Power Council Continues To Struggle With BPA Budget Crunch
 NMFS Attorney Sees God Squad On Horizon For BiOp Lawsuit
 Some Idaho Spring Redd Counts Are Best In Nearly 30 Years
 Senate Gives BPA Additional Borrowing Authority
 Groups Threaten To Sue For More Wild Steelhead Protection In Lower Columbia Gillnet Fishery
 POWER COUNCIL CONTINUES TO STRUGGLE WITH BPA BUDGET CRUNCH
Members of the Northwest Power Planning Council received more sobering news from BPA officials last week. During an emergency council meeting, BPA representatives said that just paying for programs related to the BiOp may eat up most of this year's $139 million fish and wildlife budget. Though some council members pointed out that the NW Power Act spells out a broader mission--to enhance fish and wildlife throughout the region, not just salmon and steelhead stocks listed under the ESA--they had to agree that ESA stocks are the power agency's top priority.
BPA is projecting a deficit of $1.2 billion through 2006, largely due to lower-than-expected demand and prices for surplus power. The situation has put the agency in a major cost-cutting mode, and a dismal snow pack this winter may add at least another $250 million to that deficit and lead to a double-digit boost in power rates that may be announced next week.
Sloppy accounting in the fish and wildlife division added to agency woes when more than $40 million in continuing obligations from previous years' contracts appeared in FY 2003. Such a deferral would normally be no problem at all, but the agency's severe cash flow difficulties have changed the situation.
The budget crunch is expected to have severe repercussions outside of the ESA arena. Fish managers have suggested using some of BPA's potential $700 million in additional borrowing authority, which the Senate added to the omnibus spending bill to help bail out the fish and wildlife program.
Faced with cutting an original fiscal year 2003 fish and wildlife budget of $174 million down to $139 million, BPA has estimated that $120 million will be needed to pay for proposals and projects that satisfy the BiOp obligations to improve ESA-listed fish stocks. The agency says the $120 million is an "overestimate" because some projects included elements not necessary to address "critical needs."
The agency is also faced with development of a huge monitoring and evaluation program that will measure progress towards improving fish runs at three- and five-year check-in points. If listed fish runs on the Snake River don't show adequate improvement, studies would be triggered to investigate breaching the lower Snake dams. Estimated cost for the new monitoring plan alone is $15 million for FY 2003, $22 million for FY 2004 and over $27 million in FY 2005, with some of those costs already embedded in current proposals.
That means budget cutters have to trim about $40 million from the $59 million worth of other fish and wildlife projects in the Columbia Basin. In regions where little BiOp money is spent, like Montana, the burden of reducing costs would be relatively high compared to other areas (called "ecological provinces" in council lingo), where more projects are focused on improving ESA-listed stocks.
More Number Crunching Ahead
Washington's Tom Karier, the power council's new vice chair, is worried about impacts to non-listed species, but he's even more concerned about getting the budget numbers right. "BPA hasn't processed the numbers," Karier told NW Fishletter.
He said there is evidence of some double-counting and miscounting in BPA's admittedly cursory review that pegged its BiOp obligations in the $120 million range for this fiscal year. Karier said reality could be "plus or minus 20 percent or more." The power agency "needs to identify the critical elements of the BiOp," he said, suggesting that some monitoring and evaluation costs could be reduced. Such costs now account for more than half of project totals, Karier noted.
Montana member John Hines said it's essential to maintain some flexibility in spending, especially in the carry-forward area. But he admitted that if BPA sticks to its original designations for funding priorities, his own group could be in an awkward position. "I don't know where that leaves the council," he said, acknowledging that BPA has the ultimate word when it comes to paying for the fish and wildlife program.
The Council is developing its own set of principles for prioritizing projects and selecting deferrals to cope with the crisis. At the top of the list developed by staff is maintaining critical elements of the BiOp check-in requirements. Second in importance is maintaining past investments in tributary passage and protection of productive habitat, along with paying for hatchery operations.
Funding for research projects that don't help BiOp check-ins will likely be deferred, along with other proposals that "do not immediately contribute to the productivity of a species affected by the hydro system," and projects that were not reviewed by the independent science panel and/or explicitly approved by the council.
