Original Notice.

     Preproposal statement of inquiry was filed as WSR 04-23-042.

     Title of Rule and Other Identifying Information: Amendment to chapter 173-503 WAC, Lower and Upper Skagit water resources inventory area (WRIA 3 and 4).

     Hearing Location(s): Darrington, on March 8, 2005, at 7:00 p.m., at the Darrington Community Center, 570 Sauk Avenue; at Bellingham, on March 9, 2005, at 1:00 p.m., at the Bellingham Public Library, Fairhaven Branch, Northwest Room, 1117 12th Street; and at Mt. Vernon, on March 9, 2005, at 7:00 p.m., at the Skagit Station Community Room, 105 East Kincaid Street, Suite 101.

     Date of Intended Adoption: April 30, 2005.

     Submit Written Comments to: Geoff Tallent, Department of Ecology, Northwest Regional Office, 3190 160th Avenue S.E., Bellevue, WA 98008, e-mail gtal461@ecy.wa.gov, fax (425) 649-7098, by March 18, 2005.

     Assistance for Persons with Disabilities: Contact Christine Corrigan by February 23, 2005, TTY (800) 833-6388 or (360) 407-6607.

     Purpose of the Proposal and Its Anticipated Effects, Including Any Changes in Existing Rules: The proposed amendments would reserve a limited amount of ground water for future domestic uses and the human health requirements of businesses. In addition, a reservation of water will be provided for future livestock watering. The amendments also establish closures for certain tributaries, and clarify how future water right permits may be obtained. The stream flows set in the current rule would not be altered, nor would the current maximum water allocation limits for the Skagit River basin.

     Reasons Supporting Proposal: Minimum instream flows established in the current chapter 173-503 WAC create a water right with a priority date as of the date the rule was established (April 14, 2001). All water rights, including permit-exempt groundwater withdrawals under RCW 90.54.050, are junior in priority date to the instream flow and may be subject to interruption when instream flows are not met. A rule amendment is necessary to create a new administrative framework to allow new domestic water uses and limited stock watering, including those uses exempt from water right permitting, be used without interruption from the senior instream flow right. This is done in support of the goal of RCW 90.54.020(5) which requires that adequate and safe supplies of water be preserved and protected in potable conditions to satisfy human needs.

     Statutory Authority for Adoption: Chapter 90.54 RCW, Water Resources Act of 1971; chapter 90.22 RCW, Minimum water flows and levels; chapter 173-500 WAC, Water resources management program; chapter 173-503 WAC, Instream resources protection program -- Lower and Upper Skagit water resources inventory area (WRIA 3 and 4).

     Statute Being Implemented: Chapters 90.22, 90.44, and 90.54 RCW.

     Rule is not necessitated by federal law, federal or state court decision.

     Name of Proponent: Department of Ecology, governmental.

     Name of Agency Personnel Responsible for Drafting: Geoff Tallent, Northwest Regional Office, Department of Ecology, (425) 649-4318; Implementation and Enforcement: Dan Swenson, Northwest Regional Office, Department of Ecology, (425) 649-7270.

     A small business economic impact statement has been prepared under chapter 19.85 RCW.

     BACKGROUND: The Washington State Department of Ecology's (ecology) water resources program is proposing to amend an instream resources protection and water resources program for the Skagit River basin to:

•	Retain perennial rivers, streams, and lakes in the Lower and Upper Skagit River basin with instream flows and levels necessary to protect and preserve instream values, and instream flows. Closures are proposed for specific water sources.
•	Provide for an adequate and safe supply of potable water to satisfy the domestic needs of households and small businesses and for stockwatering via the establishment of two reservations of water.
•	Clarify ecology's policies to guide the protection, utilization and management of Skagit River basin surface water and interrelated groundwater resources for use in future water allocation decisions.

     The Skagit River basin is designated as Water Resource Inventory Areas 3 and 4 (WRIA 3 & 4) in chapter 173-500 WAC. The existing rule is chapter 173-503 WAC. Ecology is developing and issuing this small business economic impact statement (SBEIS) as part of its rule adoption process. It is not legally resolved if an SBEIS is required for this rule making pursuant to chapter 19.85 RCW. However, ecology elected to perform an SBEIS and will use the information developed in the SBEIS to ensure that the proposed rule is consistent with legislative policy. Moreover, the existing rule has been challenged in Skagit County v. Washington State Department of Ecology based, at least in part, on the fact that an SBEIS was not completed during the original rule making. Ecology recognizes that conducting an SBEIS is a faster and more cost-effective approach as part of this rule-making amendment than continuing litigation over whether an SBEIS was or is necessary.

