Full opinion text
SUPPLEMENTAL MEMORANDUM DECISION RE CROSS MOTIONS FOR SUMMARY JUDGMENT NATIONAL ASSOCIATION OF HOME BUILDERS V. DEFENDERS OF WILDLIFE, 127 S.Ct. 2518 (2007), TO PLAINTIFFS’ REQUEST FOR RESCISSION OF THE SACRAMENTO RIVER SETTLEMENT CONTRACTS OLIVER W. WANGER, District Judge. TABLE OF CONTENTS I. INTRODUCTION.........................................................958 II. FACTUAL BACKGROUND.................................................959 A General History of The CVP and Relevant State Law Doctrines .............959 B. The Bureau’s Initiation of Permit Applications for the CVP Before the State Board.........................................................962 C. The 1956 Cooperative Studies and Related Analyses........................963 D. Van Camp’s Summary of the Evidence Underlying the 1956 Cooperative Study Program and Related Investigations .............................964 E. D-990 ................................................................965 F. 1951 House Interior and Insular Affairs Committee Report.................968 G. Negotiation of the SRS Contracts........................................968 H. The SRS Contracts.....................................................968 I. Decision 161¡,1 .........................................................969 J. CVPIA...............................................................969 III. ANALYSIS...............................................................970 A. Threshold Issues.......................................................970 1. Federal Defendants’ Argument that Summary Judgment Should be Granted on Other Grounds Raised in Their Summary Judgment Briefs...........................................................970 2. Proceedings Not Intended to Adjudicate Any Party’s Water Rights.....970 3. Preliminary Nature of Previous Discussions Regarding Home Builders ........................................................970 4. The ESA and CVPIA Apply to the SRS Contractors....................970 5. Evidentiary Matters................................................971 B. Does Section 7 of the ESA Apply to the Bureau’s Implementation and/or Execution of the SRS Contracts?.......................................971 1. Legal Framework..................................................971 2. Do the SRS Contracts Significantly Constrain the Bureau’s Discretion to Modify Deliveries Under the SRS Contracts?............976 a. Article 3(g)(8)..................................................977 b. The Shasta Critical Year Shortage Provision.......................978 3. Do the Original SRS Contracts Significantly Constrain the Bureau’s Discretion to Negotiate Upon Renewal for New or Modified Terms for the Benefit of the Smelt? .......................................979 a. Basic Principles of Federal Contract Interpretation.................979 b. Application to Relevant SRS Contract Language...................980 (1) Article 9 ...................................................980 (2) Articled...................................................982 (3) Alternative interpretations of Article 9(a)......................983 c. The Unmistakability Doctrine ...................................984 d. Scope of Article 9(a) ............................................987 e. Conclusion Regarding Article 9(a)................................988 f. Anderson Cottonwood Irrigation District & Sutter Mutual Water Company Renewal Contracts Water Reductions............988 g. Impact of the CVPIA and D-16/.1 on SRS Contract Renewal.........988 4. Effect of Reclamation Act Section 8 on the Bureau’s Discretion..........989 a. Relevant Background Principles of California Water Law...........992 (1) California’s Dual System of Water Rights......................992 (2) Area of Origin Protections ...................................993 (3) Reasonable & Beneficial Use/Prohibition of Unreasonable Use......................................................993 (4) Public Trust Doctrine .......................................994 b. D-990.........................................................995 e. D-990’s Reliance on the 1956 Study & Its Progeny Does Not Demonstrate the Exact Nature and Extent of the SRS Contractors’ Underlying Water Rights..........................995 d. The Effect of Condition 28.......................................997 e. D-990 Does Not Substantially Constrain the Bureau’s Discretion to Negotiate Modifications to the Settlement Contracts....................................................999 f. Preemption Analysis Unnecessary ..............................1000 IV. CONCLUSION...........................................................1000 I. INTRODUCTION The November 19, 2008, Memorandum Decision Re: Cross Motions for Summary Judgment Re Contract Rescission (“Memorandum Decision”), 2008 WL 5054115, called for further briefing addressing the applicability of the recent Supreme Court case, National Association of Home Builders v. Defenders of Wildlife, 551 U.S. 644, 127 S.Ct. 2518, 168 L.Ed.2d 467 (2007), to Plaintiffs’ request for rescission of a number of Sacramento River Settlement Contracts (“SRS Contracts”): To resolve the applicability of Home Builders ... it is necessary for the Federal Defendants and/or the Settlement Contractors to present evidence on the nature and extent of their claimed senior water rights. If, arguendo, this evidence establishes that the Settlement Contractors hold senior rights to a certain volume of water, it is appropriate to determine as a matter of law that the Bureau lacks any discretion under Home Builders over that volume of SRS Contract water. Memorandum Decision, Doc. 761, at 70:8-16 (emphasis added). A December 3, 2008 scheduling conference confirmed that these proceedings do not involve an actual adjudication of the water rights of any parties in this case. See Reporters’ Transcript, Dec. 3, 2008, Doc. 764, at 7-8,18, 28. A January 14, 2009 Supplemental Scheduling Conference Order defined the remaining issues. By January 30, 2009, the Sacramento River Settlement Contractor parties shall file further admissible evidence and supporting pleadings regarding the nature and extent of the Settlement Contractors’ water rights in order to resolve the applicability of the Supreme Court’s decision in [Home Builders], 127 S.Ct. 2518 (2007), and to further narrow the issues in this case. See Doc. 769 at 2. On January 28, 2009, Plaintiffs filed a motion for certification of interlocutory appeal or, in the alternative, for reconsideration of the district court’s November 19, 2008 memorandum decision. Doc. 770. This motion was denied without prejudice as premature on the ground that the November 19, 2008 decision was not completed nor final. Doc. 811, filed Feb. 12, 2009, 2009 WL 361857. On January 30, 2008, two groups of Sacramento River Settlement Contractors (“SRS Contractors”), Glenn Colusa Irrigation District (“GCID”), et al., and Reclamation District No. 108 (“RD 108”), et al., filed separate memoranda addressing the district court’s request. Does. 772 & 773. GCID also filed the declaration of Marc Van Camp along with voluminous supporting documentation. See Docs. 775-810. Federal Defendants and Plaintiffs responded. Doc. 815, filed Feb. 27, 2009; Doc. 820, corrected version, filed Mar. 2, 2009. Oral argument was heard on March 13, 2009, after which the matter was submitted for decision. Doc. 826. On March 24, 2009, Federal Defendants sought to file a supplemental brief to address the