Council staffer Doug Marker, who heads the group's F&W division, said high-level officials from both agencies went over some proposals last week to get a sense of what they are in for. Although it was still unclear why some proposals satisfied BPA's obligations while similar ones did not, he said the preliminary exercise whittled down BPA's BiOp budget to about $93 million from its original $120 million. He said the agency was working on an updated list to produce more concrete numbers.
Council staffer Mark Walker has been charged with soliciting members' opinions about the debt ceiling issue. With the Senate recently giving the nod to the $700 million bump in BPA's borrowing authority from $3.75 billion to $4.45 billion, some fish managers have already suggested using it as a way out of the budget mess, even though it has yet to make it through the House.
If passed, most of the expanded debt authority will allow BPA to upgrade its transmission system to reduce congestion and improve reliability. But the Columbia River Inter-Tribal Fish Commission has asked the council to consider sending a letter to both the House and Senate Appropriations committees and the Northwest congressional delegation, requesting that some of the new borrowing authority be earmarked for fish and wildlife capital projects, such as hatchery modifications and operations, irrigation diversion, and land acquisitions. CRITFC wants $180 million to be available over the life of the rate case period, including $36 million a year to fund the BiOp. But the Senate deal includes BPA's promise not to use the additional authority until 2004 or 2005 when it expects to reach the current debt limit (see story 4).
Council members were still mulling over the issue at press time. Council chair Judi Danielson of Idaho said she wanted to confer with her Senator, Republican Larry Craig, one of the sponsors of the legislation to boost BPA's debt, before commenting.
Craig staffer George O'Conner told NW Fishletter that fish managers shouldn't count on any money from the potential boost to BPA's debt ceiling. "It is not for that purpose," he said. O'Conner said it had been a "brutal battle" to get the deal through the Senate and any attempt to pay for fish costs could be used by political opponents to kill it in conference.
"It would be a shame if the region was punished over the fish issue," O"Conner said, noting that the region was lucky to convince the Administration of the need for the debt boost to pay for services the Northwest will need in two or three years. "This is for hospitals and schools, not for fish," he added.
Washington's Karier said the budget analysis has to be pinned down before anything else happens. BPA wants the Council to finish its prioritization process by Feb. 21. To that end, members agreed to meet in another emergency session Feb. 13, less than a week before their regularly scheduled monthly meeting. -Bill Rudolph
 NMFS ATTORNEY SEES GOD SQUAD ON HORIZON FOR BIOP LAWSUIT
A lawsuit environmental and fishing groups filed against the federal government over its hydro BiOp could have "big implications" for regional power bills and may end up being reviewed by a group of top federal officials called the "God Squad," a government attorney said last week. If the squad reviews the lawsuit [National Wildlife Federation v. NMFS], they may ultimately determine the fate of ESA-listed Columbia River salmon, said Sam Rauch, a Department of Justice attorney who represents the National Marine Fisheries Service. Rauch was speaking at a Seattle legal education conference.
The seven-member "God Squad," headed by Secretary of the Interior Gale Norton, has the power to override government decisions with respect to ESA enforcement. Other squad members are the Secretary of Agriculture, the Secretary of the Army, the Chairman of the Council of Economic Advisers, the Administrator of the National Oceanic and Atmospheric Administration and one individual from the affected state.
Officially called the "Endangered Species Committee," the squad was established in 1978 by an amendment to the 1973 Endangered Species Act. It has only been called into action three times to deal with proposed federal agency actions that have been determined to cause "jeopardy" to any listed species.
Such actions may receive an exemption from the ESA if five members of the committee determine that the action is of regional or national significance, that the benefits of the action clearly outweigh the benefits of conserving the species and that there are no reasonable and prudent alternatives to the action.
Uncertainty over the success of future BiOp fish mitigation efforts is a "big issue" in the lawsuit, Rauch said. The lawsuit argues that dam operations shouldn't be given a "no-jeopardy" decision on their impacts to ESA stocks based on unspecified off-site mitigation to improve fish numbers.