     DESCRIPTION AND PURPOSE OF THE SBEIS: The objective of this SBEIS is to identify and evaluate the various requirements and costs that the proposed rule might impose on business. In particular, the SBEIS examines whether the costs on businesses that might be imposed by the proposed rule impose a disproportionate impact on the state's small businesses. Through this examination, ecology also examines the expected impacts from the existing instream flows that remain in this rule. The specific purpose/required contents of the SBEIS is in RCW 19.85.040.

1. DISCUSSION OF COMPLIANCE COSTS FOR WRIA 3&4 BUSINESSES

     INTRODUCTION: Existing chapter 173-503 WAC, Instream resources protection program -- Lower and Upper Skagit water resources inventory area (WRIA 3 and 4) is the subject of this rule amendment. The evaluation of the impacts of the proposed rule is based on analysis and comparison of water right management before and after the effective date of the rule. The current water right administration is based on an extensive and complex legal and administrative framework and existing chapter 173-503 WAC. The framework includes instream flows, administrative procedures for applications for both new water rights and changes to exiting water rights, and the use of water by permit-exempt wells (RCW 90.44.050). Implementation of chapters 90.22 and 90.54 RCW are also part of this legal baseline. In proposing reservations of water, and closing certain tributary basins, the rule amendment creates new conditions that must be considered when making future water right decisions. A brief description of compliance requirements is provided below. A detailed description of water management under the existing and proposed rules can be found in Appendix B.

     WATER RIGHT ADMINISTRATION UNDER THE RULE: The proposed future water right management program will establish tributary subbasins and reserve specific quantities of groundwater in each subbasin, for the year-round future domestic uses of households and businesses. The rule also closes certain tributary basins to future appropriations, sets a reservation for future stockwatering and establishes eligibility conditions for use of the reservations. Expected impacts to water management include the following:

     Surface Water: For basins not subject to closures, the decision process will be the same as prior to the rule amendment. Ecology will condition a water right in such a way that flows are protected and a permit would be approved granting an interruptible right. Under the proposed rule, all new surface water rights, that do not use the reservations as their source, will continue to be "junior" to the instream flow levels in the rule and will be required to stop withdrawing water when minimum flows are not met in the surface water source. In general, this is not likely to represent a significant change for future proposed surface water withdrawals.

     Applications for new consumptive surface water rights from closed sources would be denied, unless the applicant proposes, and ecology accepts, mitigation of the water use. If the basin is closed for an entire year, then mitigation is possible but generally not practical. The use may also be approved if it is "clear that overriding considerations of the public interest will be served," RCW 90.54.020 (3)(a).¹ For areas currently administratively closed under ecology's surface water source limitations (SWSL) list, this would represent no change from the current situation. For areas that are not currently closed, this may represent a change because applications for new surface water rights would be denied unless impacts on instream flows can be offset.

     Groundwater: The decision process is the same as prior to the rule. Groundwater applications in hydraulic continuity with the Skagit River would still be subject to the instream flows unless they are eligible for the domestic reservation. Applications for new consumptive ground water rights from closed sources would be denied, unless the applicant proposes, and ecology accepts, mitigation of the water use or the applicant shows that the withdrawals will not affect surface water. If the basin is closed for an entire year mitigation is possible but not generally practical. A use may be approved if it is "clear that overriding considerations of the public interest will be served," RCW 90.54.020 (3)(a). For areas currently administratively closed under ecology's SWSL list, this would represent no change from the current situation. However, for areas that are not currently closed, this may represent a change because applications for new ground water rights would be likely denied by ecology unless impacts could be completely mitigated.

     In the amended rule, based on the hydrogeology of the basin, and the location and depth where groundwater withdrawals generally occur, future groundwater withdrawals have a high likelihood of capturing water that would result in impacts to surface water flows and levels in the Skagit River basin. The rule does not create the need for, and does not change the standards for, the analysis regarding whether these impacts cause impairment. This may result on an impact to future users of new wells in the basin. For example, in basins not subject to closures, businesses that initiate new agricultural, commercial, or manufacturing projects relying on wells for process water will be required to suspend water use during periods of low flows, develop storage mechanisms or to develop mitigation strategies acceptable to ecology that allow them to mitigate their impacts. This is the case under the current rule and does not represent an impact of the rule amendment. Businesses in closed basins will be required to mitigate their impacts.

     Permit Exempt Groundwater: A reservation of ground water for future domestic uses provides a management framework for these types of withdrawals. One significant factor influencing the impacts of the rule is whether the local governments implement an administrative action or ordinance to effectuate the reservation. If an administrative action or an ordinance is not put in place, the reservation will not be available to new uses until such time as these actions are taken. The analysis below assumes the local governments act to make the reservations available within their jurisdictions. Appendix C discusses the case where action is not taken.