application of Home Builders to this case. Doc. 827. The same day, Plaintiffs opposed the request, objecting that supplemental briefing would further delay a decision in this case: “Plaintiffs are anxious to obtain a ruling on this matter, as the Bureau’s implementation of the Sacramento River Settlement Contracts is likely to have a significant effect on threatened and endangered fish and their critical habitat this year.” Doc. 828. at 2. This Memorandum Decision incorporates the November 19, 2008 Memorandum Decision, except that: (a) where inconsistent, this Decision shall control, and (b) Part VLD.l. of the November 19, 2008 Decision is superceded by this Memorandum Decision. II. FACTUAL BACKGROUND Earlier decisions in this case set forth extensive background describing the coordinated operations of the Central Valley Project (“CVP”) and State Water Project (“SWP”). See, e.g. Doc. 363, filed May 25, 2007; Doc. 761. As some of the disputed water rights predate the Projects themselves, a review of the Projects’ history and the legal relationship between the SRS Contractors and Interior is necessary. A. General History of The CVP and Relevant State Law Doctrines. The California Court of Appeal, Third Appellate District, performed a comprehensive review of the relevant history in El Dorado Irrigation Dist. v. State Water Resources Control Board, 142 Cal.App.4th 937, 48 Cal.Rptr.3d 468 (2006): The History Of Comprehensive Water Planning In California As former Presiding Justice John T. Raeanelli explained in United States v. State Water Resources Control Bd. (1986) 182 Cal.App.3d 82, 98, 227 Cal.Rptr. 161: “California’s critical water problem is not a lack of water but uneven distribution of water resources. The state is endowed with flowing rivers, countless lakes and streams and abundant winter rains and snowfall. But while over 70 percent of the stream flow lies north of Sacramento, nearly 80 percent of the demand for water supplies originates in the southern regions of the state.” Efforts to solve this problem date back more than 100 years. In the early 1870’s, President Ulysses Grant appointed a commission under the leadership of Colonel B.S. Alexander (Alexander Commission) to study California’s “irrigation problem.” (Cooper, Aqueduct Empire, [1968], p. 42.) The Alexander Commission “was the first to point out ... that the Central Valley’s most bountiful water supplies lay in the Sacramento River region, in contrast to potential shortages in the valley of the San Joaquin.” (Id. at pp. 42-43.) The Commission “made several proposals for basin-wide storage and distribution of water.” (Id. at p. 42.) The work of the Alexander Commission was followed in the late 1870’s by the work of William Hammond Hall, the first State Engineer, who was appointed to investigate, among other things, “the problems of irrigation” in California. (Stats. 1878, ch. 429, § 3, p. 634; Cooper, Aqueduct Empire, supra, at p. 43.) Hall “took his assignment seriously and spoke out for coordinated region-wide water development. But in that respect he was a generation ahead of his time.... In a time of rampant self-interest Hall’s farsighted vision of systematic development went largely unrecognized.” (Cooper, supra, at pp. 43-44.) Forty years later, in 1919, Colonel Robert Bradford Marshall, chief hydrographer of the United States Geological Survey, followed in Hall’s footsteps when he “proposed to the governor of California a series of storage reservoirs and canals in the Central Valley.” (Cooper, Aqueduct Empire, supra, at p. 50; see also Rogers and Nichols, Water for California (1967) § 27, p. 46.) “[I]n the hortatory language of a crusader, [Colonel Marshall] sketched, summarized and espoused for California the inevitable water logistics which seventy years of cumulative geographic and hydrologic evidence demanded: redistribution of water from north to south; an integrated system of statewide waterworks; the Central Valley Project in all its splendid promise; the east and west side canals flanking that valley; tunnels and pumps conveying to southern California a share of the state’s endowment.” (Cooper; supra, at pp. 50-51.) In 1921, the California Legislature took up the search for a solution to California’s water problem when it directed the state engineering department “to determine a comprehensive plan for the accomplishment of the maximum conservation, control, storage, distribution and application of all the waters of the state, and to estimate the cost of constructing dams, canals, reservoirs or other works necessary in carrying out this plan.” (Stats. 1921, ch. 889, § 4, p. 1686.) Development of this comprehensive water plan for California continued over the next decade, with periodic reports to the Legislature. (See Rogers and Nichols, Water for California, supra, § 27, p. 46; Ivanhoe Irr. Dist. v. All Parties (1957) 47 Cal.2d 597, 614, 806 P.2d 824, revd. 357 U.S. 275, 78 S.Ct. 1174, 2 L.Ed.2d 1313.) In 1927, while the water plan was still being developed, a joint Senate-Assembly committee recognized the need “ ‘to file on, or withdraw from filing by private parties, the water rights to be utilized and required for the consummation of the co-ordinated plan.’ ” (25 Ops.Cal. Atty.Gen. 8, 11 (1955).) Accordingly, the Legislature passed the Feigenbaum Act (Stats. 1927, ch. 286, pp. 508-510), which was later codified as Water Code section 10500 et seq.[ ] (See 25 Ops. Cal. Atty. Gen., supra, at p. 11.) The Feigenbaum Act directed the Department of Finance “to make and file an application or applications for any water or the use thereof which in the judgment of the state department of finance is or may be required in the development and completion of the whole or any part of a general or coordinated plan looking towards the development, utilization or conservation of the water resources of the state.” (Stats. 1927, ch. 286, § 1, pp. 508-509; see § 10500.) The act further provided that the priority of any such application would be the effective date of the act, which was July 29, 1927.[] (Stats. 1927, ch. 286, § 1.) “The effect of the [Feigenbaum Act] was to withdraw the then unappropriated waters of the State filed on by the Department of Finance from any further appropriation by private parties.” (25 Ops. Cal. Atty. Gen., supra, at p. 11.) The Feigenbaum Act also gave the Department of Finance the “power, in its discretion, to release from priority or to assign any portion of or all of any of the appropriations that may be filed under the provisions of this act when such release or assignment is for the purpose of development not in conflict with such general or coordinated plan.” (Stats. 