Rauch said he doubted the lawsuit would lead to dam removal. But he said the God Squad would likely be called into action. In addition to Columbia River salmon, other potential candidates for the squad include Klamath Basin suckerfish and a minnow found in the Rio Grande River of New Mexico, he said.
But another DOJ attorney disagreed. Eileen Sobeck, deputy assistant attorney general for environment and natural resources, said the God Squad was not a useful tool for resolving ESA conflicts because it was such a cumbersome and time-consuming process. However, she thought that it may resurface in possible legislation this year.
Jokingly, Sobeck told the group she sometimes daydreamed that the perfect policy wonks on TV's "West Wing" would solve these issues and lead us "out of the ESA morass." Sobeck said litigation over ESA critical habitat issues was "gridlocked" by conflicting court decisions, inflexible time schedules and insufficient funding.
ESA Reform Unlikely
Though strong critics of the federal Endangered Species Act now head major Congressional committees, it's still doubtful the ESA will undergo any major overhaul during this session of Congress, said Washington, DC attorney Steven Quarles of Crowell & Moring.
With the House floor still controlled by moderates, Quarles said it's not likely that Rep. Richard Pombo (R-CA) will get his ESA agenda passed. Pombo supports more economic considerations in the listing process, more scientific peer review and compensation for private landowners whose property is tied up by critical habitat concerns.
Likewise, said Quarles, liberals such as George Miller (D-CA) are not likely to get anywhere with their own attempts at reform. "His bill is not going anywhere, either," said the DC attorney, who chairs his firm's natural resources and environment group.
Without any omnibus ESA re-authorization bill in the works, like the attempt a few years ago sponsored in the Senate by Dirk Kempthorne (R-ID), Max Baucus (D-MA) and others, Quarles said "there's nothing in it" for politicians to address the ESA at this time. He said it wasn't pressure from environmentalists that killed Kempthorne's bill, but "the right-wing property rights advocates that did it."
Quarles said a "slim-fast" version of the Pombo legislation may move, with a focal point that wasn't visible two years ago. The new focus is on the issue of "critical habitat," after a series of adverse judicial decisions has forced government agencies to re-think critical habitat designations in their ESA consultations. That's where major administrative reform is likely, Quarles added.
Though the Bush administration has created a task force for ESA reform, Quarles said money problems at agencies may keep much from happening. He said NMFS and the USFWS are two of the most "budget-straited" agencies in government at the present time.
National Wildlife Federation attorney John Kostyack said none of the major players in Congress support Pombo's legislation and that a "serious disconnect exists between these guys and most people over the ESA." He said a poll indicates that 78 percent of the public support maintaining or strengthening the ESA.
Kostyack said the administration knows how to take the teeth out of the ESA in more subtle ways. But he sees a continuation of what's been going on for the past couple of years; that is, actions of agency heads, like the Interior Department's Gail Norton "de-emphasizing the stick and emphasizing the carrot," but providing no new funding to compensate landowners over critical habitat.
Though the environmental attorney said it was difficult to predict what was going to happen, the law needed to be improved, especially to provide dollar incentives for private landowners to help biodiversity conservation.
Quarles said the funding problem was brought home when it was pointed out that Washington, DC residents spent as much on pizza every year as the federal government spends on implementing the ESA.
Quarles said the government promised a new template for designating critical habitat in ESA consultations last fall, but it's still not out, and conflicting opinions on critical habitat issues in two district courts have only made the situation more confusing. He noted that 40 percent of the state of California is now listed as critical habitat for one listed species or another.
New ESA Wrinkle
Earthjustice attorney Patti Goldman described a recent case in Oregon where environmental and fishing groups have filed a citizen lawsuit [Pacific Rivers Council et al v. Brown] against the Oregon State Forester which challenges his approval of certain logging practices that the groups allege "take" ESA-listed coho.