     For businesses interested in using an exempt well, there would be several alternatives. Applicants could solicit a hydrogeologist to certify that a well would not cause impairment of a water right in areas where hydraulic continuity between the surface water and groundwater is not likely. This would allow an applicant to develop a well as though the rule was not in place, but at the additional cost of the analysis. For some wells in basins that drain groundwater to saltwater bodies, this cost would likely be very small and is currently the case. For wells that would be drilled in areas where they are likely to be in hydraulic continuity with closed basins or streams with instream flows, and impairment would result, options include obtaining water from the reservation or accepting an interruptible water right with corresponding curtailment or with storage.

     The reservation requires that an applicant be located more than five hundred feet from an existing water system. If an applicant is closer to the water system than this, they will be required to connect to the system when the connection can be made in a timely and reasonable manner. This may result in increased costs, including connection charges, construction charges and monthly water rates.

     Changes or Transfers of Water Rights: Existing water rights will continue to be changed or transferred as permitted by chapters 90.03 and 90.44 RCW and the process is the same as before the proposed rule amendment. Changes for surface water rights are still evaluated considering the instream flow right. Requirements related to changes in the point of diversion from a surface point to a ground water point, if it is from the same water source, is the same in the existing rule and the proposed rule amendment. Transfers that are restricted because they are not in the same source will also be treated the same after the rule amendment as under the existing rule. Transfers of water rights may become part of mitigation strategies used by businesses to offset their new water needs.

     Reservations of Water: The reservations of water, use of water under the reservations, and associated conditions for that use, are all part of the rule proposal. In large measure, the domestic reservation will allow residential and some business development to continue as before with the benefit of having a continuous, reliable source of water during low flow periods, except for a few restrictions. These restrictions include a limit on outside lawn watering, a requirement to connect to public water systems under certain circumstances, and the finite quantity of the reservation. Domestic water use must also meet efficiency standards and outdoor uses will be limited.

     Closures of Water Sources in WRIA 3 and 4: The rule would include the current limitations and administrative closures for surface water sources, and add to them for applicants who cannot access the reservations. Ecology anticipates that applications for consumptive uses from closed sources will be denied unless the applicant can acceptably mitigate for the impacts (the same as prior to adoption of the rule) or take advantage of the reservation.

     IMPACTS TO BUSINESSES IN WRIA 3 AND 4: Several potentially significant impacts to businesses in WRIA 3 and 4 are likely and are described below:

     1. Closures in subbasins: Some subbasins that are currently open to new interruptible withdrawals will be closed. For other than domestic uses (human needs of a household or business) and stockwatering authorized under the reservations, this requirement will generally eliminate new water withdrawals. New withdrawals may still be available when nonconsumptive, fully mitigated, or from groundwater shown to not affect surface water. In these areas, water uses not eligible for the reservation will be required to obtain water from an existing water purveyor, through leases or transfers or through other methods. Domestic uses will be allowed in these closed areas through the proposed reservation but only for human needs.² For those businesses that require water for irrigation or for agricultural/industrial processes, this might be an impact on future withdrawals since the closure will result in continual mitigation, not just during low flow periods as was the case under the previous rule. This could require water leasing or transfers of existing water rights or could lead to a change in the proposed location of a commercial industry or agricultural use. The magnitude of the impact will be determined by the proposed location and use of future water permit applicants. For those businesses that need water for toilets, washrooms, etc., the establishment of the reservation should be a benefit (see below). The East Fork Nookachamps basin will be opened to a limited amount of new water use. This may be a net benefit to some water users.

     2. Creation of the reservations: Currently any groundwater withdrawal, including those via exempt wells in continuity with the Skagit River or its tributaries, is legally required to curtail use during low flow periods. Under the reservation, the future domestic needs of some businesses could be met even during low flow periods. However, only domestic uses will be allowed year around. For businesses that would typically use a relatively small amount of process water (up to 5,000 GPD), an interruptible right could still be available in an open basin, and domestic needs of the business could be met from the reservation. This process water use would not be allowed in a closed basin. For businesses developing land for residential construction or needing domestic water only, the ability to use water during low flows should be a net benefit from this rule making.

     The creation of the stockwatering reservation will likely provide year-around access to water for new stockwatering uses, except for feedlots and other activities which are not related to normal grazing uses. Currently, water accessed via permitted or permit-exempt wells are legally required to curtail use during low flows. The change in the rule should be a net benefit to stock-related businesses.

     3. Connection requirements: Applicants within a public water system service area who desire water from the reservation or an interruptible water right will be required to connect to a public water system if connection is timely and reasonable. In general, this will impact those desiring to use water for domestic needs. However, current users that would use a permit exempt well are legally required to curtail use during low flows. It is unlikely most businesses would consider the current water supply condition to be a sufficient water source and so they would likely have been required to have back-up storage or mitigate in some other way as a consequence of instream flows. As such, this connection requirement is unlikely to impact many businesses. Moreover, the Skagit County critical areas ordinance requires connections under specific conditions. An exception might be a business that doesn't require water during low flow periods, but this is likely to be a small subset of future businesses in the watershed.

