Water Conservation is Triage Only
When a government experiences a water source emergency, rules covering water conservation by water users is triage. I readily concede triage is necessary. ‘Triage’ in the subject at hand is the management of a scare commodity among those who need it. Balancing community water needs to levels of available service in an emergency is important. Managing the allocation of water use at a time when users have reduced access does not however address the cause of the problem. A water conservation ordinance specifying various levels of water use by residents cannot fix the source of a water use emergency.
A municipal well operated by the city of Spearfish has been out of operation for over a month. Using cubic feet of water per second based on all city water use permits, the shut-down well is almost 18% of the city’s total water draw if the wells were all drawing at capacity at the same time. The shut-down well is one of the larger city wells. The breakdown of the well was initially diagnosed as a mechanical problem. At this time this Spearfish deep-water well and related infrastructure has not yet been examined by outside well experts. Media reports and city records do not speak to other related issues. The current diagnosis is described as a structural problem (this may mean the pump, the well structure itself or intakes). Other comments concerned the costs for the anticipated well repair. It is important for government to provide and budget for well maintenance and repair, but that is only a part of resource management. The record contains no discussion about a review of municipal water supply reliability under the current city water system.
Two common problems with potable water supply are 1.) securing the source of water and 2.) accessing the source of water. Contingency plans for well failure which include voluntary and mandatory water use restrictions are normal. Most systems have such user rules. Unfortunately, most water use contingency plans are limited to addressing how much water can be used after a problem has been discovered. Nevertheless when an unanticipated failure leads to a water shortage of a necessary resource more is called for. A government contingency plan which deals with the current effects of well failure, but which neglects provisions dealing with possible causes of the problem is an incomplete plan.
A water resource contingency plan should include provisions for short term replacement of water sources. A contingency plan should also describe in detail a process for securing long term alternative water sources – bureaucrats call this ‘supply augmentation’. Operational problems should also be considered in a written plan. There are lots of these: water main break, contamination, suspected tampering, storage failure and water system depressurization. Has the city analyzed the area observation wells for the Madison aquifer in which the well is drilled? Has the city considered any fluctuations or declines in groundwater levels? Does the city have a long-term efficiency target for its municipal well system?
Water use conservation is not a fix-all. If the city is incorrect about the mechanical issue, what next? In the case of an actual water crisis a water conservation program would only be effective for a brief time and would do nothing to address proper resource management and planning.
Brownfields
Attributed with some hesitancy to F Scott Fitzgerald is the following, “There were no second acts in American lives” Let us see if this applies to contaminated properties. Brownfields are properties for which the expansion, redevelopment, or reuse is complicated by the presence or potential presence of a contaminant. Left unchecked, brownfields are a blight. Think of brownfields as a past tense activity. Something was done by man to or on the property that created an environmental problem. Government programs exist for which funding may be available for a brownfield property rehab.
Liability for brownfield sites is found in the Comprehensive Environmental Response, Compensation and Liability Act of 1980 (CERCLA). Based on available “reported” data, South Dakota has 151 known and documented brownfields. The number is probably larger however as there are likely others undetected and unreported. To label a property a brownfield, an environmental site assessment (ESA) must be completed. Brownfield rehab may be done to government as well as private properties. For governments looking to evaluate a possible brownfield site, a targeted brownfield assessment (TBA) is an option. TBA services include site assessments, cleanup options and costs estimates, and community outreach.
Brownfields are not superfund sites. Brownfields differ in that a brownfield is contamination ‘to a lesser degree.’ Superfund sites might be a candidate for big time cleanup. Brownfields are smaller deals, smaller property sites, with not so much money available, and with not as much public exposure of a property’s contamination. Your local church or school might be examples of brownfields.
While the cost for fixing brownfields can be high, the health and safety hazards of brownfields are real. Brownfields may include physical health hazards, such as uncovered holes, unsafe structures, and sharp objects. These properties also pose a risk to communities because of potential human exposure to hazardous chemicals. A brownfield site whether reported or not usually lowers the value of the property itself and can lower values of nearby properties.
