Chapter 873 Oregon Laws 1999

Session Law

AN ACT

HB 2162

Relating to hydroelectric projects; creating new provisions; amending ORS 468.065, 536.015, 536.050, 536.750, 536.900, 536.935, 543.300, 543.710, 543A.075 and 543A.415; and repealing ORS 543A.070.

Be It Enacted by the People of the State of Oregon:

SECTION 1. Section 2 of this 1999 Act is added to and made a part of ORS 543A.005 to 543A.415.

SECTION 2. (1) As used in this section:

(a) "Holder" has the meaning given that term in section 4 of this 1999 Act.

(b) "In-stream water right" has the meaning given that term in ORS 537.332.

(c) "Reauthorize" has the meaning given that term in section 4 of this 1999 Act.

(2) An in-stream water right shall be subject to the limitations of ORS 537.350 and shall be maintained in perpetuity, in trust for the people of the State of Oregon. The priority date of the in-stream water right shall be the same as that of the converted hydroelectric water right. The location of the in-stream water right shall be the same as the point of diversion identified in the hydroelectric water right.

(3) Five years after the use of water under a hydroelectric water right ceases, or upon expiration of a hydroelectric water right not otherwise extended or reauthorized, or at any time earlier with the written consent of the holder of the hydroelectric water right, up to the full amount of the water right associated with the hydroelectric project shall be converted to an in-stream water right, upon a finding by the Water Resources Director that the conversion will not result in injury to other existing water rights. In making the evaluation, the director shall consider the actual use of the hydroelectric project and the resulting impacts on actual use by other existing water rights as of the date of this 1999 Act. The director may include mitigation measures as conditions of the in-stream water right to avoid injury and to ensure the continuation of authorized water uses by other existing water rights.

(4) If the hydroelectric project is authorized by a pre-1909 unadjudicated claim of registration, the determination of injury shall be based upon an evaluation of the actual use as measured during the five years preceding the conversion action, and shall not constitute a determination under ORS 537.670 to 537.695 as to the underlying claim of registration of the pre-1909 use. Judicial review of a final order relating to such a conversion shall be limited to review of the conversion action.

(5) This section shall not apply to projects on boundary waters that operate with water rights issued by the State of Oregon and by any other state except upon the written request of the water right holder.

(6) If hydroelectric production is not the sole beneficial use authorized by a water right, this section shall apply only to conversion of that portion of the water right used exclusively for hydroelectric purposes.

(7) This section shall not apply if the holder, at any time prior to conversion under subsection (3) of this section, transfers the hydroelectric water right under ORS 540.520 and 540.530, except that if a time-limited hydroelectric water right is transferred under ORS 540.520 and 540.530, the provisions of this section shall apply at the time of expiration of the time-limited water right.

SECTION 3. Sections 4 to 11 of this 1999 Act are added to and made a part of ORS 543.010 to 543.610.

SECTION 4. As used in sections 4 to 11 of this 1999 Act:

(1) "1998 dollar" means a dollar amount that when adjusted for inflation or deflation equals the value of a dollar in 1998.

(2) "Holder" means a person authorized to operate a hydroelectric project under the authority of either a time-limited water right, a certificated water right or a pre-1909 uncertificated claim. "Holder" includes licensees, power claimants, uncertificated claimants and water right certificants.

(3) "Licensee" means a person authorized to operate a hydroelectric project through the means of a license containing a time-limited water right.

(4) "Power claimant" means a person authorized to operate a hydroelectric project through the means of a water right that does not expire.

(5) "Reauthorize" means the process by which a hydroelectric project holding a time-limited hydroelectric license acquires new authorization to continue operating for an additional fixed amount of time according to ORS chapter 543A.

(6) "Relicense" means the process by which the Federal Energy Regulatory Commission issues a new license to allow a hydroelectric project to continue operating past the expiration date of its current license.

(7) "Team" means a Hydroelectric Application Review Team created pursuant to ORS 543A.035, 543A.075 or 543A.300.

(8) "Uncertificated claimant" means a person authorized to operate a hydroelectric project through the means of an uncertificated claim established prior to 1909.

(9) "Water right certificant" means a person authorized to operate a hydroelectric project through the means of a time-limited certificated water right.

SECTION 5. (1) On or before January 1 of each year, each holder shall pay to the State of Oregon an annual fee for each hydroelectric project that is subject to this section. The annual fee required by this section shall be based on the theoretical horsepower specified in the water right for each project.

(2) The amount of the annual fee required under subsection (1) of this section shall be determined in the following manner:

(a) Subject to the schedule set forth in subsection (3) of this section, each holder shall pay an amount, in 1998 dollars, equal to $0.405 per theoretical horsepower covered by the water right for the holder's hydroelectric project. The annual fee may be set forth in the water right or may be established by order of the Water Resources Director and shall be adjusted annually for inflation according to rules established by the Water Resources Commission. The annual fee also may be adjusted through the periodic review process established in section 8 of this 1999 Act.

(b) Each holder of a hydroelectric project that produces 123.5 theoretical horsepower or less shall pay an annual fee of $50 for that project.

(3) The fee determined in subsection (2) of this section shall apply to a project on the January 1 following the occurrence of an event enumerated as follows:

(a) A licensee or water right certificant shall begin to pay the annual fee after the final order for the reauthorized water right is issued under ORS 543A.130.