     4. Impacts to businesses depending on instream flows: As mentioned above, a reservation is to be created from which those seeking a domestic water source and meeting the requirements will be able to obtain water in the future. Accessing the reservation will allow entities to use water for domestic purposes during low flow periods. This will slightly reduce the amount of water in the river during these low flow periods and could potentially indirectly impact instream benefits such as ecosystem services, recreation, etc. Offsetting this will be reduced future withdrawals in closed basins. For businesses that provide guide services such as rafting, fishing and bird watching, or those dependent on dilution for waste removal, there could be a very minor impact. Discussions with firms that use the river indicate little, if any, impact from the proposed flow reduction from the reservation.

     COST TO FIRMS AND REQUIRED PROFESSIONAL SERVICES: Some costs are required of firms required to comply. The following cost and professional services analysis (as required in chapter 19.85 RCW) is provided:

     Reporting and Recordkeeping: No additional reporting or record keeping required.

     Additional Professional Services: Closures in basins may lead some to transfer water rights or lease from others. This will likely require increased use of professionals including hydrogeologists, biologists, engineers, and attorneys. The exact requirements would depend on the basin, change, etc. Other mitigation options might involve construction of storage tanks and associated piping requiring engineering design services. Some may save the costs associated with these services if access to the reservation allows them to avoid these requirements. Anyone required to connect to a public water system would likely require additional engineering design and surveying.

     Costs of Equipment, Supplies, Labor, and Increased Administrative Costs: Increased equipment associated with pipeline and tank construction may be required for mitigation options but is included in the descriptions below. Some may save these same costs if they can make use of the uninterruptible reservations.

     Other Compliance Requirements: Basin closures will impact those that would have applied for an interruptible water right. In general, it is difficult to determine the cost impact of this requirement since it depends on the number of surface water withdrawals or wells proposed to be installed in the closed basins, required quantity of water, and options and prices for purchase or leases of existing rights. For businesses that require water for location specific activities, this might change the highest-valued use of the land. Water users in these locations are already required to curtail use during low flow periods making irrigation difficult without transfers of uninterruptible rights or the expense of supplemental storage. Evaluation of past permitted uses by businesses indicates that the predominant uses are for multiple domestic systems and irrigation.³ In these areas, domestic uses can still be served by individual wells through the reservation. Future irrigation uses would likely not be impacted too much under the proposed rule amendments since permits under the existing rule would already be interruptible during what is likely the most important irrigation periods. The rule will simply preclude use during the other periods when irrigation water is not as valuable.

     Creation of the reservation should be a net benefit for most businesses that need water for human domestic needs. Water that is not available during low flow periods is damaging to any business that needs it for its own use or are looking to develop residential properties. In order to have water available during low flow periods under the existing rule, water would have to be obtained though leases, transfers or on-site storage. On-site storage for a low flow period can cost approximately $25,000-$30,000⁴ and the proposed rule amendments will allow this cost to be avoided for those that utilize the domestic use reservation. The stockwatering reservation could yield the same avoided cost.

     Connection requirements could be a cost to some businesses. However, as mentioned previously, most businesses that require reliable water supply for domestic uses are likely to already connect, have a well and on-site storage or obtain water in other ways. The cost of connection to an existing system can range from $8,000 to $35,000 depending on the complexity. However, some of that cost (all, in some cases) will likely be returned via latecomer agreements. A well with storage can easily cost $40,000 to $50,000 depending on the depth of the well, geology and tank type making connecting to the system the less expensive alternative.

     For those that do not require water for domestic needs during low flow periods, an interruptible right in open subbasins remains an option under both the current and proposed rule. In closed subbasins, where interruptible rights would not be available under the proposed rule, a reservation may provide for domestic needs. For those requiring more than domestic uses in closed basins, purchase or lease of existing water, construction of a deep well or another option would be required.

2. REVENUE IMPACTS AND DISTRIBUTION OF COSTS

     INTRODUCTION: RCW 19.85.040 requires that additional analysis of impacts be provided. Specifically, the analysis should include whether compliance with this rule will cause businesses to lose sales or revenue and whether the proposed rule will have a disproportionate impact on small business. It is the purpose of this section to evaluate the proposed rules to consider these requirements.