If a county or city wants to cleanup a brownfield to allow for its future use no easy solution exists. The EPA awards competitive grants to government entities and certain non-profit organizations for cleanup activities but does not come riding in on a white horse to completely fix the problem. Government grants allocate funds mostly for assessing and classifying brownfields. Private property owners do not have quite as many opportunities for financial support for remediation as do government or non-profit sites. With all legal programs the devil is in the details; brownfield development agreements between parties and the government are intricate contracts detailing the legal responsibilities of the parties. An agreement will detail specific remediation steps concerning the contaminated property, describe the intended reuse of the property and disclose and justify the reuse technology proving that the rehab will leave the property suitable for the future uses identified.
Development of brownfield sites requires serious investigative due diligence of the property and its history. Brownfield development when completed with proper due diligence, I call it rehab, can lead to successful reuse of the site.
As stated, the EPA provides some financial assistance to eligible applicants through competitive grant programs. Additionally, funding support is provided under state and tribal programs through a separate mechanism. Let us consider a non-industrial city for illustration purposes. We will use Aberdeen as our example. The EPA in 2020 gave the city of Aberdeen a Brownfields Assessment Grant. Aberdeen’s foray into the world of brownfields provides a good sampling of the broad spectrum of the subject. EPA grant funds were to be used by the city to inventory and prioritize sites as a part of its assessment. Grant funds were also to be used to develop six cleanup plans and conduct area-wide planning activities. The Aberdeen priority sites under the grant included: the former Washington School Building (a building about as old as George Washington himself in which I was required to attend classes in high school. I could have told the powers-that-be way back then all about the building’s issues), a petroleum release site, a former dry-cleaning site, the Northwestern Railroad site which was a creosote pit, and the former Shopko retail site.
Yes, there are Second Acts in America – at least for some contaminated properties. One of my clients made a fairly good living cleaning up such properties. There ain’t no reason to be caught between the past and the present. Make something of what you got now and go forward.
Natural Resource Issues in Modern Real Estate Deals
Download the Natural Resource Issues in Modern Real Estate Deals presentation.
Do I Really Need a Water Use Permit?
Yes, you probably do. Under South Dakota law, with the important exception of water rights in Indian Country and on certain federal lands, all water within the state is the property of the people of the state. The right to the use of water may be acquired by ‘appropriation’ as provided by law. A water appropriation is authorized by the state Water Management Board granting the legal right to secure a private, beneficial use of the state’s water resources. Approval by the Water Management Board authorizes the use of either ground water or surface water. A water right, often called a permit or a license, is then issued either as a new legal water right.
A permit to use water is required for all water uses in South Dakota save for certain limited domestic and agricultural uses of water. However, this limited use of water requires a permit if water use exceeds either 25,920 gallon per day or a peak pump rate of 25 gallons per minute. The following types of water use require a water right permit.
- Commercial uses such as tourist attractions, truck stops, restaurants, campgrounds, motels, or any other type of business.
- Industrial uses where water is to be used for processing, cooling, dewatering, etc.
- Institutional uses such as churches, prisons, etc.
- Irrigation use
- Municipal use (water distribution systems using 18 gallons per minute or less do not need to get a water right permit)
- Rural water system use (water distribution systems using 18 gallons per minute or less do not need to get a water right permit)
- Suburban housing development use (in excess of 18 gallons per minute)
- Recreation use
- Fish and wildlife propagation
By way of illustration, if one is interested in constructing an irrigation project a water right permit is needed. And, importantly, this water permitting system and rules remain in place even in a drought year.
The fine points of the application process and procedure will not be discussed in this piece. But let the water permit applicant beware – the devil is in the details. Upon approval of an application a water right permit is issued by the Chief Engineer on behalf of the Water Management Board. In some instances the Water Management Board directly controls the decision. The permit includes information supplied on the application as well as any qualifications, meaning operating conditions, attached or required by the Chief Engineer or Water Management Board. A permit is not forever if it the water project is not started. The law and sometimes the state place time periods during which a water use project must be completed and the water placed to use.
An application could be filed to amend an existing permit or license. An existing permit or license may be amended for a change in use, a change in point of diversion or for other changes if the change does not: (1) unlawfully impair other party’s existing rights; (2) continues to be for a beneficial use as determined by the state definition of that term; and (3) continues to be in the public interest again as determined by the state definition of that term.
