Sanctuary Forest’s Mattole Flow Program:

LEGAL OPTIONS FOR STREAMFLOW PROTECTION

In response to an emerging crisis of persistent summertime low flows in the Mattole River
headwaters, and the desire of the local community to take action to deal with the problem,
Sanctuary Forest has spent several years researching and developing voluntary tools and options
for landowners and water users to address the low-flow crisis. Another brochure produced by
Sanctuary Forest describes the scope of the Mattole low-flow problem, and outlines the water
storage and forbearance program that is helping to address it by providing landowners along
critical stream reaches with the storage capacity to allow them to forego pumping water when the
river flows are lowest.

This brochure focuses on the particular legal tools that are available to landowners statewide who
want to make a long-term commitment to reducing their parcel’s impact on late summer
streamflows. It explains the differences between the three types of agreements that can be used to
accomplish this goal, and the general reasons why using a coordinated approach involving a
legal agreement can maximize the benefits—both for the river and for landowners. While the
research for this brochure arises out of Sanctuary Forest’s work on improving low flows in the
Mattole River headwaters, the legal options and issues described are intended to educate
landowners, land trusts and water trusts throughout California who are confronting similar low-
flow problems in other watersheds.

Why use a legal agreement to protect flows?

Some residents of flow-impaired watersheds may wonder why they should enter into a legal
agreement to limit water withdrawals, rather than just make a private effort to reduce pumping in
the dry season. To be sure, every household that manages to reduce or stop pumping when flows
are low is making a critical difference in keeping their stream flowing, and we thank you for this.
But there are a number of important advantages—both for streamflows and for participating
landowners—of entering into a coordinated legal agreement with a land trust, water trust, or
government entity charged with monitoring streamflows. Among them are:
1. A pumping regimen that is coordinated with other water users, and with up-to-date data
on streamflows, is the only way to ensure that your actions achieve the maximum
possible benefits for instream flows, and do not inadvertently cause harm.
2. Legal agreements allow you to have a long-term impact on the low-flow problem, which
can outlast your ownership of or residence on the property.
3. They provide an opportunity to clarify and establish (“perfect”) your legal water right, or
remedy problems that may be found.
4. They let you benefit from the technical support, services, information, and permitting
assistance that a local coordinating group can provide.
5. These agreements may entitle you to a tax benefit, or make you eligible for conservation
funding to compensate you for the water you’re not using.
6. They can safeguard your appropriative water right against loss due to non-use. (Owners
of riparian water rights, whose water source touches their property, do not risk losing
their right through non-use.)
Three types of landowner agreements
There are three legal mechanisms available that allow landowners to voluntarily commit to
leaving water in their stream or river: forbearance agreements, conservation easements, and
Water Code section 1707 dedications. The basic character of each is explained below, along with
some of the advantages each may have in certain circumstances. In assessing the appropriateness
of any one of them for a given landowner, an important distinction is made between the two
primary types of water rights held in California: riparian and appropriative. Riparian water rights
permanently attach to a legal parcel of land that touches a surface watercourse; the water from it
that can be “diverted” (withdrawn) under this right is not limited to a specific amount, and the
right is not diminished or lost through non-use. Appropriative water rights, on the other hand, are
essentially ongoing state permits to take water from a watercourse not touching the parcel, and
are governed by the State Water Resources Control Board (SWRCB). These water rights allow
the holder to divert a specific amount of water from a particular location; they tend to attach to
the land, but failure to exercise an appropriative water right for 5 years can result in the reduction
or loss of that right.

Forbearance Agreement
A forbearance agreement is simply a contract between a landowner/water user and a local land
trust or water trust (or other entity), in which the water user agrees to forego withdrawals of
water pursuant to the terms and conditions set forth in the contract. The main advantage of a
forbearance agreement is its simplicity and efficiency. No formal SWRCB or court approval is
required, and the terms of the agreement can be structured to fit the needs of the parties. In the
case of the forbearance agreements Sanctuary Forest has executed with Mattole headwaters
landowners, the key term is seasonal (not year-round) forbearance from withdrawing water. That
is, the landowners retain the right to withdraw water during the wetter or higher-flow seasons,
but give up the right to withdraw water during the dry season when flows are critically low.

Forbearance agreements are not permanent; they extend for a term of years agreed to by the
parties, 15 years in the case of the Mattole agreements. They may include some type of
compensation to the landowner: a payment may be made for the value of the water “given up,”
or, as in the Mattole agreements, participating landowners can receive a large-capacity water
storage tank (and other services) in exchange for their forbearance.

One disadvantage of forbearance agreements in some situations is that the “dedicated flows” (the
water left in-stream by the contracting water user) are not protected from downstream users.
Downstream users with riparian rights are not limited to specific quantities of water withdrawals,
so when upstream water forbearance results in more water remaining in that watercourse, the
downstream users can legally use the extra flows. (The same would be true for downstream
appropriative water right holders, so long as they do not exceed the maximum quantity specified
by their water right.) One way to avoid these problems—which could undermine the
effectiveness of upstream forbearance agreements—is to notify downstream users in advance
and seek their participation, or obtain from them an agreement not to divert the increased flow.

