nents between certain States may affect the interest of other or other national and not merely regional interests.

inning with the Colorado River compact of 1922, Congress Approved some two dozen water allocation compacts which an equitable apportionment of the waters of the interstate under a variety of allocation formulas.

me say, Mr. Chairman, my study for the National Water nission led me to conclude and the National Water Commisto endorse the Federal interstate compact approach that has in effect since 1961 on the Delaware River in Mr. Gekas' =e, Pennsylvania, New Jersey, New York and Delaware. That el is one, it seems to me, looking at the ACT and ACF com-5, is one that was followed-tried to be followed in the two pacts under consideration here.

here is a similarity between them and particularly the emphan both compacts that, with the United States being a signatory y to those compacts, it is essential that the Federal agencies orm their activities to the maximum extent practicable and not onflict with Federal law to the regional program that the States e adopted.

et me just close by saying that the make a few comments on ACT and ACF compacts with which I have just recently become iliar.

irst, they appear to me to be compacts to enter into compacts. e 1997 compacts were not the end of the game. It was essentially authorization to negotiate a compact, because it is the critical ter allocation formulas that we are concerned about here, what States are doing in dividing up the waters.

Although Congress has sometimes approved similar negotiating mpacts, it has always required the resulting allocation formula be brought back to it for congressional consent. The ACT and CF compacts permit the resulting allocation formulas to be apoved by the Federal Commissioner, and I personally question hether Congress may constitutionally delegate its important legistive responsibilities under compact clause in that fashion.

As I looked briefly at the draft agreement under the ACT comact, it seems to me that that draft agreement is the compact that ught to be coming back at some point for congressional action, beause that is where all the meat of what is going to happen in the asin is contained.

Secondly, unlike the Delaware compact, you know, on these two Compacts, although the Federal Government is a signatory party, t has no voting rights on the commission that shapes and adminsters all the important allocation formulas, which the Federal agencies are mandated to respect.

Third, the two compacts expressly supersede inconsistent State laws, except for those relating to water quality and establishing riparian water rights, but they disclaim any intent to repeal, modify or amend any Federal law.

Finally, just as Federal agencies in the Delaware Basin must exercise their powers so as not to substantially conflict with the comprehensive plan that that interstate commission develops, so the two compacts here require the Federal agencies, "To the maximum extent practicable to exercise their powers, authority and discretion

in a manner consistent with the allocation formula so long as such exercise is not in conflict with Federal law."

In each case, the congressional objective is the same. The Federal agencies shall implement their programs consistent with the compact commission's regional program for water allocation and management, unless irreconcilably in conflict with national programs. That concludes my statement, Mr. Chairman. Mr. BARR. Thank you very much, Mr. Muys. [The prepared statement of Mr. Muys follows:]

PREPARED STATEMENT OF JEROME C. MUYS

Mr. Chairman and members of the Subcommittee, my name is Jerome C. Muys. I have practiced law here in Washington for many years in the water resources, public lands, public utility, and environmental law fields. I have been asked to provide some background legal and institutional information on water resources development, primarily on interstate river systems, for the Subcommittee's consideration of the status of developments under the Alabama-Coosa-Tallapoosa and Apalachicola-Chattahoochee-Flint interstate water allocation compacts among Georgia, Alabama and Florida approved by Congress in 1997.

I want to note at the outset that the Judiciary Committee has the opportunity and authority to play a potentially highly significant role in the development and management of the water and related land resources of the nation's many interstate river systems. Although other Congressional committees have jurisdiction with respect to federal water resources development and environmental protection laws applicable nationwide, this Committee has the unique responsibility to address cooperative state and federal state institutional arrangements addressing regional, as opposed to state or national water issues. Interstate water litigation has increased significantly over the past 10-15 years. Disputes over the Canadian River, Arkansas River, and Republican River interstate compacts, Virginia's rights on the Potomac River, and new disagreements among the states of the North Platte River Basin have been or currently are before the Supreme Court, while rumblings from Texas and New Mexico on the Rio Grande implicating the Rio Grande Compact may also portend additional litigation before the Court.

I have been asked to discuss briefly the respective roles of state and federal law in the development of the nation's water resources, and how those roles are affected by interstate compacts approved by Congress.

From the Nation's beginning, the allocation and development of water resources has been a matter predominately within the authority of the states, subject to the power of the federal government to regulate navigation and commerce on navigable waters under the Commerce Clause of the Constitution. Almost 160 years ago the Supreme Court declared that the states "hold the absolute right to all their navigable waters, and the soils under them for their own common use, subject only to the rights.. surrendered by the Constitution to the general government.” "1 The Court has never altered that fundamental principle.2 Of course, no one could have anticipated that in the intervening years the Court would expand the reach of the federal government's constitutional authority under the Commerce Clause from regulating navigation on plainly navigable rivers to regulation of a broader array of activities on the smallest non-navigable tributaries of such rivers that may "affect" their navigable capacity or, most importantly, perhaps, to allocation of interstate waters among the states.

