June 2012                                    Popular Venue Draws A Crowd for      Texas Water                             ...
President’s Message...                             Changing of the Guard                              but not the Mission ...
That “Freddy Krueger” is a mighty fine Steer!Left to right: Leroy Goodson; Colby Goodson; Macie Goodson; Bobby Maddox, Bon...
Although he was unable to be                 TWCA’s Confluence Newsletter        with us at the TWCA                      ...
Takings Litigation Against      the Edwards Aquifer       Authority After the            Day Case      by Andrew S. “Drew”...
Day Case...                                                    to Day. The Court ultimately remands the issue of          ...
by the EAA Act. Therefore, regulatory takings                   D’Hanis and Home Place orchards. The Braggsliability, if a...
2011 Drought --Lake Conroe Chapter      by Reed Eichelberger and Jace Houston           San Jacinto River Authority	      ...
Of course, Lake Conroe                                                                   wasn’t the only lake in our regio...
to use a portion of its share of the lake, there is still        people’s fears. Despite studies that showed howa lot of s...
interested parties a first-hand opportunity to see howquickly the lake can rebound with even moderaterainfall events; even...
rain.” This is another “teachable moment.”	                	       We’re convinced that those of us in the water	       Th...
HONORARY LIFE MEMBERSHIPSThroughout the years, the Association has awarded Honorary Life Memberships to those individuals ...
FEDERAL DEVELOPMENTS..   SEQUESTRATION CALLED “TICKING TIME BOMB”         By J. Tom Ray, Lockwood, Andrews, Newnam, Inc., ...
soften or avoid sequestration are coming forward.           ments with regard to water resources infrastructureOn May 7th,...
The House version of the FY13 Energy andWater Appropriations bill also includes an amend-ment proposed by Representative R...
that something should be done to properly define             investment. The key concern, and apparently oneearmarks. Clea...
Hydraulic Fracturing in Texas: Economic Boom           and Looming Water Resource Challenges              by Leonard Douga...
13,500 feet.6 At that depth, the well lateral can            solely to supply water on the lease for a rigextend for thous...
tanks or water impoundment pits prior to and during           resources. The study will analyze and researchtreatment, rec...
FRACKING ARTICLE...Pages 17-19                                5                                                           ...
TWCA WELCOMES           NEW MEMBERS      Resource Action Programs          Contact: David Grider            Sparks, NV 894...
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Texas Water Conservation Association Newsletter June 2012

  1. 1. June 2012 Popular Venue Draws A Crowd for Texas Water TWCA June Meeting in Horseshoe Bay TWCA members will be travelling from all over the state to theConservation Association popular Horseshoe Bay Resort in the Texas Hill Country. There’s a full221 E. 9th Street, Ste. 206 agenda planned for the event, kicked off by the 6th Annual Jim AdamsAustin, Texas 78701-2510 Memorial Golf Tournament on the Ram Rock Course Wednesday after- 512-472-7216 noon, with a 1:00 pm tee off. The TWCA/RMF reception will begin at Fax: 512-472-0537 5:30 pm. (Visit the website--www.twca.org -- for the latest agenda.) http://www.twca.org Beginning in the morning on Thursday, the panels will all meet between 9 am and noon, with the General Session kicking off at 1 pm with remarks by the Mayor of Horseshoe Bay, Robert Lambert. Par- Officers ticipants will have the opportunity to hear from the Chairman of the Luana Buckner, Senate Natural Resources Committee, Sen. Troy Fraser; from TCEQ President Chair Bryan Shaw, PhD; and from Melanie Callahan, Executive Administrator, TWDB. Rounding out the session -- prior to the Board of Phillip J. Ford, Directors meeting -- is Carlos Peña, Principal Engineer, United States President-Elect Section of the International Boundary & Water Commission. Critical top- ics, such as a national perspective on water issues, water conservation, James M. Parks, and the Lake Granbury study, complete the afternoon’s discussions. Immediate Past President Back by popular demand is a Reception and Dance, featuring Cactus Country Band that will surely set your toes a’tapping. The festivities begin at 6:30 in Salons ABCD. Association Staff Off to an early start on Friday morning with opening remarks by Leroy Goodson Burnet County Judge, Donna Klaeger. Reuse will be one of the hot General Manager topics for the morning, along with remarks by Brigadier General Thomase-mail: lgoodson@twca.org W. Kula, U.S. Army Corps of Engineers. Robert Mace will be on hand to explain that the “Drought Ain’t Over ‘til it’s Over”. Developments in Dean Robbins groundwater hydrology and a review of the endangered species act close out the program. Assistant General Manager According to General Manager Leroy Goodson, “We are look- drobbins@twca.org ing forward to hearing from this distinguished group of speakers and to the fellowship these meetings provide.” Opinions expressed in Confluence are those of the writer and not necessarily those of TWCA, its officers, directors or staff. © 2012, TWCA FRASER SHAW CALLAHAN MACE 1
  2. 2. President’s Message... Changing of the Guard but not the Mission James M. Parks Luana Buckner As one steps down, another steps up. Over In closing, I want to thank everyone associated withthe past year, it has been my pleasure and honor TWCA for making this last year so memorable forto serve as President of TWCA. I find it difficult to me. Now, please join me in pledging our supportput into words what this experience has meant to and offering congratulations to Luana Buckner asme. There are no finer people to have your name she begins her role as President of TWCA.forever associated with than those who make up themembership. Water providers are seldom appreciatedby the millions that we serve and if not for the TWCA,most of us would spend our entire careers without First, my sincere thanks and appreciation torecognition for the hard work and sacrifice that each Jim Parks for his leadership of TWCA during a veryof us make each day. Thank you, TWCA. difficult and dry year. I hope you will join me in hoping Texas is going to continue to grow both that we’ll be able to put the drought behind us in theeconomically and in population. Additional coming months during my tenure as President. supplies of water are critically needed but will not I am honored and thankful for this opportunitycome easily. It is incumbent on all of us to remain to give a little back to a great organization that has givenengaged and committed to the implementation of so much to me, personally and professionally. the State Water Plan, which has been thoughtfully I ask for your help and support to keep thisand carefully developed over the past 15 years. TWCA train on its tracks with full knowledge that IThe Plan is not perfect and can certainly be may be in the conductors chair but Leroy and Deanimproved upon through the reoccurring planning are in the caboose manning the brakes.cycles. There will always be challenges andobstacles to overcome so I encourage you tostay involved and engaged in the process. 2
