October 23, 2012

Lessons from the "Tri-State" Water War

For over 20 years, the informally named “tri-state water war” has been going on between Georgia, Alabama, and Florida over allocation of water in the Apalachicola-Chattahoochee-Flint (ACF) River Basin. The water war has been described as a battle between the ever-growing population of Atlanta, the ecological interests of Florida, and the municipal, industrial, and power uses of Alabama. But terming this a “tri-state” war effectively leaves out the most important player—the federal government. Although the three states and the local governments contained within may have the most to gain or lose from any decision about allocation of the ACF River Basin, it is the federal government that has had and will likely continue to have control over who ultimately gets the water. Because the legal regimes that govern our water resources are powerful and vastly divergent from place to place, it is imperative for attorneys to understand and be able to strengthen their claim to local water resources before litigation begins or, even worse, the water runs out.

The tri-state water war has given rise to lawsuits too numerous to recount in this article; however, the most relevant decisions about water allocation have come in the last two years. In 2009, a district court in Florida struck down the Army Corps of Engineers’ (“Corps”) authorization of Lake Lanier, a reservoir in the ACF River Basin, as a water supply source for a number of local governments, including the City of Atlanta. In re Tri-State Water Rights Litigation, 639 F. Supp. 2d 1308 (M.D. Fla. 2009). The court stayed its holding for three years to give the Corps time to get congressional approval for the water withdrawals or for other water supply arrangements to be made. Id. at 1355. But, without congressional approval or some other resolution, the court held the operation of Buford Dam, the construction of which created Lake Lanier, would have to return to its mid-1970s use. Id. This would mean only two municipalities would be authorized to withdraw water from Lake Lanier. Local governments that had come to rely on Lake Lanier for their water supply, including the City of Atlanta, would have been forced to find their water somewhere else.

Two years after this decision, a three-judge panel of the Eleventh Circuit Court of Appeals overturned the 2009 district court ruling. In re MDL-1824 Tri-State Water Rights Litigation, 644 F.3d 1160 (11th Cir. 2011). The panel, however, did not expressly uphold the Corps’ water supply authorizations. Id. at 1200. Instead, it remanded the matter to the Corps to make a final determination about its authority to allocate water in Lake Lanier to water supply. Id. It gave the Corps some specific guidance and a deadline—one year—to complete its analysis.

The disagreement between these two courts hinged on whether water supply was an authorized purpose for the creation of Buford Dam. The district court felt that, while water supply may have been an incidental benefit of the creation of Lake Lanier, it was not an authorized purpose of the project. In re Tri-State Water Rights Litigation, 639 F. Supp. 2d at 1345–47. The circuit court panel disagreed, holding that Buford Dam and Lake Lanier were specifically authorized for water supply purposes. In re MDL-1824 Tri-State Water Rights Litigation, 644 F.3d at 1192. A brief look at the history of the construction and operation of Buford Dam and Lake Lanier will show how these two courts could reach such divergent views.

Historical Underpinnings and Factual Background

While the Corps’ interest in the ACF River Basin began as early as 1925, Congress authorized the construction of the Buford Dam and the creation of Lake Lanier in the Rivers and Harbors Act of 1946 (RHA). In that same year, the Corps issued the “Newman Report,” which further refined the plan for the ACF system and was incorporated in full into the RHA. Construction of the Buford Dam commenced in 1950.

The historic record is mixed on whether water supply was one of the express purposes for the creation of Lake Lanier. Initially, the Corps’ interest in the project stemmed from a request from Congress to find suitable sites for hydroelectric power. Id. at 1167. As the project became more refined, other benefits were noted, including flood control, flow stability, navigation, and water supply. Id. at 1167–68. The Newman Report attempted to quantify the value of the benefits that would be provided by the creation of Lake Lanier. Water supply was not included on this list—benefits were only calculated for power, navigation, and flood control. Id. Despite the fact that it did not quantify the benefit, the Newman Report noted the water supply benefits the project would provide. It provided for a minimum continuous flow of the Chattahoochee River at Atlanta, and it noted that this minimum release might have to be increased as the area developed. Id. at 1168. The Newman Report termed any decrease in power value resulting from this release as “marginal and outweighed by the benefits of an ‘assured’ water supply for the City of Atlanta.” Id. (citing Newman Report
¶ 80 (1946)). Later reports from the Corps refining the project indicated that water supply was a benefit of the project; however, it was not assigned a monetary value because “‘definite evaluation of this benefit cannot be made at this time.’” Id. at 1169 (citing Definite Project Report on Buford Dam Chattahoochee River, Georgia ¶ 124 (1949)).

Although the water supply benefits that the Buford project would provide for the City of Atlanta were recognized during the appropriations process, the city did not contribute financially to the construction of Buford Dam. In fact, the Corps did not want Atlanta to pay for any of the project because the water supply benefits “were all incidental to the purposes of hydropower and flood control and would ‘not cost the Federal Government 1 cent to supply.’” Id. at 1169. The City of Atlanta did not seem to place much importance on the Buford project as necessary to its future water supply, which contributed to its lack of interest in helping to pay for it. Ironically, in 1948, the then-mayor of Atlanta said: “The City of Atlanta has many sources of potential water supply in north Georgia. Certainly a city which is only one hundred miles below one of the greatest rainfall areas in the nation will never find itself in the position of a city like Los Angeles. . . .” In re Tri-State Water Rights Litigation, 639 F. Supp. 2d at 1315.