1927, ch. 286, § 1, p. 509; see § 10504 [“The board may release from priority or assign any portion of any application filed under this part when the release or assignment is for the purpose of development not in conflict with such general or coordinated plan or with water quality objectives established pursuant to law”].) “It was under th[e] authorization [of the Feigenbaum Act] that the Director of Finance, beginning in 1927, filed some 37 applications on behalf of the state on streams within the central valley area .... ” (Ivanhoe Irr. Dist. v. All Parties, supra, 47 Cal.2d at p. 614, 306 P.2d 824.) One of those state-filed applications, application No. 5645, was filed on July 30, 1927. That application sought a permit to appropriate for irrigation and domestic use various amounts of water from various points in El Dorado County on tributaries to the American and Cosumnes Rivers, including-as relevant here-the South Fork of the American River. • . The History Of The Area Of Origin Protections In 1931, the Division of Water Resources submitted a comprehensive series of reports on the State Water Plan to the Legislature. (25 Ops. Cal. Atty. Gen., supra, at p. 13.) That same year, “the Legislature was called upon to amend the Feigenbaum Act of 1927 by extending the date to which State filings would be exempted from requirements of diligence.” (Id. at p. 14.) The bill introduced to make this amendment “was [itself] amended before final passage to provide a further restriction on the authority of the Department of Finance to release from priority or to assign any of the State’s filings.” (Ibid.) Specifically, the Legislature amended the Feigenbaum Act to provide that “no such priority shall be released,, or assignment made of any such appropriation that will, in the judgment of the state department of finance, deprive the county in which such appropriated water originates, of any such water necessary for the development of such county.” (Stats. 1931, ch. 720, § 1, p. 1515.) This amendment was the culmination of several attempts since 1925 “to protect the counties of origin against exportation of water which might be needed by them in their own future development.” (25 Ops. Cal. Atty. Gen., supra, at p. 12.) Two years later, in 1933, “[a]s the result of the prolonged studies and planning by the state, the Legislature ... enacted a statute designating the Sacramento-San Joaquin coordinated project as the Central Valley Project” (the CVP). (Ivanhoe Irr. Dist. v. All Parties, supra, 47 Cal.2d at p. 614, 306 P.2d 824.) Part of the Central Valley. Project Act of 1933 was a provision that later became section 11460, which provides: “In the construction and operation by the department of any project under the provisions of this part a watershed or area wherein water originates, or an area immediately adjacent thereto which can conveniently be supplied with water therefrom, shall not be deprived by the department, directly or indirectly of the prior right to all of the water reasonably required to adequately supply the beneficial needs of the watershed,' area, Or any of the inhabitants or property owners therein.” FN5 (Stats. 1933, ch. 1042, § 11, pp. 2650-2651.) FN5. Although on its face this provision applies only to the Department, section 11128 makes the statute applicable to the Bureau as well. “The limitations prescribed in Section 11460 and 11463 shall also apply to Any 'agency of the State or Federal Government which shall undertake the construction or operation of the project, or any unit thereof, including, besides those specifically described, additional units which are consistent with and which may be constructed, maintained, and operated as a part of the project and in furtherance of the single object contemplated by this part.” (§ 11128.) The CVP “Construction of the CVP began in 1937. It is now one of the world’s most extensive water transport systems.... Shasta Dam on the upper Sacramento River is the focal point of the CVP. Shasta Dam was completed in 1945 but began storing water and generating electric power in 1944. The waters of the Sacramento River which flow past the Shasta Dam are augmented by additional water supplies brought through a tunnel from the Trinity River and from reservoirs formed by Folsom and Nimbus Dams on the American River. About 30 miles south of Sacramento, the Delta Cross Channel regulates the passage of Sacramento River water through the Delta to the Tracy Pumping Plant.” [United States v. State Water Resources Control Board, supra, 182 Cal.App.3d at p. 99, 227 Cal.Rptr. 161.] The appropriative water rights necessary for operation of the CVP included rights acquired by assignment of various state-filed applications. Indeed, as of 1957, “[t]he greater portion of water to which the United States ha[d] acquired rights [wa]s by assignments from the state’s Director of Finance. [Citation.] Four assignments of applications for the appropriation of unappropriated water of the Sacramento River, totaling 35,000 second-feet diversion and 12,690,000 acre-feet annual storage, were made on September 3, 1938 .... ” (Ivanhoe Irr. Dist. v. All Parties, supra, 47 Cal.2d at p. 618, 306 P.2d 824.) 142 Cal.App.4th at 945-949, 48 Cal.Rptr.3d 468 (parallel citations and footnotes omitted). B. The Bureau’s Initiation of Permit Applications for the CVP Before the State Board. The Bureau of Reclamation (“Bureau” or “Reclamation”) took over operation of the CVP on behalf of the United States in the late 1930s. See SC 03663; see also State Water Board Decision 990 at 5-6. In 1938, the State of California assigned to the United States a number of pending water rights applications related to the mainstem Sacramento River. SC 03663. In 1952, another application for direct diversion from Delta channels was assigned to the United States. SC 03664. The United States applied to the State Water Rights Board (the “Board” — a predecessor to the State Water Resources Control Board (“SWRCB”)) for permits to operate the CVP with water from the assigned water rights, along with a 1943 water rights application for power and incidental domestic purposes at Keswick Power Plant. D-990 at 6,10-14. One of the central purposes of the state water rights application/permitting process is to determine whether there is sufficient water available to satisfy both senior rights-holders and the applicant’s requested appropriation. California Water Code (“CWC”) § 1375 (“As prerequisite to the issuance of a permit to appropriate water ... [t]here must be unappropriated water available to supply the applicant”); 23 Cal. Admin. Code § 731(a) (“A person who claims an existing right to the use of water shall be granted a permit or license to appropriate no more water than is needed over that which is available under the existing right to meet the beneficial use requirements of the project.”). The SWRCB disclaims authority to directly adjudicate or otherwise resolve disputes over the validity, nature, or extent of pre-1914 water rights. See SWRCB, Information Pertaining to Water Rights in California — 1990 at p. 8. Instead, the parties may file suit in a court of competent jurisdiction to determine the extent and nature of such water rights. The court may, in turn, refer the matter to the Board, as referee, for investigation. See CWC §§ 2000, 2001. Alternatively, “one or more claimants to water of any stream system” may request “the determination of the rights of the various claimants to the water of that stream system.” CWC § 2525. If “the facts and conditions are such that the public interest and necessity will be served by a determination of the water rights involved,” the Board may “enter an order granting the petition and make proper arrangements to proceed with the determination.” Id. C. The 1956 Cooperative Studies and Related Analyses. On July 7, 1952, Reclamation, the State of California, and the Sacramento Valley Water Users Committee entered into a “Memorandum of Understanding Relating to a General Approach to Negotiations for Settlement of Water Diversions from the Sacramento River and Sacramento-San Joaquin Delta with the Objective of Avoiding Litigation.” SC 03629-32 (“1952 MOU”). The signatories agreed that: The Federal Government acting through the Bureau of Reclamation