  3. 3. That “Freddy Krueger” is a mighty fine Steer!Left to right: Leroy Goodson; Colby Goodson; Macie Goodson; Bobby Maddox, Bonham Cattle Co.;Dan Hoge, judge; Kyla Goodson; Judene Goodson; Lisa Goodson; Stanley Hoffman; Mildred Hoffman;Kannon Acker Goodson; Kandra Goodson; Kati Robinson; and Mandi Maddox, Bonham Cattle Co. On Friday the 13th, when Kannon Acker Goodson acquired a steer to raise for the Houston Live-stock Show and Rodeo, he figured that Freddy Krueger would be an appropriate name for the anmial-- after the horror movie bad guy. As the animal continued to grow, Kannon -- a member of the CanyonHigh School FFA -- knew he he had something special on his hands. According to family members, theyoung teen worked “diligently and enthusiastically” doing all the hard work necessary to raise the steer. It wasn’t Kannon’s first rodeo -- he had been exhibiting cattle for the past five years at the presti-gious Houston Livestock Show and Rodeo. The difference was that this year, his steer won the GrandChampion Junior Market Steer at the Houston event. If that honor weren’t enough, the animal waspurchased at auction for $460,000 -- the highest bid in more than a decade! Show judge Dan Hoge slappedthe steer on the haunches and said it was, “near perfect”. The crowd roared its approval! Kannon -- just 15 -- said it was a “once in a lifetime moment”. “I was nervous but confident,” heexplained. Kannon had devoted countless hours to working with the splendid Charolais steer. “I had tomake sure he was comfortable with me and okay in crowds of peopleand animals. There’s always a goat, pig or dog around, so he got usedto them, too.” The young man said that he’s proud his hard work paid off,and acknowledged that, “It feels great to be champion.” He has newanimals now, and will be out on the Texas Livestock Show circuitduring the summer, and San Antonio, Fort Worth, Austin, and SanAngelo during the winter. Kannon credits the support of his familyfor this success. “It’s something we do as a family and it means theworld to me!” Congratulations Kannon! 3
  4. 4. Although he was unable to be TWCA’s Confluence Newsletter with us at the TWCA gratefully acknowledges the 68th Annual Meeting in Dallas, 2012 Sponsors who make this the conference was dedicated to communication among members possible... State Representative ALLAN B. RITTER PLATINUM Chair, House Committee on AECOM Natural Resources Angelina & Neches River Authority Freese and Nichols, Inc. Lloyd Gosselink Rochelle & Townsend, P. C. North Texas Municipal Water District SAIC Energy, Environment & Infrastructure LLC San Antonio River Authority Tarrant Regional Water District GOLD Brazoria Drainage District No. 4 Brown & Gay Engineers, Inc. Chambers-Liberty Counties Navigation District Colorado River Municipal Water District Guadalupe-Blanco River Authority Gulf Coast Waste Disposal Authority In recognition of his untiring efforts Harlingen Irrigation District Cameron County #1for the betterment of water resources Jefferson County Drainage District #6 Lavaca-Navidad River Authority in the State of Texas. Lower Neches Valley Authority North Harris County Regional Water Authority Northeast Texas Municipal Water District Sabine River Authority of Texas San Jacinto River Authority Titus County Fresh Water Supply District #1 TWCA Risk Management Fund Upper Neches River Municipal Water Authority SILVER Barton Springs/Edwards Aquifer Conservation District Cameron County Drainage District #1 Canadian River Municipal Water Authority Evergreen Underground Water Conservation District Franklin County Water District J. Stowe & Co., LLC K. Friese & Associates, Inc. BRONZE Bell Engineers and Consulting, Inc. Brazoria County Groundwater Conservation District John E. Burke & Associates LLC Kimley-Horn and Associates, Inc. Klotz Associates, Inc. Plum Creek Conservation District Texas Water Foundation, Inc. 4
  5. 5. Takings Litigation Against the Edwards Aquifer Authority After the Day Case by Andrew S. “Drew” Miller I. Introduction In February 2012, the Texas Supreme Courtissued its landmark decision in Edwards AquiferAuthority v. Day. In that case, and for the first time,the Texas Supreme Court has held that landowners with surface water. Later, Day sought an initialhave a property interest in groundwater prior to regular permit (“IRP”) from the EAA pursuant tocapture that may be the subject of a regulatory the Edwards Aquifer Authority Act (“EAA Act”)takings claim. The obvious and immediate result (Act of May 30, 1993, 73rd Leg., R.S., ch. 626,of the Day decision is that landowners may assert 1993 Tex. Gen. Laws 2350, as amended), basedregulatory takings claims against the Edwards on his predecessors’ use of Edwards groundwaterAquifer Authority (“EAA”), Chapter 36 groundwater from the well during the Act’s statutorily-mandatedconservation districts, and other governmental historic period. Following a contested case hearingentities in response to regulation that limits or in which Day was able to show that his predecessorprohibits access to, or production of, groundwater. irrigated only seven acres with Edwards groundwaterWhether and to what extent such claims will succeed during the historic period, the EAA issued an IRPunder the facts of each case, including the situation to Day with a withdrawal amount of 14 acre-feetof the particular claimant and the nature of the (“AF”) per year. Under the terms of the EAA Act,regulation at issue, is much less clear. Day was entitled to an IRP for 14 AF based on the In its Day decision, the Court did not hold number of acres of land that he was able to showthat a compensable taking of Day’s property had had been irrigated with Edwards groundwater.occurred but, rather, remanded that question to the Day filed a lawsuit against the EAA challengingtrial court for a determination of the merits of Day’s the validity of the EAA’s decision to grant a permittakings claim. In the wake of the Day decision, to Day for only 14 AF per year, alleging numerousattention has been turned to the EAA’s remaining errors. The lawsuit also included a claim that thedefenses to, and the merits of, Day’s takings claim,and to other takings claims that are pending andwhich are being threatened against the EAA. Thisarticle summarizes the Day case, and examinesthe issues on remand in that case as well as otherpending takings litigation against the EAA. II. Edwards Aquifer Authority v. DayBackground In 1994, Burrell Day and Joel McDaniel(collectively, “Day”) purchased property in BexarCounty upon which existed an uncontrolled, flowing,dilapidated Edwards Aquifer well with a collapsedcasing and no pump. Water from the well flowedinto a ditch and thereafter into a lake, which wasfed by an intermittent creek, where it comingled Day & McDaniel’s well – September 2004 (from EAA files) 5