When the United States acquired the vast land areas which subsequently became 37 new states, it became sovereign "owner" of those lands. As to the waters on those lands, the Supreme Court treated the United States' interest in them the same as that recognized in private landowners bordering a stream under the common law of England and later the 13 colonies and early states, i.e., the owner of riparian lands was entitled to the "reasonable use" of its "natural flow." Thus, in 1899 the Court recognized that “in the absence of specific authority from Congress a state cannot by its legislation destroy the right of the United States, as the owner of lands bordering on a stream, to the continued flow of its waters; so far at least as may be necessary for the beneficial uses of the government property. "3 It acknowledged that such “specific authority” had been conferred on the western states

1 Martin v. Waddell's Lessee, 16 Pet. 367,410 (1842).

2 See, e.g., Idaho v. Coeur d'Alene Tribe of Idaho, 521 U.S. 261, 283–86 (1997).

3 United States v. Rio Grande Dam & Irr. Co., 174 U.S. 690, 703 (1899).

by the Desert Land Act of 1877, which provided that "the water of all lakes, rivers and other sources of water supply upon the public lands and not navigable, shall remain and be held free for the appropriation and use of the public for irrigation, mining and manufacturing purposes subject to existing rights" under state law. However, as in Martin, supra, it held that the jurisdiction conferred on the western states to allocate use rights in such waters remained subject to the "superior power of the general government to secure the uninterrupted navigability of all navigable streams" 4 which Congress had subsequently exercised in 1890 by prohibiting unauthorized "obstructions to the navigable capacity of any waters of which the United States has jurisdiction." 5

Water resources development in the West was initially a matter almost solely of private investment, just as it had been in the East, but the magnitude of the investment needed to develop such resources led to federal assumption of the responsibility for providing water storage and distribution facilities for irrigation throughout the West in the Reclamation Act of 1902, applicable only to the 17 western territories and states.6

At about the same time Congress began to focus its attention on development of the hydroelectric power potential of the nation's rivers, which had up to that time been a matter of private or public initiatives at the state or local level securing Congressional approval of dams on a case-by-case basis. After a long legislative struggle, Congress enacted the Federal Water Power Act of 1920, which created the Federal Power Commission (now the Federal Energy Regulatory Commission ("FERC")) to license hydroelectric projects on all federally owned lands and waters subject to federal jurisdiction. The Commission was directed to develop comprehensive river basin plans and authorized to license non-federal projects "best adapted to a comprehensive plan for development" of the resources of each basin.

A series of devastating floods in the 1920's and 1930's led Congress to initiate major flood control programs dependent primarily on the construction of dams and levees by the U.S. Ármy Corps of Engineers, which had been responsible for maintaining the navigable capacity of the nation's waterways from the earliest days of the Republic. Thus by mid-century there were in place (1) the federal reclamation program under the Bureau of Reclamation applicable in the 17 western states, (2) the federal flood control program under the Corps of Engineers, which was applicable nationwide, and (3) the nationwide federal hydroelectric project licensing program under the Federal Power Commission. The two federal dam construction programs had spawned numerous projects across the nation, including the first two large scale multipurpose water projects providing water supply, flood control and power generation, with power sales providing the principal funding for such projects: the Bureau's Hoover Dam on the Colorado River and the Corps' Grand Coolee Dam on the Columbia. Similarly, FPC-licensed hydro projects had proliferated. With the rapid growth of our population after World War II with more leisure time and disposable income than ever before, recreation was added as an important water project purpose. Generally overlooked in the process were fish and wildlife and other environmental values, along with the historic water rights of Native Americans.

As you can imagine, conflicts between federal water resource development projects and non-federal projects dependent on water rights acquired under state law were inevitable. In accordance with traditional “preemption" law grounded on the Supremacy Clause of the Constitution, in cases of irreconcilable conflict between federal and state law federal law must prevail. In the 1950's and early 1960's a series of Supreme Court decisions tilting the respective roles of state and federal law in water resources development more to the federal government and expanding the magnitude of Indian reserved water rights and water rights for other federal reservations created consternation in the western states and Congress, but Congress took no action to reverse that trend.

8

4 Id. at 703

9

5 Id. at 707. The history of the Congressional severance of federal land and water interests in the West is reviewed in California Oregon Power Co. v. Beaver Portland Cement Co., 295 U.S. 142 (1935).

