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HomeMy WebLinkAbout2021-08-31 J. Kleinman - Open Record Memorandum and Exhibits1 Chenelle Hale From:Jeffrey L. Kleinman <kleinmanjl@aol.com> Sent:Tuesday, August 31, 2021 4:48 PM To:William Groves Subject:File Nos. 247-21-000731-A, 18-386-TP, 18-454-SP, 18-542-MA LUBA No. 2018-140 Court of Appeals A171603 (Central Land and Cattle Co.) Attachments:Hearings Officer Memorandum 8-31-21.pdf; Kleinman Exhibit A - FISH AND WILDLIFE MITIGATION PLAN ADDENDUM-HIGHLIGHTED (from ODFW file) 4-21-08.pdf; Kleinman Exhibit B.pdf [EXTERNAL EMAIL] Hi Will, Attached please find my initial open record memorandum and two exhibits for the record in the above matter. Thank you. Jeffrey L. Kleinman Attorney at Law The Ambassador 1207 SW Sixth Avenue Portland, OR 97204 Tel: (503) 248-0808 Fax: (503) 228-4529 Email: KleinmanJL@aol.com JEFFREY L. KLEINMAN ATTORNEY AT LAW THE AMBASSADOR 1207 S.W. SIXTH AVENUE PORTLAND, OREGON 97204_______ TELEPHONE (503) 248-0808 FAX (503) 228-4529 EMAIL KleinmanJL@aol.com August 31, 2021 FIRST OPEN RECORD MEMORANDUM OF ANNUNZIATA GOULD TO:Deschutes County Land Use Hearings Officer FROM:Jeffrey L. Kleinman RE:File Nos. 247-21-000731-A, 18-386-TP, 18-454-SP, 18-542-MA; LUBA No. 2018-140; Court of Appeals A171603 Thornburgh Destination Resort Subdivision ______________________________________________________________________ A. Introduction When one separates the wheat from the chaff in this matter, there remains an ample supply of wheat. This is explained in great detail in the findings of Hearing Officer Olsen. Based upon the extensive evidence in the record before him, he determined that Thornburgh had not met its burden of proving compliance with FMP Conditions 10 and 38. That is why he imposed Tentative Plan (TP) Condition 17. Now, putting forth even less–and arguably weaker–evidence, and in the face of stronger countervailing evidence, Thornburgh would have the Hearings Officer believe that the applicant should be able to snap its fingers and make Condition 17 go away. Thornburgh’s attempt at quasi-judicial hypnosis must fail. Condition 17 is straightforward, requiring in material part: 17. Prior to issuance of building permits for the single-family dwellings, obtain site design approval for at least 50 OLU’s, which approval shall demonstrate that * * * the Big [Falls] Ranch and COID water referenced in the Mitigation Plan and FMP decision have been secured, demonstrate that the proposed alternate source is acceptable to ODFW and provides the same quantity and quality mitigation so as to not constitute a substantial modification or justify a modification to the FMP. The applicant now states that it will rely only upon Big Falls Ranch water for mitigation. It will not rely upon COID (Central Oregon Irrigation District) water, and will not propose an alternate source for review and approval by ODFW. On or about May 21, 2021, Thornburgh filed its site plan application for its first 80 OLUs in Casefile No. 247-21-000508-SP. Review of that application is ongoing. If the applicant has adequate mitigation water from BFR, as they contend here, what is the problem with proving it in that proceeding. What precisely is Thornburgh’s team afraid of? B. Thornburgh Has Failed Once Again to Meet Its Burden of Proof. The source of Thornburgh’s mitigation water is not merely relevant but is critical to the entire “delicate balance” to which we have referred previously. That source is cold spring-fed water in Deep Canyon Creek, which in turn flows a mere half mile at the most to the Deschutes itself. There is no substitute. Page 2 - FIRST OPEN RECORD MEMORANDUM OF ANNUNZIATA GOULD In a nutshell, Thornburgh contends that it will obtain sufficient cold water to compensate for the impact upon anadromous fish habitat of the resort’s depletion of groundwater for homes, golf courses, recreational lakes, and other uses, by obtaining BFR’s rights to the spring-fed water of Deep Canyon Creek and assuring the unrestrained flow of the now-impounded creek into the Deschutes. Thornburgh did not possess those rights in 2018. It has had three years to obtain them. It has failed to do so. Moreover, its ability to obtain