BILL REQ. #:  H-0084.2 

Prefiled 12/21/2004. Read first time 01/10/2005.   Referred to Committee on Economic Development, Agriculture & Trade.

     AN ACT Relating to water conservancy boards; amending RCW 90.80.010, 90.80.020, 90.80.030, 90.80.035, 90.80.040, 90.80.055, 90.80.065, 90.80.070, 90.80.080, 90.80.090, 90.80.100, 90.80.120, 90.80.135, and 90.80.150; creating a new section; repealing RCW 90.80.901; and declaring an emergency.

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

Sec. 1   RCW 90.80.010 and 2004 c 10 s 1 are each amended to read as follows:
     The following definitions apply throughout this chapter, unless the context clearly requires otherwise.
     (1) "Alternate" means an individual: (a) Who is appointed by the county legislative authority or authorities under RCW 90.80.050(3); (b) who is trained under the requirements of RCW 90.80.040; and (c) who, while serving as a replacement for an absent or recused commissioner: (i) May serve and vote as a commissioner; (ii) is subject to any requirement applicable to a commissioner; and (iii) counts toward a quorum.
     (2) "Board" means a water conservancy board created under this chapter.
     (3) "Commissioner" means an individual who is appointed by the county legislative authority or authorities as a member of a water conservancy board under RCW 90.80.050(1), or an alternate appointed under RCW 90.80.050(3) while serving as a replacement for an absent or recused commissioner.
     (4) (("Department" means the department of ecology.
     (5) "Director" means the director of the department of ecology.
     (6) "Record of)) "Decision" means the ((conclusion reached by)) decision of a water conservancy board ((regarding)) to approve, deny, or approve with conditions an application for a transfer filed with the board.
     (((7))) (5) "Department" means the department of ecology.
     (6) "Transfer" means a transfer, change, amendment, or other alteration of a part or all of a water right authorized under RCW 90.03.380, 90.03.390, or 90.44.100.

Sec. 2   RCW 90.80.020 and 1997 c 441 s 3 are each amended to read as follows:
     (1) The county legislative authority of a county may create a water conservancy board((, subject to approval by the director,)) for the purpose of expediting voluntary water transfers within the county.
     (2) A water conservancy board may be initiated by((: (a))) a resolution of the county legislative authority((; (b) a resolution presented to)). The county legislative authority ((calling for the creation of a board)) may also be petitioned to create a water conservancy board by: (a) The legislative authority of an irrigation district, public utility district that operates a public water system, a reclamation district, a city operating a public water system, or a water-sewer district that operates a public water system; (((c) a resolution by)) (b) the governing body of a cooperative or mutual corporation that operates a public water system serving one hundred or more accounts; (((d))) (c) a petition signed by five or more water rights holders, including their addresses, who divert water for use within the county; or (((e))) (d) any combination of (a) through (((d))) (c) of this subsection. The ((resolution or)) petition must state the need for the board, include proposed bylaws or rules and procedures that will govern the operation of the board, identify the geographic boundaries where there is an initial interest in transacting water sales or transfers, and describe the proposed method for funding the operation of the board.
     (3) After receiving a ((resolution or)) petition to create a board, a county legislative authority shall determine its sufficiency. If the county legislative authority finds that the ((resolution or)) petition is sufficient, or if the county is initiating the creation of a board upon its own motion, it shall hold at least one public hearing on the proposed creation of the board. Notice of the hearing shall be published at least once in a newspaper of general circulation in the county not less than ten days nor more than thirty days before the date of the hearing. The notice shall describe the time, date, place, and purpose of the hearing, as well as the purpose of the board. Following the hearing, the county legislative authority may adopt a resolution approving the creation of the board if it finds that the board's creation is in the public interest. The resolution must identify the boundaries of the area that is within the jurisdiction of the board.

Sec. 3   RCW 90.80.030 and 1997 c 441 s 4 are each amended to read as follows:
     (((1))) If it adopts a resolution creating a board, the county legislative authority shall ((forward a copy of the resolution or petition calling for the creation of the board,)) inform the department of the board's creation by forwarding a copy of the resolution ((approving the creation of the board, and a summary of the public testimony presented at the public hearing to the director following the adoption of the resolution calling for the board's creation)) to the department.
     (((2) The director shall approve or deny the creation of a board within forty-five days after the county legislative authority has submitted all information required under subsection (1) of this section. The director must determine whether the creation of the board would further the purposes of this chapter and is in the public interest. The director shall include a description of the necessary training requirements for commissioners in the notice of approval sent to the county legislative authority.))