(b) Notwithstanding paragraph (a) of this subsection, if a licensee holds, on the effective date of this 1999 Act, an original state hydroelectric license for which the original expiration date was or is more than five years after the expiration date of the original Federal Energy Regulatory Commission license for the project, the licensee shall begin payment of the annual fee established under this section after the expiration date of the original state hydroelectric license.

(c) A power claimant, or uncertificated claimant, licensed by the Federal Energy Regulatory Commission shall begin to pay the annual fee after the Federal Energy Regulatory Commission issues a new license. A power claimant or uncertificated claimant that received a new license from the Federal Energy Regulatory Commission within 10 years prior to the effective date of this 1999 Act shall begin to pay the annual fee on January 1, 2000.

(d) A power claimant, or uncertificated claimant, whose project is exempted from licensure by the Federal Energy Regulatory Commission or not licensed by the Federal Energy Regulatory Commission shall begin paying the annual fee under this section on January 1, 2008, for that project.

(4) No fee shall be assessed under ORS 543.710 for a project subject to an annual fee under this section.

SECTION 6. (1) In addition to the annual fee set forth in section 5 of this 1999 Act, a holder may be required to pay project specific fees.

(2) Project specific fees are fees that compensate a state agency for the agency's reasonable and necessary oversight of a holder's implementation of the protection, mitigation and enhancement measures included in a water right for the project, a certificate issued pursuant to ORS 468B.040 or 468B.045 or a Federal Energy Regulatory Commission license.

(3) Project specific fees shall be considered at the time of reauthorization or relicensing of a hydroelectric project and, if needed, shall be established before the proposed final order is issued under ORS 543A.115, and shall be included in the reauthorized water right or the certificate issued pursuant to ORS 468B.040 or 468B.045. In the case of power claims and uncertificated claims, project specific fees shall be considered at the time of relicensing and, if needed, shall be included in an order of the Water Resources Director amending the claim pursuant to section 11 of this 1999 Act or in a certificate issued for the project pursuant to ORS 468B.040 or 468B.045.

(4) The need for, and amount of, a project specific fee shall be based upon the following factors:

(a) Experimental or unproven nature of the proposed mitigation;

(b) Significance of the resource affected;

(c) Need for ongoing agency involvement in reviewing the effectiveness of the proposed measure;

(d) Need for agency personnel to perform field work or research efforts; and

(e) Overall nature of the protection, mitigation or enhancement measures, including but not limited to consideration of whether the measure is simple, complex, closed-ended or adaptive and whether the measure is determined solely by the holder or by an agency or public committee.

(5) A project specific fee may not be assessed for:

(a) Work on projects other than the project for which the fee is established;

(b) Work that is paid for by the annual hydroelectric fee;

(c) Development of statewide hydroelectric policy;

(d) Coordination of statewide activities within an agency;

(e) Costs to the agency of Attorney General assistance associated with ongoing litigation; or

(f) Routine monitoring of compliance with nonadaptive management provisions of the water right, an uncertificated claim, a certificate issued pursuant to ORS 468B.040 or 468B.045 or a Federal Energy Regulatory Commission license.

(6) A project specific fee shall be time-limited. One year before expiration of a project specific fee, the holder and any affected agency shall review the need, if any, to modify, extend or terminate the project specific fee. After such review, the agency shall propose a fee modification, extension or termination. Any dispute regarding the proposed fee action shall be referred to an independent fact finder selected by mutual agreement, whose costs shall be borne one-half by the holder and one-half by the agency. The fact finder shall review whether the proposed fee action is appropriate under and consistent with the criteria set forth in subsections (2), (4) and (5) of this section. The fact finder shall not review the substance of the protection, mitigation and enhancement measures contained in the water right, the uncertificated claim, the certificate issued pursuant to ORS 468B.040 or 468B.045 or the Federal Energy Regulatory Commission license. The fact finder shall forward its determination in writing to the holder and agency. Upon receipt and consideration of the fact finder's determination, the agency shall notify the holder whether the project specific fee is modified, extended or terminated. If the holder is dissatisfied with the fee action, the holder may request administrative or judicial review in accordance with statutes or rules applicable to a particular agency's fee action. The written determination of the fact finder shall be admissible in any such administrative or judicial hearing. Notwithstanding any other law, a presumption shall exist in favor of the determination of the fact finder and the burden shall be on the party seeking a fee action contrary to the determination of the fact finder to demonstrate that a different fee action is justified under this section.

(7) Subject to subsections (2) to (5) of this section, the amount of a project specific fee shall be established based on an estimate of the cost to the agency of the labor, supplies and overhead expended by the agency in providing reasonable and necessary oversight of a holder's implementation of the protection, mitigation and enhancement measures included in the water right, the uncertificated claim, the certificate issued pursuant to ORS 468B.040 or 468B.045 or the Federal Energy Regulatory Commission license. The estimate used to derive a project specific fee amount shall be determined by using increments of not more than 0.25 full-time equivalents.

(8) A project specific fee shall be payable after issuance of the final order pursuant to ORS 543A.130, or in the case of power claimants and uncertificated claimants, after the issuance of either the director's order or a certificate issued for the project pursuant to ORS 468B.040 or 468B.045. A project specific fee shall be paid in increments that are reasonably related to the work to be performed and set forth in the final order, certificate issued pursuant to ORS 468B.040 or 468B.045 or the director's order.

(9) Each agency receiving project specific fees shall, on a biennial basis, provide the holder paying the fees with a summary of project specific expenditures.