A water permit could be cancelled for the following reasons: The project is not constructed within the authorized construction period; a failure to place water to timely use may result in either forfeiture or abandonment. Water must be placed in use at least once every 3 years. If not, all or any part of the water that is not used is subject to cancellation. Indifference to water rights and water law is a fool’s game but some have played it.
More action needed to protect mussels
From South Dakota News Watch 3/23/2022
Since Faltys’ study was published, the state’s only specific action to protect freshwater mussels has been a 2020 state administrative rule that bans commercial and noncommercial harvesting of freshwater mussels. State regulations allow people to pick up empty mussel shells, but not those of endangered or threatened species.
Chelsey Pasbrig, a GFP aquatic biologist, said in an email that her agency is concerned about the decline of freshwater mussel populations in South Dakota, and it is aware they are among the most endangered animals in North America.
“GFP has begun collaborations with other states to explore the option for augmenting populations with propagated individuals; however, this is in its infancy” she wrote. “Kaylee Faltys’ study provided us a snapshot of the status of freshwater mussels in South Dakota; however, future research and monitoring is likely needed.”
Pasbrig added that no current mussel monitoring efforts are underway in South Dakota.
“Unfortunately, the professor at SDSU who could assist with this expertise is since retired, therefore future monitoring and research efforts have not continued at this time. There are endless questions that exist regarding the status of freshwater mussels in S.D. and across the country; however, limited resources both financially and staffing exist,” she wrote.
Since at least 1995, the GFP also has sponsored mussel research by a retired University of Sioux Falls faculty member and a retired departmental wildlife biologist, among others.
Pasbrig says the department currently addresses water quality issues that may be contributing to decreased mussel abundance and diversity through the Conservation Reserve Program, the James River and Big Sioux River Conservation Reserve Enhancement programs, the EPA 319 non-point source watershed projects and riparian buffer programs. The state agency also recently expanded its private lands habitat program and aquatic habitat program, which partner with landowners and other conservation entities to improve habitat, Pasbrig says.
GFP did not respond to follow-up questions asking for figures on the net numbers of additional landowners and acres in the expanded private lands habitat and aquatic habitat programs. A request for the number of stream miles of riparian buffers created in the last several years also was not answered, but previous reporting by News Watch has showed that state efforts to encourage implementation of agricultural buffer strips has been extremely slow to catch on.
The U.S. Fish and Wildlife Service declined to comment on its role in monitoring and protecting freshwater mussels in South Dakota at this time.
Faltys and others have called for further research and monitoring of freshwater mussel populations in South Dakota.
“Our research … suggests that the statewide unionid structure is changing quickly, thus adequate conservation strategies are needed for the future survival of this group,” Faltys said.
Biske, of the Nature Conservancy, agrees that “more can be done” in South Dakota to monitor and conserve existing freshwater mussel populations
But under the two major federal acts pertaining to water, the Clean Water Act and Safe Drinking Water Act, individual and groups of South Dakotans do not have the right to take legal action against ag-related nonpoint source polluters, says David Ganje an Aberdeen native who practices natural resource and commercial law in South Dakota.
However, when endangered species are involved, government entities have the right to intervene to protect the endangered species, although this is rarely done, he said.
Individual states do have the power to regulate non-point source pollution and protect wildlife, should their policymakers choose to do so. South Dakota law states that both South Dakota’s waters and wildlife are the property of all South Dakota residents.
Ganje points to Wisconsin as a state that manages non-point source pollution well, with a published 5-year, 110-page plan. Wisconsin’s approach results in better surface water quality, despite intensive farming and industrial activity. Its most recent report states that 83% of its waters are healthy, 13% are impaired and 4% are being restored. South Dakota’s corresponding numbers are almost reversed: 78% of stream-miles are impaired in some way, while only 22% are healthy. Lake acres are 85% impaired and only 9% healthy.
Wisconsin also has a strategy to reduce phosphorus and nitrogen pollution from fertilizer applications.
“If over time those parties in society [agricultural, manufacturing, construction industries] are put in the limelight, invited to meetings, having the DENR/DANR sit down with them and say ‘What can we do as a group? What should we do? These numbers are getting worse and worse and worse.’ You know, there might even be some press that shows up to some of those meetings. That’s how you change this stuff,” Ganje said.