is applying for certain permits to appropriate unappropriated water from the Sacramento River, in aid of the Central Valley Project. The water users along the Sacramento River, hereinafter referred to as “the watér users”, who are for the purposes hereof acting through the Sacramento Valley Water Users Committee, have protested the applications of the Federal Government for such permits and seek various conditions and limitations. The State Engineer, before whom the applications are pending, encourages satisfactory agreements between applications and protestants providing for withdrawal of protests. The Federal Government has also indicated that an authoritative determination of the validity and extent of rights to the Use of water of the Sacramento River is necessary, and the parties hereto are in accord that this determination should be made by agreement, if possible, rather than by litigation. The water users and the Federal Government are accordingly undertaking to negotiate an adjustment of the various matters just referred to without litigation and with a minimum of formal proceedings, for their mutual benefit. Such adjustment would eliminate the delay, expense and uncertainty attendant upon complex and difficult lawsuits, with a view of apportioning the water of the Sacramento River in an equitable manner so that the Central Valley Project can function in the manner intended without injury to the water users. The state of California will participate and assist in these negotiations through its State Engineer and its Attorney General. * * * [The] general approach [suggested by this memorandum] shall not in any way prejudice any water rights claimed by any of the parties ... SC 03629-30 (emphasis added). The unambiguous intent of the MOU is to reach, by agreement and compromise, “an authoritative determination of the validity and extent of rights to the use of water of the Sacramento River,” as between Sacramento River water users and the United States. To do this, the parties “entered into a cooperative study program” in an “effort to reach an agreement on existing water rights along the Sacramento River and in the Delta.” D-990 at 28. The results of the 1956 studies were published in the “Report on 1956 Cooperative Study Program,” which reaffirmed that the studies were intended to “produce information that would be used to further negotiations aimed at reaching an agreement on water rights along the Sacramento River and in the Delta.” SC 00065. The Report explained that the assumptions utilized in the studies were “solely for the purpose of evaluating the effects of [those] assumptions upon water right yields, deficiencies, and supplemental water requirements, and no implications as to the legal status of such assumed rights are intended.” SC 00066 (emphasis added). Using the results of the cooperative study program, the parties presented separate studies to the Board to support an “equitable basis for determining the yields of existing rights along the Sacramento River and in the Delta.” D-990 at 31 (emphasis added). Study C-2BR was prepared by Reclamation and Study C-650D was submitted by the Sacramento River and Delta Water Association. Id. A description of the C-650 Study published by the California Department of Water Resources (“DWR”) in 1959 reiterates that the purpose of the then-ongoing negotiations between Sacramento River water users and the Bureau is “to find a basis for agreement upon the respective water rights of these parties and upon a suitable arrangement for the water users to obtain a supplemental water supply from the Central Valley Project.” SC 03451 (emphasis added). D. Van Camp’s Summat'y of the Evidence Underlying the 1956 Cooperative Study Program and Related Investigations. GCID submits the declaration of Marc Van Camp, a registered civil engineer with extensive experience in the fields of hydrology, hydraulics, irrigation, drainage, groundwater, water supply, water rights, and related subjects. Doc. 775. His declaration summarizes and explains voluminous technical information pertaining to the SRS Contractors’ relevant underlying water rights. Id. Much of Van Camp’s information is from the 1956 Cooperative Studies, C-2BR, and C-650. Id. at ¶ 9. Van Camp presents a series of tables to summarize the nature and extent of the senior water rights held by each of the SRS Contractors. Exhibits C-l through C-28 summarize those senior rights considered and used to arrive at the original contract quantities. Id. at ¶ 11. Exhibits D-l through D-28 are plots for each of the SRS Contractors, showing the monthly contract quantities ultimately provided for within each of the original SRS Contracts, together with the water rights data from C-l through C-28. Id. at ¶ 12. Exhibit E depicts the combined monthly water rights quantities and the combined monthly contract quantities of 27 of the 28 challenged SRS Contracts, distinguishing between the various types of underlying and contractual water rights involved. Id. at ¶ 13. According to Van Camp’s uncontradicted review of the information contained in these Studies, the underlying water rights held by the SRS Contractors included pre1914 appropriative water rights, posH914 appropriative rights, riparian rights, and a small volume of “other” types of water rights. Most of the underlying water rights included only a maximum rate of diversion and a season of diversion. None of the underlying water rights included any monthly diversion limits, other than the maximum rate of diversion. Van Camp opined that in all but six eases, the monthly contract quantities eventually agreed to in the original set of SRS Contracts were less than the “documented” underlying water rights. Id. at ¶ 41. The sum of the monthly contract quantities that exceed the face value of the underlying water rights accounts for approximately one percent of the total contract quantity for the 28 contractors at issue in this case. Id. Van Camp opines that some of these exceedences are attributable to small differences in assumptions used to estimate monthly demand, rounding, and the failure to identify all “other” water rights concerned. Id. at ¶ 56. Van Camp explains that other exceptions, such as the fact that Anderson Cottonwood Irrigation District’s (“ACID”) pre-1914 claim is less than the monthly contract quantities provided for in their contract, was the result of Reclamation and ACID’s consideration of “unusually high conveyance losses, porous soils, and projected crop patters within ACID....” Id. at ¶ 50. E. D-990. In response to the United States’ applications, the Board held more than 75 days of hearings over the course of more than a year. D-990 at 6-7. The Board first rejected the United States’ position that it should be issued an unconditional permit to appropriate water for the operation of the CVP, reasoning: [This] demand ... is irreconcilable with the provisions of Section 8 of the Reclamation Act of 1902 that federal reclamation law is not intended to interfere with state laws “relating to the control, appropriation, use, or distribution of water used in irrigation ... and the Secretary of the Interior, in carrying out the provisions of this act shall proceed in conformity with such laws.... ” There is no such thing as an unconditional water right under the law of California, or of any other western state for that matter. Id. at 25. D-990 recognized that “[t]he final report acknowledged [that the] assumptions [made in the studies], particularly with respect to water rights, may differ considerably from the rights as may be determined by a court of law.” Id. at 31. The Board also examined the data to determine the maximum quantity that the Bureau should be permitted to divert to storage during any given year: In fixing the rates of direct diversion to be allowed, the Board is inclined to greater liberality than usual because of the magnitude of the Project and the complexities involved in determining at this time the direct diversion as distinguished from rediversions of stored water. However, notwithstanding these considerations, we would require greater particularity in proof of direct diversion requirements were we not assured that no prejudice to others will result from failure of applicant to produce such proof. This assurance is provided by conditions which will be imposed in the permits subjecting exports of water from the Delta to use within the Sacramento River Basin and Delta so that there can be no interference with future development of these areas. Id. at 40. The Board concluded: [T]he public interest requires that water originating in the Sacramento Valley Basin be made available for use within the Basin and the Sacramento-San Joaquin Delta before it is exported to more distant areas, and the permits granted herein will so provide. However, the Board will limit the period of time in which such preference may be exercised. This limitation is necessary in order to best conserve in the public interest the water to be appropriated. The Board considers that, in view of the length of time the Project has been in operation, a period of approximately three years is a reasonable time in which the users within the watershed who are currently using water from [the] Sacramento River or the Delta may have a preferred right to Project water. Accordingly, the permits will provide that until March 1, 1964, requests for water service contracts from such users within the Sacramento Valley and Delta shall be preferred over requests from users outside the watershed. The Board concurs with Counsel for the Association that a period of approximately ten years is a reasonable length of time in which users within the watershed who are not presently diverting water from the Sacramento River or Delta may consummate contracts for Project water [citation]. Accordingly, the permits will provide that until March 1, 1971, requests for water service contracts from such users shall be preferred over requests from users outside the watershed. Users within the watershed who do not presently hold appropriative rights but who wish to initiate such rights by application to this Board should also be afforded preference. Accordingly the permits granted for use outside the watershed shall be subject to rights initiated by applications for use within the watershed. Id. at 72-73. The Board directly encouraged the United States to reach a settlement agreement with the Sacramento River water users who held “existing rights” in the Sacramento River: Throughout these proceedings, the Bureau’s representatives have consistently affirmed their policy to recognize and protect all water rights on the Sacramento River and in the Delta existing under State law at the times these applications were filed, including riparian, appropriative and others. Unfortunately, these rights have never been comprehensively defined. It is imperative, therefore, that the holders of existing rights and the United States reach agreement concerning these rights and the supplemental water required to provide the holders with a firm cmd adequate tvater supply, if a lengthy and extremely costly adjudication of the waters of the Sacramento River and its tributaries is to be avoided. Id. at 75 (emphasis added). The Board found: [Unappropriated water exists in the Sacramento river and in the Delta at times and in sufficient amounts to justify approval of [the] Applications.... [T]he uses proposed are beneficial; that such waters in general, but with certain exceptions and subject to certain conditions, may be taken and used as proposed without interference with the exercise of prior rights; and that the applications should be approved and permits issued pursuant thereto, subject to the usual terms and conditions and subject to those additional terms and conditions indicated in ... this decision for the protection of prior rights and in the public interest. The Board finds that as so conditioned the developments proposed in these applications will best develop, conserve and utilize in the public interest the water sought to be appropriated. Id. at 79. The position of the United States is unequivocal: to “recognize and protect” existing Sacramento River water rights already held by SRS users at the time (1952) the Bureau’s applications were filed. The parties did so by agreement. On February 9, 1961, the board granted the Bureau’s applications, subject to, among others, the following relevant conditions: 20.The quantity of water which may be diverted under permits issued pursuant to Applications 5625, 5626, 9364 and 9365 shall remain subject to depletion of stream flow above Shasta Dam by the exercise of lawful rights to the use of water for the purpose of development of the counties in which such water originates, whether such rights have been heretofore or may be hereafter initiated or acquired; such depletion shall not exceed in the aggregate 4,500,000 acre-feet of water in any consecutive 10-year period and not to exceed a maximum depletion in any one year in excess of 700,000 acre-feet. 21. In conformity with Water Code Section 10505, permits issued pursuant to Applications 9363, 9366, 9367 and 9368 shall be subject to any and all rights of any county in which the water sought to be appropriated originates to the extent that any such water may be necessary for the development of such county. 22. Direct diversion and storage of water under permits issued pursuant to Applications 5626, 9363, 9364, 9366, 9367 and 9368 for use beyond the Sacramento-San Joaquin Delta or outside the watershed of Sacramento River Basin shall be subject to rights initiated by applications for use within said watershed and Delta regardless of the date of filing said applications. 23. The export of stored water under permits issued pursuant to Applications 5626, 9363 and 9364 outside the watershed of Sacramento River Basin or beyond the Sacramento-San Joaquin Delta shall be subject to the reasonable beneficial use of said stored water within said watershed and Delta, both present and prospective, provided, however, that agreements for the use of said stored water are entered into with the United States prior to March 1, 1964, by parties currently diverting water from Sacramento River and/or Sacramento-San Joaquin Delta and prior to March 1, 1971, by parties not currently using water from Sacramento River and/or Sacramento-San Joaquin Delta. Id. at 84-86. The parties place particular emphasis on Condition 23. F.1951 House Interior and Insular Affairs Committee Report. Congress also urged the Bureau to reach an agreement with the SRS Contractors. In 1951, the House Interior and Insular Affairs Committee issued a report recognizing the growing possibility of conflict between existing Sacramento River water users and the nascent CVP, urging the Bureau to avoid litigation. See Engle, CVP Documents, Part I, S. Res. 1, 84th Cong. (2d Sess.), H.R. Res. 416 at 