Irrigators are asking a federal appeals court to rule that Endangered Species Act enforcement doesn’t trump state water right regulation in Oregon’s Klamath Basin.

The 9th U.S. Circuit Court of Appeals must decide whether federal species protections pre-empt an order issued by Oregon water regulators meant to protect irrigation storage in Upper Klamath Lake.

“If you don’t have a water right, you can’t use water. The ESA does not give you a water right,” said Nathan Rietmann, attorney for the Klamath Irrigation District, during June 12 oral arguments in San Francisco.

The irrigation district was joined by the Klamath Water Users Association in urging the 9th Circuit to overturn a 2023 ruling that determined ESA obligations allow the U.S. Bureau of Reclamation to disregard state government dictates for managing the lake.

The federal agency faces a fundamental quandary in regulating the lake, which contains two species of endangered sucker fish but whose water is also needed to sustain threatened salmon downstream. Withholding water can deprive salmon of healthy stream flows while releasing it can hurt the suckers as well as farmers who depend on the lake for irrigation.

At the behest of irrigators, the Oregon Water Resources Department sought to block the Bureau of Reclamation from releasing lake water in 2021, citing the state government’s authority to regulate water rights, and later accused the federal agency of violating the order.

Last year, U.S. District Judge William Orrick in San Francisco agreed with the Bureau of Reclamation that OWRD’s order and violation notices were pre-empted by the ESA because federal law prevails over state law under the U.S. Constitution’s Supremacy Clause.

“The OWRD Order conflicts with the ESA, at least because it poses an obstacle to the accomplishment and execution of Congress’s purpose and objective in enacting the ESA: protecting and restoring endangered species,” the ruling said.

According to the irrigator organizations, the judge’s ruling was erroneous because ESA requirements only apply to specific actions over which the federal government has discretion, but the Bureau of Reclamation lacks such discretion under its contracts with Klamath water users.

“There’s no such language that allows Reclamation to go back and revise the contracts,” said Brittany Johnson, attorney for the Klamath Water Users Association.

The KWUA also argued the federal government’s irrigation curtailments have unconstitutionally deprived them of private property, in the form of water rights, without just compensation.

The irrigators argued ownership of those rights determines the use of water, regardless of the federal agency’s control of the Link River Dam, which regulates lake storage.

In passing the ESA, Congress did not intend to displace water rights or state water laws, which the federal agency must follow under the Reclamation Act, according to the irrigators.

“This discussion is absolutely backwards,” since the federal agency’s authority under ESA is determined by its authority to use water, said Nathan Rietmann, attorney for the Klamath Irrigation District.

“Water is distributed based on water rights, it is not distributed based on ESA,” he said.

The federal government countered that legal precedents have already established the agency has discretion over the Klamath Irrigation Project and its actions are subject to ESA.

Under contracts between irrigators and the Bureau of Reclamation, the federal agency must determine the amount of water available for distribution — a discretionary action governed by ESA, said John Smeltzer, attorney for the government.

“There’s nothing in the contracts that determines the amount of water each user has,” Smeltzer said. “Reclamation not only controls the storage but what is available for use.”

Though the Bureau of Reclamation must comply with state water laws, that doesn’t absolve the agency from its duties under ESA, according to the government.

“The ESA acts as a restriction on the exercise of the water right,” Smeltzer said. “The contractual obligations are subject to the overriding law. When ESA interacts with the property right, that property right gives way.”

Under Oregon law, the Bureau of Reclamation isn’t required to withhold water under its storage water rights in the lake, the agency said. Releasing water simply limits that storage and doesn’t require additional rights for diversion or in-stream uses.

“It’s about the non-exercise of a right,” Smeltzer said.

As to the unjust takings claim, the Bureau of Reclamation doesn’t steal from irrigators to provide water for fish because their water rights are junior to those of Klamath tribes, the agency claimed. Those tribal rights are equal to the amount of water needed to avoid jeopardy to listed species.

The three-judge 9th Circuit panel overseeing the case raised concerns about the case potentially being rendered moot because OWRD withdrew the order in question after the 2023 ruling in federal court.

However, litigants on both sides of the dispute agreed the underlying legal question about federal discretion to curtail water rights under ESA remains active.

“This plays out every year in all but the wettest years,” said Brittany Johnson, KWUA’s attorney. “That means land is fallowed that would otherwise be planted.”

The legal question is also at the center of numerous other Klamath Basin issues that are currently on hold in state and federal courts, said Jay Weiner, attorney for the Klamath Tribes.

“Everything is absolutely at a standstill,” he said.