     REVENUE IMPACTS: As noted previously, some firms could experience an increased cost associated with this rule. For those businesses located in subbasins closed by the rule, the cost of obtaining future water in another way may be an impact. Those with existing water rights will not be impacted by these closures. Those required to connect to water systems to obtain new or additional water could also experience an increased cost although this is likely to be a limited number of entities since connection may already be the preferred alternative. To the extent that increased costs yield increased prices for firms, gross revenues could be reduced. Offsetting this is the net benefit to firms that will now be able to get water during periods of low flows via the reservation and avoid expensive on-site storage or other mitigation alternatives. This will likely lower costs to some potential water users and to that extent, may increase revenues.

     DISTRIBUTION OF COMPLIANCE COSTS: The distribution of compliance costs can be analyzed by evaluating previous water right permits and existing business-owned developable parcels. In the past, permitted business water uses have been predominately small firms as defined by chapter 19.85 RCW.⁵ However, all permits issued previously except one were issued prior to the existing instream flow rule. Permitted uses must now restrict use or mitigate during low flow periods making them relatively less desirable than before the existing rule was put in place. Therefore, the historical rate of permits may overstate the expected number of future permits. However, it is reasonable to anticipate that a majority of future applications will also be from small firms.⁶ The reservation will yield a net benefit to any business-owned parcels in the watershed since on-site storage will no longer have to be provided. The exact amount will depend on the size of parcels, ownership, firm size and zoning and yields the distribution of costs in Table 2.1.

     CONCLUSIONS: Some firms located in closed subbasins may experience a cost impact from the proposed rule and this will likely be disproportionately borne by small firms given the past history of water rights issued predominately to small firms. However, all firms of all sizes that elect to use the reservation are likely to experience a negative cost (net benefit) from the rule and it appears the benefit will disproportionately benefit small businesses.

3. ACTIONS TAKEN TO REDUCE THE IMPACT ON SMALL BUSINESS

     In its pending Superior Court challenge to the current rule, Skagit County alleges that ecology should have conducted a small business economic impact statement when proposing instream flows for the Skagit River. Ecology continues to dispute this assertion. Regardless, in an exercise of caution, and in an attempt to minimize the issues that may arise if this rule making is challenged, ecology, in evaluating the instream flow impacts as part of this SBEIS examination finds reason to believe that the impacts on small businesses might have been disproportionate in the current rule. The exact impact is difficult to determine, but based on preliminary analyses in other basins and what is known about the existing rule, it appears likely that, in hindsight, the existing rule had disproportionate impacts on small businesses that should be addressed in this rule making. These potential impacts are mitigated to some extent by the proposed amendments. In general, the disproportionate benefits for exempt well development found in Table 2.1 would simply be considered the costs of the existing rule to exempt well development since the rule created the need for storage or other mitigation alternatives evaluated previously. The estimated impacts of instream flow requirements on permit exempt uses in WRIA 3 and 4 would be as provided in Table 3.1.

     As can be seen in Table 2.1, it appears likely that most businesses will benefit from the proposed rule and that small businesses will benefit disproportionately. There are no additional recordkeeping or reporting requirements or inspections and compliance timetables and fine schedules are not altered by the proposed rule amendment.

4. HOW WAS SMALL BUSINESS INVOLVED IN THE DEVELOPMENT OF THIS RULE?

     The proposed rule has been developed relatively quickly under a court order and is based on conversations during the past two years with governmental and tribal stakeholders. After the filing of the CR-102, official public hearings will be held to consider the rule and allowing small businesses to provide additional input.

5. LIST OF INDUSTRIES REQUIRED TO COMPLY

     No industries are required to comply with the proposed rule amendment unless they seek to obtain new water rights in the covered area. However, requirements affecting water use are likely to translate into changes in property values based on impacts to the highest valued uses in the watershed. As such, existing business owners of undeveloped property are likely to be the industries that will be required to "comply" either directly in terms of attempting to acquire water or indirectly in terms of changes in asset values. Therefore, the following list is provided indicating standard industrial codes (SIC) codes for existing developable properties in the Skagit watershed.¹²

¹ This is also true in basins not subject to closure.

² Currently, permit-exempt well users can use up to 5,000 GPD during all periods except low flow periods assuming they meet the other requirements of chapter 90.44 RCW.

³ Since 1985, ecology annually issues approximately two permits to business entities with the majority of those issued prior to 1992. All but one permit was issued prior to the existing rule.

⁴ Cost assumes two-15,000 gallon underground potable-water rated tanks.

⁵ Since 1985, approximately thirty-seven permits have been issued to businesses or private owners for irrigation. Of those permits only two have been for large firms.

⁶ As noted previously, no cost is provided due to the situation specific nature of permitted water uses.

⁷ Costs assume full development of all business-owned developable parcels.

⁸ The total number of firms represents all businesses located in the county listed as owner of the parcel and where employment security data could be located.

⁹ Cost comparisons use the largest 10% of firms required to comply.

¹⁰ The total number of firms represents all businesses located in the county listed as owner of the parcel and where employment security data could be located.

