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Sunday, January 2, 1994 - Page updated at 12:00 AM

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Hydro Project Sparks Big Battle Over Small River

BRINNON, Jefferson County - The Mississippi inspired Mark Twain to write novels. The Columbia inspired Woody Guthrie to write music.

The Dosewallips River has inspired lawyers to write briefs. Reams of them.

This small, pristine Olympic Peninsula stream has spawned a seven-year legal battle that's about to hit the big time: the U.S. Supreme Court.

Lawyers for the state and the city of Tacoma will argue PUD No. 1 vs. Washington before the high court early this year.

The justices' decision could influence everything from the fate of Northwest salmon and steelhead runs to the bottom line on your electric bill.

It all began nearly a decade ago as a dispute between state agencies and Tacoma City Light over how much water the utility could take from the Dosewallips to fuel a proposed hydroelectric power project.

But, like all cases that get this far, the issues are more cosmic now: states' rights, federal supremacy, congressional intent.

In essence, the Supreme Court has been asked to decide whether states can, under any circumstances, regulate how much water hydro developers must leave to flow in rivers and streams. It's a jurisdictional turf war that all parties agree has far-reaching implications.

One sign of the case's significance: the voluminous friend-of-the-court briefs filed by other states, environmentalists, fishermen and utilities from throughout the Northwest and the nation.

"This is definitely a big one," says Michael Blumm, a law professor at Lewis & Clark College in Portland and expert on water law.

A PROJECT WITH IMPACT

The Dosewallips travels just 28 miles from its source high in the glaciers of the Olympic Mountains to the mud flats of Hood Canal. Halfway through that journey, the river tumbles through a canyon, dropping 300 feet in a little over a mile.

It was here, just outside the boundary of Olympic National Park, that Tacoma City Light and its partner, Jefferson County Public Utility District No. 1, proposed in 1982 to capture the falling water's energy to heat heaters and light light bulbs.

They called it the Elkhorn project, after the Forest Service campground just downstream.

Their plans showed a barrier across the river 10 feet high, diverting most of the flow most of the year into a 9-foot diameter tunnel.

The water was to be piped to a powerhouse 1.2 miles downstream, then back to the river after turning the turbines. It wasn't a very big project for all the fuss it was to cause: just 13 megawatts, about 2 percent of Tacoma's average daily consumption.

From the start, the Elkhorn project's fate hinged on fish.

The stretch of river that Tacoma proposed to largely de-water supports - or has supported - coho and chinook salmon and steelhead trout.

On the Dosewallips, as on many other Northwest rivers, the fish are in trouble.

Scientists say the river's fall chinook are at high risk of extinction. Its spring chinook may already be extinct.

The federal government is studying adding all coastal coho stocks, including the Dosewallips', to the endangered species list. The river's winter steelhead run is considered depressed.

So, long before it submitted a license application for the Elkhorn project, Tacoma embarked on a two-year, computer-assisted study of the Dosewallips with the state departments of Ecology, Fisheries and Wildlife, the U.S. Fish and Wildlife Service and the Point No Point Treaty Council.

Its aim: determine the project's "minimum flows" - how much water Tacoma should leave in the river to protect fish habitat.

Tacoma, the agencies and the tribes analyzed the same data and came to different conclusions.

Tacoma submitted minimum flows for the reach that it said would result in no net loss of fish habitat.

The agencies and tribes said higher flows were needed. Tacoma said the agencies' flows would actually produce more habitat than the Dosewallips provides in its natural state. It was a complex, highly technical dispute that boiled down mostly to questions of emphasis and interpretation.

Finally, in 1986, the Department of Ecology ordered Tacoma to abide by the minimum flows the agencies and tribes had proposed.

LAWS, AGENCIES COLLIDE

When you compare those numbers and Tacoma's with the Dosewallips' mean monthly flows, the differences don't seem great.

But they were great enough, Tacoma said, to reduce the power output of the Elkhorn project 17 percent - enough to undercut the project's economics, effectively killing it. The city appealed.

If Tacoma City Light had simply challenged Ecology's numbers, its appeal never would have reached the U.S. Supreme Court.

The city is contesting something more fundamental: the authority of the state - and, by extension, any state - to impose any minimum flows on hydro projects.

By law, Tacoma contends, that's the exclusive province of the Federal Energy Regulatory Commission (FERC), the federal dam-licensing agency. The state Pollution Control Hearings Board, a Thurston County Superior Court judge and the Washington Supreme Court all rejected that argument.

If the U.S. Supreme Court also turns Tacoma down, environmentalists say, dam-builders will be forced to pay more attention to fish, wildlife and recreation.

Some dams may not be built at all.

Utilities argue that such an outcome will mean regulatory chaos and less reliance on hydropower, a cheap, renewable energy source the nation can't do without. Their contrary opinions stem largely from their contrary views of FERC.

SEEN AS `THE BAD GUYS'

The five-member commission has a reputation among environmentalists and fish advocates as perhaps the most notorious eco-villain in the federal firmament, an agency that never met a dam it didn't like.

"They're always willing to give the power folks the benefit of the doubt," says Katherine Ransel, co-director of the Seattle office of American Rivers, a national conservation group.

"Dealing with them is like throwing stuff into a black hole."

