Sacramento Grazing Ass'n, Inc. v. United States

SACRAMENTO GRAZING ASS'N, INC., et al., Plaintiffs, v. THE UNITED STATES, Defendant.

No. 04-786 L

United States Court of Federal Claims

November 3, 2017

Declaration of Water Right Ownership, N.M. STAT. ANN. § 72-1-3 (West 2015);

Endangered Species Act of 1973, 7 U.S.C. § 163, 16 U.S.C. §§ 1531-1544 (2012);

Federal Land Policy and Management Act of 1976, 43 U.S.C. § 1752 (2012);

National Environmental Policy Act of 1969, 42 U.S.C. §§ 4321-4375 (2012);

Forest and Rangeland Renewable Resources Planning Act of 1974, 16 U.S.C. § 1604 (2012);

Statute of Limitations, 28 U.S.C. § 2501 (2012);

U.S. CONST. amend. V, Takings Clause;

36 C.F.R. § 222.3(c)(1)(ii) (Forest Service Livestock Grazing Permits).

Michael Joseph Van Zandt, Hanson Bridgett, LLP, San Francisco, California, Counsel for Plaintiffs.

Kristine Sears Tardiff, United States Department of Justice, Environment & Natural Resources Division, Concord, New Hampshire, Counsel for the Government.

MEMORANDUM OPINION AND ORDER DETERMINING THAT THE FEDERAL GOVERNMENT VIOLATED PLAINTIFFS' RIGHTS UNDER NEW MEXICO LAW TO BENEFICIAL USE OF STOCK WATER IN THE LINCOLN NATIONAL FOREST

BRADEN, Chief Judge.

On January 2, 2016, several dozen ranchers, who unsuccessfully attempted to find common ground with environmental groups and officials from Oregon's Malheur National Wildlife Refuge for over a decade, decided to take up arms to protest federal policy and regulations to prioritize migrating bird water habitat, by limiting the number of cattle that historically grazed and used water in that area—decades before it was subject to federal control.¹ In contrast, the Sacramento Grazing Association, Inc. ("SGA") filed a complaint in the United States Court of Federal Claimsfor an adjudication of its right to beneficial use of stock water sources within the Sacramento Allotment of the Lincoln National Forest, New Mexico, that pre-date federal control.

Today, the court reaffirms a prior ruling that SGA's Fifth Amendment Takings Clause claims are not barred by the statute of limitations. In addition, the court has determined that SGA established, at trial, a property interest, recognized by New Mexico law, to make beneficial use of stock water sources in the Sacramento Allotment of the Lincoln National Forest. The court also has determined that SGA established the right to make beneficial use of stock water sources in the Sacramento Allotment that was abrogated by actions undertaken by the United States Forest Service ("USFS"), in violation of the Takings Clause of the Fifth Amendment to the United States Constitution.²

As Justice Holmes observed ninety-five years ago, "We are in danger of forgetting that a strong public desire to improve the public condition is not enough to warrant achieving the desire by a shorter cut than the constitutional way of paying for the change." Pa. Coal Co. v. Mahon, 260 U.S. 393, 416 (1922); see also Murr v. Wisconsin, 137 S. Ct. 1933, 1950 (2017) (Roberts, C.J., dissenting, joined by Thomas & Alito, JJ.). ("Our decisions have, time and time again, declared that the Takings Clause protects private property rights as state law creates and defines them. By securing such established property rights, the Takings Clause protects individuals from being forced to bear the full weight of actions that should be borne by the public at large.") (emphasis omitted); see also Tahoe-Sierra Preservation Council v. Tahoe Regional Planning Agency, 535 U.S. 302, 354 (2002) (Rehnquist, C.J., dissenting, joined by Thomas & Scalia, JJ.). ("[A]s is the case with most governmental action that furthers the public interest, the Constitution requires that the costs and burdens be borne by the public at large, not a few targeted citizens.").

The United States Forest Service ("USFS") has responsibility to manage national forests including the habitat of endangered species. But a small, family-owned cattle ranch should not be forced to "bear" the entire financial burden of the USFS's management choices, where they interfere with property rights, recognized by state law.

To facilitate review of this Memorandum Opinion And Order, the court has provided the following outline:

I. FACTUAL BACKGROUND.

A. The History Of The Lincoln National Forest.

B. The History Of The Sacramento Grazing Association.

C. In 1985, The United States Forest Service Erected "Exclosures" Around Water Sources To Protect Endangered Species: The Sacramento Mountains Thistle And The Southwestern Prickly Poppy.

D. Post-Trial Efforts Made By The Parties To Ascertain Alternative Water Sources From 2012 To 2016.

II. RELEVANT PROCEDURAL HISTORY.

III. JURISDICTION.

A. The Second Amended Complaint Properly Invoked The Jurisdiction Of The United States Court Of Federal Claims.

B. The Statute Of Limitations Does Not Bar The Court From Adjudicating The Takings Clause Claims Alleged In The Second Amended Complaint.

1. The Court's Pre-Trial November 1, 2010 Memorandum Opinion And Order.

2. The Effect Of Subsequent Precedent.

a. The Government's Argument.

b. The Plaintiffs' Response.

c. The Government's Reply.

d. The Court's Resolution.