675-783 (1956). In this report, Congress expressed its concern about the possibility that the CVP could become involved in “[a] monstrous lawsuit ... that would embroil the [CVP] in litigation for decades.” Id. at 681. On the one hand, the Committee nowhere conceded that the CVP’s rights were subordinate to any other existing rights on the Sacramento River. The Report provides that, should the matter be taken to court, the Department of Justice “would undoubtedly represent the interest of the Federal Government and assert every possible claim to the water....” Id. However, the Report simultaneously acknowledged that any dispute over the relative priority of the Bureau’s water rights would be a heated one, as the Bureau promised “that no water which is needed in the Sacramento Valley will be sent out of it.” Id. at 678. Moreover, “instead of firm water rights necessary for the operation of the [CVP] the Bureau ... had in effect merely ‘four pieces of paper’ which the State of California ... in effect said the Bureau should ‘take to court’ to find out if it has any water rights.” Id. at 682. G. Negotiation of the SRS Contracts. The proposed contracts were developed and forwarded to interested Sacramento River water users in 1962. A February 15, 1963 Memorandum Report on Sacramento River Water Diversions, developed by a specially appointed panel, made recommendations to the Secretary of the Interior on the negotiations. The Report recommended, among other things, that “the water studies C-2BR and C-650-B, which were the principal bases for derivation of schedule A quantities applicable to diverters above the city of Sacramento, continue to be the principal bases for determining each diverter’s entitlement to the so-called base supply of Sacramento River water----” SC 03685. However, the possibility was left open that “adjustments [could] be made in individual cases where there is specific and convincing justification for departure.” Id. H. The SRS Contracts. The United States reached agreement with the Settlement Contractors and executed most of the original SRS Contracts in 1964. SAR 004147. The SRS Contracts fixed the specific volume of water and place of use for each SRS Contractor for 40 years and during any renewals of those contracts, all subject to the condition subsequent that if a general stream adjudication or other proceeding to judicially and/or administratively determine Sacramento River System water rights eventuates, the parties are no longer bound by the contract settlements, and all parties are then free to assert the full extent of their claimed SRS water rights. SC 04447-05760. I. Decision 1641. In Decision 1641 (“D-1641”), issued December 1999 and revised March 2000, the SWRCB modified the United States’ permits to operate the CVP to implement flow objectives for the Sacramento San-Joaquin Bay-Delta Estuary, in response to petitions to change points of diversion of the CVP and SWP in the Southern Delta, and to address a petition to change places and purposes of use for the CVP. Among other things, D-1641 amended the United States’ permits to operate the CVP to include the following conditions concerning endangered species: This permit does not authorize any act which results in the taking of a threatened or endangered species or any act which is now prohibited, or becomes prohibited in the future, under either the California Endangered Species Act (Fish and Game Code sections 2050 to 2097) or the Federal Endangered Species Act (16 U.S.C.A sections 1531 to 1544). If a “take” will result from any act authorized under this water right, the permittee/licensee shall obtain authorization for an incidental take prior to construction or operation of the project. Permittee/Licensee shall be responsible for meeting all requirements of the applicable Endangered Species Act for the project authorized under this permit/license. D-1641 at 148. This does not diminish the SRS Contractors’ rights. J. CVPIA. Effective October 31, 1992, Congress enacted the Central Valley Project Improvement Act (“CVPIA”), Pub.L. No. 102-575, 106 Stat. 4600 (1992), mandating changes in management of the CVP. Among other provisions, § 3406(b) provides that: The Secretary, immediately upon the enactment of this title, shall operate the Central Valley Project to meet all obligations under State and Federal law, including but not limited to the Federal Endangered Species Act, 16 U.S.C. § 1531, et seq., and all decisions of the California State Water Resources Control Board establishing conditions on applicable licenses and permits for the project. This provision does not elevate or subordinate any of the specified laws or decisions of the SWRCB over any other. With respect to the renewal of contracts, § 3404(c) provides: Renewal of Existing Long-Term Contracts-Notwithstanding the provisions of the Act of July 2,1956 (70 Stat. 483), the Secretary shall, upon request, renew any existing long-term repayment or water service contract for the delivery of water from the Central Valley Project for a period of twenty-five years and may renew such contracts for successive periods of up to 25 years each. (2) Upon renewal of any long-term repayment or water service contract providing for the delivery of water from the Central Valley Project, the Secretary shall incorporate all requirements imposed by existing law, including provisions of this title, within such renewed contracts. The Secretary shall also administer all existing, new, and renewed contracts in conformance with the requirements and goals of this title. III. ANALYSIS A. Threshold Issues. 1.Federal Defendants’ Argument that Summary Judgment Should be Granted on Other Grounds Raised in Their Summary Judgment Briefs. Federal Defendants argue that they are entitled to summary judgment for all of the reasons set forth in their original summary judgment motion, Doc. 679. The November 19, 2008 Memorandum decision rejected these other grounds upon which Federal Defendants sought summary judgment, finding them without merit. See Doc. 761. There is no basis to reconsider those decisions. 2.Proceedings Not Intended to Adjudicate Any Party’s Water Rights. Federal defendants renew their concern that this proceeding cannot adjudicate the extent of the SRS Contractors’ historical water rights. Such an adjudication is beyond the court’s jurisdiction over these proceedings. The sole focus of this proceeding is the applicability of Home Builders to the facts and circumstances of the existing record. 3.Preliminary Nature of Previous Discussions Regarding Home Builders. To the extent any party has interpreted the discussion in Part VI.D.l. of the November 19, 2008 Memorandum Decision to be a final decision, it was not so intended, as explained in the response to Plaintiffs’ request for certification of an interlocutory appeal of the Home Builders portion of that decision. See Doc. 811, filed February 12, 2009. 4.The ESA and CVPIA Apply to the SRS Contractors. The November 19, 2008 Memorandum Decision found: The CVPIA specifically exempts all Settlement Contracts from the various new requirements imposed by that law. Representative Fazio noted that such special treatment is appropriate “given the seniority of their water rights.” 