those rights has been further impaired over time. In this regard, we direct the Hearings Officer’s attention to the letter from Ms. Gould’s water counsel, Karl Anuta, filed on August 23, 2021, and its Exhibits 1 through13. (Please note that due to their length, the exhibits were filed as nine separate items and are listed in reverse order on pages 15-17 of the ACCELA site for this remand proceeding. There is no Exhibit 4.) At the August 24 public hearing, the Hearings Officer directed questions to counsel regarding the contents of that letter. Mr. Anuta is responding under separate cover today. Portions of Mr. Anuta’s earlier letter relate to the resort’s use of water, necessitating mitigation. Other portions relate to a series of pending applications from Thornburgh under consideration by OWRD. If granted, these may well complicate the mitigation picture later. However, the discussion most relevant to Page 3 - FIRST OPEN RECORD MEMORANDUM OF ANNUNZIATA GOULD the specific question on remand appears at pages 2 through 4: The applicant will also need water for mitigation for any and all of its wells. That is required by OWRD and the Deschutes Basin Mitigation Program. In addition, the applicant will need an appropriate amount of cold spring water permanently protected instream - in order to meet the applicant's obligations under its Mitigation Agreement with the Oregon Department of Fish & Wildlife (ODFW), and to meet the County ‘no net loss’ policy, both of which were incorporated into conditions of approval for the Resort Final Master Plan. Availability Of Water - Mitigation The applicant is required by the approval conditions to fully mitigate the water impacts of its Phase A-1 Resort. That includes both quality and quantity of water. The applicant agreed, and the County conditioned approval on, the applicant providing cold spring surface water from Deep Canyon Creek, and the removal of two dams/reservoirs on that Creek - in order to off set the impacts of the Resort ground water Permit (#G-17036) on Whychus Creek. Those are impacts which LUBA has already acknowledged and confirmed: “The resort's consumptive use of groundwater is anticipated to impact an offsite fish-bearing stream, Whychus Creek, by reducing instrearn water volumes and increasing water temperatures. The mitigation plan requires intervenor to replace the water consumed by the resort with volumes and quality of water that will maintain fish habitat, especially cold water thermal refugia. The county found that the mitigation plan will result in no net loss/degradation to fish and wildlife resources.” Gould v. Deschutes County, 79 Or LUBA 561, 563-64 (2019), appeal dismissed, ___ Or App ___ (2019), rev'd and rem'd, 367 Or 427, 478 P3d 982 (2020), aff'd, 310 Or App 868, 484 P3d 1073 (2021). However, the water rights that the Resort promised and that the Page 4 - FIRST OPEN RECORD MEMORANDUM OF ANNUNZIATA GOULD County required for that mitigation have subsequently been transferred to another location. They have been moved to ground water, by the holder of those rights - Big Falls Ranch. In 2018, as part of Transfer T-12651, Big Falls Ranch requested a "Permanent Water Right Transfer" to move the surface water rights in Deep Canyon Creek to ground water. That request was granted, by OWRD Special Order dated November 21, 2018. That transfer means that the cold spring surface water flows in Deep Canyon Creek - the flows specifically required to offset the impacts of the Resort G-17036 Permit - are no longer currently available as potential instream flow mitigation for the Resort. In theory, up until or on November 20, 2023, a request to have Transfer T-12651 "unwound" - in other words the water moved back to surface water - could be submitted. That date is 5 years from the date the transfer was approved. The transfer Order on T-12651 recognized (as is normal for such transfers in the Deschutes Basin) that if an application to transfer the right back to surface water was submitted within 5 years from date of the transfer approval, such an application would normally be approved. How long such an approval that would take [to] complete, is anyone's guess. Regardless, there is no evidence