The document outlines the Washington Water Trust's efforts to enhance stream flows statewide through voluntary, cooperative, and market-based water acquisition strategies. It discusses the Nisqually Basin water banking feasibility study, highlighting water rights issues, the need for improved instream flows, and mitigation strategies for water users. Furthermore, it includes a summary of previous water acquisition successes and the future prospects for regional water planning and exchanges.

1. WASHINGTON WATER TRUST, WATER BANKS AND THE NISQUALLY BASIN NISQUALLY RIVER COUNCIL Amanda Cronin Washington Water Trust January 15, 2010

2. Washington Water Trust Water Law in WA- context for our work Stream Flow Restoration- examples Groundwater Mitigation and Water Banks Overview of the Nisqually basin water banking feasibility study PRESENTATION SUMMARY

3. 501(c)3 independent nonprofit Enhancing stream flows statewide Water acquisition – voluntary, cooperative, market based Work collaboratively with a wide range of partners, Offices in Ellensburg and Seattle Confidential, non-regulatory Columbia Basin- regional effort Working since 1998 with 35 years collective experience WASHINGTON WATER TRUST

4. WHY DO OUR STREAMS NEED MORE WATER? Many streams are over allocated Salmon evolved in pre-managed hydrologic regimes over 1000s of years Balance of uses: instream out-of-stream Low flow due to: Surface and Ground water withdrawals Impervious surfaces change flow patterns Climate: reduced snowpack: natural reservoir depletion Natural conditions 200 cfs of water rights 300 cfs flows overallocated / insufficient flow

5. Water Law Basics in Washington Property rights to “use” public resource (usufructuary) Prior appropriation (senior water uses first) 5-year “use it or lose it” rule ( exception when in “Trust”) All surface and groundwater rights must be permitted except permit exempt -wells Trust Water RCW 90.38 and 90.42 Allows “use” of water for instream flow (w/o “lose it”) “ Trust water” managed & protected by WA DOE Retains priority date (seniority) Expedited processing of water right changes (Hillis Rule) Temporary, permanent, short-term, long-term WATER RIGHTS & TRUST WATER 101

6. BASIC WATER MARKET OPTIONS Lease (temporary) Yearly compensation Familiarize parties with water market and transfer processes Purchase (in perpetuity) High degree of flexibility Transfer (new place, purpose of use, and new point of diversion) Donation Permanent = eligible for IRS charitable gift Easiest transfer (and process)

7. Split-season leasing Dry-year “options” Source substitution Changing point of diversion “ Pulse flows” Reverse auction Water conservation (efficiencies) Non-diversionary agreements Water banking & mitigation Land conservation CREP Riparian restoration Conservation easements FLEXIBILITY & BALANCE

8. Restored 28.8 cfs to Taneum Creek through source substitution Restored access to 21 miles of fish habitat Water users sourced to groundwater Changed 130-yr practice Voluntary agreement with Taneum Canal Company Landowner payments of over $800,000 TANEUM CREEK – YAKIMA BASIN SOURCE SUBSTITUTION: WINTER WATER FOR FISH & LIVESTOCK

9. TEANAWAY RIVER – YAKIMA BASIN Cumulative and late-season Ten landowner partnerships from North Fork to Mouth Teanaway River

10. COWICHE CREEK- YAKIMA BASIN SNOW MOUNTAIN RANCH Partnership between Cowiche Canyon Conservancy, WWT, landowner, North Yakima Conservation District and WDFW 1.43 cfs transferred permanently to instream 73 acres of restoration

11. CASCADE CREEK, ORCAS ISLAND Most significant salmon-bearing stream in San Juan Islands Purchase 0.25 cfs for summer flow and 0.5 cfs for fall flow Flows threatened by current and future municipal/ domestic Agency support: DOE flow monitoring WDFW fish and habitat surveys WDFW identified dry season target flows for purchase goals Result: Critical flows for fish. Satisfied needs for people.

