Stephen H. North, Attorney General of Washington, Olympia, WA, for Appellants.
Kevin R. Lyon, Sharon Ilene Haensly, Squaxin Island Legal Dept., Shelton, WA, for Respondent.
Timothy W. Whitehead, Michael K. Dorcy, Mason County Prosecutors Office, Shelton, WA, for other Parties.
[177 Wn.App. 736] ¶ 1 The Washington State Department of Ecology (Ecology) appeals from the superior court's order concluding that Ecology's denial of the Squaxin Island Tribe (Tribe)'s rulemaking petition was arbitrary and capricious, and requiring Ecology to engage in rulemaking to amend watershed management rules to protect minimum instream flows of Johns Creek in Mason County as requested in the Tribe's petition. The Tribe contends that Ecology's response to its rulemaking petition failed to specifically address the Tribe's concerns as required by RCW 34.05.330(1) and that Ecology's decision not to engage in rulemaking due to budget concerns, other priorities, and lack of technical information was arbitrary and capricious. We disagree and hold that (1) Ecology's explanation of its refusal to initiate rulemaking satisfied RCW 34.05.330 and (2) Ecology's decision not to engage in rulemaking was reasoned and supported by the record and, thus, it was not arbitrary and capricious. Accordingly, we reverse the contrary decision of the superior court.
¶ 2 The Tribe also attempts to challenge the validity of several existing watershed management rules. But the trial court did not reach the rule challenges, and they are not properly before us for review.
[177 Wn.App. 737] FACTS
¶ 3 The Tribe's petition focuses on Johns Creek, which is in the Kennedy-Goldsborough Water Resource Inventory Area (WRIA 14). In 1984, Ecology adopted a water management rule for WRIA 14, chapter 173-514 WAC, which set minimum instream flows for Johns Creek and other creeks. WAC 173-514-030(2). Ecology specifically considered the needs of anadromous fish in setting the instream flows. It also seasonally closed Johns Creek to all consumptive uses to protect early chum salmon runs. WAC 173-514-040. The Johns Creek instream flows became a surface water right with a priority date of 1984.
¶ 4 Despite the protections provided by chapter 173-514 WAC, Johns Creek " flows have continued to decline so that adopted instream flow levels are rarely met mid-February through September." Agency Record Part B (ARPB) at 219. Since 1984, there has been considerable development pressure on the Johns Creek basin. Ecology estimates that more than 280 new permit-exempt wells have been drilled since that time. Johns Creek is fed by ground water, which contributes cold water that is critical to anadromous fish habitat. Reduced flows and higher temperatures in Johns Creek are harming its small and fragile summer chum population.
¶ 5 The Tribe alleges that junior wells in the basin are affecting or interfering with senior surface water rights by [177 Wn.App. 738] capturing water that is otherwise destined for Johns Creek. Ecology recognizes that the " corresponding drop in stream flows in Johns Creek and increased ground water use suggests a likely correlation."  ARPB at 225.
Both Ecology and the Tribe agree that specific hydrogeological data and models are needed for informed decisions about managing and allocating water use and protecting surface flows in the Johns Creek basin. The cost of such a study has been estimated at $300,000. Once funding is obtained, it will take at least two years to perform the study and to make its results useable to decision makers. Ecology, the Tribe, and Mason County have unsuccessfully sought funding for this study at various times.
¶ 6 In December 2009, the Tribe filed a petition requesting that Ecology initiate rulemaking to revise the WRIA 14 water management rule. The Tribe requested that Ecology promulgate a rule withdrawing Johns Creek basin from new water appropriations pending a study of water availability in the basin. The Tribe also requested various revisions to existing rules.
[177 Wn.App. 739] ¶ 7 Ecology denied the Tribe's petition, explaining that (1) Ecology staff reductions and potential new cuts were already limiting the agency's ability to do comprehensive work on instream flow rule development across the state and (2) additional information regarding the hydrology and hydrogeology of Johns Creek basin was needed before a comprehensive rule amendment could be undertaken. As an alternative to granting the petition, Ecology agreed to seek funding to study the Johns Creek basin and to direct Mason County to limit ground water withdrawals for new residential developments to in-house domestic use of water.
¶ 8 The Tribe petitioned for judicial review of Ecology's denial of its rulemaking petition. The Tribe also sought a declaration that certain existing WRIA 14 water management ...