¹¹ Cost comparisons use the largest 10% of firms required to comply.

¹² The table was constructed based on data provided by the Skagit County assessor and by the Washington State Employment Security Department.

     A copy of the statement may be obtained by contacting Geoff Tallent, Department of Ecology, Northwest Regional Office, 3190 160th Avenue S.E., Bellevue, WA 98008, phone (425) 649-4318, fax (425) 649-7098, e-mail gtal461@ecy.wa.gov.

     A cost-benefit analysis is required under RCW 34.05.328. A preliminary cost-benefit analysis may be obtained by contacting Geoff Tallent, Department of Ecology, Northwest Regional Office, 3190 160th Avenue S.E., Bellevue, WA 98008, phone (425) 649-4318, fax (425) 649-7098, e-mail gtal461@ecy.wa.gov.

January 27, 2005

Polly Zehm

Deputy Director

OTS-7748.3

AMENDATORY SECTION(Amending Order 99-05, filed 3/14/01, effective 4/14/01)

WAC 173-503-020   Purpose.   The purpose of this chapter is to retain perennial rivers, streams, and lakes in the Lower and Upper Skagit water resources inventory area ((and)) including the Cultus Mt. Tributaries with instream flows and levels necessary to provide for the protection and preservation of wildlife, fish, scenic, aesthetic, and other environmental values, and navigational values, as well as recreation and water quality.

     Chapter 90.54 RCW (Water Resources Act of 1971) requires that utilization and management of waters of the state be guided by a number of fundamentals, including:

     Uses of water for domestic, stock watering, industrial, commercial, agricultural, irrigation, hydroelectric power production, mining, fish and wildlife maintenance and enhancement, recreational, and thermal power production purposes, and preservation of environmental and aesthetic values, and all other uses compatible with the enjoyment of the public waters of the state, are declared to be beneficial. (RCW 90.54.020(1))

     The quality of the natural environment shall be protected and, where possible, enhanced, as follows:

     Perennial rivers and streams of the state shall be retained with base flows necessary to provide for the protection and preservation of wildlife, fish, scenic, aesthetic and other environmental values, and navigational values. Lakes and ponds shall be retained substantially in their natural condition. Withdrawals of water which would conflict therewith shall be authorized only in those situations where it is clear that overriding considerations of the public interest will be served. (RCW 90.54.020 (3)(a))

     This chapter creates both a reservation of adequate and safe supplies of potable water to satisfy human domestic needs and a reservation for stock watering needs. It establishes closures for tributaries, and sets forth conditions for future water right permitting.

     Waters of the state shall be of high quality. Regardless of the quality of the waters of the state, all wastes and other materials and substances proposed for entry into said waters shall be provided with all known, available, and reasonable methods of treatment prior to entry. Notwithstanding that standards of quality established for the waters of the state would not be violated, wastes and other materials and substances shall not be allowed to enter such waters which will reduce the existing quality thereof, except in those situations where it is clear that overriding considerations of the public interest will be served. (RCW 90.54.020 (3)(b))

     In administering and enforcing this regulation, the department's actions shall be consistent with the provisions of chapter 90.54 RCW. In addition, all agencies of state and local government, including counties and municipal and public corporations, shall, whenever possible, carry out powers vested in them in manners which are consistent with the provisions of this chapter (RCW 90.54.090).

[Statutory Authority: Chapters 90.54 and 90.22 RCW, and chapter 173-500 WAC. 01-07-027 (Order 99-05), § 173-503-020, filed 3/14/01, effective 4/14/01.]

     "Allocation" means the designating of specific amounts of water for specific beneficial uses.

     "Appropriation" means the process of legally acquiring the right to use specific amounts of water for beneficial uses, as consistent with the ground and surface water codes and other applicable water resource statutes. This term refers to both surface and ground water right permits and to ground water withdrawals otherwise exempted from permit requirements under RCW 90.44.050.

     "Consumptive use" means a use of water that reduces the amount of water in the water source.

     "Department" means the Washington state department of ecology.

     "Domestic water use" means, for the purposes of administering WAC 173-503-073 and 173-503-074, potable water to satisfy the human domestic needs of a household or business, including water used for drinking, bathing, sanitary purposes, cooking, laundering, and other incidental uses. Outdoor watering shall be limited to an area not to exceed a total of 1/12th of an acre, or three thousand six hundred thirty square feet, for all outdoor uses for each individual domestic water use. Under all circumstances, total outdoor watering for multiple residences under the permit exemption (RCW 90.44.050) shall not exceed one-half acre.

     "Instream flow" means a stream flow level set in rule that is required to protect and preserve fish, wildlife, scenic, aesthetic and other environmental values, and navigational values. The term "instream flow" means a base flow under chapter 90.54 RCW, a minimum flow under chapter 90.03 or 90.22 RCW, or a minimum instream flow under chapter 90.82 RCW.