12. WWT ACQUISITION IN DUNGENESS 2009 Dungeness Leasing with Dungeness Water Users Association Split season (Aug 15 – Sept 15) Mostly hobby farms Jointly with DWUA; 7 district boundary $100/acre maximum bid Must have irrigated in 2008, 5 acres+ 2009 Totals: 10 bids received; 9 accepted Acreage leased: 372.6 acres Spent in leases: $32,187 Instream flow: 2.42 cfs Open Invite for Bids How much are you willing to ACCEPT for your water? $ _____ / acre _____ acre feet

13. WHAT IS A WATER BANK? A water bank is an intermediary that acquires or leases water from willing sellers and then holds, transfers, and exchanges water rights on behalf of willing buyers Many examples of water banks across the west WA water banks are active in the Yakima and Walla Walla Statewide Trust water rights program is a form of banking and provides the administrative process by which to transfer water rights from one use to another

14. WALLA WALLA BASIN- GROUNDWATER MITIGATION Map: Department of Ecology

15. WHAT IS THE WALLA WALLA INSTREAM FLOW RULE? Amends existing WAC 173-532 Sets instream flows Prohibits new summer surface water diversions Limits new water use to flow improvement and environmental enhancement projects Restricts withdrawals from the gravel aquifer New limits on stock watering Conditions use of Exempt Wells Exempt from permitting not regulation RCW 90.44.050

16. EXEMPT WELLS UNDER THE RULE CONDITIONS ON NEW GRAVEL AQUIFER WELLS As of September 5 th , 2007 New Commercial and industrial uses not permitted New restrictions on livestock watering This provision applies to the entire WA portion of the watershed Wells must be metered Wells limited to 1,250 gpd Outdoor use must be mitigated May – Nov Beginning May 1, 2008

17. STATE ASSISTED MITIGATION EXCHANGE HOW IT WORKS WWT seeds the exchange for 2 years by acquiring existing water rights and placing into trust program Homebuilders pay WWT $2,000/exempt well Homebuilders receive mitigation certificate from Ecology WWT and Ecology debit the exchange .5 af for each mitigation certificate Homebuilders must meter use, record monthly and report annually to Ecology Monitoring & enforcement by State

18. DUNGENESS BASIN

19. Surface and groundwater rights are fully allocated SW flows insufficient for instream flow needs and economic growth New groundwater requests are threatening existing water users Late season low flows are limiting stream and fish health Economic growth potential is hampered by water scarcity DUNGENESS BASIN WATER EXCHANGE THE FUTURE OF REGIONAL WATER PLANNING IN WA

20. FUTURE DUNGENESS INSTREAM FLOW RULE Formally close surface water allocations Sets instream flows Require new GW allocations to offset impact on SW flows Summary - create a cap and trade system Consumptive use cap on water Links GW to SW Allocates rights (and costs) Enables trading

21. Potential Buyers Restoration City PUD Small GW uses Exempt Wells SCOPE OF TRADING “WATER EXCHANGE” Potential Sellers Right holders Irrigators GW users Offsets Reclaimed water Recharge Storage

22. DUNGENESS: KEY QUESTIONS FOR DESIGNING A WATER EXCHANGE How do we design a system that provides for some new uses and flow restoration? Who can participate? Who has the authority to create and accept mitigation credits? How are offsets considered? Credits vs. Payments? Option A: Buy an existing right Option B: Create a new right (but offset impact) Offset 1: Develop own offset project Offset 2: Buy offset credits (provided by other) Offset 3: Payment in lieu (of providing offset)

23. Economic Development (new groundwater uses) Restoration Funds Public Sources Watershed Implementation State Appropriation Salmon Recovery Board Federal Grants Puget Sound Partnership Private Sources Individual Donations Corporate Sponsorships Tribal Donations Dungeness Water Exchange Flow Restoration and Groundwater Mitigation Environmental Restoration (Dungeness River flows) Mitigation Funds Private Sources Builders/Homeowners Property Developers Other new GW Users Public Sources City Payments PUD Payments County subsidies (?) Environmental Sustainability Exchange Water Transactions Exempt Well Retirement Conserved Ag Water GW Recharge Reclaimed Water (replace SW diversion) New Surface Storage (replace SW diversion) Instream SW Transfers S/T & L/T Instream Leasing GW Right Retirement Minimum Diversion/Flow Agreements

24. NISQUALLY WATER BANKING FEASIBILITY STUDY Task 1: Basin orientation and key stakeholder interviews Task 2: Research of current and desired conditions Task 3: Present initial findings and water banking concepts Task 4: Write final report

25. TIMELINE Nisqually Basin Feasibility Study Workplan Activities Jan Feb Mar Apr May Jun Task 1: Basin Orientation and Key Stakeholder Interviews Follow Up Interviews Task 2: Research Current and Desired Conditions Task 3: Presentations Task 4: Draft Report ready for review Final report

26. DISCUSSION /QUESTIONS? Amanda Cronin [email_address] 206.675.1585 x100 Western WA Office 1530 Westlake Ave N, Ste 400 Seattle, WA 98109 206.675.1585 Eastern WA Office 222 East 4 th Ave, Ste 109 Ellensburg, WA 98926 509.925.5600