SECTION 7. (1) At least 45 days before the fees required under section 5 or 6 of this 1999 Act become due, the Water Resources Department shall issue invoices to the holder for each fee.

(2) If any holder fails to pay the fees required under section 5 or 6 of this 1999 Act within 15 days after the date specified in the invoice, the department shall notify the holder of the amount and nature of the overdue fee. Any such notice shall be sent to the holder by certified mail and shall include notification that the holder has 30 days from the date of the certified delivery of the notice to pay the overdue fee or the holder shall be subject to the late payment penalty provisions of subsection (3) of this section.

(3) Any fee that is not paid within 30 days of the date a holder receives certified delivery of the notice required under subsection (2) of this section shall be considered delinquent and shall be increased by 25 percent. In addition, the state shall have a preference lien for any such fee, together with interest at the rate of 10 percent per annum from the date of delinquency, upon the property of the holder used, or necessary for use, in the development of the water right, together with any improvements erected on the property for such development. Upon notice from the Water Resources Commission, the Attorney General shall foreclose the lien and collect the amount due, as provided in this section, in the same manner as other liens on real property are foreclosed.

(4) The remedy set forth in subsection (3) of this section is in addition to any other remedy provided by law for the collection of moneys or for noncompliance with a condition of a water right order, uncertificated claim or certification under ORS 468B.040 or 468B.045.

SECTION 8. (1) The Water Resources Director shall appoint a review panel to review the amount of the annual fee established under section 5 of this 1999 Act in 2003 and 2009 and every eight years thereafter. The review panel shall consist of at least one representative from the following and others at the director's discretion:

(a) The Department of Environmental Quality;

(b) The State Department of Fish and Wildlife;

(c) The Public Utility Commission;

(d) The Water Resources Department;

(e) Investor owned utilities;

(f) Publicly owned utilities;

(g) Municipalities;

(h) Environmental organizations;

(i) Agricultural organizations; and

(j) Nonutility owners of hydroelectric projects.

(2) All holders paying annual fees under section 5 of this 1999 Act shall be notified by the Water Resources Department at least 60 days in advance of the meeting of the review panel established in subsection (1) of this section, and provided the opportunity to submit comments to the panel.

(3) Any periodic review conducted under subsection (1) of this section shall evaluate each agency's hydroelectric program to determine if current staffing levels, activities and funding are appropriate to fulfill program objectives. There shall be a presumption that the fee should not change. To overcome the presumption and alter the existing fee, the panel must find compelling reasons for alteration and must reach unanimous consent on the new fee. If the presumption is overcome, upon completion of the review process the director shall either adjust the annual fee as recommended by the panel or elect not to adjust the fee. Any change in the annual fee as a result of this section shall become effective on the January 1 following the director's action. The director shall notify all holders of any change in the annual fee and the effective date of such change.

SECTION 9. (1) Notwithstanding ORS 543A.405 and 543A.410, during each year of the interim period established in subsection (2) of this section, any licensee or water right certificant seeking reauthorization of a state water right to operate a federally licensed hydroelectric project shall pay the greater of:

(a) The actual cost of the Hydroelectric Application Review Team's reauthorization activities for the year in question as established pursuant to ORS 543A.405 and 543A.410; or

(b) 12.5 cents per theoretical horsepower as specified in the water right for each project under consideration for reauthorization. This amount shall be calculated in 1998 dollars.

(2) For any project, the interim period referred to in subsection (1) of this section shall begin on the January 1 immediately following submission to the Water Resources Department of a proposed final order for reauthorization of the project under ORS 543A.115 (2). For any project, the interim period referred to in subsection (1) of this section shall end on December 31 of the year the department issues a final order on reauthorization of the project pursuant to ORS 543A.130.

(3) Notwithstanding section 10 of this 1999 Act, during each year of the interim period established in subsection (4) of this section, any power claimant or uncertificated claimant seeking to relicense a federally licensed hydroelectric project shall pay the greater of:

(a) The actual cost of the team's relicensing activities for the year in question as established pursuant to section 10 of this 1999 Act; or

(b) 12.5 cents per theoretical horsepower as specified in the water right for each project under consideration for relicensing. This amount shall be calculated in 1998 dollars.

(4) For any project, the interim period referred to in subsection (3) of this section shall begin on the January 1 immediately following issuance of an annual license for the project by the Federal Energy Regulatory Commission. For any project, the interim period referred to in subsection (3) of this section shall end on December 31 of the year the Federal Energy Regulatory Commission issues a new license for the project.

(5) The Water Resources Department shall reimburse a participating agency for costs incurred in the agency's review of a project during the year for which the fees are collected. Such costs shall not include expenses of other state agencies for which a fee is otherwise collected under state law. Any fees collected under subsection (1) or (3) of this section in excess of the team's actual cost of evaluation of the project for the year shall be distributed according to ORS 536.015.

(6) No fee shall be charged under this section unless the project is a federally licensed project.

(7) No fee shall be charged pursuant to subsection (1) of this section unless the Hydroelectric Application Review Team proposes to reauthorize the water right for the project in the proposed final order submitted to the Water Resources Department under ORS 543A.115 (2).

(8) Water right certificants and licensees with water rights or licenses that expire more than five years after the original federal license for the project expires shall not begin paying fees assessed under this section until after the expiration date of the original state hydroelectric license or water right.