138 Cong. Rec. H 11,493, 11,515-516 (Oct. 5, 1992). “These contractors have a prior right to the water they receive. They were entitled to this water before the project was constructed.” Id. Doc. 761 at 64. This statement needs clarification. While certain sections of the CVPIA apply only to “water service and repayment” contractors, e.g. § 3404(c) (requiring renewal of all “existing long-term repayment or water service contraet[s]” for periods of up to 25 years), other provisions explicitly include “water rights settlement contracts,” as distinguished from “water service or repayment contracts,” e.g., § 3405 (permitting “all individuals ... who receive Central Valley Project water under water service or repayment contracts, water rights settlement contracts, or exchange contracts” to transfer water, subject to certain conditions, “to any other California water user or water agency”). The November 19, 2008 Decision also found that any truly “senior” rights held by the SRS Contractors “are beyond the reach of the ESA.” This statement is over-broad. Even if, under Home Builders, section 7(a)(2) does not apply to the Bureau’s water allocation actions and the SRS Contractors’ diversion of their “senior” rights, it is undisputed that other sections of the ESA may apply, including section 9, 16 U.S.C. § 1539, which prohibits the “take” of an endangered species by any person without a permit. See United States v. Glenn-Colusa Irr. Dist., 788 F.Supp. 1126 (E.D.Cal.1992). 5. Evidentiary Matters. A number of evidentiary issues are pending. First, Plaintiffs filed a motion to strike portions of the Van Camp declaration. Doc. 821, filed March 2, 2009. GCID opposed the motion to strike. Doc. 823, filed Mar. 6, 2009. During the March 13, 2009 hearing on the Home Builders issue, the court overruled all of Plaintiffs’ objections to the Van Camp declaration, except that Mr. Van Camp’s use of the term “senior” in connection with this analysis of water rights is an inadmissible legal conclusion. Any legal conclusions advanced by the Van Camp declaration are inadmissible as irrelevant. Second, the SRS Contractors object to portions of Plaintiffs’ Request for Judicial Notice. Doc. 825, filed March 9, 2009. These objections are resolved in a concurrently-filed memorandum decision, incorporated by this reference. The SRS Contractors request the court take judicial notice of a number of documents, the existence of which are judicially noticeable as publically-filed documents in court proceedings. Doc. 774. A large number of these documents relate to the 1956 Cooperative Study Program and related investigations and the underlying water rights considered in those investigations. See id. In their Home Builders brief, Plaintiffs object to the “vast majority” of this evidence as “beyond the scope of these proceedings.” Doc. 820-2 at 25. Specifically, Plaintiffs argue that this evidence fails to document the kind of “finite, enforceable water rights,” evidence of which the district court called for at the start of these proceedings. Id. Plaintiffs objection goes to the weight, not the admissibility of this evidence. Plaintiffs’ objection is OVERRULED; the SRS Contractors’ Request for Judicial Notice is GRANTED. The documents are admissible only for the limited purpose of ascertaining whether the SRS Contractors hold definite and certain senior water rights. B. Does Section 7 of the ESA Apply to the Bureau’s Implementation and/or Execution of the SRS Contracts? 1. Legal Framework. Section 7(a) (2) of the Endangered Species Act (“ESA”), which requires federal agencies to consult with one of the federal wildlife agencies to determine whether their actions will affect threatened or endangered species or their habitat, only applies to those agency actions “in which there is discretionary federal involvement or control.” Home Builders, 127 S.Ct. at 2534. As a general rule, the Bureau retains considerable discretion to “choos[e] what specific actions to take in order to implement” the general goals of Reclamation Law. Nat’l Wildlife Fed’n v. Nat’l Marine Fisheries Serv., 524 F.3d 917, 929 (9th Cir.2008) (“NWF II”). The parties dispute whether and to what extent the Bureau’s discretion over the delivery of water to and contracting with the SRS Contractors has been constrained either by law or contract. Home Builders, 127 S.Ct. at 2524, addressed the transfer of permitting authority under the Clean Water Act’s (“CWA”) National Pollution Discharge Elimination System (“NPDES”) from the Environmental Protection Agency (“EPA”) to the State of Arizona pursuant to CWA § 402(b). Under section 402(b), the EPA “shall approve” a State’s request to assume the permitting program “unless [it] determines that adequate authority does not exist” to ensure that nine specific criteria set forth in the statute are satisfied. If the criteria are met, the transfer must be approved. Id. at 2525. At the same time, § 7 of the ESA requires federal agencies to consult with either FWS or NMFS to “insure that any action authorized, funded, or carried out by such agency ... is not likely to jeopardize” endangered or threatened species or their habitats. Id. (quoting ESA § 7). Home Builders recognized that “[although a later enacted statute (such as the ESA) can sometimes operate to amend or even repeal an earlier statutory provision (such as the CWA), repeals by implication are not favored and will not be presumed unless the intention of the legislature to repeal is clear and manifest.” Id. at 2532. The Supreme Court reasoned that requiring the EPA to comply with ESA § 7 when approving a transfer application “would effectively repeal § 402(b)’s statutory mandate by engrafting a tenth criterion onto the CWA.” Id. Section 402(b) of the CWA commands that the EPA “shall” issue a permit whenever all nine exclusive statutory prerequisites are met. Thus, § 402(b) does not just set forth minimum requirements for the transfer of permitting authority; it affirmatively mandates that the transfer “shall” be approved if the specified criteria are met. The provision operates as a ceiling as well as a floor. By adding an additional criterion, the Ninth Circuit’s construction of § 7(a)(2) raises that floor and alters § 402(b)’s statutory command. Id. at 2532-33 (emphasis in original). Home Builders approved a joint NMFS/ FWS regulation that provided: “Section 7 and the requirements of this part apply to all actions in which there is discretionary Federal involvement or control.” 50 C.F.R. § 402.03. Pursuant to this regulation, § 7(a)(2) would not be read as impliedly repealing nondiscretionary statutory mandates, even when they might result in some agency action. Rather, the ESA’s requirements would come into play only when an action results from the exercise of agency discretion. This interpretation harmonizes the statutes by giving effect to the ESA’s no-jeopardy mandate whenever an agency has discretion to do so, but not when the agency is forbidden from considering such extrastatutory factors. We conclude that this interpretation is reasonable in light of the statute’s text and the overall statutory scheme, and that it is therefore entitled to, deference under Chevron [U.S.A. Inc. v. Natural Resources Defense Council, Inc., 467 U.S. 837, 104 S.Ct. 2778, 81 L.Ed.2d 694 (1984)]. Section 7(a)(2) requires that an agency “insure” that the actions it authorizes, funds, or carries out are not likely to jeopardize listed species or their habitats. To “insure” something-as the court below recognized-means “ ‘[t]o make certain, to secure, to guarantee (some thing, event, etc.).’ ” 420 F.3d, at 963 (quoting 7 Oxford English Dictionary 1059 (2d ed. 1989)). The regulation’s focus on “discretionary” actions accords with the commonsense conclusion that, when an agency is required to do something by statute, it simply lacks the power to “insure” that such action will not jeopardize endangered species. Id. at 2533-35 (emphasis in original). Home Builders reasoned that “[a]gency discretion presumes that an agency can exercise ‘judgment’ in connection with a particular action,” id. at 2535, and that while the EPA might exercise “some judgment” in determining whether to approve a transfer application under CWA § 402(b), “the statute clearly does not grant it the discretion to add another entirely separate prerequisite to [the listed criteria,]” id. at 2537. Where a statute articulates broad goals or leaves sufficient room for an agency to maneuver, the consultation requirements apply. A recent example is Home Builders’ application to the operation of Federal Columbia River Power System (“FCRPS”) dams and related facilities in NWF II, 524 F.3d at 928. NWF II held the federal statutes authorizing operation of the FCRPS merely set forth “broad goals” for the agency to follow when operating the System, leaving the agency “considerable” discretion to balance its mandates with the requirements of the ESA. Id. at 928-929. Similarly, Natural Resources Defense Council v. Houston, 146 F.3d 1118 (9th Cir.1998), a pre-Nome Builders case, examined a statute that directed Reclamation to give contracting districts “a first right ... to a stated share or quantity of the project’s available water supply .... ” (quoting 43 U.S.C. § 485h-1(4)). Although Congress directed Reclamation to give the CVP Friant Unit water service contractors the first right to water, the statute qualified that obligation by indicating that only “available” water must be provided, leaving it to Reclamation to determine whether water needed for ESA purposes was “[un]available” for delivery. Id. at 1126. In contrast, where a prior agreement or enforceable permit or license fails to retain for the federal agency the right to take action on behalf of a now-listed species, consultation requirements may not apply. In Sierra Club v. Babbitt, 65 F.3d 1502 (9th Cir.1995), another pre-Home Builders case, a federal agency entered into a reciprocal right-of-way agreement with a landowner prior to passage of the ESA. Under the agreement, the agency only reserved the right to object to projects built in the right-of-way in limited circumstances. Id. at 1505-06. Because the agency did not retain discretion to “implement measures that inure to the benefit of ... protected species,” it was not required to reinitiate consultation when the spotted owl was listed. Id. at 1509. An analogous result was reached in Environmental Protection Information Center v. Simpson Timber Co., 255 F.3d 1073, 1079-82 (9th Cir.2001) (“EPIC”), where the Fish and Wildlife Service (“FWS”) was not required to reinitiate consultation when two species found on affected land were listed as threatened after FWS issued an incidental take permit to the landowner. Although FWS retained some discretion over activities pursuant to the take permit, it did not “retain discretionary control to make new requirements to protect species that subsequently might be listed as endangered or threatened.” Id. at 1081. An unambiguous limitation on agency discretion in the context of contract renewal exists under the Federal Power Act (“FPA”), which authorizes the Federal Energy Regulatory Commission (“FERC”) to issue long term licenses to operators of hydro-electric projects for periods not to exceed fifty years. 16 U.S.C. §§ 797, 799. When any such licenses come up for renewal, the applicant must begin a lengthy and complex relicensing process. 18 C.F.R. § 16.6. If FERC does not issue a new license before the expiration of the existing license, FERC is required to issue annual licenses “to the then licensee under the terms and conditions of the original license until ... a new license is issued,” 16 U.S.C. § 808(a)(1) (emphasis added), a clear example of mandatory, albeit temporary, renewal on terms and conditions of an original license. Platte River Whooping Crane Critical Habitat Maintenance Trust v. FERC, 876 F.2d 109 (D.C.Cir.1989) (“Platte I”), and a subsequent decision in the same case, 962 F.2d 27 (D.C.Cir.1992) (“Platte II”), concerned the issuance of annual FERC licences to two licensees. An environmental organization sued, arguing that FERC had an obligation to consider inserting conditions in the annual licenses that would benefit the Whooping Crane. Id. at 110-11. The D.C. Circuit upheld FERC’s interpretation of the FPA as empowering FERC “to amend an annual license, for example by adding conditions for the protection of fish and wildlife, only if the existing license contains such reservation of authority or the licensee agrees to such additional conditions.” Id. One of the disputed licenses included such a reservation of authority; the other did not. Id. at 112. Despite the reservation of authority in one of the licenses, FERC refused to consider inserting conditions for the protection of the Whooping Crane into either license. See id. at 114. FERC abused its discretion by “refusing even to explore the need for protective conditions.” Platte II, 962 F.2d at 30 (citing Platte I, 876 F.2d at 119). The D.C. Circuit “suggested that [FERC] could seek [the] cooperation [of the licensee whose original license did not contain a reservation of rights] in implementing any conditions deemed necessary,” but agreed that FERC only possessed authority to impose conditions unilaterally on the licensee whose original license contained a reservation of the authority to do so. Id. But see Turtle Island Restoration Network v. Nat’l Marine Fisheries Serv., 340 F.3d 969, 977 (9th Cir.2003) (where wildlife agency issues permits under a statute designed to promote compliance with international conservation treaties, the agency retains “substantial discretion to condition permits to inure to the benefit of listed species”). An agency’s discretion may also be constrained by previously-concluded management decisions subject to the consultation process. In a recent (post-Home Builders ), unpublished decision, an Arizona district court examined water releases for power generation on the Colorado River. Grand Canyon Trust v. United States Bureau of Reclamation, 2008 WL 4417227, 2008 U.S. Dist. LEXIS 83853 (D.Ariz. Sept. 26, 2008). An environmental organization claimed that Reclamation’s practice of allowing nonseasonal fluctuating releases of water into the Colorado River to generate electricity jeopardized the continued existence and habitat of an endangered fish. After close examination of the system’s operational history, the district court concluded that the release practices had been approved by a series of decisions in 1996 and 1997, which followed full, lawful consultation processes. The plaintiffs contention that Reclamation should be required to complete consultation every year when it prepares its Annual Operating Plan (“AOP”) for a number of reservoirs on the Colorado was rejected. The court held the agency’s action was “legally foreordained” by the 1996 and 1997 decisions, and that Reclamation lacked discretion to modify the regime to benefit the species. Id. at *15, 2008 U.S. Dist. LEXIS 83853 at *47 (citing Defenders of Wildlife v. United States EPA 420 F.3d 946, 967 (9th Cir.2005)); but see Pacific Rivers Council v. Thomas, 30 F.3d 1050 (9th C