  6. 6. Day Case... to Day. The Court ultimately remands the issue of whether Day has suffered a compensable taking as aContinued result of the application of the EAA Act’s regulatoryEAA’s permit decision amounted to a regulatory scheme to the trial court for further considerationtaking of Day’s vested ownership rights to the Edwards and decision.groundwater under his property therefore entitling Motion for RehearingDay to compensation. On the question of the validity In April, the EAA filed a motion for rehearingof the EAA’s permit decision, the Texas Supreme which: (1) asks the court to narrow its focus toCourt held that the decision is valid and supported Edwards groundwater and hold that any interestby evidence in the record before the agency. held by landowners in Edwards groundwater within The trial court had granted summary the jurisdiction of the EAA beneath their propertyjudgment in favor of the EAA on Day’s regulatory may not be the subject of a regulatory takings claim;takings claim on the ground that Day had no and (2) argues that the discussion in Part IV of thevested right to groundwater beneath his property Court’s opinion – related to whether the EAA Act’sprior to capture. The Court of Appeals reversed regulatory scheme as applied to Day has resultedon that issue, holding that Day has a vested right in a compensable taking – concerns issues thatand remanded the case to the trial court for further were not raised, briefed, or factually developed,proceedings on the merits of Day’s takings claim. are not properly before the Texas Supreme CourtBoth sides sought and were granted review by the for decision and is unnecessary dicta, and thereforeTexas Supreme Court. should be deleted from the opinion. As of this The Texas Supreme Court’s Holding writing, the EAA’s motion for rehearing remains The Texas Supreme Court addressed the pending.vested rights issue – i.e., whether Day has a property Likely Issues on Remandinterest in groundwater prior to capture entitled to The Texas Supreme Court remanded the Dayprotection under the takings clause of the Texas case so that the trial court could address Day’s takingsConstitution. The Court repeatedly emphasized claim on its merits and thus determine whether thethat it had never before ruled on this question. legislatively-mandated Edwards permitting process,The Court then declared that the common law of as applied to Day, deprives Day of his Edwardsownership of oil and gas applies to groundwater. groundwater and constitutes a compensable taking.Under that law, oil and gas (and now groundwater) The Court discussed the standards and legal testsare owned in place. They are considered a part of applicable to making such a determination and, inthe realty, and the landowner is regarded as having particular, the three-factor balancing test set forthabsolute title to these substances, which each by the United States Supreme Court in its 1978landowner owns privately, separately, distinctly, and decision in the Penn Central Transportationexclusively, as a result of his proprietorship of the Company v. New York City case – the “Pennland. A landowner’s right in these substances prior Central” factors. The three Penn Central factorsto capture is entitled to protection under the takings to be looked at have been succinctly restated as:clause of the Texas Constitution, and therefore may (1) he economic impact of the regulation on tbe the subject of regulatory takings claim. the claimant;The Texas Supreme Court’s Discussion in Part IV (2) he extent to which the regulation has t of its Opinion: Whether the EAA Act’s Regulatory interfered with reasonable investmentScheme Results in a Compensable Taking as to Day backed expectations; and In Part IV of its opinion, the Court discusses, (3) the character of the governmental action.at some length, the application of the standards In the remanded proceeding, the EAA willand legal tests used by courts to determine whether advance at least one complete defense to takingsa compensable taking has occurred (including the liability: that the EAA is not liable for a regulatorythree-factor Penn Central balancing test) and how taking of Day’s property because its actions withthese tests and factors might play-out with respect respect to Day’s permit application were mandated 6
  7. 7. by the EAA Act. Therefore, regulatory takings D’Hanis and Home Place orchards. The Braggsliability, if any, properly lies with the State of Texas ask on appeal that the district court’s judgment beand not the EAA. In addition, the EAA will present modified to correct (by increasing) the amount ofevidence and legal arguments to support a decision just compensation to which the Braggs are entitled.that the EAA is not liable for a taking of Day’s The Braggs argue that the district court was requiredproperty upon the court’s application and analysis to value the Braggs’ groundwater rights separateof the Penn Central factors. from the land and failed to do so, and committed III. Edwards Aquifer Authority v. Bragg other valuation and calculation errors. The BraggsThe Braggs, pecan farmers in Medina County, also argue that they have suffered a categorical orapplied for two IRPs from the EAA for Edwards per se taking of their property (eliminating the needwells on each of their two orchards. The EAA for a Penn Central analysis) because (1) Edwardsdenied the Braggs’ permit application for the well regulation preventing them from withdrawingon their D’Hanis orchard, which had no historical sufficient water denies them all economically viableuse as it was drilled after the EAA Act was passed use of their lands, and (2) the EAA’s actions on theirand after the close of the legislatively-mandated permit applications constitute physical takings ofhistoric period. The EAA granted the Braggs’ their groundwater. permit application for the well on their Home Placeorchard, but for an amount based on the number of Drew Miller is theacres irrigated during the historical period, which is 2012-2013 TWCAless than the Braggs indicated they need to water Water Laws Committee Chair and a partnertheir mature pecan trees. The EAA’s actions on at the Austin officeboth of these permit applications were mandated of Kemp Smith LLPby the EAA Act. where he serves In 2011, the trial court in Medina County as the chair of hisissued a judgment holding that the Braggs suffered firm’s Environmental,a regulatory taking of both of their orchards under Adminis-trative andthe Penn Central analysis, and are entitled to Public Law Department. Drew representsabout $135,000 in compensation with respect public and private entity clients across Texasto the D’Hanis orchard and about $598,000 in in the areas of water and environmentalcompensation with respect to the Home Place law, emphasizing groundwater regulationorchard. and issues involving contaminated property. This case is currently on appeal to the Fourth He serves as counsel for the EdwardsCourt of Appeals in San Antonio. The EAA argues Aquifer Authority in the Day case and inon appeal that the trial court’s judgment should be other matters. If you would like additionalreversed because, among other reasons: (1) the EAA information or have questions related to thisis not liable for a taking because its actions on the article or other matters, please contact DrewBraggs’ permit applications were mandated by the at 512-320-5466 or dmiller@kempsmith.State of Texas; (2) the applicable statute of limitations com.bars the Braggs’ takings claims; (3) the EAA Act MARK YOURincreased the value of the Home Place orchard CALENDARS...so no compensation is owed; (4) the trial court TWCA FALL MEETINGimproperly determined the adequate compensation October 24-26, 2012owed for a taking of the D’Hanis orchard; and The Crowne Plaza(5) the trial court improperly determined that the Riverwalk HotelAct and its implementation caused a taking of the San Antonio, TX 7