Sec. 4   RCW 90.80.035 and 2004 c 10 s 2 are each amended to read as follows:
     (1) If a county is the only county having lands comprising a water resource inventory area as defined in chapter 173-500 WAC, the county may elect to establish a water conservancy board for the water resource inventory area, rather than for the entire county.
     (2) Counties having lands within a water resource inventory area may jointly ((petition the department for establishment of)) establish a water conservancy board for the water resource inventory area. Counties may jointly ((petition the department to)) establish boards serving multiple counties or one or more water resource inventory areas. For any of these multicounty options, the counties must reach their joint determination on the decision to ((file the petition)) create the board, on the proposed bylaws, and on other matters relating to the establishment and operation of the board in accordance with the provisions of this chapter and chapter 39.34 RCW, the interlocal cooperation act. Each county must meet the requirements of RCW 90.80.020(2). The counties must jointly determine the sufficiency of a petition under RCW 90.80.020(3) and each county legislative authority must hold a hearing in its county.
     (3) If ((establishment of)) a multicounty water conservancy board is created under any of the options provided in subsection (2) of this section ((is approved by the department)), the counties must jointly appoint the board commissioners and jointly appoint members to fill vacancies as they occur, and may jointly appoint alternates in accordance with the provisions of this chapter and chapter 39.34 RCW.
     (4) A board established for more than one county or for one or more water resource inventory areas has the same powers as other boards established under this chapter. The board has no jurisdiction outside the boundaries of the water resource inventory area or areas or the county or counties, as applicable, for which it has been established, except as provided in this chapter.
     (5) The counties establishing a board for a multiple county area must designate a lead county for purposes of providing a single point of contact for communications with the department. The lead county shall forward the ((information)) resolutions creating the board as required in RCW 90.80.030(1) for each county.

Sec. 5   RCW 90.80.040 and 1997 c 441 s 5 are each amended to read as follows:
     The director of the department may, as deemed necessary by the director, adopt rules in accordance with chapter 34.05 RCW ((necessary to carry out this chapter, including)) establishing minimum requirements for the training and continuing education of commissioners. Training courses for commissioners shall include an overview of state water law and hydrology. Prior to commissioners taking action on proposed water right transfers, the commissioners shall comply with training requirements that include state water law and hydrology.

Sec. 6   RCW 90.80.055 and 2001 c 237 s 9 are each amended to read as follows:
     (1) Except as provided in subsection (2) of this section, a board shall operate on a countywide basis or on an areawide basis in the case of a board with jurisdiction in more than one county or water resource inventory area, and have the following powers, in addition to any other powers granted in this chapter:
     (a) Except as provided in subsection (2) of this section, a board may act upon applications for the same kinds of transfers that the department itself is authorized to act upon, including an application to establish a trust water right under chapter 90.38 or 90.42 RCW. A board may not act upon an application for the type of transfer within an irrigation district as described in RCW 90.03.380(3). If a board receives an application for a transfer between two irrigation districts as described in RCW 90.03.380(2), the board must, before publication of notice of the application, receive the concurrence specified in that section.
     (b) A board may act upon an application to transfer a water right claim filed under chapter 90.14 RCW. In acting upon such an application, the board must make a tentative determination as to the validity and extent of the right, if any, embodied in the claim and may only issue a record of decision regarding a transfer of such a claim to the extent it is tentatively determined to be valid. ((Neither)) The board's tentative determination((, nor the director's acceptance of such a tentative determination,)) does not constitute((s)) an adjudication of the right under RCW 90.03.110 through 90.03.240 or 90.44.220, and such a determination does not preclude or prejudice a subsequent challenge to the validity, priority, or quantity of the right in a general adjudication under those sections.
     (c) A board may establish a water right transfer information exchange through which all or part of a water right may be listed for sale or lease. The board may also accept and post notices in the exchange from persons interested in acquiring or leasing water rights from willing sellers.
     (d) The director shall assign a representative of the department to provide technical assistance to each board. If requested by the board, the representative shall work with the board as it reviews applications for formal acceptance, prepares draft records of decision, and considers other technical or legal factors affecting the board's development of ((a final record of)) its decision. A board may request and accept additional technical assistance from the department. A board may also request and accept assistance and support from the county government or governments of the county or counties in which it operates.
     (2) The jurisdiction of a board shall not apply within the boundaries of a federal Indian reservation or to lands held in trust for an Indian band, tribe, or nation by the federal government.

Sec. 7   RCW 90.80.065 and 2001 c 237 s 16 are each amended to read as follows:
     A water conservancy board may be formally dissolved by the county or jointly by the counties as applicable in which it operates by adoption of a resolution of the county legislative authority or authorities. Notice of the dissolution must be provided to the director of the department. ((The department may petition the county legislative authority of the county or the lead county for a board to request that the board be dissolved for repeated statutory violations or demonstrated inability to perform the functions for which the board was created.))

Sec. 8   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)(a) The applicant for any proposed water right transfer may apply to a board for a ((record of)) decision on a transfer and the board may render a decision on the application 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)). However: A board may approve a transfer that includes a change in the point of diversion or withdrawal of water under a water right only if the geographic area within the jurisdiction of the board includes both the current and proposed point of diversion or withdrawal; and a board may approve a transfer that includes a change in the place of use of the water under a water right only if the geographic area within the jurisdiction of the board includes both the current and proposed place of use.
     (b) 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)). 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.)) 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.)) In such a case, however, if a majority of the board determines that the application could be approved under the applicable laws of the state if certain conditions were added to the approval, the board may approve the application with those conditions.
     (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. 9   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. 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)) After rendering its decision on an application for a transfer, the board must promptly forward to the department for recordkeeping its decision, its report of examination that summarizes the factual findings on which the board relied in reaching its decision, and a copy of the files and records upon which the board's decision is based. Upon the conclusion of its business involving a water right transfer application, a board must promptly send the original copies of all remaining records relating to that application to the department for recordkeeping. A board may keep a copy of the original documents.
     (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).))