C. Standing.

IV. PLAINTIFFS ESTABLISHED THE RIGHT, UNDER NEW MEXICO LAW, TO BENEFICIAL USE OF STOCK WATER SOURCES WITHIN THE SACRAMENTO ALLOTMENT OF THE LINCOLN NATIONAL FOREST.

A. Prior To Trial, Plaintiffs Satisfied The Requirements Of New Mexico Law To Establish A Prima Facie Right To Beneficial Use Of Stock Water Sources Within The Sacramento Allotment.

B. At Trial, Plaintiffs Also Established That SGA Made Beneficial Use Of Water Sources Within The Sacramento Allotment.

1. The Plaintiffs' Argument.

2. The Government's Response.

3. The Plaintiffs' Reply.

4. The Government's Sur-Reply.

5. The Court's Resolution.

C. New Mexico Law Does Not Require Diversion To Establish The Right To Beneficial Use Of Stock Water.

1. The Government's Argument.

2. The Plaintiffs' Response.

3. The Court's Resolution.

V. AT TRIAL, PLAINTIFFS ESTABLISHED UNDER THE TAKINGS CLAUSE OF THE FIFTH AMENDMENT TO THE UNITED STATES CONSTITUTION THAT THE GOVERNMENT EFFECTED A TAKING OF THEIR RIGHT TO BENEFICIAL USE OF STOCK WATER SOURCES WITHIN THE SACRAMENTO ALLOTMENT OF THE LINCOLN NATIONAL FOREST.

A. The Plaintiffs' Argument.

B. The Government's Response.

C. The Plaintiffs' Reply.

D. The Government's Sur-Reply.

E. The Court's Resolution.

VI. CONCLUSION.

I. FACTUAL BACKGROUND.³

A. The History Of The Lincoln National Forest.

Between 1902 and 1910, Congress set aside certain tracts of land within the New Mexico Territory to protect the region's timber and water supply, control overstocking the range, andprovide a recreational area for the public. DX 504 at 10-11. In 1917, these tracts of land were combined to form the Lincoln National Forest. DX 504 at 11.

Since 1905, the USFS has administered federally-owned land within the Lincoln National Forest. Sec. Am. Compl. ¶ 3.⁴ Every year, the USFS determines the number of cattle that may graze on the Sacramento Allotment. DX 504 at 15 (describing the origin of the "permitting system"). This information is published in Annual Operating Instructions ("AOI"), known as Annual Operating Plans ("AOP"). JX 17-20 (AOI For The Sacramento Allotment from 1997-1998). Prior to the issuance of an AOP, the USFS District Ranger ("District Ranger") must consult with permittees to determine "the number of cattle, length of [the] grazing season, and [the] allowable utilization levels on forage species," before reaching a final decision issued in a Bill for Collection. See Sacramento Grazing I, 66 Fed. Cl. at 212.

Since 1910, the USFS also has issued multi-year grazing cards (or permits) to ranchers that list "the number of cattle, which pastures were used for grazing[,] and how the ranchers came to obtain the allotment." TR 202-20, 306 (Frances Goss) ("The grazing cards are to show cattle grazing on allotted pieces of land, and when cattle graze, they drink water, and water was transferred to us when we purchased the allotment."); PX 17 (grazing cards, issued from 1910-1989, reflecting both cattle grazing and use of water within the Sacramento Allotment). Historically, grazing permits were issued, based on priority of earliest and continuous use, with priority for smaller, local ranchers, after payment of a fee. DX 504 at 16, 18.

B. The History Of The Sacramento Grazing Association.

In 1885, Ananias Green moved his family from Texas to the Sacramento Mountains of New Mexico to raise cattle. TR 189-90 (Frances Goss) (Ananias Green "came into the Sacramento Mountains in 1885 from Texas."). His great-great grandson, Justin ("Spike") Goss, is the Vice-President of SGA,⁵ a New Mexico non-profit corporation, formed in 1989, to obtain and holdUSFS permits to graze cattle on the Sacramento Allotment of the Lincoln National Forest, New Mexico. TR 183 (Frances Goss) ("[SGA] is an association that was formed to run cattle on an allotment in the Sacramento Mountains."). SGA's base property consists of approximately eighty acres and is held in fee simple. Sec. Am. Compl. ¶¶ 6-7; TR 223 (Frances Goss).⁶

It has been the custom of ranchers in this area of New Mexico to convey water rights at the same time as the sale or transfer of land on the Sacramento Allotment. PX 26; TR 227-32 (Frances Goss) ("You buy [the deed] from predecessors, and all the waters that Oliver Lee had bought, when he sold his allotment, he sold cattle, water rights, access rights, range rights."); TR 321 (Frances Goss) ("it was the custom of the Sacramento Mountain ranchers when they passed their allotment to someone else, that was one of the things they passed, was their water rights."). For example, on December 12, 1896, Eli Reynolds conveyed a deed to Oliver Lee that described "all rights, to title, and interests of [Eli Reynolds] and then to all and every spring or springs in the mouth of said Alamo Canyon, and the Waters of the said springs . . . and to all of the said waters, springs, ditches, and so forth used by appropriation and otherwise." PX 26 (12/12/1896...