Two local governments in Nevada have won the right to sue the federal government over alleged failure to prepare an environmental impact statement prior to implementing a water-rights acquisition plan in the Lahontan Valley. The Ninth U.S. Circuit Court of Appeals has ruled that Churchill County and the City of Fallon do have the standing to sue the Secretary of the Interior under the federal Administrative Procedures Act. The local governments claim the Interior Department should have prepared a programmatic EIS on the water-acquisition plan or on the combined effect of the plan's actions prior to implementation. Instead, the Interior Department prepared a final EIS later on. The water-rights acquisition plan was called for by the passage of the Fallon Paiute Shoshone Indian Tribes Water Rights Settlement Act of 1990. This law was designed to resolve a series of complex water-rights dispute arising from the federal government's diversion of water in western Nevada for the Newlands Reclamation Project. Among other things, the law called for a reallocation of water to improve wetlands in the Lahotan Valley that had been damaged by the water diversion. Under the water rights acquisition plan, the U.S. Fish & Wildlife Service is authorized to purchase land or water rights to transfer water back to improve 25,000 acres of wetlands in the Lahotan Valley. The Service is permitted to buy land from willing sellers only. In November 1996, Fish & Wildlife announced plans to purchase 55,000 acre-feet of water from within the Carson Division of the Newlands Reclamation Project, and acquire rights to 35,000 additional acre-feet through leasing and other methods. The Carson Division is located within Churchill County and near the City of Fallon. The Interior Department issued a final EIS but refused to prepare a programmatic EIS on the combined effect of the plan with other programs in the area. Churchill County and Fallon sued under the Administrative Procedure Act claiming a violation of NEPA. U.S. District Court Judge Edward C. Reed Jr. ruled that the county and the city did not have standing because they had failed to show that the plan would result in imminent injury to them. Meanwhile, a local power company, Sierra Pacific Power Company, sought to intervene as a defendant in the city/county action. Judge Reed permitted Sierra Pacific to intervene in the remedial phase of the case but not in the phase dealing with the merits. On appeal, a three-judge panel of the Ninth Circuit overturned Judge Reed, concluding that the city and the county do have a right to appeal. The panel affirmed Judge Reed's ruling on Sierra Power, however. In order to have standing, Churchill County and Fallon had to prove that there has been a final agency action adversely affecting them and that their injury falls within the zone of interests protected by the section of the National Environmental Policy Act which they claim was violated. The county and the city produced several claims of proof. Among other things, the two local governments argued that the projects would cause environmental harm to land they own, including increased fire hazard, airborne particles, erosion, changes to the groundwater supply, and reduced quality of local drinking water. "It is reasonable that the transfer of a significant amount of water rights from the area adjacent to and surrounding County and City lands will affect those lands adversely," the Ninth Circuit wrote. In arguing against the city and county position, the Interior Department argued that the city and the county had "failed to show the imminence of their injury." The Ninth Circuit ruled that the Interior Department was paying too much attention to the "imminence" issue; imminence is not necessary, the court ruled, because the potential injury is beyond the control of the city and county. "In this case, although it is not clear when further land purchases will occur and water rights will be transferred to the wetlands, it is clear that the Secretary intends to purchase 55,000 acre-feet of water rights in the Carson Division - in County and near City - and has already started. One estimate of the time involved is that it will take twenty years for all the purchases and transfers. ... County and City do not have to wait for all purchases and transfers to be completed before they have standing. They have shown that their injury is not hypothetical or speculative, but is imminent, and redressable by the courts." The court affirmed the trial judge's ruling that Sierra Pacific should be permitted to intervene only in the remedial phase of the trial, not the merits, because the company does not have a "significantly protectable" interest in compliance with NEPA. The Case: Churchill County v. Babbitt, No. 97-15508, 98 Daily Journal D.A.R. 11189 (issued October 29, 1998). The Lawyers: For Churchill County and City of Fallon: Antonio Rossmann, (415) 861-1401. For Department of the Interior: Fred R. Disheroon, Assistant U.S. Attorney, Washington, D.C.