Perkins-Coie attorney Galen Schuler pointed out that it's a confusing situation that pits state law against the ESA, and has 10th Amendment implications. "Every local government and state agency should have concerns," Schuler said, because such suits can penalize agencies for trying to incorporate ESA concerns into their regulations. He said the state of Oregon would probably be better off not issuing permits for the logging practices since "they're less likely to be liable for take if they're not protecting." (On Jan. 28., the Oregon Forestry Board temporarily suspended the need for loggers to submit a written plan or get approval before harvesting timber on steep slopes, removing the link between the state forester and "take" of coho." Plaintiffs had filed for an injunction last May to stop all logging on steep slopes on state and private lands until the case is settled. A hearing on the injunction is scheduled for Feb. 11). -B. R.
 SOME IDAHO SPRING REDD COUNTS ARE BEST IN NEARLY 30 YEARS
A few redd counts have trickled in from Idaho, and preliminary data shows that plenty of ESA-listed spring chinook made it back to index streams in the state's wilderness areas. Index streams are important because annual redd counts are tallied to gauge the strength of ESA-listed salmon stocks. Over the last few years, the numbers show continuing high productivity, likely related to good ocean conditions.
Government and tribal fish managers recently estimated about 60,000 Snake River wild spring chinook had entered the Columbia River in 2002, but until the redd count data appeared, it was hard to assess the size of the run that made it all the way home.
Bear Valley Creek, for instance, was home to at least 245 salmon redds, the most in the past 14 years and second highest number counted there since 1973. Last year, 172 redds were counted. The brood year for most of last year's return contributed only 105 redds in 1998, but productivity was already on the rise from the dismal lows of the mid-1990s. Ten redds were counted in the stream in 1994 and only nine redds were found there in 1995.
Other index areas showed excellent returns as well; 186 redds were counted in Marsh Creek, while the 1998 brood year produced 90 redds. In 1995, no redds were counted there. In Elk Creek, 377 redds were counted, up from 219 redds last year and 105 redds from brood year 1998. No redds were counted in Elk Creek in 1995. Other hot spots included the Upper Salmon River where 561 redds were counted compared to 357 last year and about 33 redds from brood year 1998. Johnson Creek was home to 184 redds, the highest count since 1973.
The good numbers mean that some creeks are now producing about four recruits for every adult spawner, when just a few years ago they were producing less than one recruit per spawner. -B. R.
 SENATE GIVES BPA ADDITIONAL BORROWING AUTHORITY
It took more than two years, but the Bonneville Power Administration finally won an increase in its borrowing authority. The Senate last week added $700 million to BPA's borrowing authority through an amendment to the omnibus spending bill.
The budget measure, which funds the federal government for the remainder of fiscal year 2003, now goes to a House-Senate conference committee, where supporters say it has a good chance of approval. President Bush last year included an identical boost to BPA borrowing authority in the administration budget, which should carry considerable weight in the House.
Bonneville began the quest two years ago, seeking to increase its borrowing authority by $2 billion. Last year, the request was lowered to $1.3 billion, but still failed. BPA argued that the additional authority was essential to upgrade its aging transmission system, as well as to make other improvements.
Sen. Larry Craig (R-ID) negotiated the deal that cleared the way for the amendment, which was supported by the entire Northwest Senate delegation. A key selling point was Bonneville's promise not to use the additional authority until 2004, or possibly 2005, when the agency expects it will reach the limit on its ability to finance improvements and new facilities.
Craig told his Senate colleagues that "reliable and readily available power is essential to the economy of the Pacific Northwest.
"The BPA currently owns and operates 75 percent of the high-voltage power transmission in the Northwest and is now being forced to operate way beyond its limits. New power generation is critically needed in the region, and the additional borrowing authority provided by this bill to upgrade transmission services will go a long way to make that happen," Craig said.
BPA's quest was also aided by a joint statement from the Natural Resources Defense Council, the Renewable Northwest Project, the Alliance to Save Energy and the American Wind Association.
"Our support reflects BPA's strong regional leadership in integrating new renewable capacity in the Northwest grid and in opening its transmission investment process to demand-side and other alternatives to conventional large-scale powerlines," said the statement, which was prompted in part by a blast at BPA from Taxpayers for Common Sense.