SECTION 10. (1) Any project operating under a hydroelectric license issued by the Federal Energy Regulatory Commission and concurrently operating under the authority of a power claim or uncertificated claim shall pay all expenses related to the review and decision of a Hydroelectric Application Review Team established under ORS 543A.075 that:

(a) Are incurred by the team and any agency participating as part of the team in the federal relicensing process; and

(b) Are not otherwise covered by the reauthorization fee paid under ORS 543A.415.

(2) Not later than six years before the expiration of a hydroelectric license issued by the Federal Energy Regulatory Commission to any project operating concurrently under the authority of a power claim or uncertificated claim, the Water Resources Department shall contact the holder to schedule a consultation meeting regarding expected fees to be incurred by the Hydroelectric Application Review Team.

(3) Relicensing fees shall be calculated and assessed according to the terms and conditions set forth in ORS 543A.405 and 543A.410 for application fees.

SECTION 11. (1) Upon the request of the holder and the approval of the Water Resources Department, a hydroelectric water right or claim may be amended.

(2) The Water Resources Department shall develop rules governing the process by which a hydroelectric water right or claim may be amended. Any amendments under subsection (1) of this section shall:

(a) Be consistent with the final unified state position for the project;

(b) Be consistent with the requirements of ORS chapter 543A;

(c) Cause no injury to other water rights; and

(d) Allow for public participation in the amendment process.

(3) The Water Resources Director may unilaterally amend a power claim or uncertificated claim in order to assess project specific fees under section 6 of this 1999 Act.

SECTION 12. ORS 468.065 is amended to read:

468.065. Subject to any specific requirements imposed by ORS 448.305, 454.010 to 454.040, 454.205 to 454.255, 454.505 to 454.535, 454.605 to 454.745 and ORS chapters 468, 468A and 468B:

(1) Applications for all permits authorized or required by ORS 448.305, 454.010 to 454.040, 454.205 to 454.255, 454.505 to 454.535, 454.605 to 454.745 and ORS chapters 468, 468A and 468B shall be made in a form prescribed by the Department of Environmental Quality. Any permit issued by the department shall specify its duration, and the conditions for compliance with the rules and standards, if any, adopted by the Environmental Quality Commission pursuant to ORS 448.305, 454.010 to 454.040, 454.205 to 454.255, 454.505 to 454.535, 454.605 to 454.745 and ORS chapters 468, 468A and 468B.

(2) By rule and after hearing, the commission may establish a schedule of fees for permits issued pursuant to ORS 468A.040, 468A.045, 468A.155 and 468B.050. Except as provided in ORS 468A.315, the fees contained in the schedule shall be based upon the anticipated cost of filing and investigating the application, of carrying out applicable requirements of Title V, of issuing or denying the requested permit, and of an inspection program to determine compliance or noncompliance with the permit. The fee shall accompany the application for the permit. The fees for a permit issued under ORS 468A.040 or 468B.050 may be imposed on an annual basis.

(3) An applicant for certification of a project under ORS 468B.040 or 468B.045, and any person submitting a notice of intent to seek reauthorization, a preliminary application or an application for reauthorization of a water right for a hydroelectric project under ORS 543A.030, 543A.035, 543A.075, 543A.080 or 543A.095 shall pay as a fee all expenses incurred by the commission and department related to the review and decision of the Director of the Department of Environmental Quality and commission. These expenses may include legal expenses, expenses incurred in evaluating the project, issuing or denying certification and expenses of commissioning an independent study by a contractor of any aspect of the proposed project. These expenses shall not include the costs incurred in defending a decision of either the director or the commission against appeals or legal challenges. [The initial fee for a new project shall be $5,000, and the fee for an existing project needing relicense shall be $3,000. To the extent possible, the full cost of the investigation shall be paid from the initial fee paid under this section. However, if the costs exceed the fee, the applicant shall pay any excess costs shown in an itemized statement prepared by the department. In no event shall the department incur expenses to be borne by the applicant in excess of 110 percent of the fee initially paid without prior notification to the applicant. In no event shall the total fee exceed $40,000 for a new project or $30,000 for an existing project needing relicense. If the costs are less than the initial fee paid, the excess shall be refunded to the applicant.] The department shall bill applicants for costs incurred on a monthly basis, and shall provide a biennial report describing how the moneys were spent. An applicant may arrange with the department to pay the fee on a quarterly basis. The department shall not charge a fee under the fee authority in this subsection if the holder is being charged a fee under ORS 543A.405 or sections 9 and 10 of this 1999 Act. In no event shall the department assess fees under this section and under ORS 543A.405 for performance of the same work.

(4) The department may require the submission of plans, specifications and corrections and revisions thereto and such other reasonable information as it considers necessary to determine the eligibility of the applicant for the permit.

(5) The department may require periodic reports from persons who hold permits under ORS 448.305, 454.010 to 454.040, 454.205 to 454.225, 454.505 to 454.535, 454.605 to 454.745 and ORS chapters 468, 468A and 468B. The report shall be in a form prescribed by the department and shall contain such information as to the amount and nature or common description of the pollutant, contaminant or waste and such other information as the department may require.