Eminent Domain
SIOUX FALLS, S.D. (KELO) — Landowners continue to gather and plan meetings as Summit Carbon Solutions has applied for a carbon dioxide (CO2) pipeline permit in Iowa.
“In the coming weeks we will be filing our permits in South Dakota and North Dakota,” said Jim Pirolli, the chief commercial officer for Summit. The developer has already applied in Iowa, Pirolli said.
Once the permit is submitted South Dakota that kicks off a process that is roughly a year long, he said.
Projects would harvest CO2 for transport in pipelines across five states
Summit and Navigator have proposed two CO2 pipelines whose routes include South Dakota, parts of Iowa and Minnesota. Pipelines would capture CO2 from ethanol plants, which would reduce the plants’ overall carbon footprint and allow those plants to sell ethanol at a higher price in markets such as California, which has strict carbon guidelines. The project would also allow participants to use tax credits provided in the 45Q, which provides a tax credit for each metric ton of sequestered CO2. The captured CO2 would be buried at site in North Dakota by Summit and in Illinois by Navigator.
As Summit seeks to secure easements from landowners in South Dakota, Iowa and other states, the possible use of eminent domain comes up.
Ed Fischbach, a landowner in Spink County, said eminent domain is a concern because as of now, there is at least some opposition to agreeing to easements for the Summit pipeline in his region and in other states.
Eminent domain is “a right of a government to take private property for public use by virtue of the superior dominion of the sovereign power over all lands within its jurisdiction,” according to Merriam-Webster.
“I can only speak to my neighbors but there has been a lot of opposition,” Fischbach said.
Several counties in Iowa have passed resolutions, or written letters to the state’s public utilities board, in opposition to the use of eminent domain for CO2 pipelines.
Pirolli said Summit is somewhat surprised by the letters and resolutions in opposition to eminent domain because it wants to use easements and the project will benefit farmers, participating ethanol plants and the overall rural economy.
“Iowa is really organized and ahead of us,” Fischbach said of organized opposition to CO2 pipelines and eminent domain.
McPherson County has passed a moratorium on pipelines that would include CO2 pipelines, Fischbach and Bruce Mack, a landowner near Aberdeen, said.
Opponents of the proposed C02 pipelines cite safety concerns, permanent damage to the land on which the pipeline is buried, and the use of eminent domain on a private project in which a private developer will make millions.
Landowners should have questions about eminent domain and even the easements, said Dave Ganje, a lawyer based in Rapid city. Ganje works in natural resources law and commercial law and litigation.
Eminent domain for private developers
“The use of eminent domain for pipelines and private developers has been established by the U.S. Supreme Court,” Ganje said.
Ganje cited a 2005 U.S. Supreme Court case called Kelo vs. City of New London (Connecticut) in which the court ruled that the city could use eminent domain to transfer land from one private owner to another private owner. The use did not violate the 5th Amendment’s taking clause, according to the court. The court cited public use and economic development.
Rep. Charlie Hoffman, a Republican from Eureka, said the South Dakota courts may need to decide if eminent domain would be an appropriate use for CO2 pipelines.
Part of the original pipeline plan would have gone through Hoffman’s property. The route has since been switched but Hoffman said that is why he supports the pipeline. The pipeline will be a benefit to farmers and ethanol plants, Hoffman said.
Although he supports the proposed Summit CO2 project he understands farmers’ fears of eminent domain. In general, farmers don’t want private development on their property, he said.
Using eminent domain for the purpose of a pipeline is not unusual, Ganje said. The U.S. has thousands of miles of pipelines for various materials, he said.
The use of eminent domain can be allowed through statute, regulatory body such as a state agency or county government, Ganje said.
Chris Nelson, the South Dakota Public Utilities Commissioner, said the PUC does not get involved in eminent domain. That is between the landowner and developer and decided in circuit court, he said.
Pirolli said it’s too early to talk of eminent domain because Summit wants to work with landowners to obtain easements.
“We have just begun right of way acquisition in the state of South Dakota,” Pirolli said. “So far, we’ve had a great reception.”
“It’s preliminary to say we would have to go down that path…,” Pirolli said of eminent domain. “…acquiring right of way takes a long time.”
