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Former Forest Service official says some ski resorts may have acquired their water rights by ‘fraud and deception’

A former U.S. Forest Service official weighs in on the water rights tussle between the agency and the ski industry.

Former head of Forest Service ski area program says current water tussle between the agency and the ski industry is an outgrowth of regulatory abuses during the Bush administration

By Bob Berwyn

SUMMIT COUNTY — A recent flareup in the water war between the federal government and the ski industry took yet another turn last week, as a former Forest Service official weighed in and charged the industry with taking advantage of a lax regulatory environment under the Bush administration to try and acquire water rights that belong to the people of the United States with “fraud and deception.”

The water rights issue surfaced publicly in November, when the National Ski Areas Association, represented by attorney Glenn Porzak, complained in Congress that the Forest Service was trying to “take” privately held water rights by revising a ski area permit condition that was adopted in 2004. Since then, the ski industry has threatened to sue the Forest Service over the new water rights clause.

But Ed Ryberg, who headed the agency’s ski area program from 1992 to 2005, says it’s the other way around. According to Ryberg, the ski industry used its political connections in the Bush administration to lobby for regulatory changes that were subsequently implemented without public input or review under federal environmental laws.

Those efforts extended beyond the water rights issue to other aspects of ski area operation, including the establishment of quasi-private, special access lift lines,  advertising on chairlift safety bars and even real estate development schemes, as in the case of the proposed village at Wolf Creek.

Ryberg said he felt compelled to write his strongly worded letter because the ski industry is spinning the issue to try and manipulate the federal government once again.

“They have a visceral antagonism toward regulation,” Ryberg said, referring to the ski industry. “I can speak freely now. I would be irresponsible if I didn’t do it,” he added.

At issue is specific language in ski area permits that requires resorts to sign over certain types of water rights to the Forest Service. Under rules developed in the 1980s, all resorts that operated under federal permits agreed to those terms when they signed their permits — whether they agreed with the language or not.

Ryberg raised the specter that some ski resorts may have been involved in defrauding the American public by signing their permits without any intention of complying with the terms and conditions relating to water rights.

But in 2004, the ski industry lobbied high-level Bush administration officials to change the language. Ryberg was part of those discussions, at least until the ski industry decided to take its requests outside the normal administrative channels and into the political arena.

Here’s how Ryberg described it in his letter to Udall, Bennet and Hickenlooper:

“The 2004 water rights clause was a radical change to Forest Service direction with regards to water rights at permitted ski areas. It eliminated the long standing requirement that ski areas transfer water rights for water diverted and put to beneficial use on NFS lands to the United States. As I discussed earlier, the 2004 clause was the direct result of the ski industry exploiting the lax regulatory environment that characterized the Bush Administration. At this time, serving as the agency’s ski area program coordinator, I was informed that the Under Secretary of Agriculture for Natural Resources and the Environment (Under Secretary) was being lobbied by the National Ski Areas Association (NSAA) to change the existing ski area permit water rights clause. I was directed to meet with representatives from the NSAA to gain an understanding of their problems with the existing clause and attempt to address them. At this meeting I was accompanied by an attorney from the Department of Agriculture’s Office of General Council (OGC) with extensive experience in the field of Federal water rights. As the meeting progressed, the industry representatives made it clear that their intent was to eliminate the permit requirement to transfer water rights to the Government for water diverted from NFS lands and put to beneficial use at ski areas. They reacted to every concern we voiced with hostility and let us know that they had the support of the Under Secretary’s Office to make the changes they wanted. Following this unproductive meeting, all discussions on modifying the clause were conducted between NSAA representatives, the Director of Recreation in the Chief’s office, and the Under Secretary’s staff. Agency permit specialist and water rights experts with OGC were excluded from the meetings that resulted in the development of the 2004 water rights clause.”

According to Ryberg, the latest move by the Forest Service to revise the language merely restores the balance that existed before 2004 and ensures that water that originates on national forest lands and has been developed for ski resort use remains with the ski areas.

Again, from Ryberg’s letter:

“The ski area water rights clause of November 8, 2011, restores the ability of the Forest Service to compel ski areas to comply with the requirements of the pre-2004 clause. It requires that ownership of rights to divert and use water on site that were initiated, developed, certified, or adjudicated prior to 2004, continue to be governed by the terms and conditions of the ski area permit in effect at the time that water right was first filed. This allows the Forest Service to require ski areas to transfer water rights justly belonging to the United States as a condition to any permit activity such as authorizing new uses or areas, issuing permits to new owners, or reissuing permits that have expired. The 2011 clause still provides for joint ownership of water rights to divert and use water on the permitted area while correcting the problems with the 2004 clause with respect to Colorado law. Importantly, the new clause commits the Forest Service to exercise ownership rights to this water specifically to support ski area operations, and ensures that this water will be available to subsequent ski area operators. In this way, it helps to ensure that ski areas and the communities dependent on them are sustainable by preventing ski area operators from selling or diverting water that is needed for the operation of ski areas to other uses. This clause will not negatively impact ethical ski areas who met their agreed-to obligations of their permits. It will only impact the  bad actors  in the ski industry who welshed on their agreements with the United States, and obtained water rights, justly belonging to the American people, through fraud and deception. These are the ski areas on who’s behalf NSAA has been lobbying.”