(6) Any fee collected under this section or ORS 468A.315 shall be deposited in the State Treasury to the credit of an account of the department. Such fees are continuously appropriated to meet the administrative expenses of the program for which they are collected. The federal operating permit program shall include a commensurate amount of the fee for any permit issued under this section for which the department incurs costs associated with the requirements of Title V and any fees collected under ORS 468A.315. Fees collected for the federal operating permit program in any biennium that exceed the legislatively approved budget, including amounts authorized by the Emergency Board for the federal operating permit program for such biennium, shall be credited toward the federal operating permit program budget for the following biennium. The fees collected under this section or ORS 468A.315 by a regional air pollution control authority pursuant to a permit program authorized by the commission shall be retained by and shall be income to the regional authority except as provided in ORS 468A.155 (2)(c). Such fees shall be accounted for and expended in the same manner as are other funds of the regional authority. However, if the department finds after hearing that the permit program administered by the regional authority does not conform to the requirements of the permit program approved by the commission pursuant to ORS 468A.155, such fees shall be deposited and expended as are permit fees submitted to the department.

(7) As used in this section, "Title V" has the meaning given in ORS 468A.300.

SECTION 13. ORS 536.015 is amended to read:

536.015. (1) The Water Resources Department Hydroelectric Fund is established separate and distinct from the General Fund of the State Treasury. Except as provided in subsections (4) to (6) of this section, of the moneys in the Water Resources Department Hydroelectric Fund:

(a) A portion equal to 67 percent of the total moneys received each year shall be transferred to the fund created under ORS 496.835;

(b) A portion equal to 10.3 percent of the total moneys received each year shall be transferred to an account of the Department of Environmental Quality to be used to review applications for certification of hydroelectric projects under ORS 468B.040 and 468B.045; and

(c) All of the remaining moneys received each year are continuously appropriated to the Water Resources Commission and the Water Resources Department to provide for the payment of the administrative expenses of the commission and the department in carrying out their responsibilities related to the issuance of permits, licenses or water right certificates for hydroelectric projects.

(2) The following shall be deposited into the State Treasury and credited to the Water Resources Department Hydroelectric Fund:

(a) Fees received by the Water Resources Department for hydroelectric projects under ORS 536.050, 543.210, 543.280, 543.300, 543.710, 543A.405 and 543A.415 and sections 5 to 11 of this 1999 Act; and

(b) All [money] moneys received on behalf of this account by gift, grant or appropriation from whatever source.

(3) All interest, if any, from moneys credited to the Water Resources Department Hydroelectric Fund shall be credited to the fund and shall inure to the benefit of the Water Resources Department Hydroelectric Fund.

(4) Application fees received under ORS 543A.405 shall be disbursed to the various agencies in the amounts specified in the cost reimbursement agreement executed with each reauthorization applicant.

(5) Four cents of each 28 cents paid as a reauthorization fee under ORS 543A.415 shall be paid to the Department of Environmental Quality.

(6) Annual fees paid under section 5 of this 1999 Act shall be disbursed to state agencies pursuant to a memorandum of agreement developed by the Department of Environmental Quality, the State Department of Fish and Wildlife and the Water Resources Department.

SECTION 14. ORS 543A.070 is repealed and section 15 of this 1999 Act is enacted in lieu thereof.

SECTION 15. (1) Not later than six years before the expiration of any state or federal hydroelectric license or state authorized water right issued to a federally licensed project, the Water Resources Department shall notify the holder of the date of expiration of the right or license and shall ask that the holder advise the department whether the holder intends to seek reauthorization or relicensing.

(2) If the holder does not intend to seek reauthorization, the holder shall inform the department within 90 days after receiving notice under subsection (1) of this section of the proposed disposition of the federally licensed project.

(3) If the holder intends to seek reauthorization, the holder shall inform the department within 90 days after receiving notice under subsection (1) of this section whether the holder intends to seek reauthorization of the water right concurrently with the federal relicensing.

(4) A holder seeking relicensing and reauthorization concurrently:

(a) Shall not, by applying for reauthorization, under ORS 543A.075 and in the absence of agreement by the holder, be deemed to have accelerated the actual expiration date of the project's water right; and

(b) May, upon providing concurrent notification to the Federal Energy Regulatory Commission, withdraw and void its application for reauthorization at any time prior to issuance of the final water right certificate issued by the Water Resources Director without prejudice to its right to reapply for reauthorization of its water right.

(5) Any water right issued by the Water Resources Department pursuant to an application filed under this chapter shall become effective upon the issuance of the new water right. The existing water right shall be canceled immediately upon issuance of the new water right.

(6) A holder not electing to concurrently seek reauthorization but seeking relicensing shall notify the Water Resources Department of its position and shall indicate in the notification its plans for the project and the project's state water right.

(7) In the absence of agreement by the holder to pay the application fees under ORS 543A.405, and notwithstanding the provisions of ORS 543A.015, the state is not required to develop and provide a coordinated state position.

SECTION 16. ORS 543A.075 is amended to read:

543A.075. (1) [Not later than 90 days after receiving a notice under ORS 543A.070,] Each person operating an existing federally licensed project and intending to apply for reauthorization shall submit to the Water Resources Department a notice of intent to file an application for reauthorization of the water right for the project. If the person intends to seek reauthorization concurrently with federal relicensing, the notice of intent shall be submitted at the same time the person provides the information to the department under section 15 (3) of this 1999 Act. The notice of intent shall include:

(a) The name and post-office address of the applicant;

(b) The federal project number;

(d) An unequivocal statement of the applicant's intention to file an application for reauthorization of the state water right;

(e) The location of the project by county and stream and, when appropriate, by city or nearby city;

(f) The amount of water in cubic feet per second; and

(g) The project capacity.