Sec. 10   RCW 90.80.090 and 2001 c 237 s 13 are each amended to read as follows:
     (1) The decision of ((the director to approve or deny an action to create a board, or to approve, deny, or modify)) a board on an application for 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)) is subject to review in superior court. The decision is appealable in the manner provided by chapter 34.05 RCW for appealing a decision of a state agency to superior court except that the petition for review must be filed, except as provided in subsection (2) of this section, in the superior court of the county in which the point of diversion or withdrawal of the right is located before the transfer.
     (2) For decisions of a board on a transfer of a water right that is the subject of a general adjudication of water rights that is being litigated actively under chapter 90.03 or 90.44 RCW, the petition must be filed with the superior court conducting the adjudication, to be consolidated by the court with the general adjudication. A party to the adjudication shall be a party to the appeal under this chapter only if the party files or is served with a petition for review to the extent required by chapter 34.05 RCW.

Sec. 11   RCW 90.80.100 and 2001 c 237 s 14 are each amended to read as follows:
     Neither the county or counties, the department, a conservancy board, or its employees, nor individual conservancy board commissioners shall be subject to any cause of action or claim for damages arising out of ((records of)) decisions on transfers made by a board under this chapter.

Sec. 12   RCW 90.80.120 and 2004 c 10 s 5 are each amended to read as follows:
     (1) A commissioner of a water conservancy board shall not engage in any act which is in conflict with the proper discharge of the official duties of a commissioner. A commissioner is deemed to have a conflict of interest if he or she:
     (a) Has an ownership interest in a water right subject to an application for approval before the board;
     (b) Receives or has a financial interest in an application submitted to the board or a project, development, or venture related to the approval of the application; or
     (c) Solicits, accepts, or seeks anything of economic value as a gift, gratuity, or favor from any person, firm, or corporation involved in the application.
     (2) In the event of a recusal of an appointed commissioner, an alternate may serve as a commissioner on a board and may act upon the official board business for which the conflict of interest exists.
     (3) ((The department shall return a record of decision to a conservancy board without action where the department determines that any member of a board has violated subsection (1) of this section.
     (a))) If a person seeking to rely on this section to disqualify a commissioner knows of the basis for disqualification before the time the board issues a ((record of)) decision, the person must request the board to have the commissioner recuse himself or herself from further involvement in processing the application, or be barred from later raising that challenge.
     (((b) If the commissioner does not recuse himself or herself or if the person becomes aware of the basis for disqualification after the board issues a record of decision but within the time period under RCW 90.80.080(3) for filing objections with the department, the person must raise the challenge with the department. If the department determines that the commissioner should be disqualified under this section, the director must remand the record of decision to the board for reconsideration and resubmission of a record of decision. The disqualified commissioner shall not participate in any further board review of the application. The department's decision on whether to remand a record of decision under this section may only be appealed at the same time and in the same manner as an appeal of the department's decision to affirm, modify, or reverse the record of decision after remand.
     (c))) If ((the)) a person becomes aware of the basis for disqualification after the ((time for filing objections with the department)) board renders its decision, the person may raise the challenge in an appeal of the ((department's final)) board's decision under RCW 90.80.090.

Sec. 13   RCW 90.80.135 and 2001 c 237 s 18 are each amended to read as follows:
     (1) A board is subject to the requirements of chapter 42.17 RCW. Each board must establish and maintain records of its proceedings and determinations. While in the possession of the board, all such records must be made available for inspection and copies must be provided to the public on request under the provisions of chapter 42.17 RCW.
     (2) ((Upon the conclusion of its business involving a water right transfer application, a board must promptly send the original copies of all records relating to that application to the department for recordkeeping. A board may keep a copy of the original documents.)) After the board's records regarding an application are transferred to the department under RCW 90.80.080, the responsibility for making the records available under chapter 42.17 RCW is transferred to the department.

Sec. 14   RCW 90.80.150 and 2001 c 237 s 21 are each amended to read as follows:
     The department shall report biennially by December 31st of each even-numbered year to the appropriate committees of the legislature on the boards formed ((or sought to be formed)) under the authority of this chapter, the transfer applications reviewed and other activities conducted by the boards, and the funding of such boards. Conservancy boards must provide information regarding their activities to the department to assist the department in preparing the report.

NEW SECTION.  Sec. 15   The provisions of this act regarding the decisions of and the review of the decisions of water conservancy boards on applications for water right transfers apply to decisions that are rendered after the effective date of this section.

NEW SECTION.  Sec. 16   RCW 90.80.901 (Reports to the legislature) and 2001 c 237 s 32 are each repealed.

NEW SECTION.  Sec. 17   This act is necessary for the immediate preservation of the public peace, health, or safety, or support of the state government and its existing public institutions, and takes effect immediately.