions of subsections (1) and (3) of this section, for any water right permit, previously approved permit extension, or water right change or transfer with a development schedule requiring construction or application of water to beneficial use between the effective date of this section and December 31, 2016, the times for construction and the application of water to beneficial use are both extended for five years. The extension must be issued by the department after payment of the fee required by RCW 90.03.470. In connection with the ministerial permit extension authorized in this subsection, the department shall not increase or decrease the quantity of water authorized under the permit or modify any other terms or conditions of the permit. As an alternative to the ministerial permit extension authorized in this subsection, a water right permit holder may apply for a permit extension under subsection (1) of this section.
     (3) The provisions of this section do not apply to the Quincy groundwater subarea as defined in WAC 173-134A-040(8) as it existed on the effective date of this section.

Sec. 3   RCW 90.80.070 and 2004 c 10 s 4 are each amended to read as follows:
     (1) A person proposing a transfer of a water right may elect to file an application with a water conservancy board, if a board has been established for the geographic area where the water is or would be diverted, withdrawn, or used. If the person has already filed an application with the department, the person may request that the department convey the application to the conservancy board with jurisdiction and the department must promptly forward the application. A board is not required to process an application filed with the board. If a board decides that it will not process an application, it must return the application to the applicant and must inform the applicant that the application may be filed with the department. An application to the board for a transfer shall be made on a form provided by the department. A board may require an applicant to submit within a reasonable time additional information as may be required by the board in order to review and act upon the application. At a minimum, the application shall include information sufficient to establish to the board's satisfaction that a right to the quantity of water being transferred exists, and a description of any applicable limitations on the right to use water, including the point of diversion or withdrawal, place of use, source of supply, purpose of use, quantity of use permitted, time of use, period of use, and the place of storage.
     (2) The applicant for any proposed water right transfer may apply to a board for a record of decision on a transfer if the water proposed to be transferred is currently diverted, withdrawn, or used within the geographic area in which the board has jurisdiction, or would be diverted, withdrawn, or used within the geographic area in which the board has jurisdiction if the transfer is approved. In the case of a proposed water right transfer in which the water is currently diverted or withdrawn or would be diverted or withdrawn outside the geographic boundaries of the county or the water resource inventory area where the use is proposed to be made, the board shall hold a public hearing in the county of the diversion or withdrawal or proposed diversion or withdrawal. The board shall provide for prominent publication of notice of the hearing in a newspaper of general circulation published in the county in which the hearing is to be held for the purpose of affording an opportunity for interested persons to comment upon the application. If an application is for a transfer of water out of the water resource inventory area that is the source of the water, the board shall consult with the department regarding the application.
     (3) After an application for a transfer is filed with the board, the board shall publish notice of the application and send notice to state agencies in accordance with the requirements of RCW 90.03.280. In addition, the board shall send notice of the application to any Indian tribe with reservation lands that would be, but for RCW 90.80.055(2), within the area in which the board has jurisdiction. The board shall also provide notice of the application to any Indian tribe that has requested that it be notified of applications. Any person may submit comments and other information to the board regarding the application. The comments and information may be submitted in writing or verbally at any public meeting of the board to discuss or decide on the application. The comments must be considered by the board in making its record of decision.
     (4) If a majority of the board determines that the application is complete, and that the transfer is in accordance with RCW 90.03.380, 90.03.390, or 90.44.100, the board must issue a record of decision approving the transfer, subject to review by the director unless the board elects to issue the decision as a final decision under section 5 of this act. In making its record of decision, the board must consider among other things whether the proposed transfer can be made without detriment or injury to existing water rights, including rights established for instream flows. The board must include in its record of decision any conditions that are deemed necessary for the transfer to qualify for approval under the applicable laws of the state. The basis for the record of decision of the board must be documented in a report of examination. The board's proposed approval must clearly state that the applicant is not permitted to proceed to effect the proposed transfer until a final decision is made by the director unless the board elects to issue the decision as a final decision under section 5 of this act. ((In making its record of decision, the board must consider among other things whether the proposed transfer can be made without detriment or injury to existing water rights, including rights established for instream flows.))
     (5) If a majority of the board determines that the application cannot be approved under the applicable laws of the state of Washington, the board must make a record of decision denying the application together with its report of examination documenting its record of decision. The board's record of decision is subject to review by the director under RCW 90.80.080 unless the board elects to issue the decision as a final decision under section 5 of this act.
     (6) When alternates appointed under the provisions of RCW 90.80.050(3) are serving as commissioners on a board, a majority vote of the board must include at least one commissioner appointed under the provisions of RCW 90.80.050(1).
     (7) An alternate when serving as a commissioner in the review of an application before the board shall:
     (a) Review the written record before the board and any exhibits provided for the review or provided at the hearing if a hearing was held;
     (b) Review any audio or video recordings made of the proceedings on the application; and
     (c) Conduct a site visit if a site visit by other commissioners acting on the application has been previously conducted.
     (8) An alternate serving as a commissioner shall be guided by the conflict of interest standards applicable to all commissioners under RCW 90.80.120. The board shall provide notice of an alternate sitting as a commissioner to the applicant and other participants in proceedings before the board in a timely manner to provide sufficient time for any challenges for conflict of interest to be made prior to the board's decision on the application.