6 For the history of the development of the federal reclamation program, see California v. United States, 438 U.S. 645 (1978).

7 See, e.g., FPC v. Oregon, 349 U.S. 435 (1955); Ivanhoe Irr. Dist. v. McCracken, 357 U.S. 275 (1958); City of Fresno v. California, 372 U.S. 627 (1963).

8 Arizona v. California, 373 U.S. 546 (1963).

9 See, e.g., Hearings on S. 1275 before the Subcommittee on Irrigation and Reclamation of the Senate Committee on Interior and Insular Affairs, 88th Cong., 2nd Sess. (1964) (considering legislation directing the federal agencies to carry out their programs in conformity with state law).

Over this same time period the Supreme Court was framing a national policy with respect to interstate waters. The Founding Fathers had anticipated that a variety of regional disputes might arise within the newly-created federal system that would be beyond the power of a single state to deal with and yet not within what were then thought to be relatively narrow powers which the states had delegated to the national Congress. Hence the Constitution provided two mechanisms for dealing with them. Article 1, section 10, clause 3 authorized the continued use of interstate agreements or "compacts" (a device which had been liberally used in Colonial America to resolve boundary disputes), subject only to the requirement of Congressional consent to assure protection of any national interest that might be implicated in such agreements.

The second mechanism for the settlement of interstate disputes was an original action in the Supreme Court provided for in article III, section 2. In a number of decisions the Court progressively developed the guiding principle that it would apply in such cases, declaring that each state in an interstate river basin is entitled to an "equitable share" of the river, determined by the Court's evaluation of a number of factors relevant to an "equitable apportionment." See, e.g., Nebraska v. Wyoming, 325 U.S. 589, 618 (1945). I recently treated the evolution of the Court's equitable apportionment doctrine in a paper I delivered at the American Bar Association's Annual Water Law Conference in San Diego last February that I would like to submit for the hearing record.

It was not until the Supreme Court's 1963 decision in Arizona v. California, 373 U.S. 546, that a third avenue for the solution of interstate water disputes was discovered, namely Congressional exercise of its authority under the Commerce Clause. In that case the Court concluded that Congress had in the Boulder Canyon Project Act of 1928 effected a "statutory apportionment" of the mainstream of the lower Colorado River among California, Arizona, and Nevada by conferring upon the Secretary of the Interior, as part of his authority to manage Hoover Dam, the power to make a "contractual allocation" of those waters in the event that the three states were unable to agree to a compact. One can only speculate about whether certain Corps of Engineers water supply contracts might effect a similar allocation of interstate rivers.

Both the Bureau and the Corps have traditionally relied on state law for the acquisition of necessary water rights for their projects, the Bureau pursuant to the mandate of section 8 of the Reclamation Act and the Corps as a matter of comity. The Federal Water Power Act also requires a hydro project license applicant to acquire the water rights necessary for a proposed project under state law.

Let me digress a moment to explain that there are two basic state legal systems governing the acquisition and use of rights to water in the United States. The first is the riparian system, derived from the common law of England and applicable in most eastern and central states, which permits owners of land adjacent to rivers and other water bodies to make reasonable use of such waters on their riparian lands. The common law rule has been modified in most states by legislation requiring a permit for the exercise of such rights. The second system is the appropriation system, which developed as a matter of necessity in the arid western states. It is not dependent on ownership of riparian lands, but on the application of water to a reasonable beneficial use, and establishes priorities based generally on the principle that "first in time is first in right." In addition to these two basic state law systems, the Supreme Court has developed a body of federal law applicable to reserved federal and Indian lands in the western United States which can make significant inroads on established state created rights end programs. Similar federal and Indian water rights have not yet been held applicable in the rest of the nation. Let me turn now to a discussion of the role of interstate compacts in our federal system, and how they relate to existing state and federal water resources development and environmental protection legislation.

Article I, section 10, clause 3 of the Constitution, provides that” “No State shall, without the Consent of Congress enter into any Agreement or Compact with another State or with a foreign Power." Although the compact clause seems to mandate Congressional consent for all interstate agreements, the Supreme Court has held that consent is required only where the compact threatens to significantly impinge on national interests.10 Similarly, consent is not required prior to formal agreement, as the clause suggests, but may be evidenced either before or after agreement is reached.11 Sometimes, however, Congress has enacted legislation generally authorizing states to negotiate a compact on a particular subject matter but

10 Virginia v. Tennessee, 148 U.S. 503, 518-19 (1893); United States Steel Corp. v. Multistate Tax Commission, 434 U.S. 452 (1978).