Agreement Executed to Advance Truckee River Operating Agreement

Truckee Meadows Water Authority (“TMWA”) entered into an agreement with Great Basin Land and Water (“GBLW”) and the Pyramid Lake Paiute Tribe (“Pyramid Tribe”) to sell 2,747.92 AF of water rights at a price of $7 million (approximately $2,545/AF).

GBLW is paying for the water rights, which the parties refer to as the Desert Terminus Lake (“DTL”) water rights, with a $7 million grant from the U.S. Bureau of Reclamation. Half of the payment was made at the closing of the sale, and the remainder will be transferred when the State Engineer approves the change applications.  The water will be conveyed directly to the Pyramid Tribe to be used for water quality purposes.

The transfer is needed to move the Truckee River Operating Agreement (“TROA”) forward. Under a 2007 agreement among the Cities of Reno and Sparks, Washoe County and the Pyramid Tribe, the municipal entities agreed to provide 6,700 AF to the tribe for water quality purposes no later than when the Truckee River Operating Agreement (“TROA”) takes effect. Reno, Sparks and Washoe County previously transferred 3,952.08 AF to the Tribe—but the failure to fully meet the 6,700 AF obligation had the potential to cause significant delay in the implementation of the TROA.

TMWA considered the water rights to be “excess”—and therefore available to sell—because they were not part of the inventory that the Authority uses to meet municipal water demands, and they are not pledged for payment of bonds. They are comprised of blocks of converted irrigation rights that were acquired by TMWA’s predecessor, Sierra Pacific Power Company, between the 1950s and 1970s but were never assigned or committed to any particular parcel or water service. TROA will place constraints on the use of TMWA’s unassigned water rights, so in addition to resolving the issues related to the failure to meet the 6,700 AF obligation, the Authority finds the transaction advantageous because it derives a benefit from unexercised rights that will not be available for future municipal use.

According to John Erwin, TMWA Director Natural Resources-Planning & Management, all of the parties have approved the agreement, and they are in escrow as of September 21, 2015.

The TROA, which was signed in September 2008, will modify operation of Truckee River reservoirs to enhance coordination and flexibility to ensure that the demands of existing water rights are met while still providing flood control benefit and meeting dam safety conditions.  (For more on TROA, see “Truckee River Operating Agreement Signed,” Water Strategist September 2008).

 

Written by Marta L. Weismann