If Summit believed it would have to use eminent domain to get much of the property for the pipeline, it would not have pursued the project, Pirolli said.
Eminent domain and easements as a share of the profit?
If eminent domain is used then what is the obligation of the private developer to the property owners? Ganje asked.
How is the value of that property determined and should the property owner be entitled to more than a “one-off” payment, Ganje said are questions that must be asked. Should property owners share in the profit from the private development? Ganje asked.
Ganje said the same questions need to be asked with an easement.
Fischbach said landowners also need to understand if an easement obligates them completely, even if the project is not developed.
“They may never get that easement back,” Fischbach said.
Ganje said some easements are written to allow for uses other than the intended use if the original project does not happen.
Pirolli said if Summit’s pipeline is not developed, nothing else can happen on that easement.
Summit has a structure it uses to determine a fair easement payment to the landowner, Pirolli said.
The structure is based on the value of the land, crop production and other factors, he said.
Summit will also pay 100% of the crop or pasture damage in the first year which is the year of construction, Pirolli said.
It will pay 80% of the crop or pasture damage in the second year and 60% in the third year, Pirolli said. Many farmers report little or no crop damage loss in the second and third year, he said.
Meetings
When Summit applies for a permit in the state of South Dakota the process includes information meetings, hearings and other requirements.
Summit already had several meetings in 2021 to inform the public about the proposed CO2 pipeline project in South Dakota, Pirolli said.
Fischbach said at least two meetings were held in October during harvest which was inconvenient for farmers. Also, he received a letter about the proposed CO2 project toward the end of July and surveyors arrived shortly after to ask about surveying property, Fischbach said.
“No one had heard anything prior to then (July letter),” Fischbach said.
Pirolli said Summit hasn’t been invited to meetings such as the one planned for 5:30 p.m. Wednesday, Feb. 2, at the 4-H building in the fairgrounds in Redfield.
Mack said they hope to have ethanol and county representatives at the meeting.
He described some meetings as organized by “activists who are not focused on the benefits of the project…” They are instead focused on opposing it, Pirolli said.
Summit is focused on educating the public about how pipelines can safely transport CO2 and how capturing it can improve the rural economy.
Meanwhile, Fischbach said landowners like him will continue to educate the public about the possible dangers of CO2 pipeline transport and discuss how to oppose a private development using federal tax credits to make money and possibly, take their land.
Naked in the Wind
I continue to be in a state of puzzlement. My dad would sometimes tell me I was young and naïve. I am now considerably older and by the looks of it still naïve. I always thought South Dakotans said, ‘local control is better.’ This as I was taught is a good maxim for government.
A maxim is a moral rule, principle, or a particular behavior pattern of mankind. I have considered, naively, that local government control is desirable.
Local government control applies to wind farm ordinances. County ordinances covering the development and operation of wind farms are not exclusive of course; the state has adopted a series of statutes and rules administered by the PUC and to an extent the SD GF&P which also apply. Yet the more local government participates in the process the better the representation of residents. Only some counties in South Dakota have adopted local wind farm ordinances also known also as wind energy ordinances.
Wind energy projects create siting issues. The physical placement and configuration of wind turbines, roads, fences, collection lines and the like must be considered. Relevant questions include a project’s impact on existing land use, on a neighbor’s land use, and the environment. These are local issues.
A few months ago on behalf of a landowner client I submitted an extensive letter to a county commission in the state advocating the adoption of a wind energy ordinance. The county had none. I have in the past been accused of being a tree hugger. This criticism is an ad hominem distraction. Neither I nor my client are opposed to wind energy development. I am a third-generation businessman, and in my work have represented natural resource developers.
In the letter to the county, I discussed several things to consider including turbine setbacks, the development application and approval process, decommissioning, infrastructure, and safety. In some counties unfamiliarity with wind technology has kept county leaders from addressing wind development. Contrariwise some counties, like Lincoln County, have adopted significant restrictions on wind energy development.
Creating a county oversight and permitting process, that is – writing a basic wind farm ordinance setting down “rules of the road” gives wind energy projects an affordable, streamlined, and accountable system for legal permitting. On the other hand, open range (meaning no requirements) in which a county has no guidelines is an unsuitable system for a county that has adopted a comprehensive plan.