The ski industry’s position is that the Forest Service has never had the legal authority to require resorts to transfer water rights, and that state water law supersedes any federal regulations.

Following is the entire text of Ryberg’s letter, followed by a response from attorney Glenn Porzak on behalf of the NSAA:

Dear Senator Udall:

This letter is in regard to your recent request to the Chief of the U.S. Forest Service to establish a moratorium on implementing the November 8, 2011 water rights clause in ski area permits. While I realize that the Forest Service has chosen not to implement the requested moratorium, I would still like to add my perspective on this matter for your consideration. From 1992 until my retirement in 2005, I served as the coordinator for U.S. Forest Service ski area program. During this time I was involved in numerous actions to issue new and revised permits to ski areas on National Forest System (NFS) lands. As a result of my position and experience I am knowledgeable on the basis for the pre-2004 ski area permit water rights clause. The 2004 water rights clause was implemented during my tenure and accordingly, I experienced how the ski industry exploited the lax regulatory environment that characterized the Bush Administration to attempt to effectuate the transfer valuable water rights, that justly belong to the American people, to private ski areas. The 2004 water rights clause is the legacy of this effort and should be seen in the context of that administration’s regulatory failures that allowed greed to jeopardize our economy and environment.

Prior to 2004, the ski area permit water rights clause was straightforward and unambiguous. This clause required that all water rights acquired or claimed by a ski area permitee during the term of their permit, which involved diversion of water directly from NFS lands, to the extent they were applied to beneficial use to carry out the purposes of applicable statutes, protect Federal property and economic interest, and protect the public interest.(36 CFR 251.56) The intent of the requirement that water rights for water used to provide outdoor recreation on permitted ski areas be held by the United States is to ensure that water needed to operate these ski areas will continue to be dedicated to that use. This helps to ensure these ski areas and the outdoor recreation they provide the American people are sustainable as required by the MUSY Act.

The 2004 water rights clause was a radical change to Forest Service direction with regards to water rights at permitted ski areas. It eliminated the long standing requirement that ski areas transfer water rights for water diverted and put to beneficial use on NFS lands to the United States. As I discussed earlier, the 2004 clause was the direct result of the ski industry exploiting the lax regulatory environment that characterized the Bush Administration. At this time, serving as the agency’s ski area program coordinator, I was informed that the Under Secretary of Agriculture for Natural Resources and the Environment (Under Secretary) was being lobbied by the National Ski Areas Association (NSAA) to change the existing ski area permit water rights clause. I was directed to meet with representatives from the NSAA to gain an understanding of their problems with the existing clause and attempt to address them. At this meeting I was accompanied by an attorney from the Department of Agriculture’s Office of General Council (OGC) with extensive experience in the field of Federal water rights. As the meeting progressed, the industry representatives made it clear that their intent was to eliminate the permit requirement to transfer water rights to the Government for water diverted from NFS lands and put to beneficial use at ski areas. They reacted to every concern we voiced with hostility and let us know that they had the support of the Under Secretary’s Office to make the changes they wanted. Following this unproductive meeting, all discussions on modifying the clause were conducted between NSAA representatives, the Director of Recreation in the Chief’s office, and the Under Secretary’s staff. Agency permit specialist and water rights experts with OGC were excluded from the meetings that resulted in the development of the 2004 water rights clause. As the attached email from NSAA’s Geraldine Link states,  the vast majority of our discussions on the water rights clause took place with the USFS Director of Recreation at the time, Dave Holland  and that Tom Tidwell, the current Chief, was also on the 2004 water rights team and he did not object to the clause in any way. However, it should be noted that at the time of these meetings, Tom Tidwell was assigned to the Under Secretary’s Office and was representing the views of the Bush Administration, not his personal views or the views of the Forest Service. Because permit and water rights specialists were excluded from these discussions, the 2004 clause was not properly vetted within the Forest Service nor OGC. It should come as no surprise that the resulting water rights clause has been found to be unworkable and not legally viable in Colorado. This example of regulatory mischief is part of the pattern perfected in the executive agencies during the Bush Administration, similar to how the political appointees in Department of Interior improperly ignored science and imposed their ideological bias on endangered species and energy issues.