One other potential disadvantage of forbearance agreements applies only to appropriative water
rights holders, because (as noted above) their water right can be jeopardized by five years of
non-use. If appropriative water users participate in forbearance agreements for five years or
longer, their water right could be reduced or lost with respect to the quantity of water dedicated
through the forbearance agreement. Again, this risk does not apply to riparian water rights
holders, who cannot lose their rights through non-use of water.
Conservation Easement
Conservation easements are voluntary, permanent, legally binding agreements that restrict the
uses of or activities on a property, and are widely used between land trusts (or agencies) and
landowners who want to protect specific resource values of their land in perpetuity. They are
broader in scope than a forbearance agreement, as easements typically limit the development
potential of a property and impose other restrictions designed to protect habitat or open space.
But there are a few examples, including one to date in the Mattole headwaters, of conservation
easements which incorporate terms restricting water withdrawals.

As a tool for legally protecting streamflows, then, a conservation easement can serve as a
permanent water forbearance agreement, with similar advantages and disadvantages regarding
water law. The water restrictions of the easement would be structured to fit the landowner needs,
and no SWRCB process would be required. There would be no legal protection of the water from
downstream users. Landowners with appropriative water rights could lose their seasonal water
rights after five years of reducing their seasonal withdrawals—though for a permanent
agreement, that would not seem to pose a big concern.

Conservation easements can be sold or donated; when donated, they entitle the donor to
potentially significant income tax deductions based on the appraised reduction in property value
that results from the easement restrictions. For landowners who are committed to placing broader
protections on their land in addition to protecting streamflows, the tax benefits available through
this legal tool may offer a real advantage. There are, however, usually other costs associated with
developing a conservation easement, including the costs of documenting the agreement,
appraising the property, and an endowment or protection fund to ensure that the easement holder
(land trust) has the financial means to provide perpetual monitoring and legal defense of the
easement’s terms. And given the permanence of these agreements, their terms should be
structured very carefully to allow them to accomplish the goal of protecting streamflows, or
other key resources, in the face of possible future changed circumstances.

Dedication to Instream Flows under Water Code Section 1707

A third legal option for protecting streamflows is a dedication of water to instream flows
utilizing Water Code section 1707. A “1707 instream flow dedication” allows a water user to
transfer all or a portion of any water right to “instream uses”—that is, designating that such
conserved water must remain in the watercourse for the benefit of aquatic habitat. It is available
to owners of either riparian or appropriative water rights, and can be crafted for either short-term
(less than a year) or long-term duration.

A 1707 dedication differs from forbearance agreements and conservation easements in several
key respects. Unlike the other two agreements, which are private contracts between a water
user/landowner and (usually) a land trust or water trust, a 1707 dedication is essentially a public
regulatory change. It involves a water user submitting an application (a “1707 petition”) to the
State Water Resources Control Board which, once processed and approved, will limit both the
exercise of the applicant’s water right and the freedom of downstream users to withdraw the
resulting increased flows. As such, it is the only mechanism which provides a legal basis for
preventing others from diverting the conserved water. That said, in practice there is considerable
uncertainty and complexity in determining exactly what the effect of a 1707 dedication will be
on downstream users; precisely whether or how downstream users’ water rights will be impacted
depends on the seniority and extent of the water rights on a given watercourse.
For some landowners, the 1707 dedication has two other advantages over the other legal
mechanisms. First, it protects an appropriative water right from diminishment or loss due to non-
use. Since the dedication of water to instream flows is legally considered a “beneficial use” of
that water, the landowner can be confident that the full right will still be available to him at the
end of the dedication period. And second, a 1707 dedication can be accomplished by an
individual landowner without the involvement of a land or water trust. The landowner can work
directly with the SWRCB to file a petition and develop the required supporting data, though legal
assistance will likely be required to assess the existing water right and address other issues.

The main disadvantage of a 1707 dedication, especially for those of more than a year or of larger
quantities of water, is the complexity, duration, and cost of completing the petition and seeing it
through the approval process. The bureaucratic requirements (which may include public notices
and considerable documentation) are likely to daunt many individuals who might otherwise be
interested in pursuing it. However, in cases where a 1707 dedication is the best mechanism for
dealing with an acknowledged low-flow problem, the landowner may be able to engage the help
of a water trust or other group to help shepherd the application, and may even be eligible for
payment for the value of the conserved water.

Summary
The following table distills some of the key differences between the three types of streamflow
protection agreements discussed above:

Forbearance Conservation 1707 Streamflow

Agreement Easement Dedication
Permanent? No Yes No
Requires SWRCB approval? No No Yes
Provides tax benefit? No Yes No
Protects flows from downstream users? No No Yes
Protects existing appropriative right? No No Yes

Legal agreements like those explored here are not the only means for addressing seasonal low-
flow crises of the type being experienced in the Mattole River headwaters. Indeed, Sanctuary
Forest’s efforts in the Mattole have taught us that the first, and most important, ingredient in
seeking solutions is community awareness—the willingness of concerned residents to identify
the problem, educate themselves and their neighbors about its causes, and search for voluntary,
collaborative solutions. Once that commitment emerges, we believe that carefully crafted legal
agreements to protect streamflows can be part of a self-reinforcing patchwork of voluntary but
binding conservation protections. Collectively these agreements can make possible a future in
which people and fisheries coexist with the streams and rivers both need to survive.

* * *

For more information, please call Sanctuary Forest at (707) 986-1087, or visit our website at
www.sanctuaryforest.org. There you can download our related brochure on “Water Storage and
Forbearance,” as well as our comprehensive 2004 report entitled “Options and Obstacles:
Living with Low Water Flows in the Mattole Headwaters.”