  8. 8. 2011 Drought --Lake Conroe Chapter by Reed Eichelberger and Jace Houston San Jacinto River Authority Writing an article about the recent Texasdrought in the Confluence newsletter isn’t likepreaching to the choir, it’s more like preachingto a group of seminary professors. What can wepossibly say about this drought that hasn’t alreadybeen said or lived by everyone in the water industry?Perhaps not much, but over the past year, we gainedvaluable insights by hearing the various stories ofhow the drought impacted different organizationsand individuals in TWCA, so we offer the followingas the San Jacinto River Authority’s chapter in theongoing story of the 2011 drought. You’ll find that many of the themes from our Photo by Don Sarichstory are familiar. We faced similar challenges tothose experienced in other parts of the state – testingthe reliability of our water rights; attempting toeducate the public about how water supply reservoirsand water rights work; and dealing with the hueand cry of lake-area residents and business ownersas water levels declined and fears of the unknown Figure 2 shows how Lake Conroe’s water levelincreased. fared through the drought. As previously mentioned, But we also had some unique challenges and the drought started in early 2010 in Montgomeryinteresting storylines that will hopefully make our County. The last time Lake Conroe was at full poolchapter in this story…not dry reading! elevation was in April of 2010. After a complete How the Drought Unfolded lack of winter and spring rains in 2011, the lake in Montgomery County level began to fall steadily throughout the summer As Figure 1 (below) demonstrates, East Texas as evaporation rates exceeded 150 million gallonsgot a head start on the drought. Starting basically in per day and inflows into the lake were essentiallyJanuary 2010, Lake Conroe began receiving below- negligible (right).normal rainfall and experienced a steady decline in Like most lakes that have a lot of lakefrontreservoir elevation that didn’t begin to take a positive residential development and recreational use,turn until January 2012. Lake Conroe has a “happy zone.” Whenever If you scroll through a “time lapse” collection the lake is within about three feet of normal poolof the U.S. Drought Monitors from January 2010 elevation (which for Lake Conroe has been thethrough May of 2012 (which you can do at http:// case approximately 95 percent of the time sincewww.sjra.net/drought/index.php), you’ll see the the lake was constructed in 1973), most of theearly stages of the drought beginning in East Texas, people within our community are satisfied. Inand find that the drought still hasn’t let up in West fact, Lake Conroe has only dropped below thisTexas. happy zone five times in the past 39 years. Figure 1. U.S. Drought Monitor for Lake Conroe left the happy zone in aboutMay 2010 shows early signs of the 2011 drought May of 2011, surpassed its previous record lowbeginning to settle into East Texas and Louisiana level in September, and finally bottomed out at(right). approximately 8.4 feet low in December. 8
  9. 9. Of course, Lake Conroe wasn’t the only lake in our region that was impacted by the drought. On August 15, 2011, the City of Houston called for the release of some of its water that it owns in Lake Conroe. This was only the second time in the history of Lake Conroe that Houston had called for the release of water from the Lake. The release started at 50 million gallons per day, but ramped up to 165 million gallons per day through most of September, October, and November. The release was finally suspended on November 30, 2011, when much-welcomed rains in the Lake Houston watershed restored Lake Houston to near-normal levels. Figure 1. U.S. Drought Monitor for May 2010 Lake Conroe’s conservation capacity is approximately 416,000 acre-feet. This month (May 2012), Lake Conroe’s storage is at approximately 370,000 acre- feet, or 90 percent. When the lake reached its lowest point in December 2011, reservoir storage was at approximately 280,000 acre-feet, or 70 percent. Fear of the Unknown Numerous times during the fall of 2011, we received calls from print and television reporters looking for a doom and gloom report about the drought’s effects on Lake Conroe. “Are we about to run out of water?” “Are we on the brink of a waterFigure 2. Water level in Lake Conroe from March 2010 to present. supply disaster?” “How many days of water supply do we have left?” Over and over, we would explain the facts to these surprised reporters, which was that we had many years of water supply still available in Montgomery County. We would explain how all of the municipal water demand in Montgomery County is still met using groundwater and how there is actually very little water being used from Lake Conroe. Even with the City of Houston beginning 9
  10. 10. to use a portion of its share of the lake, there is still people’s fears. Despite studies that showed howa lot of supply available. the lake reacts to rainfall cycles, despite historic data But eventually the questions would come showing that Lake Conroe spills about seven feet ofaround to lake level. “But isn’t the falling lake water per year on average, despite past experiencelevel causing a lot of concern among residents, demonstrating how quickly the lake could rebound;businesses, and community leaders around the lake?” all of these efforts seemed to do little to calm theAbsolutely. Concern about how long the drought public’s concerns. We even directed their attentionwill last. Concern about whether or how long it will to other lakes in the State that have historicallytake Lake Conroe to ever recover. Concern about fluctuated much more than Lake Conroe and stillhow property values and local businesses may be have healthy businesses and home values. This didimpacted. little to assuage their concerns. The basic problem is illustrated in the photos A Perfect Storm Becomesbelow. Even though Lake Conroe is first and a Perfect Opportunityforemost a water supply reservoir, it has become So what else could you add to the droughta major residential, commercial, and recreational to create an even more perfect storm of publicvenue. Approximately two-thirds of its 140-mile relations challenges? How about starting a projectshoreline has been developed. There are over to build a $500 million dollar water treatment4,000 residential docks and a dozen marinas on plant to begin taking water out of Lake Conroethe lake. All of these residents and businesses have for the first time for public