Sec. 4   RCW 90.80.080 and 2001 c 237 s 12 are each amended to read as follows:
     (1) The board must provide a copy of its record of decision to the applicant and to the department. The board shall submit its record of decision on the transfer application to the department for review. The board shall also submit its report of examination to the department summarizing factual findings on which the board relied in reaching its record of decision and a copy of the files and records upon which the board's record of decision is based. The board shall also promptly transmit notice by mail to any person who objected to the transfer or who requested notice of the board's record of decision.
     (2) Upon receipt of a board's record of decision, the department shall promptly post the text of the record of decision transmittal form on the department's internet site. The director shall review each record of decision made by a board for compliance with applicable state water law.
     (3) Any party to a transfer, third party who alleges his or her water right will be impaired by the proposed transfer, or other person may file a letter of concern or support with the department and the department may consider the concern or support expressed in the letter. Such letters must be received by the department within thirty days of the department's receipt of the board's record of decision.
     (4) The director shall review the record of decision of the board and shall affirm, reverse, or modify the action of the board within forty-five days of receipt. The forty-five day time period may be extended for an additional thirty days by the director or at the request of the board or applicant. If the director fails to act within the prescribed time period, the board's record of decision becomes the decision of the department and is appealable as provided by RCW 90.80.090. If the director acts within the prescribed time period, the director's decision to affirm, modify, or reverse is appealable as provided by RCW 90.80.090, and the director's decision to remand is appealable as provided by RCW 90.80.120(2)(b).
     (5) This section applies unless the board elects to issue the decision as a final decision under section 5 of this act.

NEW SECTION.  Sec. 5   A new section is added to chapter 90.80 RCW to read as follows:
     (1) Notwithstanding the provisions in this chapter calling for review of the board's record of decision by the director, the board may, in its sole discretion and upon request by the applicant, elect to issue a final decision if the applicant and the board agree in advance of the board's election that the party defending the board's decision in case of appeal will be either:
     (a) The board;
     (b) The applicant; or
     (c) The board and applicant jointly.
     (2)(a) In the event of the board's election to issue a final decision under subsection (1) of the section, the board must provide a copy of its record of decision to the applicant and to the department. The board shall also promptly transmit notice by mail to any person who objected to the transfer or who requested notice of the board's record of decision.
     (b) Upon receipt of a board's record of decision under this subsection (2), the department shall promptly post the record of decision on the department's internet site.
     (c) The board's decision is appealable in the same manner as other water right decisions made pursuant to chapters 90.03 and 90.44 RCW. The director has the same right of appeal as any other aggrieved person. If a board decision is appealed to the pollution control hearings board, the board may, but is not required to, participate in the appeal.

Sec. 6   RCW 90.80.090 and 2001 c 237 s 13 are each amended to read as follows:
     The decision of the director to approve or deny an action to create a board((, or to approve, deny, or modify a water right transfer either by action or inaction)) is appealable in the same manner as other water right decisions made pursuant to chapters 90.03 and 90.44 RCW.

Sec. 7   RCW 43.21B.305 and 2005 c 34 s 2 are each amended to read as follows:
     In an appeal that involves a penalty of fifteen thousand dollars or less, the appeal may be heard by one member of the board or by an administrative law judge employed by the board, whose decision shall be the final decision of the board. The board shall define by rule alternative procedures to expedite appeals involving penalties of fifteen thousand dollars or less. These alternatives may include: Mediation, upon agreement of all parties; submission of testimony by affidavit; or other forms that may lead to less formal and faster resolution of appeals.

NEW SECTION.  Sec. 8   Sections 3 through 6 of this act expire December 31, 2016.