Environmental Defense Fund, Inc. v. East Bay Municipal Utility District

572 P.2d 1128, 20 Cal. 3d 327, 142 Cal. Rptr. 904, 8 Envtl. L. Rep. (Envtl. Law Inst.) 20105, 12 ERC (BNA) 1134, 1977 Cal. LEXIS 199
CourtCalifornia Supreme Court
DecidedDecember 20, 1977
DocketS.F. 23422
StatusPublished
Cited by18 cases

This text of 572 P.2d 1128 (Environmental Defense Fund, Inc. v. East Bay Municipal Utility District) is published on Counsel Stack Legal Research, covering California Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Environmental Defense Fund, Inc. v. East Bay Municipal Utility District, 572 P.2d 1128, 20 Cal. 3d 327, 142 Cal. Rptr. 904, 8 Envtl. L. Rep. (Envtl. Law Inst.) 20105, 12 ERC (BNA) 1134, 1977 Cal. LEXIS 199 (Cal. 1977).

Opinions

Opinion

CLARK, J.

Plaintiffs and intervener appeal from judgment of dismissal following the court’s sustaining defendants’ demurrers without leave to amend. We affirm the judgment. •

Plaintiffs, three corporations and three individuals, are residents of an area served by defendant East Bay Municipal Utility District (EBMUD), a governmental agency. Intervener is the County of Sacramento.

Plaintiffs’ Complaint

We first summarize the allegations of plaintiffs’ complaint. Delivering water to approximately 1,100,000 persons in Alameda and Contra Costa Counties, EBMUD possesses water rights to 325 million gallons per day (mgd) from the Mokelumne River watershed, its principal source of water. The current average water consumption within EBMUD’s service area is 212 mgd.

EBMUD organized and controls Special District One which operates a waste water treatment facility. This facility performs only “primary treatment” on the water, discharging the effluent into San Francisco Bay.

In the early 1960s EBMUD determined its Mokelumne River supply would be insufficient to meet the needs of its service area by the year 1985. EBMUD thereupon undertook a wide-ranging search for supplemental water supplies. In 1968, it entered an agreement with, among others, the United States Bureau of Reclamation (Bureau). By the terms of this agreement, EBMUD obligated itself to perform specified conditions if it later signed a contract with the Bureau. One condition obligated EBMUD to construct a canal, known as the Hood-Clay Connection, if the Bureau found such a canal necessary. The Hood-Clay [332]*332Connection is an integral part of the Bureau’s Central Valley Project, East Side Division.

EBMUD contracted with the Bureau in December 1970, agreeing to purchase, beginning in the year the Bureau completes its AubumFolsom-South Project on the American River, up to 150,000 acre feet of water annually for a period of 40 years. This water is to be delivered to EBMUD from a diversion point on the Folsom-South Canal above its intersection with the proposed Hood-Clay Connection. This choice of diversion point renders the water unavailable to the lower American River.

EBMUD’s actions will cause its 1985 consumers to pay a higher price for water than if EBMUD were to reclaim waste water. And EBMUD did not, in the course of its contractual negotiations, consider waste-water reclamation as a means of supplementing existing water supplies. EBMUD’s agreements have contributed to the likelihood the Bureau will complete its East Side Division. And the Bureau’s completion of this project will in turn diminish flows on the lower American River, injuring recreational opportunity, increasing salination, and accelerating wild river destruction. Finally, EBMUD’s conduct will pollute San Francisco Bay.

On the basis of their allegations, plaintiffs assert three causes of action. As their first cause, plaintiffs claim EBMUD’s decision not to develop reclamation facilities violates article X, section 2, of the California Constitution and Water Code sections 100 and 13500 e-t seq. Plaintiffs’ second cause contends EBMUD’s decision to obtain water from the American River violates the same provisions because it contributes to the likelihood the Bureau will complete the East Side Division project. The third cause asserts the combination of the two EBMUD decisions violates the constitutional and statutory provisions.

Plaintiffs seek three orders, one requiring EBMUD to use its best efforts- to rescind the 1970 contract with the Bureau, the second prohibiting EBMUD from issuing bonds to finance the construction of facilities for transmitting and distributing American River water, and the third requiring EBMUD to undertake a reclamation program “as the proof will determine is required by law.”

[333]*333Intervener’s Complaint

The complaint in intervention incorporates plaintiffs’ allegations. We summarize its additional allegations. The “lower” American River lies within the boundaries of Sacramento County. The river has been used by the public for scenic and recreational purposes for numerous years. In 1962, the county began developing an area along the river for a regional park, having now expended over $6 million.

EBMUD might have acquired water from the federal government at a point below the confluence of the Sacramento and lower American Rivers just as economically as from the diversion point actually chosen. As recognized by decision No. 1400 of the California Water Resources Control Board, the lower diversion point would not impair the recreational use of the American River.

In addition to the relief sought in plaintiffs’ complaint, the complaint in intervention prays for a declaration that EBMUD lacked legal capacity to enter the 1970 contract because the diversion point constitutes an unreasonable water use.

Plaintiffs’ first amended complaint combines the allegations of their original complaint and of intervener’s complaint, seeking the relief claimed in both.

The trial court sustained defendants’ general demurrers on the ground the case is governed by federal—not state—law. In its extensive and well reasoned opinion, the trial court noted that EBMUD is purchasing water from a federal project authorized by Congress, that the Bureau has obtained a permit for the project from the State Water Resources Control Board (SWRCB), and that plaintiffs had not challenged the legality of the federal project. The trial court was of the opinion application of state law might render the water unsalable, interfering with the federal government’s water rights and with the project itself.

While holding that federal law controls this proceeding, the trial court addressed plaintiffs’ state law cáuses of action. The court held plaintiffs failed to assert a cause of action on the basis of article X of the California Constitution or Water Code section 100 because they were not claiming a property right in the water adverse to the rights of the defendants. The [334]*334court further ruled Water Code section 13500 et seq. do not impose a legal duty on EBMUD to reclaim waste water.

Federal Preemption

At the outset we must determine whether the Reclamation Act of 1902 (43 U.S.C. § 371 et seq.) precludes application of state law to a contract between a state entity and the Bureau. It is undisputed that EBMUD in general possesses authority to contract with the Bureau. (Pub. Util. Code, §§ 12721, 12801, 12844.)

EBMUD contends the United States Supreme Court has interpreted the act as limiting application of state law to merely defining what constitutes a compensable property interest. EBMUD asserts state law is otherwise preempted. Plaintiffs and intervener on the other hand argue that the cooperative relationship between the states and the federal government established by federal law permits the states to determine who may receive water from a federal project and under what conditions. (See generally, Sax, Problems of Federalism in Reclamation Law (1965) 37 Colo.L.Rev. 49.)

We conclude the Reclamation Act preempts state law (1) when state law conflicts with federal law, (2) when federal law vests the federal agency with final authority over the subject matter, or (3) when the application of state law would frustrate a federal objective. Insofar.

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Bluebook (online)
572 P.2d 1128, 20 Cal. 3d 327, 142 Cal. Rptr. 904, 8 Envtl. L. Rep. (Envtl. Law Inst.) 20105, 12 ERC (BNA) 1134, 1977 Cal. LEXIS 199, Counsel Stack Legal Research, https://law.counselstack.com/opinion/environmental-defense-fund-inc-v-east-bay-municipal-utility-district-cal-1977.