     "Mitigation plan" means a scientifically sound plan voluntarily submitted by a project proponent to offset the impacts of a proposed water use and approved by the department. A mitigation plan can be submitted to the department for a stream, basin, reach, or other area. A mitigation plan must show that the withdrawal with mitigation in place will not impair senior water rights, including instream flow rights, nor will the withdrawal or mitigation diminish water quality. The plan must provide mitigation for the duration of the water use as needed.

     "Nonconsumptive use" means a use of water that does not reduce the amount of water or the quality of water in the water source.

     "Permit-exempt withdrawals" or "permit exemption" means a ground water withdrawal exempted from permit requirements under RCW 90.44.050, but which is otherwise subject to the ground water code.

     "Public water system" means any system established under RCW 43.20.260 which provides water for human consumption through pipes or other constructed conveyances, excluding a system serving only one single-family residence and a system with four or fewer connections all of which serve residences on the same farm. This term includes group domestic systems.

     "Reservation" means an allocation of water for future beneficial uses. The priority date of a given allocation from the reservation is the same as the effective date of the reservation.

     "Stream management unit" means a stream segment, reach, or tributary used to describe the part of the relevant stream to which a particular instream flow level applies. Most of these units contain a control station.

     "Subbasin management unit" means a stream segment or basin, including ground water hydraulically connected to the surface water, defined for the purposes of administering the reservation established in WAC 173-503-073 and 173-503-074.

     "Timely and reasonable manner" means potable water service can be provided by a purveyor within one hundred twenty days of a purveyor's written approval of the request for service, to a property located within the public water system and five hundred feet of the purveyor's water pipe line. The department may determine that water service is unreasonable if the applicant for service provides sufficient information to show that the cost of connection with an appropriate public water system would be more than twice the cost of an individual alternative source.

     "Withdrawal" means the physical movement of ground water from a public ground water body for beneficial use, or the diversion or use of surface water from a public surface water body for beneficial use.

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     (2) Exceptions to the closures and instream flow requirements are provided in WAC 173-503-060, 173-503-073, 173-503-074 and 173-503-075.

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     (6) Any authorization for new beneficial uses must require development on a timeline that shows reasonable progress and due diligence.

[Statutory Authority: Chapters 90.54 and 90.22 RCW, and chapter 173-500 WAC. 01-07-027 (Order 99-05), § 173-503-060, filed 3/14/01, effective 4/14/01.]

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     Based on this finding, the department hereby reserves specific quantities of ground water for each subbasin established in WAC 173-503-074, to provide adequate and safe supplies of water for year-round future domestic uses. This reservation of ground water is not subject to the instream flows established in WAC 173-503-040 or closures established in WAC 173-503-051. Use of the water under the reservation is available only if all the conditions set forth in this section are fully complied with.

     (2) Conditions for use of the reserved domestic water are as follows:

     (a) The ground water reservation shall be only for the purpose of domestic water uses, as defined in WAC 173-503-025. It is available to single or group domestic users exempt from the permitting process and to permitted public water systems, as outlined in WAC 173-503-060.

     (b) This reserve of ground water shall be allocated based on the subbasin management units established in WAC 173-503-074.

     (c) Domestic water use shall meet or exceed the local and state water use efficiency and conservation standards. Existing public water systems requesting water from the reservation for domestic use shall demonstrate, to the department's satisfaction, that conservation and efficiency measures have been successfully implemented in their existing system.

     (d) This reservation shall only be applicable in areas where all of the following conditions exist:

     (i) An ordinance or other administrative action is established by the appropriate city or county that provides that the same requirements as (a), (b), (c), (e), (f) and (g) of this subsection shall be conditions within a building permit or subdivision approval if the water adequacy finding for such permit or approval is based upon the reservation contained herein;

     (ii) It shall be the responsibility of an applicant for a building permit or subdivision approval seeking water under the reservation to comply with the conditions in (a), (b), (c), (e), (f) and (g) of this subsection and all other conditions of this chapter. Once this chapter is adopted, the department will promptly notify the appropriate county or counties, water well contractors and the public of the restriction on future permitted and permit-exempt water withdrawals, availability of water from the reservation and the specific requirements that an applicant obtaining a building permit or subdivision approval must comply with; and

     (iii) As part of an ordinance or other administrative action, the appropriate city or county acknowledges that withdrawals from the East Fork Nookachamps, Gilligan, Salmon/Stevens, Upper Skagit, Middle Skagit, and Lower Skagit subbasins identified in WAC 173-503-074, that are exempt from the requirements for a water right permit and that are not using water from this reservation, are interruptible and junior to the instream flows established in WAC 173-503-040, and furthermore acknowledges that an interruptible ground water withdrawal may not constitute evidence of an adequate water supply for year-round domestic water use for the purposes of obtaining a building permit or subdivision approval.