(2) Upon receipt of a notice of intent under subsection (1) of this section, the department shall:

(a) Convene the Hydroelectric Application Review Team for the project. The team shall consist of representatives of the Water Resources Department, the Department of Environmental Quality and the State Department of Fish and Wildlife and may include a representative of any other agency that has regulatory or advisory responsibility for the project or a resource or hazard affected by the project.

(b) Provide public notice of the receipt of the notice of intent. The public notice shall provide the date of the public scoping meeting to be conducted under ORS 543A.085 and include a description of the hydroelectric project, the location of the project, the expiration dates of the water right for the project and the Federal Energy Regulatory Commission license for the project, and information pertaining to how an interested person may obtain future notices about the application and participate in the reauthorization process.

(3) Any person who is authorized by the Federal Energy Regulatory Commission to apply for a license for a federally licensed project may apply to reauthorize a water right for the project. The team shall process such applications under the standards and process set forth in ORS 543A.060 to 543A.300 for a federally licensed project. A nonowner applicant may obtain a water right with the priority date of the expiring water right only if the applicant submits a notice of intent within six months after the owner submits a preliminary application as described in ORS 543A.080, or within 30 days after June 30, 1997, whichever is later.

SECTION 17. ORS 543A.415 is amended to read:

543A.415. (1) Except as provided in subsection (2) of this section, each holder of an existing hydroelectric license shall pay to the Water Resources Department annually a reauthorization fee in an amount per theoretical horsepower covered by the existing license [which] that, when added to the amount per theoretical horsepower covered by the existing license that is paid under ORS 543.300, equals [24] 28 cents for each horsepower covered by the existing license, or $15, whichever is greater, for the purpose of implementing the state reauthorization process established by this chapter and ORS 468.065, 468B.040, 468B.045, 468B.046, 536.015, 536.050, 543.012 and 543.710. The reauthorization fee shall be paid until the project is reauthorized, and a water right issued, under this chapter and ORS 468.065, 468B.040, 468B.045, 468B.046, 536.015, 536.050, 543.012 and 543.710. Upon reauthorization and issuance of a water right, a new annual fee shall be assessed under ORS 543.300, and the reauthorization fee shall no longer apply.

(2) The department shall notify existing license holders of the amount of the fee described in subsection (1) of this section. The notice shall state the date by which the license holder must notify the department if the license holder does not intend to reauthorize the project. The department shall assess the fee described in subsection (1) of this section unless the license holder notifies the state that it does not intend to apply to reauthorize the project upon expiration of the license. The holder of an existing hydroelectric license that notifies the department that it does not intend to reauthorize the project need not pay the reauthorization fee and may not seek reauthorization of the project upon expiration of the existing license.

(3) The department shall submit a report to the Legislative Assembly during each legislative session describing the department's use of reauthorization funds.

(4) Four cents of each 28 cents paid as a reauthorization fee in subsection (1) of this section shall be deposited to the Water Resources Department Hydroelectric Fund and disbursed to the Department of Environmental Quality.

SECTION 18. The amendments to ORS 543A.415 by section 17 of this 1999 Act become operative on January 1, 2000.

SECTION 19. ORS 536.050 is amended to read:

536.050. (1) For applications filed after July 23, 1997, the following fees shall be collected by the Water Resources Department in advance:

(a) Except as provided under ORS 543.280 for an application for a hydroelectric project, for examining an application for a permit to appropriate water, $250, plus $150 for the first second-foot or fraction thereof, plus $75 for each additional second-foot or fraction thereof.

(b) For examining an application for a permit to store water under ORS 537.400, an application for a permit to store water under ORS 537.534 (4) or an application for a permit to exclusively appropriate stored water, $250, plus $10 for the first acre-foot up to 10 acre-feet, plus $1 for each additional acre-foot up to 1,000 acre-feet, plus 25 cents for each additional acre-foot in excess of 1,000.

(d) For filing or recording any other water right instrument, $25 for the first page and $5 for each additional page.

(e) For copying records in the department, $2 for the first page and 50 cents for each additional page.

(f) For certifying to copies, documents, records, or maps, $10 for each certificate.

(g) For blueprint copy of any map or drawing, the actual cost of the work.

(h) For examining an application for approval of a change to an existing water right, $200, plus $100 for each additional type of change requested, plus, if a request for a change in place of use or type of use or for a water exchange under ORS 540.533, $100 for each second-foot or fraction thereof requested in addition to the first second-foot.

(i) For examining an application for a temporary change in place of use under ORS 540.523 or 540.570, $100, plus:

(A) For nonirrigation uses, $50 for each second-foot or fraction thereof requested in addition to the first second-foot; or

(B) For irrigation uses, 25 cents per acre of land irrigated.

(j) For submitting a protest under ORS 537.153, 537.621 or 543A.120, $200, reduced by the amount of any protest previously paid toward the same application and for filing any other protest with the department, $25.

(k) For filing an application for extension of time within which irrigation or other works shall be completed or the right perfected, $100.

(L) For a limited license under ORS 537.143 or 537.534 (2), the fee established by rule by the Water Resources Commission.

(m) For filing, examining and certifying a petition under ORS 541.329, $250 plus 10 cents per acre of water involved in the application. For purposes of computing this fee, when any acreage within a quarter quarter of a section is involved, the 10 cents per acre shall apply to all acres in that quarter quarter of a section.