water supply? So nowcome to expect, and rely upon, a fairly constant in addition to plummeting lake levels, residentslake level. In fact, many homes were sold in the in the county are beginning to pay an additionalearly days of Lake Conroe with the erroneous fee on their water bills to build a water treatmentpromise by unknowing realtors and developers plant to take more water out of the lake. that Lake Conroe was a constant level lake. Fortunately, this perfect storm has become a From May to December of 2011, as the perfect opportunity to educate the public about howdrought drove Lake Conroe to record low levels, a a water supply reservoir works. Beginning in Januarypermeating fear of the unknown created more and of this year, Lake Conroe finally began to receivemore anxiety among residents, business owners, significant rainfall. Water levels have rebounded toand community leaders. At times it seemed that no within two feet of full pool elevation – back withinamount of data or factual information could calm the happy zone. This has given residents and other Figure 3. 3-D rendering of SJRA surface water treatment plant that will begin using approximately 24 million gallons of water from Lake Conroe beginning in 2016. 10
  11. 11. interested parties a first-hand opportunity to see howquickly the lake can rebound with even moderaterainfall events; even following a record 12-monthdrought. Putting it All in Perspective During the worst part of the drought, our staffwas fielding numerous calls each day from angrylake-area residents complaining about not being ableto use their docks or get their boats into the waterfrom their boat lifts. At one point we finally beganpointing out to them that agricultural losses in Texashad already exceeded $5 billion. We began pointingout that there were reservoirs in West Texas with lessthan 10 percent storage remaining. We explainedthat there were communities in the state that weredown to less than one year of remaining water supply. feed them. And consider the plight of farmers It’s not that a prolonged drought won’t who had to decide which acreage to irrigate as theycreate real economic challenges in Montgomery face the long-term prospect of having to return toCounty. It’s just that seeing the bigger picture dry land farming in the Panhandle. The challengehelps people put their problems in perspective. to all of us is to plan better; to anticipate drought It is also important to remember that even impacts and prepare for them. Texans don’t giveif our portion of the state has climbed out of the up, even in the wake of a record-setting drought.drought doldrums for now, we – and everyone Necessity, they say, is the mother of invention…across the state – will be coping with the economic and we’ve learned from this “time it didn’timpacts of the drought for years to come. We’ll allpay the costs of failed crops…of cotton left in thefield because the plants didn’t mature or were toostunted to harvest…the staggering cost to ranchersto rebuild cattle herds lost or moved out of statebecause of insufficient or cost-prohibitive hay toFigure 4 shows two photos of the same cove onLake Conroe – one taken in November 2011 atthe height of the drought in our area, (above) andone taken in March 2012 after only three monthsof better-than-average rainfall (above right). 11
  12. 12. rain.” This is another “teachable moment.” We’re convinced that those of us in the water The National Drought Mitigation Center industry must continue educating the public aboutemphasizes the hydro-illogical cycle that exposes the real impacts of droughts, the real importance ofhow people perceive and deal with drought: first long-term water planning, the real value of water,there’s apathy…so what it if hasn’t rained for and the importance of conserving this preciousa few weeks? Then people start talking about resource. The drought of 2011 drove home thedrought…still no rain…deeper into drought. Folks importance of this educational effort, and in fact,start to panic. Then, miraculously, it rains! Well, demands a redoubling of our efforts. The publicthe drought must be OVER…return to apathy. must understand that much of our great State is still This perception is nothing new. As Ivan experiencing a serious drought, and that even theR. Tannehill, a forecaster with what became portions of the State that have experienced somethe United States Weather Bureau, noted in relief are precariously close to slipping back into“Drought: Its Causes and Effects” in 1947: drought conditions.  “We welcome the first clear day after arainy spell. Rainless days continue for a time andwe are pleased to have a long spell of such fineweather. It keeps on and we are a little worried.A few days more and we are really in trouble.The first rainless day in a spell of fine weathercontributes as much to the drought as the last, butno one knows how serious it will be until the lastdry day is gone and the rains have come again.” Reed Eichelberger (left) and Jace Houston San Jacinto River Authority PROP 2 CAMPAIGN March TWCA meeting -- Leroy Goodson (left), Gen- eral Manager of the Texas Water Conservation Association, presented a Certificate of Apprecia- tion to Perry Fowler, Assoc. General Contractors of TX, for his leadership in creating a statewide education campaign about Proposition 2. 12
  13. 13. HONORARY LIFE MEMBERSHIPSThroughout the years, the Association has awarded Honorary Life Memberships to those individuals whohave contributed above and beyond in their service to the Association and its membership. At the March AnnualConvention Dinner, seven outstanding individuals were presented this award. Presenting the awards, Jim Parkssaid, “If we combined all their service years as Directors and participants in TWCA, it would exceed two hundredyears.” Left to right above are: James R. Nichols, Jimmy Banks, Jim Parks, Bruce Rigler, and Richard Bowers.Juan F. “Frank” Ruiz was also recognized but unable to attend, as were Robert Shirley Wagner. The Wagnersreceived their Certificate from Leroy Goodson at a water district meeting (above right). THE PRESIDENT’S AWARDS At the TWCA’s 68th Annual Convention in Dal- las, TX in March, Jim Parks (left) presented the The second President’s Award was presented President’s Award to Brian Sledge, an attorney to Elizabeth (“Liz”) A. Fazio. She currently and governmental relations consultant with the law serves as Committee Director of the House firm of Lloyd Gosselink Rochelle Townsend. Committee on Natural Resources. President Jim Parks made the presentation. 13
