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Ski industry sues Forest Service over water rights

A water-rights showdown between the U.S. Forest Service and the ski industry is looming in federal district court.

NSAA claims illegal takings; agency says it wants to ensure long-term viability of ski area operations

By Bob Berwyn

SUMMIT COUNTY — The veneer of partnership between the U.S. Forest Service and the ski industry cracked this week under the weight of a serious disagreement over water rights.

The National Ski Areas Association Monday filed a lawsuit try and block the agency from changing permit language relating to the ownership of water rights associated with the development and operation of ski areas under federal permit.

At stake are millions of dollars worth of water rights that originate on national forest system lands. A dispute over the ownership of those water rights has been simmering since the 1980s, when the Forest Service developed permit language requiring resorts to assign ownership of certain water rights to the federal government.

While most resorts operating on national forest lands agreed to the conditions by signing the permits, the industry claimed the terms violate state water law.

Sensing a favorable political climate under the Bush administration, the ski industry lobbied U.S. Department of Agriculture officials, and the Forest Service changed the permit language in 2004, developing a water rights clause that tried to create a joint-ownership scenario for the water rights — but those conditions did not comply with water law in states like Colorado, according to the Forest Service.

The Forest Service has said all along that its intent is to ensure that the water rights remain with the resorts to ensure the long-term viability of the ski areas’ operation. The goal is to make sure that the water rights aren’t sold off, which could potentially leave a future ski area operator high and dry, top agency officials said in November.

In November 2011, after a year of negotiations with the ski industry, the Forest Service adopted the new permit conditions that are now being challenged by the ski industry.

In the lawsuit, the NSAA claims the change marks a “stunning and unprecedented directive to its employees … to control and seize privately owned water rights acquired and used under state law by ski area operators at ski areas on National Forest System lands throughout the United States.”

The suit challenges the change based on the claim that it’s “arbitrary, capricious, in excess of the Forest Service’s statutory authority, compels an uncompensated taking of private property, and was adopted without public notice or an opportunity to comment as required by the APA and by the National Forest Management Act (“NFMA”).”

“We greatly value our longstanding and successful partnership with the United States Forest Service … we will continue to work positively and cooperatively with the agency to provide these opportunities on public land, but water rights are simply too critical and valuable to our operations not to defend ourselves against this outright taking of private property by the U.S. Government,” NSAA president Michael Berry said in a prepared statement.

The industry says it is particularly concerned about water rights that have been purchased with private dollars by ski areas for business operations. Resorts see those water rights as privately owned business assets, and the lawsuit suggests that the new permit language could make it more difficult for resorts like Winter Park to secure financing.

From NSAA’s view, requiring ski areas to transfer ownership or limit the sale of water rights without compensation is no different than the government forcing a transfer of ownership of gondolas or chairlifts, grooming machines, or snowmobiles without compensation—except for the fact that water rights are significantly more valuable than these other ski resort assets.

But Ed Ryberg, the former head of the Forest Service ski area program, sees it differently. According to Ryberg, the new permit language won’t affect ethical ski areas, but only those resorts that “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.”

Ryberg recently wrote a lengthy and strongly worded letter to Colorado’s congressional delegation, urging the lawmakers to support the Forest Service and advocate on behalf of the American people and for responsible stewardship of publicly owned resources.

Ryberg said litigation in federal court will help clear up lingering questions about water rights and help determine whether criminal prosecution should be pursued against some ski resorts that may have obtained water rights through “fraud and deception.”

Ryberg’s complete letter is online here.

NSAA complaint against the U.S. Forest Service:

USFS water rights permit language:

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3 Responses

  1. So the gloves are off! The ski industry association is trying to block the Forest Service from righting what was a back door provision that they got through the Bush cronyism era. More looting of the treasury of the people. Greed knows no bounds, especially today. If the Ski Industry gets away with this, then it will add $millions to the value of their operation[s], again, at the expense of the people, who own those water rights. The old adage: “careful what you wish for”, could come back to haunt them, especially if the snow becomes less & less in the coming years through global warming, translating to less water available. Food for thought.

  2. No, the language of the new clause explicitly gives the federal government control of the water rights, a very dangerous gamble. If the federal government owns the water rights they can deny the ski area water for snowmaking on the basis of “the rivers need it”. An outlandish excuse I know, but this will put the very business of the ski resort industry in jeopardy. What they should do instead is allow the ski areas to retain the water rights with the understanding that they cannot sell them off, that they are permanently tied to the ski area under ownership change. No such language exists inside the clause, a dangerous proposition to the long term viability of the industry.

  3. I may be wrong here, but didn’t the Forest Service have that right before the change during the Bush era? And isn’t snow making done in the winter time? I can’t see how the rivers/fish/etc would be demanding extra water, which sounds like a shift in reasoning. The owners knew out front when they obtained their leases, what was what, but now after getting their way, it’s being threatened. You’re correct that there should be language to prevent the water being separated from the resort in any sale, but with the uncertainty of future water availability from climate change, then the value might also be reduced in a future sale. The owners should have thought of that when they bought the changes during the Bush years. Now, they have brought attention to the subject, perhaps to their losing out?

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