Immediately following the development of the 2004 water rights clause and its inclusion in the Forest Service Special Use Handbook, the Chief’s office directed field units to offer all ski area permit holders the opportunity to replace the existing water rights clause in their permits with the new clause. Most ski areas took advantage of this opportunity. The direct effect was to eliminate the means by which the Forest Service could compel ski areas to honor their agreements to transfer to the United States certain water rights applied for and/or perfected during the terms of their permits. At this point, it is important to establish the fact that the only reason ski areas could obtain these water rights was because the Forest Service allowed them to. Forest Service authorization was needed to divert or develop this water and put it to beneficial use on NFS land authorized under permit. The Forest Service made the decision that the development and use of this water was needed to operate the ski area in a manner that would meet the needs of the American people for outdoor recreation. Ski areas profited from the enhanced skiing experience made possible by using this water for snowmaking, and the Forest Service guaranteed them the right to use this water through the term of their permit. However, according to the email from NSAA’s Geraldine Link, referenced earlier,  Ownership was not transferred in the 1980s because the clause that asked for ownership was unlawful. Her statement seems to imply that ski areas intentionally deceived the Forest Service when they signed these permits. If, in fact, some ski area operators signed their permits under the pretense of agreeing to transfer these water rights to the Government, when their intent was not to do so, they knowingly and willfully deceived the Forest Service and defrauded the United States. Accordingly, these ski area operators risked criminal penalties under 18 USC 1001, as well as termination of their permits. That they would resort to such reckless behavior clearly illustrates the power of greed.

The ski area water rights clause of November 8, 2011, restores the ability of the Forest Service to compel ski areas to comply with the requirements of the pre-2004 clause. It requires that ownership of rights to divert and use water on site that were initiated, developed, certified, or adjudicated prior to 2004, continue to be governed by the terms and conditions of the ski area permit in effect at the time that water right was first filed. This allows the Forest Service to require ski areas to transfer water rights justly belonging to the United States as a condition to any permit activity such as authorizing new uses or areas, issuing permits to new owners, or reissuing permits that have expired. The 2011 clause still provides for joint ownership of water rights to divert and use water on the permitted area while correcting the problems with the 2004 clause with respect to Colorado law. Importantly, the new clause commits the Forest Service to exercise ownership rights to this water specifically to support ski area operations, and ensures that this water will be available to subsequent ski area operators. In this way, it helps to ensure that ski areas and the communities dependent on them are sustainable by preventing ski area operators from selling or diverting water that is needed for the operation of ski areas to other uses. This clause will not negatively impact ethical ski areas who met their agreed-to obligations of their permits. It will only impact the  bad actors  in the ski industry who welshed on their agreements with the United States, and obtained water rights, justly belonging to the American people, through fraud and deception. These are the ski areas on who’s behalf NSAA has been lobbying.

It now appears that NSAA is contemplating litigation to prevent the Forest Service from implementing the 2011 water rights clause. Frankly, litigation may be the best way forward on this issue. I’m confident that based on the statutory history discussed earlier, litigation will result case law strongly supporting the authority of the Forest Service to regulate water use on NFS lands. It will be advantageous to the public’s interest to get the Justice Department involved in this matter. It will provide them an opportunity to become familiar with the facts of the matter to help them determine if criminal prosecutions should be pursued, and to expedite acquiring title to water rights that justly belong to the American people. In the absence of litigation, this new clause will allow the Forest Service to begin to reclaim these water rights through permit actions as discussed earlier. These actions will have no effect on ethical ski areas. Unscrupulous ski areas will be required to transfer their ill-begotten water rights to the United States, as a condition of being authorized to conduct new activities or use additional areas under their permit. If these ski areas are not willing to commit water rights to ensure the sustainability of their operations and the communities dependent on them, then the American people should not incur the environmental impacts and loss of wildlands associated with new uses at these ski areas.

In closing, I would like to commend the Forest Service for it’s efforts to redress the abuses of the crony capitalism practiced by the Bush administration. I would hope that you will become an advocate for this type of responsible stewardship of public resources and devote your efforts to serving the public’s interest rather the interest of the greedy.

Please feel free to contact me at 720-635-5334 if I can be of any assistance to you in this matter.

Sincerely,

ED RYBERG

Attachment;

CC:    United States Senator Michael F.Bennet
Colorado Governor John Hichenlooper

The response from Glenn Porzak:

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One Response

  1. The distinction stated, is straight forward. This should be carefully watched by all who are affected. After all, what happens if the ski areas sell the water rights separately, putting the new owners at the mercy of another, for the water needed to run the operation? That is what will happen in these cases if the issue doesn’t revert to the original. Crony capitalism, a part of what’s wrong with the country today.

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