  14. 14. FEDERAL DEVELOPMENTS.. SEQUESTRATION CALLED “TICKING TIME BOMB” By J. Tom Ray, Lockwood, Andrews, Newnam, Inc., Chair, TWCA Federal Affairs Committee Having been called a “ticking time bomb”, “a soften it, make the cuts (revenue adjustments) earlysword of Damocles”, and the greatest threat to our or postpone it by changing the dates in the BCA.national security by none other than the Chairman However, not kicking this legislative mandate downof the Joint Chiefs of Staff, sequestration (i.e., the road will result in across-the-board budget cutsstatutory mandated spending cuts) is set to explode to non-exempt defense, domestic discretionary andon the federal budget on January 2, 2013 unless some mandatory or entitlement programs. Congress and President act to soften or avoid the The numbers are interesting: Congressmandate. The debacle of the Budget Control Act gives credit for interest ‘savings’, so the $1.2 tril-of 2011 set up the problem and the consequences, lion in cuts is reduced by 18% to $984 billion.particularly to our defense budget, are massive. The cuts are evenly divided annually for the nextRecall that the BCA, as it is often referred to, set up nine years, resulting in an annual cut of $109the “Super-Committee” to define at least $1.2 tril- billion. The annual cut is split evenly betweenlion in budget cuts over 10 years, which turned out non-exempt portions of defense and non-defenseto be a politically impossible task. No cuts defined; spending; unless exempt; the cuts are appliedno Congressional action. Therefore, sequestra-tion will be triggered unless actions are taken to to both mandatory and discretionary spending. Taking into account the number of do- mestic programs that are exempted from seques- ter and the relative size of the defense budget versus non-defense discretionary budget, the sequestration cuts will be 46% of the total de- fense budget as compared to 27.9% of non-de- fense and 14.8% of entitlement spending. The severe cuts, particularly to defense, are a major concern and Congressional efforts to 14
  15. 15. soften or avoid sequestration are coming forward. ments with regard to water resources infrastructureOn May 7th, Chairman Ryan and the House Budget funding and also on the Federal regulatory front. Committee approved a bill (H.R. 4966) that would, First, both the House and the Senate Energyamong other things, stop the sequestration for and Water FY13 Appropriations bills have beendefense and non-defense discretionary programs, passed out of full Appropriations Committee. Itbut leave the sequester for entitlement programs. has been many years since such rapid progress wasHowever, H.R. 4966 is linked to the Ryan budget made on this bill which funds both the Bureau ofand as a result would cut non-defense discretionary Reclamation and the Corps of Engineers. A group ofspending in 2013 to about the same levels that us recently meet with Roger Cockrell, Staff Director,will result if sequestration does take place. Senate Subcommittee on Energy and Water Senate The situation with Congress today is Appropriations. Mr. Cockrell discussed the disap-that Mr. Ryan’s proposal and any similar ac- pointments of recent appropriations cycles, but wastions in the House will not be taken up nor actually, at least somewhat, optimistic that the Senatewill they be initiated by the Senate. So, where would pass an EW appropriations bill by October.does that leave us? Two possible outcomes: (Some basic funding numbers in table below.) Expect the sword to drop. Unless As you can see, the Senate version of the En-Congress and President can act in a very limited ergy and Water Appropriations bill is more generoustime available, probably less than six working weeks than the House bill when it comes to water infra-left in this election year, to deal with sequestra- structure funding. TWCA provided a support lettertion as well as the Bush tax cuts and debt ceiling, to the Senate Energy and Water Appropriationswe can expect across-the-board cuts to every line Committee for the additional funding in the FY12item of every federal agency’s budget in the 10% bill and we need to continue this support for FY13.range (for example, recent conversations with In another piece of good news, Senate En-Bureau of Reclamation and EPA staff the expec- ergy and Water Appropriators once again addedtation was 10% and 7.8%, respectively); or, $40 million for the Corps of Engineers Environ- Avoid the issue totally—kick-the-can. mental Infrastructure Construction account. ThisSince many economists are saying that if seques- is the section of the Corps budget that funds watertration occurs, it may throw the nation deeper into resources infrastructure. Although $40 million isrecession, a possible outcome will be that Congress a modest sum when considered in context of totaland President decide to amend the dates in the BCA Federal spending, this add-on would provide forand push the burden off to another Congress. the continuation of this effort in FY13. WithoutEnergy Water Appropriations specific support from the Congress, the Corps En- There have been important recent develop- vironmental Infrastructure Program cannot exist. 15
  16. 16. The House version of the FY13 Energy andWater Appropriations bill also includes an amend-ment proposed by Representative Rehberg [R:MT],which was adopted by a vote of 28 to 20 in HouseAppropriations and is now a part of the House Bill.This amendment prohibits the use of Corps FY13funding to “develop, adopt, implement, administer,or enforce a change or supplement to the rule datedNovember 13, 1986, or guidance documents datedJanuary 15, 2003, and December 2, 2008 pertain-ing to the definition of waters under the jurisdiction ofthe Federal Water Pollution Control Act.” The Sen-ate version of the bill has no similar provision. In addition to this House Appropria-tions amendment, two authorizing bills have with Respect to Waters of the United States.”also been introduced in the Congress which The chief sponsor is Senator John Barrasso ofwould prohibit both USEPA and the Corps of Wyoming who has been joined by 32 co-sponsors.Engineers from finalizing the proposed Clean S.2245 was introduced on March 28, 2012. Water Act Guidance or of using the Guidance as The other is a House bill, HR 4965 whichthe basis for any decision regarding the scope was introduced on April 27th by Transportationof the Federal Water Pollution Control Act. and Infrastructure Chair John Mica, joined by the One of these bills is S. 2245, which is titled full Committee Ranking Democrat Nick Rahall. Its“To Preserve Existing Rights and Responsibilities provisions are virtually identical to S. 2245. Expect lots of action with regard to water resources to be centered on the FY13 Energy and Water Appro- priations bill and on the Congressional resistance to having the Administration finalize the proposed Guidance with regard to the Clean Water Act. Whether the Congress ever returns to the days when Members could request and support Appropriations funding on behalf of their constitu- ents, the one certainty is that the day of the “easy earmark” has passed and is unlikely to return any time soon. WIFIA As severe as the budget deficit and national debt are, and even with Sequestration looming, Congress does recognize the importance of water infrastructure—in the short term to help create jobs and fight the recession and in the long term to help sustain the economy and provide for public health and welfare. At Texas Water Day this year, the Texas delegation members from both parties voiced support and agreed, to varying degrees, 16