In 1958, when construction of Buford Dam was almost complete, Congress passed the Water Supply Act (WSA). The purpose of the WSA was to foster collaboration and cooperation between the federal government and the states and local interests in developing water supplies for domestic, municipal, industrial, and other purposes. In re MDL-1824 Tri-State Water Rights Litigation, 644 F.3d at 1170. Congress authorized the Corps to allocate storage in federal reservoirs for water supply, provided that the entity seeking that supply paid for the storage. Congress placed a limit on the Corps’ authority, however, providing that water storage and supply modifications to a reservoir project that had already been authorized, planned, or constructed that would “‘seriously affect the purposes for which the project was authorized, surveyed, planned or constructed, or which would involve major structural or operational changes shall be made only upon the approval of Congress as now provided by law.’” Id. at 1171.

Originally, only two municipalities were permitted to withdraw directly from the lake. As time went on, however, local governments began asking the Corps for authorization to use Lake Lanier for water supply. At the outset, some of these requests were approved by Congress, as the Corps felt it did not have the authority to permit the withdrawals. As time went on, however, the Corps began approving such supply requests, without seeking congressional approval, on an interim basis. Eventually the Corps agreed, again on an interim basis, to release more water from Lake Lanier for Atlanta to withdraw from the Chattahoochee River.

When the Corps allowed these interim water supply contracts to continue for too long, the neighboring states, as well as the power company that relies on Buford Dam, brought suit. Later, in 2001, Georgia sued the Corps in an attempt to secure additional releases from Buford Dam for a more assured water supply.

Recent Court Rulings

Many of the lawsuits involving operation of Buford Dam came to a head in the district court’s 2009 decision. In that case, the district court held that the Corps had violated the WSA by allocating storage in Lake Lanier to water supply without authority from Congress. The court held that, under the WSA, the Corps was required to seek authorization from Congress before making any significant changes to the purpose of the project. In re Tri-State Water Rights Litigation, 639 F. Supp. at 1350. The court determined that the Corps’ reallocation decisions had effectively consumed more than 21.5% of Lake Lanier’s total conservation storage, a major operational change that required congressional approval under the WSA. Id. Because the Corps had not secured such approval, its decisions were overturned, and it was given three years to either get congressional approval or figure out another water supply strategy. Id. at 1355.

In June 2011, a three-judge panel of the Eleventh Circuit Court of Appeals overturned the 2009 district court order. In what is viewed as a major victory for the State of Georgia and, more specifically, the City of Atlanta, the Eleventh Circuit held that the Rivers and Harbors Act of 1946, which authorized the construction of Lake Lanier, “clearly indicates that water supply was an authorized purpose of the Buford Project.” In re MDL-1824 Tri-State Water Rights Litigation, 644 F.3d at 1193. The court remanded to the Corps to reconsider its authority to make water supply determinations as well as Georgia’s specific water supply request. Id. at 1200. The court instructed the Corps to consider the fact that water supply, and particularly that of the City of Atlanta, was an authorized purpose of the Buford project. Id. Finally, the court gave the Corps one year to complete the analysis, after which time it expected to have a “well-reasoned, definitive, and final judgment as to its authority under the RHA and the WSA.” Id. at 1205.

A Wake-up Call for Local Government

Now, with the future of their water supplies at stake, the local governments that rely on Lake Lanier for water are forced to sit around and wait for another six months or so for a federal agency to decide their fate. And even then, after a battle that has lasted more than 20 years, the Corps’ decision may not ultimately decide the parties’ concerns. No matter the outcome, the Corps’ decision will no doubt lead to the initiation of additional lawsuits.

Unfortunately, when a federal public works project like the Buford Dam is involved, the federal government will always be inextricably tied to water supply concerns that might be more appropriately left at the state and federal levels. In such cases, state and local governments may only have so much control over their fate. But proper planning needs to be undertaken to reduce the odds that a water crisis will occur. Despite the fact that the district court’s ruling was overturned, Judge Magnuson’s words about the water war in the ACF River Basin will continue to ring true for local governments around the country:

The blame for the current situation cannot be placed solely on the Corps’ shoulders, however. Too often, state, local, and even national government actors do not consider the long-term consequences of their decisions. Local governments allow unchecked growth because it increases tax revenue, but these same governments do not sufficiently plan for the resources such unchecked growth will require. Nor do individual citizens consider frequently enough their consumption of our scarce resources, absent a crisis situation such as that experienced in the ACF basin in the last few years. The problems faced in the ACF basin will continue to be repeated throughout this country, as the population grows and more undeveloped land is developed. Only by cooperating, planning, and conserving can we avoid the situations that gave rise to this litigation.

In re Tri-State Water Rights Litigation, 639 F. Supp. 2d at 1355.

Perhaps the City of Atlanta thought it was planning for its population growth by seeking (and securing) approval from the Corps for additional discharges from Lake Lanier. And perhaps it did not anticipate the potential that it would lose these allocations even after they had been provided. But one thing is certain—nothing will stunt a city’s growth, or its bottom line, more than running out of a basic necessity of life such as water. Although no plan is foolproof, state and local governments must do everything they can to anticipate growth and ensure that they will have the resources in place to accommodate it, no matter what water rights regime they are working under.