(n) For requesting standing under ORS 537.153 (5), 537.621 (6) or 543A.120, $50.

(o) For participating in a contested case proceeding under ORS 537.170 (2), 537.622 (2) or 543A.130, $150.

(p) Except for an applicant, for obtaining a copy of both a proposed final order and a copy of a final order for a water right application under ORS 537.140 to 537.252, 537.505 to 537.795 or 543A.005 to 543A.300, $10.

(q) For submitting an application for a water right permit for a reservoir under ORS 537.409, $10 for each acre-foot, but not more than $100 per application.

(r) For submitting a notice of intent under ORS 543A.030 or 543A.075, the amount established by the director under ORS 543A.410.

(2) Notwithstanding the fees established under subsection (1) of this section, the commission may by rule establish examination and permit fees lower than those under subsection (1) of this section for:

(a) The right to appropriate water for a storage project of five acre-feet or less; or

(b) The right to appropriate water for the purpose of allowing the applicant to water livestock outside of a riparian area. As used in this paragraph, "riparian area" has the meaning given that term in ORS 541.350.

(3) Notwithstanding subsections (4) and (5) of this section, if the Water Resources Director determines a refund of a fee paid under this section is appropriate in the interest of fairness to the public or necessary to correct an error of the department, the director may refund all or part of a fee paid to the department.

(4) Except as provided in subsection (5) of this section, all moneys received under subsection (1) of this section shall be deposited in the Water Resources Department Operating Account and credited to the Water Resources Department. Such moneys are continuously appropriated to the Water Resources Department to pay the department's expenses in administering and enforcing the provisions of ORS chapters 536 to [543] 543A.

(5) All fees received for power purposes under ORS 543.280 shall be paid to the Water Resources Department Hydroelectric Fund established in ORS 536.015.

SECTION 20. ORS 536.750 is amended to read:

536.750. (1) Notwithstanding any provision of ORS chapters 536 to [543] 543A, after a declaration that a severe, continuing drought exists, the Water Resources Commission may:

(a) Issue without first conducting a hearing under ORS 537.170, a temporary permit for an emergency use of water;

(b) Allow a temporary change in use, place of use or point of diversion of water without complying with the notice and waiting requirements under ORS 540.520;

(c) Notwithstanding the priority of water rights, grant preference of use to rights for human consumption or stock watering use;

(d) Waive the notice requirements under ORS 537.753 and the report required under ORS 537.762; and

(e) Allow a temporary exchange of water without giving notice as required under ORS 540.535.

(2) The commission by rule may establish procedures for carrying out the provisions of this section and a schedule of fees that must accompany a request under subsection (1) of this section.

SECTION 21. ORS 536.900 is amended to read:

536.900. (1) In addition to any other liability or penalty provided by law, the Water Resources Commission may impose a civil penalty on a person for any of the following:

(a) Violation of any of the terms or conditions of a permit, certificate or license issued under ORS chapters 536 to [543] 543A.

(b) Violation of ORS 537.130 or 537.535.

(d) Violation of ORS 540.045, 540.145, 540.210, 540.310, 540.320, 540.330, 540.340, 540.435, 540.440, 540.710, 540.720 and 540.730 or rules adopted under ORS 540.145.

(2) A civil penalty may be imposed under this section for each day of violation of ORS 537.130, 537.535, 540.045, 540.310, 540.330, 540.710, 540.720 or 540.730.

(3) In the event the petitioner knowingly misrepresents the map and petition required in ORS 541.329, the commission may assess a penalty of up to $1,000 based upon guidelines to be established by the commission. In addition, the petition and map shall be amended to correct the error at the petitioner's cost. Affected users shall be given notice as provided in ORS 541.329 (5).

(4) A civil penalty may not be imposed until the commission prescribes a reasonable time to eliminate the violation. The commission shall notify the violator of the time allowed to correct a violation within five days after the commission first becomes aware of the violation.

(5) Notwithstanding any term or condition of a permit, certificate or license, the rotation of the use of water under ORS 540.150 shall not be considered a violation under subsection (1) of this section.

SECTION 22. ORS 536.935 is amended to read:

536.935. All penalties recovered under ORS 536.930 shall be paid into the State Treasury and credited to an account of the Water Resources Department. Such moneys are continuously appropriated to the department to carry out the provisions of ORS chapters 536 to [543] 543A.

SECTION 23. ORS 543.300 is amended to read:

543.300. Any license issued under ORS 543.010 to 543.610 shall take into consideration, and shall be on, the following conditions:

(1) That the proposed project shall be such as, in the judgment of the Water Resources Commission, is well adapted to the development and utilization of the water power involved.

(2) That the licensee shall construct and build the project according to the maps, plans and specifications filed with and approved by the commission, and within the time fixed by the license or by any lawful extension thereof.

(3) The operations of the licensee so far as they affect the use, storage and discharge from storage of waters affected by the license, shall at all times be controlled by such reasonable rules as the commission may prescribe for the protection of life, health and property, and in the interest of the fullest practicable conservation and utilization of such waters for power purposes and for other beneficial public uses, including recreational purposes. The licensee shall release water from the project reservoir at such rate in cubic feet per second, or such volume in acre-feet per specified period of time, as the commission may prescribe.

(4) That the licensee will maintain the project, and each part thereof, in good order and repair and in efficient operation, for the development and transmission of electricity to its reasonable capacity; shall make all necessary renewals and replacements as required; and shall maintain and operate the project, and all parts thereof, conformably to the rules of the commission not inconsistent with ORS 543.010 to 543.610.