  17. 17. that something should be done to properly define investment. The key concern, and apparently oneearmarks. Clearing the earmark constraint is that is slowing progress on the bill, is whether EPAcertainly a key to the building the next WRDA or the States’ SRF agencies should administerbill and to federal support for financing the the program.  Whereas TWCA, WESTCAS andTexas water projects in the State Water Plan. other water associations support the State option, The progress by the Senate Energy and Water others, notably including AWWA, support EPA.  Appropriations subcommittee to pass a spending In April, I visited with TI subcommittee staffbill, include plus-ups for the Corps of Engineers and in DC about this question. Who will administer theBureau of Reclamation, and working with the House program is now the hang-up. Staff sees the pointssubcommittee potentially pass out an appropriations on both sides, and it is important for TWCA tobill by October, in regular order, is encouraging. So continue not only to monitor but also to provideis the addition of another potential option for water further input to committee on our position. At theinfrastructure financing. Earlier this year, Chairman upcoming Federal Affairs Committee meeting, weGibbs of the Transportation Infrastructure will consider more TWCA input on WIFIA. Committee introduced Water InfrastructureFinancing and Innovation Act (WIFIA). Tom Ray, of Lockwood, At Federal Affairs Committee meeting in Andrews Newnam, hasFebruary, we discussed WIFIA. There is certainly followed national water is-a role for a bill that would provide revolving loan sues for more than 20 years.financing for large projects or combined projects He can be reached atof $20 million or more.  Positive also is removing j-tray@lan-inc.com.the Private Activity Bond and encouraging private 68th Annual Convention Dinner Speaker TX Agriculture Commissioner Todd Staples 17
  18. 18. Hydraulic Fracturing in Texas: Economic Boom and Looming Water Resource Challenges by Leonard Dougal, Partner at Jackson Walker L.L.P. 1 The production of oil and natural gas using explosives down-hole, has been in use since thelong-lateral horizontal drilling combined with multi- 1860s.3 Hydraulic fracturing by name is fairly selfstage hydraulic fracturing, also known as “fracking” explanatory. The basic method is that fluids areor “fracing,” is revolutionizing domestic energy pumped into hydrocarbon producing formations atproduction in the United States. In Texas, fracing high pressure, creating fractures which are pathwaysis creating enormous economic benefits, but at the to allow more natural gas or oil to escape. The fluidsame time stretching available water resources as used for hydraulic fracturing is typically about 90%operators move rigs into more arid areas of the water, 9.5% sand or other proppant, and 0.5% otherstate to target higher value oil and liquids, such as chemicals.4 The proppant and chemicals increasefound in the Wolfberry Field in the Permian Basin the length of the fractured pathways within theand the Eagle Ford Shale in South Texas. A recent formation rock and help the hydrocarbons escapestudy by the University of Texas at San Antonio through newly created propped fractures and flow toestimates that in a single year, 2011, the total the wellbore. The chemical composition of the fluidseconomic impact of the drilling and production used can vary among operators and locations. activity in the 20-county Eagle Ford Shale region In Texas, hydraulic fracturing does not occur nearwas 25 billion dollars, including supporting more the surface. Depending on the geography of thethan 47,000 full time jobs.2 Despite drilling location, the depth of the target formationmore than sixty years of experience with hydraulic can range from approximately one to two miles.5fracturing, the recent domestic expansion of oil and This depth is normally far below the base of thegas development has resulted in new opposition by useable groundwater. For instance, in the Barnettenvironmental and community groups, especially Shale in Texas, shale gas is often found at a depthas drilling moves into urban areas and regions that of 6,500-8,500 feet while useable groundwater ishave not historically benefitted from production generally located at depths shallower than 1,200activities. Common concerns voiced by opposition feet; likewise in the Haynesville Shale in Louisianagroups include the volume of water consumed and Texas, the freshwater depth is above 400 feetin the fracing process, potential contamination while the gas formations are between 10,500 toof drinking water supplies, adverse impacts tosurface water, and excessive air emissions. Inlight of this heightened attention, there has been asignificant increase in regulatory activity related tofracing at the local, state and federal levels. This article briefly outlines thehydraulic fracturing process and availabilityof shale gas, the potential impacts to groundand surface water, and the federal and statedevelopment of new regulations and guidance. Hydraulic Fracturing Basics Hydraulic fracturing has been aroundfor generations. The basic process was firstpatented in 1949, but “shooting” a well by blasting 18
  19. 19. 13,500 feet.6 At that depth, the well lateral can solely to supply water on the lease for a rigextend for thousands of feet horizontally, and these that is actively engaged in oil and gas drillinglong laterals are where the multi-stage fracture or exploration operations.8 The scope of thisoperations occur. Nearer to the surface, multiple exemption, especially as applied to fracing, isstrings of steel surface casing protect groundwater, subject to debate. The Railroad Commissionincluding surface casing which is cemented into place asserts that it exempts from permitting on-leasebelow the depth of useable groundwater then all the produced water used for fracing. Nevertheless,way back to the surface. Additional well production currently some groundwater conservation districtscasing is installed at deeper depths, and finally are requiring the operators to pay fees andproduction tubing isolates the produced hydrocarbons obtain drilling permits for such water wells. from contacting the production casing. Risks to Water Quality Consumption of Water After studying areas of known oil and gas Multi-stage hydraulic fracturing operations impacts to groundwater (presumably arising fromrequire large quantities of water. The Bureau of surface spills), in May 2009 the Chairman of theEconomic Geology reports that individual fracing Railroad Commission of Texas concluded that thereoperations routinely consume millions of gallons was “not...a single documented contaminationof water.7 In the Eagle Ford it is not unusual for case associated with hydraulic fracturing.” Morea fracing operation to use more than 5,000,000 recently, the U.S Environmental Protection Agencygallons and some of the larger fracs can consume dismissed its high profile enforcement case againstover 10,000,000 gallons. Securing such large Range Resources, in which the EPA alleged thequantities of water has posed a challenge to company’s fracing operations in the Barnettoperators in arid areas of Texas, and has created Shale had led to hydrocarbon contamination ofa growing industry of water purveyors. Existing drinking