     (e) A new water withdrawal under this reservation is not allowed in those areas where a public water system has been established, and where the connection can be provided in a timely and reasonable manner, as defined in WAC 173-503-025.

     (f) Outdoor water use is limited to the watering of an outdoor area not to exceed a total of 1/12th of an acre for all outdoor uses under each individual domestic water use, as defined in WAC 173-503-025. Under all circumstances, total outdoor watering for multiple residences under the permit exemption (RCW 90.44.050) shall not exceed one-half acre.

     (g) The department reserves the right to require metering and reporting of water use for single domestic users, if more accurate water use data is needed for management of the reservation and water resources in the area of the reservation. Public water system providers will be required to meter, as consistent with the state department of health's requirements.

     (3) The reservation is a one-time, finite resource. Once the reservation is fully allocated, it is no longer available. New water sources may be available only under the provisions in WAC 173-503-060, 173-503-081, 173-503-100 and 173-503-110.

     The department shall notify the appropriate county, in writing, when it determines that fifty percent, seventy-five percent, and one hundred percent of the reservation for each subbasin management unit has been allocated. The department shall also issue a public notice annually in a newspaper of general circulation for the region that shows the amount of reserved water for each subbasin management unit that has been allocated, remains unallocated, and any subbasin management units that have been fully allocated and from which water is no longer available under this reservation.

     (4) If a water use is not in compliance with any condition of this reservation, the department may take action consistent with WAC 173-503-090.

     (5) If existing county and city land use decisions, including zoning changes and building permit and subdivision approvals, allow for uses inconsistent with this chapter or for increased densities that adversely affect small tributaries and other flow-sensitive areas, the department may limit or restrict the further use of the reservation. The department will promptly notify the appropriate county or counties, water well contractors and the public of any changes to use of the reservation.

     (6)(a) A record of all ground water withdrawals from the reservation shall be maintained by the department. The record will readily show both the allocated and unallocated quantities of ground water that are in reserved status.

     (b) The department may account for water use under the reservation based on the best available information contained in well logs, water availability certificates issued by the counties, water rights issued by the department, public water system approvals or other documents. When other sources of information are not readily available, the department may account for water use at a rate of three hundred fifty gallons per day (gpd) per residence or business. This figure may be adjusted down to one hundred seventy-five gpd if the residence or business is served by an on-site septic system. The department may revise its accounting based on actual measured water use if available, or other information.

     (c) If a water user under this reservation subsequently abandons the withdrawal and notifies the department of the abandonment, the actual amount of water used and debited from the reservation for the abandoned use may be credited back to the reservation.

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Table 1

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     (a) Use of water from the reservation shall not be available for feedlots and other activities which are not related to normal grazing land uses.

     (b) Appropriation or use of water from the reservation for stock watering shall be limited to the land base and carrying capacity of the grazing lands.

     (c) The department will maintain an estimate of the amount of water used from the reservation, and reserves the right to require reporting of water use to ensure compliance with the conditions of use for this reservation.

     (2) This section does not affect existing riparian stock water rights. The department encourages existing and future riparian stock water right holders to prevent livestock access to streams for the purpose of protecting water quality and stream habitat. Under these circumstances, no change application is required, as long as the amount of water diverted to nearby stock water tanks for consumption by livestock is consistent with the historic use of water by that stock consistent with WAC 173-503-075 (1)(b).

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     (3) To obtain compliance and enforce this chapter, the department may impose such sanctions as appropriate under authorities vested in it, including, but not limited to, issuing regulatory orders under RCW 43.27A.190; and imposing civil penalties under RCW 43.83B.336, 90.03.400, 90.03.410, 90.03.600, 90.44.120 and 90.44.130.

[Statutory Authority: Chapters 90.54 and 90.22 RCW, and chapter 173-500 WAC. 01-07-027 (Order 99-05), § 173-503-090, filed 3/14/01, effective 4/14/01.]

     Alternative sources of water of equal or better quality than the proposed source can be used to improve stream flows for fish, offset impacts of withdrawals on stream flows and provide sources of water for future out-of-stream uses.

[Statutory Authority: Chapters 90.54 and 90.22 RCW, and chapter 173-500 WAC. 01-07-027 (Order 99-05), § 173-503-100, filed 3/14/01, effective 4/14/01.]

     (2) The determination of how much water should be allocated between future out-of-stream uses and the restoration and enhancement of instream flows will be made at the time the water is acquired and deposited into the trust water rights program.

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     The following section of the Washington Administrative Code is repealed:

WAC 173-503-080

Policy statement for future permitting actions.

© Washington State Code Reviser's Office