(5) That the licensee will pay to the state annually not more than $1 for each horsepower covered by the license. This sum shall constitute a first lien upon the project, which lien may be enforced by suit in equity or other appropriate proceeding, or payment thereof may be enforced by the state in an action for debt. Payment of such license fees may be waived by the commission during all or any part of the period of construction. The fees need not be uniform throughout the entire period of the license, but may be for different amounts for different periods. The amount of the license fees, within the minimum and maximum limits herein specified, shall be determined by the commission and expressed in the license.

(6) Other and further conditions not inconsistent with ORS 543.010 to 543.610 as the commission may require in the public interest.

(7) In issuing a license for a minor project of not more than 100 horsepower the commission may waive all or any of the conditions and requirements of ORS 543.010 to 543.610 except the period for which a license may be issued, and the annual charge as determined by the commission under subsection (5) of this section. In issuing licenses for projects in excess of 100 horsepower for which the applicants are required to secure permits and licenses from the United States as a condition precedent to the construction of the projects, the commission may waive and modify such of the terms, conditions and requirements of ORS 543.010 to 543.610, except the period for which a license may be issued and the annual charge as determined by the commission under subsection (5) of this section, as the commission, by order, after full investigation and public hearing, shall find to make impracticable the construction of such projects. During the time that a licensee is not a public utility and does not sell electric energy, and does not sell bonds or other evidences of debt against the licensee's plant, the commission may waive the accounting and amortization requirements of ORS 543.010 to 543.610, even where the project involved exceeds 100 horsepower.

(8) Subsection (5) of this section does not apply to a water right reauthorized pursuant to ORS chapter 543A.

SECTION 24. ORS 543.710 is amended to read:

543.710. Every claimant other than a licensee under ORS 543.010 to 543.610 shall on or before January 1 of each year pay to the state in advance an annual fee based upon the theoretical water horsepower claimed under each separate claim to water, graduated as follows: Thirty cents for each theoretical water horsepower or fraction thereof up to and including 50 and [24] 28 cents for each theoretical water horsepower or fraction thereof in excess of 50. However, upon filing the statement provided in ORS 543.720, the United States or the state, claiming the right to the use of water to any extent for the generation of power, or any other claimant to the right to use water for the generation of 10 theoretical water horsepower or less, shall be exempted from the payment of all fees provided for in this section. Four cents of each 28 cents collected as a reauthorization fee under this section shall be deposited to the Water Resources Department Hydroelectric Fund and disbursed to the Department of Environmental Quality.

SECTION 25. The amendments to ORS 543.710 by section 24 of this 1999 Act become operative on January 1, 2000.

SECTION 26. (1) For the period beginning on the effective date of this 1999 Act and ending June 30, 2001, the Water Resources Department may not initiate rulemaking under ORS 543A.300 (2) with respect to decommissioning standards and procedures for hydroelectric projects operating under concurrent state and Federal Energy Regulatory Commission authority.

(2) The Water Resources Commission shall adopt rules for ordering and conducting the decommissioning of hydroelectric projects that are not subject to the jurisdiction of the Federal Energy Regulatory Commission.

SECTION 27. (1) Not later than one year after the effective date of this 1999 Act, the Water Resources Director shall convene a hydroelectric task force. The task force shall include a representative from:

(a) The State Department of Fish and Wildlife;

(b) The Department of Environmental Quality;

(c) The State Parks and Recreation Department;

(d) The Public Utility Commission;

(e) The Division of State Lands;

(f) The Office of Energy;

(g) The State Department of Geology and Mineral Industries;

(h) Investor owned utilities;

(i) Publicly owned utilities;

(j) Municipalities;

(k) Environmental organizations;

(L) Agricultural organizations; and

(m) Nonutility owners of hydroelectric projects.

(2) The task force shall develop recommendations to be presented to the Seventy-first Legislative Assembly regarding:

(a) The decommissioning of projects not reauthorized;

(b) Changes to the procedure for obtaining a water right permit for a new hydroelectric project that are necessary for the development of a coordinated state agency process for exercising state jurisdiction over new hydroelectric projects in the State of Oregon consistent with the process established in ORS 543A.005 to 543A.300; and

(c) Technical corrections to ORS chapter 543A identified but not resolved by the task force assembled by the Water Resources Director pursuant to section 39, chapter 449, Oregon Laws 1997, and further corrections and additions to ORS chapter 543A based upon the experience of the Hydroelectric Application Review Team and hydroelectric operators seeking reauthorization.

SECTION 28. Sections 26 and 27 of this 1999 Act are repealed June 30, 2001.

SECTION 29. (1) As used in this section, "person" has the meaning given that term in ORS 174.100.

(2) No person shall be estopped or precluded from challenging the constitutionality or validity of any provision of chapter 449, Oregon Laws 1997, or the provisions of this 1999 Act as a result of having received or sought benefits under, complied with, paid fees under or filed an application under those statutes, or as a result of having participated in their drafting, enactment or implementation.

(3) Nothing in this section shall be construed to imply that a person is estopped or precluded from challenging the validity or constitutionality of any statute as a result of having participated in the drafting, enactment or implementation of the legislation that resulted in the enactment of such statute.

Approved by the Governor July 28, 1999

Filed in the office of Secretary of State July 28, 1999

Effective date October 23, 1999

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