water aquifers.9 The case was especiallyholders of surface water rights have been amending notable as EPA’s position was in direct conflictthose rights to add “mining use” to allow the sale of with findings by the Railroad Commission ofsuch water to oil and gas operations. Tight supplies Texas which, after a full evidentiary hearing,of water and local concerns about consumption are unanimously found that Range Resources didcausing operators to devote increasing resources to not contribute to the alleged contamination. reuse of frac fluids. H o w e v e r, c o n t a m i n a t i o n r i s k t o groundwater does exist. It comes from surface spills, mishandling of fluids, or the potential “In the Eagle Ford it failure in the mechanical integrity of the well is not unusual for a fracing casing or the cement behind the casing. After fracing is completed, the pressure operation to use more decreases within the well and frac fluid flows back to than 5,000,000 gallons the surface. This is referred to as “flowback.” The and some of the larger amount of frac fluid recovered varies dramatically by well, but has been reported to range from 25% fracs can consume over to 75%; the flowback rate in the first few days 10,000,000 gallons.” can exceed 100,000 gallons per day and then decreases over time. Flowback can contain high Oil and gas rigs routinely use groundwater amounts of total dissolved solids (TDS), formationproduced from the well-site for drilling operations. hydrocarbons, salts and other contaminants thatThe Water Code provides an exemption from need to be managed with care. Flowback andpermitting for the drilling of a water well used produced water are typically held in on-site storage 19
  20. 20. tanks or water impoundment pits prior to and during resources. The study will analyze and researchtreatment, recycling, and disposal. Underground questions involving water acquisition, chemicalinjection is the primary method for disposal mixing, well injection, flowback and produced water,of flowback and produced water in Texas. and wastewater treatment and waste disposal. The Similar to the risk to groundwater, as long study will also include five retrospective case studiesas the methods of managing flowback are properly (Bakken Shale, North Dakota; Marcellus Shale,implemented, there is normally very little risk to Pennsylvania (2 locations); Raton Basin, Colorado;surface water. However, releases, leaks, and/ and the Barnett Shale, Texas) and two prospectiveor spills involving the storage or transportation case studies (Marcellus Shale, Pennsylvania andof wastewater could pose a contamination risk to Haynesville Shale, Louisiana). EPA expects theshallow aquifers and surface water bodies. initial result of the study to be available in 2012, Public Disclosure of Content of with a final report released in 2014. Hydraulic Fracturing Fluids Recently, one common theme among statelegislatures and regulators is an increased desire forfracing operators to disclose the chemical ingredientsused in fracing operations. In Texas, the legislaturein 2011 passed a bill mandating the disclosure ofchemical additives to fracing fluids.10 Pursuant tothe legislation, the Railroad Commission of Texashas adopted regulations which require operatorsto disclose information on frac fluids, includingthe total volume of water used; each chemicalingredient added; the trade name and descriptionof the chemical; and the concentration of eachchemical.11 This information must be filed with the Conclusionregulatory agency with the well completion reports The economic benefits of hydraulic fracturingand, significantly, posted online as well. The online in shale plays are an economic game-changer inpostings are found at the website FracFocus.org. many areas of the country. These operations useThe regulations provide protection for trade secret large quantities of water, which create resourceinformation, consistent with existing state law as set challenges and conflicts in arid areas. Newforth in the Texas Public Information Act. regulations require public disclosure of facing chemicals, and in response we may well find that oil and gas operators will voluntarily choose to use less exotic chemicals in their future hydraulic fracturing operations. Also coming will be more emphasis on recycling and reuse of flowback fluids to reduce the water consumption footprint of these operations.  EPA Hydraulic Fracturing Study Leonard Dougal, Study Plan on November 3, 2011. This Partner at Jacksonplan outlines a study process which will examine Walker L.L.P. 1the entire “life cycle” of fracing, with specific (Footnotes on page 20)focus on the potential impact to drinking water 20
  21. 21. FRACKING ARTICLE...Pages 17-19 5 See U.S. Environmental Protection Agency, Office of Research and Development, Plan to Study the Potential(Footnotes) Impacts of Hydraulic Fracturing on Drinking Water1 I would like to express my thanks to Jacob Arechiga, Resources 22 (Nov. 2011).an associate with Jackson Walker for his contributions 6 Id.to this article. 7 Current and Projected Water Use in the Texas2 Economic Impact of the Eagle Ford Shale, Center Mining and Oil and Gas Industry, The University offor Community and Business Research, The University Texas Bureau of Economic Geology (June 2011).of Texas at San Antonio Institute for Economic 8 Texas Water Code §36.117(b).Development (May 2012). 9 The EPA action began on December 7, 2010, when3 Carl T. Montgomery and Michael B. Smith, Hydraulic EPA issued an Emergency Order under Section 1431Fracturing: History of an Enduring Technology 27 of the Safe Drinking Water Act alleging that Range(Dec. 2010). Resources’ fracing operations had caused methane4 American Petroleum Institute, Freeing Up Energy, contamination to two domestic wells.Hydraulic Fracturing: Unlocking America’s Natural Gas 10 Tex. H.B. 3328, 82nd Leg., R.S. (2011).Resources 8 (July 19, 2010) 11 16 TAC §3.29. Welcome to Horseshoe Bay WANTED! June 13-15, 2012 Reservoir site in Texas for TWCA Mid-Year Conference pilot development More Aqua, Inc. is a spin off company fromthe Massachusetts Institute of Technology. Wedeveloped a water saving technology that reducesevaporation losses from water reservoirs. We are seeking a reservoir in Texas to developa pilot. The requirements are:  20 - 50 acre surface area  The reservoir is known not to have seepage losses or is lined to prevent seepage losses  The water is used for irrigation or industry.  The pilot project will not interfere with the reservoir function. Water can be drained or added as long as we can account for it.  The duration of the site rental would be for approximately 2 years. Please contact: Moshe Alamaro CTO, Interim CEO More Aqua, Inc. www.moreaqua.com 617-244-7995 21
  22. 22. TWCA WELCOMES NEW MEMBERS Resource Action Programs Contact: David Grider Sparks, NV 89431 Freeman Corbett, LLP Contact: Ronald J. Freeman Austin, TX 78759 San Patricio Municipal Water District Contact: Brian G. Williams Ingleside, TX 78362 Velma R. Danielson Spring Branch, TX 78070 EDITORIAL SERVICES... Barbara Payne 281-893-2099 barbara@paynecom.com22

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