The fiscally conservative group called BPA "a case study in fiscal mismanagement," that "has repeatedly failed to uphold federal laws and treaties to protect salmon." -Lynn Francisco
 GROUPS THREATEN TO SUE FOR MORE WILD STEELHEAD PROTECTION IN LOWER COLUMBIA
Several fish conservation groups from Oregon have issued a 60-day letter notifying the states and NOAA Fisheries they will take legal action unless changes are made in the lower Columbia gillnet fishery to better protect ESA-listed wild steelhead. The groups are worried that this year's season will be a repeat of last year when gillnetters exceeded the incidental take permit on wild steelhead, the limit established under the ESA that protects them.
"We have talked about it for three years and it is time to take action," said Jason Miner, conservation director for Oregon Trout, whose group announced the potential lawsuit, along with Washington Trout, and the Native Fish Society. "We have invested time and money into habitat repair and protection and it is unacceptable to have a small commercial fishery take so many steelhead. Legal action is an obvious step we have to take to protect these fish."
According to documents presented to the Oregon Fish and Wildlife Commission last December, problems were evident in the tangle net fishery designed to release wild chinook while allowing for harvest of hatchery stocks that display a clipped fin. In last year's winter fishery, the agency allowed commercial fishermen to use 5.5-inch mesh gill net, but it turned out to be too large. "...The wrong mesh size for steelhead contributed to the high numbers of steelhead handled in the commercial fishery," said harvest managers, who also noted the steelhead run was unusually large, with 21,700 steelhead being handled, including 13,000 unmarked steelhead (wild).
Steelhead have been protected from commercial harvest by Oregon and Washington since the mid-1970s in the lower Columbia as well as being protected under federal law, but the incidental take permit issued by NOAA Fisheries allows harvesters to kill up to 2 percent of the threatened steelhead in the fishery that targets spring chinook.
According to ODFW biologists, "the immediate mortality rate for steelhead caught was 2 percent...and the long-term mortality rate is estimated to be between 20% to 50%. In any case, impacts to ESA-listed winter steelhead are likely above the preseason guideline of 2 percent for mainstem fisheries."
NOAA Fisheries biologist Peter Dygert says the incidental take permit is not a guideline. "It is a cap, a limit they are supposed to manage to," he said. "We are trying to move to a live capture-type fishery, and the fish managers are trying to make it work. We want a viable fishery that stays within the impact limits that are low enough to recover the fish. We set the criteria that will protect the fish and the managers figure out how to stay within the limits."
Steve Sanders, ODFW legal council, said the state is still looking at fishing methods that limit harm to wild fish. "As part of the biological opinion and U.S. v Oregon, we are continuing to explore options for selective fisheries and we believe the tangle net offers some promise."
But conservation groups are not so sure. Their notice of intent to sue includes conditions for increasing protection for steelhead. They have proposed "the lower Columbia River fishery be directly and adequately monitored and terminated or suspended if it appears likely that the number of…steelhead impacted by the fishery will exceed permitted levels."
The groups want the gillnet mesh size reduced to 3.5 inches in the 2003 fishery (it is proposed to be 4.25 inches), the requirement of a daylight fishery, and timed to avoid steelhead interception. They also want harvest managers to open and close more often to allow more steelhead escapement and confine gillnetters to below the town of St. Helens. They are also asking for the fishery to be suspended when the steelhead encounter rate exceeds 5 percent of the catch.
Dygert said harvest managers and NOAA Fisheries are expecting to establish a steelhead impact threshold based on predicted run size, encounter rates and an impact limit of 2 percent. He admitted it was a "difficult management problem." Once the threshold was reached, he expected managers to close the fishery down, but he didn't oppose reopening it as long as the harvest stayed within the incidental take limit.
Oregon Trout's Jason Miner does not disagree with Dygert, but he isn't so sure the fishery can be carried out and still protect steelhead. "The fishery will kill a lot of fish this year if we do not take action to prevent it," he said. "We are seeking greater monitoring. They need to determine how many fish they are taking each day and not exceed the limit of 2 percent. It is logical to shut down the fishery as they approach the limit," Miner said.
The states are proposing a fishery that will use new technology, time and area closures, encourage the use of "excluder" nets that would intercept fewer steelhead, and increase monitoring. This effort is expected to cost $600,000 and is being funded by the Bonneville Power Administration. -Bill Bakke
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