State of Ohio v. United States

CourtUnited States Court of Federal Claims
DecidedJune 21, 2021
Docket20-288
StatusPublished

This text of State of Ohio v. United States (State of Ohio v. United States) is published on Counsel Stack Legal Research, covering United States Court of Federal Claims primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
State of Ohio v. United States, (uscfc 2021).

Opinion

In the United States Court of Federal Claims No. 20-288C

(Filed: June 21, 2021)

) STATE OF OHIO, ) Suit for breach of contract; contract based ) on Water Supply Act of 1958, as Plaintiff, ) amended, 43 U.S.C. § 390(b); cross- ) motions for partial summary judgment v. ) ) UNITED STATES, ) ) Defendant. ) ) )

Ian F. Gaunt, Assistant Attorney General, Environmental Enforcement Division, State of Ohio, Columbus, Ohio, for plaintiff. With him on the briefs were Dave Yost, Ohio Attorney General, Daniel J. Martin, and Amber Wootton Hertlein, Assistant Attorneys General, State of Ohio, Columbus, Ohio.

Ioana Cristei, Trial Attorney, Commercial Litigation Branch, Civil Division, United States Department of Justice, Washington, D.C., for defendant. With her on the briefs were Brian M. Boynton, Acting Assistant Attorney General, Robert E. Kirschman, Jr., Director, and Deborah A. Bynum, Assistant Director, Commercial Litigation Branch, Civil Division, United States Department of Justice, Washington, D.C., as well as Daniel Inkelas, Assistant Counsel, Office of the Chief Counsel, and Lauren R. Horner, Assistant District Counsel, Louisville District, United States Army Corps of Engineers.

OPINION AND ORDER

LETTOW, Senior Judge.

The State of Ohio seeks redress for the United States Army Corps of Engineers’ alleged violation of a contract relating to flood control and water supply at the Caesar Creek Project (the “Project”) in Southwestern Ohio. The contract, executed by Ohio and the Corps in 1970 pursuant to the Water Supply Act of 1958, Pub. L. No. 85-500, Title III, § 301 (codified at 43 U.S.C. § 390b), stipulated that the parties would share the “annual experienced joint-use operation and maintenance costs of the Project.” First Am. Compl. Ex. A Art. 5.c.(1) (the “Contract”), ECF No. 23-2. Ohio alleges, inter alia, that “[t]he United States has charged—and continues to charge—the State of Ohio for costs not authorized by the . . . Contract.” First Am. Compl. ¶ 45, ECF No. 23-1. Pending before the court are the parties’ cross-motions for partial summary judgment. See Pl.’s Mot. for Partial Summ. J. (“Pl.’s Mot.”), ECF No. 26; Def.’s Resp. & Cross-Mot. for Partial Summ. J. (“Def.’s Cross-Mot.”), ECF No. 32. Following the completion of briefing, see Pl.’s Reply & Resp. (“Pl.’s Reply”), ECF No. 33; Def.’s Reply, ECF No. 36, the court held a hearing on May 21, 2021. The court concludes that “joint-use operation and maintenance costs of the Project,” Contract Art. 5.c.(1), are those necessary “to maintain [the Project] as an efficient going concern,” Nampa & Meridian Irrigation Dist. v. Bond, 268 U.S. 50, 53 (1925), i.e., “to operate [the Project] effectively” for water storage, water availability, and flood control, id., and “to remedy injurious effects resulting from the [P]roject’s subsequent operation,” Casitas Municipal Water Dist. v. United States, 543 F.3d 1276, 1284 (Fed. Cir. 2008). Because allegedly extraneous costs are at issue, plaintiff’s motion is GRANTED IN PART and the government’s cross-motion is DENIED.

BACKGROUND 1

A. The Flood Control Act and the Water Supply Act

The Flood Control Act of 1938 “[a]uthoriz[ed] the construction of certain public works on rivers . . . for flood control, and for other purposes.” Pub. L. No. 75-761, 52 Stat. 1215. Congress passed the Act in response to the Ohio River flood of 1937, see Ohio v. United States, 150 Fed. Cl. 173, 176 (2020), and the Little Miami River in Ohio, of which Caesar Creek is a tributary, was identified as an appropriate site for a future reservoir in the Ohio River Basin, see id.; see also H.R. Rep. No. 75-2353, at 11 (1938). The Act specifically references the plan for the Ohio River Basin as a “general comprehensive plan for flood control and other purposes.” 52 Stat. at 1217. Congress further adopted the Water Supply Act of 1958, and the Act’s 1963 amendments, for a similar purpose, see Pub. L. No. 85-500, § 301(a) (1958) (codified as amended at 43 U.S.C. § 390b(a)); Pub. L. No. 88-140, 77 Stat. 249, and “authorized the U.S. Army Corps of Engineers ‘to impound water for present or anticipated future demand or need for municipal or industrial water’ in its reservoir projects.” Ohio, 150 Fed. Cl. at 176 (quoting 43 U.S.C. § 390b(b)). The Water Supply Act, as amended, briefly addresses operation and maintenance costs, asserting that a state such as Ohio can obtain permanent rights to water storage space so long as the state “continue[s] payment of annual operation and maintenance costs allocated to water supply.” Pub. L. No 88-140, § 3 (codified at 43 U.S.C. § 390e).

B. The Contract

In January of 1970, the parties established a flood control contract related to the Caesar Creek Reservoir Project in Ohio. Contract at 1. The Contract was entered pursuant to the Flood Control Act of 1938 and the Water Supply Act of 1958 to manage water supply needs and reduce flooding risks along various rivers, including the Little Miami River in Ohio. See id. The Corps

1 The recitations that follow are not findings of fact but rather are recitals attendant to the pending motions and reflected matters drawn from the complaint, the parties’ briefs, and the records and documents appended to the complaint and briefs.

2 agreed to operate and enhance the Caesar Creek Project by adding water storage capabilities and supply. See id. Art. 1.d. Under the Contract, Ohio gained “the right . . . to utilize an undivided 48.7 percent of the storage space in the Project between elevations 800.0 and 846.0 feet above mean sea level as deemed necessary by the State to impound water for municipal and industrial use and to make withdrawals therefrom at any time,” a storage space “estimated to be 80,400 acre-feet.” Id. Art. 1.a.

Article 5 of the Contract provided that Ohio agreed to pay the United States a variety of costs, including a portion of the Project’s operation and maintenance costs. Contract Art. 5. Specifically, the Contract stated that “[t]he State shall pay 12.70 percent of the annual experienced joint-use operation and maintenance costs of the Project” on an annual basis. Id. Art. 5.c.(1). The Contract did not define what costs could be considered operation and maintenance costs, but it did provide that the United States’ contracting officer possessed discretion to determine the appropriate amount of operation and maintenance costs. Id. Art. 5.c.(3). Ohio could request additional operation and maintenance, but the State would be responsible for “the entire cost of such additional expense.” Id.

C. Procedural History

Ohio filed suit in this court in March 2020. See Compl., ECF No. 1. Among other claims, Ohio disputed numerous “facially improper line items” charged by the Corps as operation and maintenance expenses. Compl. ¶ 30; see also First Am. Compl. ¶ 30. Ohio specifically challenged charges related to “birdseed, parking lots, pedestrian bridges, environmental management, water quality testing, travel orders, tree removal, and community outreach.” First Am. Compl. ¶ 30.

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