The proposed Chuitna coal strip mine that would excavate a Cook Inlet salmon stream out of existence was the backdrop last week to a lawsuit seeking to force the Parnell administration to act on water rights applications to protect the stream.
The Chuitna strip mine, proposed by a Texas company affiliated with Dallas billionaire William Herbert Hunt, would be the biggest mine ever developed in Alaska salmon habitat.
The Chuitna Citizens Coalition has gone to court to force the state Department of Natural Resources to act on its water rights applications to keep the stream flowing. Like all other such requests from private groups, the application has languished with no attention for years.
The court case comes during a pause in a political battle over legislation being pushed by the Parnell administration that aims to end any ability of private interests to make such claims to begin with.
The citizens group includes residents from the small western Cook Inlet community of Beluga as well as set-net commercial fishermen. The case was argued Wednesday before Anchorage Superior Court Judge Mark Rindner.
They are trying to preserve Middle Creek, within the proposed Chuitna Coal Project.
The developer, PacRim Coal Limited Partnership, plans a large strip mine about 12 miles northwest of Tyonek and 45 miles west of Anchorage. Hunt, 84, one of the famed Texas brothers who made and lost a fortune on silver, is listed as the manager of the company that acts as PacRim partnership's general manager. PacRim plans to extract an estimated 300 million tons of coal over 25 years, said PacRim vice president Joe Lucas.
The coal would be sent along a conveyor belt nine or so miles long to a dock yet to be developed. The area to be mined stretches across 5,000 acres -- nearly eight square miles -- within 20,000 acres of mineral leases on state land owned by the Alaska Mental Health Trust Authority, Lucas said. PacRim has applied for some key permits with others in the works, Lucas said.
The citizens group, which is being represented by the nonprofit environmental law firm Trustees for Alaska, wants to protect seven miles of Middle Creek, sometimes called Stream 2003, to ensure salmon will continue to spawn there. Developers propose redirecting the stream and its bed to the south.
"Coal mining is a large excavation project. So you have to dewater the area so you don't have where you are mining and where you are excavating fill up with water," Lucas said.
The Chuitna coalition contends that diverting the water flow would destroy vital salmon habitat, echoing the concerns about another massive proposed project, the Pebble gold and copper mine in the Bristol Bay region.
The group sued the Department of Natural Resources in 2011 to force it to act on water rights applications for Middle Creek. It filed those applications in 2009.
In Alaska, there's never been a mine of this size allowed in salmon habitat, Ed Fogels, deputy Department of Natural Resources commissioner, said in an interview.
At issue is a type of water right called a water reservation. State law says government agencies as well as private interests can seek approval from the Department of Natural Resources commissioner to reserve, or set aside, water for specific public purposes: recreation, navigation, water quality preservation, and protection of salmon and other wildlife.
They call it an "instream flow" reservation because it assures enough running water will remain in the creekbed or riverbed to preserve the public purpose.
For private groups frustrated with the pace of state action on their applications, the current law, passed in 1980, seems to exist only on paper now, said Valerie Brown, the attorney with Trustees for Alaska handling the water rights case.
"It's supposed to be a better, more proactive way to protect fish, but DNR doesn't let anybody use it," Brown told a reporter after last week's court hearing.
None of the 35 private applications -- including three from the Chuitna Citizens Coalition -- has ever been acted upon, Colleen Moore, senior assistant attorney general, acknowledged to Rindner in court. She's defending DNR in the Chuitna case.
And, as it turns out, few public agency requests are getting action either.
The U.S. Fish and Wildlife Service hasn't had any of its applications for water rights dealt with, and there are 187 applications pending, Moore said. The federal Bureau of Land Management has had one request resolved, but 19 more are pending, she said.
The state Department of Fish and Game is getting action on some of its requests for water reservations after agreeing to fund most of a position in the Department of Natural Resources to do the work, Moore said.
In all, through December 2012, DNR had received 432 applications for water reservations in streams and had granted 61, including four sought by DNR itself, Trustees for Alaska said in a court filing. More have come in since, DNR says.
DNR says it has approved 56 requests by Fish and Game.