FERC has guarded its turf jealously, arguing repeatedly in court that it can license dams over the objections of states and other federal agencies.

It has won more often than it has lost. The Supreme Court upheld FERC's right to pre-empt state laws, permits and requirements affecting hydro projects in 1946 and again in 1990.

What's different about the Dosewallips case is that the Department of Ecology imposed minimum stream flows not on its own authority, but in carrying out its responsibilities under a federal law, the Clean Water Act. That law says that, before projects can win federal approval, the affected states must certify they won't violate water-quality standards.

What's more, it says federal agencies can't change any conditions states attach to the certificate.

The Department of Ecology included the minimum flows for the Dosewallips in its water-quality certificate for the Elkhorn project.

Only once before had the agency imposed such a condition using the Clean Water Act. If it prevails before the Supreme Court, Washington and other states will have secured a powerful new tool for protecting rivers.

Environmentalists say states can't do a worse job than FERC has.

"The central issue here is whether FERC is still king," says Blumm, the law professor.

The Department of Ecology went too far, Tacoma argues: the Clean Water Act deals with water quality, not quantity.

"They're trying to use this small little window to manipulate the process to accomplish what they want in these other areas," says Steve Klein, Tacoma City Light superintendent.

Congress has charged FERC with the task of balancing hydro development with fish protection, recreation, flood control, navigation and other competing uses.

If FERC had imposed the minimum flows the Department of Ecology adopted for the Elkhorn project, Klein says, Tacoma probably wouldn't have a case.

But the state is under no similar obligation to seek balance, he says. "They can impose a condition that kills the project. And if they can do it here, they can do it at existing projects."

That may be what concerns utilities like Seattle City Light and Puget Sound Power & Light most. They get much of their electricity from aging dams. When the FERC licenses authorizing those projects expire, the utilities must seek new ones - and water-quality certificates from the state.

STATE FLEXES ITS MUSCLE

On the White River, where Puget Power has operated a hydro project for 80 years, the Department of Ecology last April imposed minimum flows for fish that both the utility and FERC staff contend are too high.

But FERC says it has no choice but to accept them, unless the Supreme Court rules otherwise in the Dosewallips case.

Bonnie Lindner, licensing coordinator for Puget Power, says the Ecology Department's flows translate into a 14 percent drop in the project's annual power output - electricity that must be made up from some other, more expensive source.

Utilities recognize they must leave more water for fish at dams, Klein says, but it comes at a price. "How many barrels of oil are we talking about importing?"

If the Department of Ecology imposes unreasonable flows, they won't withstand judicial scrutiny, says Jay Manning, senior assistant attorney general for the department.

He acknowledges the state will face a conservative Supreme Court not known for environmentalist leanings.

"We're not going to win this case by talking about salmon and steelhead," Manning says.

But the Department of Ecology got a boost last month when the Clinton administration sided with the state. If George Bush were still president, says Klein, it wouldn't have happened.

PROJECT MAY NEVER HAPPEN

As the Dosewallips case has wound its way through the judicial system, the details of the original conflict have faded from combatants' memories.

Klein has been superintendent of Tacoma City Light only since July. The Department of Ecology has gone through three directors since 1986.

FERC has put Tacoma's license application on hold pending the Supreme Court's ruling. Even if the city prevails, the project still faces problems.

The four-state Northwest Power Planning Council designated the Dosewallips a protected area in 1988, a river with fish and wildlife resources so valuable it should never be dammed.

FERC isn't required to follow the council's wishes - but it is supposed to give them substantial weight. The Elkhorn site is on national forest land.

President Clinton's proposed Northwest forest plan, unveiled in July, includes the area in a reserve, off-limits to almost all development.

New, small hydro projects aren't as economically attractive as they were a decade ago.

Even if Tacoma does at long last get the go-ahead, Klein says there's no guarantee Elkhorn ever will be built.

On the Dosewallips, the principles eclipsed the project long ago.

----------------------------------------- THE DOSEWALLIPS: HOW MUCH WATER FOR FISH? ----------------------------------------- Tacoma City Light says the state Ecology Department's minimum flows for the Dosewallips River - the volume that must remain in the river - aren't warranted and effectively kill its proposed dam project. Below, all flows are expressed in cubic feet per second.

TACOMA'S ECOLOGY DEPT.'S.

PROPOSED ADOPTED . MONTH NATURAL FLOW # MINIMUM FLOW MINIMUM FLOW . -------------------------------------------------------------. January 340 100 140 . February 302 75 100 . March 325 145 200 . April 408 130 200 . May 689 105 200 . June 738 105 200 . July 448 90 200 . August 222 170 200 . September 159 150 150 . October 149 140 140 . November 285 95 140 . December 397 75 140 .

# Mean flow: more water half the days, less water half the days of each month. Source: Department of Ecology

Published Clarification Date: 01/09/94 - A Chart In This Article Describing Monthly Flows Of The Dosewallips River On The Olympic Peninsula Inaccurately Labeled The ''Median'' Flow As The ''Mean'' Or Average Flow. The Median Monthly Flow Is The Volume That Is Exceeded Half The Days Of Each Month.

Copyright (c) 1994 Seattle Times Company, All Rights Reserved.

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