In Ag and ranch country there are risks in doing nothing. Please consider the matter of abandoned wells and orphaned non-tax-paying gas wells in Harding County. This problem challenges Harding County leaders on questions of how to re-establish a tax base and what party is to clean up all the unused infrastructure.
In a 2013 article in the South Dakota Law Review the author discussed property rights and the preservation of local control in the context of state surface drainage practices. The author said that keeping local oversight is important to county commissions because each county wants to know where related activity occurs within its boundaries; and further wrote that many citizens appreciate local ordinances because these ordinances ensure that a project applicant would, 1. notify the county and the affected landowners and 2. that a public hearing would be scheduled before a proposed project begins. The author’s comments apply equally to a wind energy ordinance. Wind energy ordinances establish reasonable parameters on local planning issues and make the project development process and its operations clearer to residents and the public.
Published in the Rapid City Journal, Dec 3, 2021
Water Law Revision Recommended
South Dakota is in a state of drought, breaking century long records for extreme dryness. June 2021 has been the driest June in South Dakota over the past 127 recorded years, according to the government monitoring site, drought.gov. Another report from SDSU revealed that as of February of 2021, 89% of South Dakota was in some level of drought, with 50% being in severe drought or worse. As of August 2021, 100% of the state is facing abnormally dry conditions, while 92% of the state is experiencing moderate drought or worse, according to the U.S. Drought Monitor.
The governor of South Dakota declared a state of emergency in 2021 in response to the widespread drought conditions in the state. A recent news article indicated that all of South Dakota is suffering from drought conditions ranging from abnormally dry to extreme levels of drought.
The US Army Corps of Engineers estimate that the runoff amount for the year 2021 may be the 10th driest year since 1898, in the Upper Missouri River Basin, which constitutes the Missouri River water above Sioux City.
Mark Sweeney, a professor at the University of South Dakota, was recently quoted as saying, “Things like this should make us focus more on making sure we have plans in place for really severe droughts in this state so ultimately the economic impacts can be minimized to the best extent possible.”
The state has the legal authority to shut off water rights in times of emergencies. Historically the DENR, now known as the DANR, has issued orders to shut off junior surface water rights permits (based on a permit date or prior vested legal authority) in roughly 3 or 4 basins (A “basin” is “a natural or artificial land surface depression with or without perceptibly defined beds and banks to which surface runoff gravitates and collectively forms a flow of water continuously or intermittently in a definite direction.” Shut off orders have also been issued for irrigation rights. Most shut off orders direct water rights holders to stop using water are temporary. However, the current drought may very well result in more of this type of government action. From my experience I know that the staff of the DANR understands that this powerful ‘policing tool’ is not to be undertaken lightly. The DANR understands the importance of these water rights permits whether current, vested or otherwise legally created.
My objection is with the current legal process by which a shut off order should be issued, and under what fair processes such a decision can be made. The shut off procedure has never been considered by the state’s highest court. The current shut off procedure needs real change.
Due process rules and regulations of the state – which apply to other administrative contested matters – are not included in the South Dakota law which grants the chief engineer of the DANR the right to shut off a permit holder’s water rights. Current law states that the state’s chief engineer on his or her own, and without a hearing, may, after appropriate investigation, issue an order to shut off or limit a person or permit holder’s use of surface water or groundwater, or order them to plug or otherwise control a well. The current law is intended to protect those water rights of another user who has higher or earlier priority rights or to cause a user to discontinue the use of water to which that user has no legal right. The shut off law provides no rights to the user by way of advance notice and by way of providing the user with a description of the problem at hand. Nor does the law offer an opportunity to contest the ‘decision’ of the engineer or have a public hearing on the matter before the agency or before the state Water Management Board.
Courts in other jurisdictions have recognized that “once rights to use water are acquired, they become vested property rights. As such, they cannot be infringed by others or taken by governmental action without due process and just compensation.” At a minimum, the government must provide notice and opportunity for hearing appropriate to the nature of the action and reasonably calculated, under all the circumstances, to give parties notice of the proposed action and afford the water rights holder an opportunity to present arguments, objections, and facts. These safeguards should be placed in South Dakota law.