HOW LONG IS TOO LONG
PacRim says that Middle Creek, or Stream 2003, is mainly habitat for silver salmon. King salmon tend to stay in the main river, six stream miles below the mine site, according to PacRim. The creek produces fewer than 10,000 smolt a year, the coal company says. Some 1,200 returned as adults in 2008. PacRim says it will create new habitat below the mine area; once the mine is played out, it will rebuild the stream, it says.
The citizens group questions whether that's possible considering the scale of the excavation.
The group includes Judy and Lawrence Heilman, who live in Beluga. He is retired from a 27-year stint working for the Chugach Electric Association power plant in Beluga. They hunt and fish. Middle Creek is an important salmon tributary to the Chuitna River and needs protection from the coal project, Judy Heilman said in a court filing.
Rindner asked Moore whether failure to act on an application violated the citizen group's constitutional rights.
When would it be a violation of due process to accept an application that's not acted upon? Rindner asked. "How long would it take? What is your outer limit ... or is it your position that you never have to act on these applications?"
There's no constitutional right at stake that requires DNR to act, Moore replied.
But state law creates a system for obtaining water rights, and DNR charges a fee to applicants, Rindner said. Doesn't that create an obligation to do something? he said.
"I think that there is an obligation to adjudicate them at some time," Moore said.
"But you just told me you never have to," the judge said.
"No, no," Moore said.
"You told me if you don't want to, you don't have to," Rindner said.
Then there was a misunderstanding, Moore said. It's not like DNR chooses not to act because "we don't like those people," she said.
DNR doesn't have enough staff for the complex work, she said.
"Every year it goes to the Legislature and it asks for more money to do more of these applications," she said. "It's a very long process, but it's not a process where DNR chooses not to do it."
The judge remained unconvinced.
"The excuse that the Legislature hasn't given us enough money doesn't trump constitutional rights," Rindner said.
DNR did seek funding for about 30 positions in 2011 to eat away at an overall backlog of more than 2,500 applications on a broad range of permits, including water rights. It went back the next year to keep the money in the budget, said Fogels, the deputy commissioner.
The application fee for each water reservation is $1,500, according to Trustees for Alaska. Chuitna Citizens Coalition was directed to break up its request into three parts, for $4,500 in filing fees plus the cost of required scientific stream studies that will need updating after so much time, Brown said.
DNR says there's no harm in waiting.
"In this situation, the water's in the stream. The water's not going anywhere," Moore told Rindner.
The whole system for reserving stream water could be changing. A hotly fought Parnell administration bill seeks to eliminate private groups from those that can petition to keep the stream flowing.
The measure, House Bill 77, stalled in the state Senate in the last days of the 2013 session. Parnell and his team plan to push it anew, Fogels said. PacRim supported the bill, Lucas said.
"Rumor has it by the end of this legislative session, you are not even going to have the right to ask," Rindner said in court to Brown, the trustees lawyer. "Should I be deciding constitutional issues or should I wait and see whether we still got a statute?"
There's no legal authority for a judge to delay a decision because of the possibility of legislation, Brown responded.
The massive bill seeks a number of changes in permits and was vigorously fought by critics, including former Senate President Rick Halford, an opponent of the proposed Pebble mine.
DNR contends that water reservations were intended to be used in resolving competing uses of the same stream, and if no one else is seeking to preserve or use the water, there's no pressure to act.
Water applications are complicated and time intensive, Fogels said. The state Department of Fish and Game is responsible for protecting the habitat, and it will keep its ability to apply for water rights even if House Bill 77 passes. The state should hold water reservations, not private interests, he said.
"It simply makes it so that a water reservation, which is supposed to be a public asset, is something that is applied for and held by a public entity," Fogels said.
Brown noted that the 1980 law didn't specify who would hold the reservation once granted. The authority could be placed in the state's hands by regulation, she said.
Water rights are supposed to be assigned under the doctrine "first in time, first in right," Brown told Rindner. But in the DNR system, there is no line, she said.
"This is a case where there is a pile that's not getting adjudicated," she said.
Rindner said he would rule soon but expects that whatever he decides will be appealed.
Reach Lisa Demer at email@example.com or 257-4390.
By LISA DEMER