that such an application has to date even been submitted. There is certainly no approval that would allow the use of the Deep Canyon Creek water in the manner required under the Mitigation Agreement. To the contrary, rather than a request to transfer the water back, Big Falls Ranch has instead submitted a Claim Of Beneficial Use (COBU) at the new groundwater location. That COBU is an effort to try to turn the T-12651 transfer Order into a new Certificated right, at that new groundwater location. That COBU was submitted on 9-30-20. (Emphasis in original; footnotes omitted. In the original letter on file, the footnotes direct the reader to specific supporting exhibits mentioned above.) Page 5 - FIRST OPEN RECORD MEMORANDUM OF ANNUNZIATA GOULD We would reemphasize here the following dates: • November 21, 2018. OWRD approves the application of Big Falls Ranch to move the surface water rights in Deep Canyon Creek which are required to be permanently protected instream, to groundwater instead. When moved to groundwater (drawn from wells), the water in question is no longer available instream for fish habitat mitigation purposes. • September 30, 2020. Big Falls Ranch submits its Claim of Beneficial Use at the new location at which it draws groundwater, in order to turn OWRD’s Order approving the transfer into a new certificated right at that location. If OWRD determines that the permit conditions have been met, a water right certificate will be issued to BFR; this will be the “certificated right.” Both of those events occurred after Hearings Officer Olsen issued his decision on October 29, 2018, holding that Thornburgh had not met its burden of proving the availability of the required cold mitigation water in Deep Canyon Creek. As we have said, the applicant’s case has only become weaker over the years since that time. It would probably be beneficial (in the conventional sense of the word) to turn now to the actual language of the underlying agreement with ODFW which allowed the master plan for the resort to be approved. This is the “Thornburgh Resort Fish and Wildlife Mitigation Plan Addendum Relating to Potential Impacts of Ground Water Withdrawals on Fish Habitat,” dated April 21, 2008 (“FWMP”). It was actually prepared by Thornburgh’s engineer, David Newton. A copy with the most relevant language highlighted is attached as Exhibit A. We reproduce the Page 6 - FIRST OPEN RECORD MEMORANDUM OF ANNUNZIATA GOULD relevant language here: The mitigation to be provided in connection with the Thornburgh water right will serve as a major component of the mitigation measures for this Addendum. As described below, coupled with additional measures recommended by ODFW, the flow replacement plan developed by Thornburgh will address both flow and temperature concerns and is expected to fully mitigate for any negative impacts so that there is no net loss of habitat quantity or quality for fishery resources. The measures will also provide additional benefits to habitat resources. Exhibit A at 1. Big Falls Ranch Water Rights The Resort also has entered into an agreement to purchase existing surface water rights from Big Falls Ranch located near Lower Bridge, within the General Zone of Impact. The 464.9 acres of irrigation water rights are expected to generate a total of 836.82 AF per year of mitigation water when transferred to instream water rights. Thornburgh is currently working with Big Falls Ranch on transfer applications for the first 175 acres of water rights to be acquired under the agreement and transferred to instream use. The instream water right would protect flow from a point near Lower Bridge downstream to Lake Billy Chinook. This initial transfer is expected to result in 315 AF of mitigation water. The first 175 acres of Big Falls Ranch water rights that are proposed for transfer are located in Sections 8, 9 and 17, Township 14 South, Range 12 East, as shown on Figure 3, a map prepared for the water right transfer application. These water rights are designated as "FROM" acres on Figure 3. The source of water for these rights (and the total of 464.9 acres of irrigation) is Deep Canyon Creek. The authorized point of water diversion from the creek is shown on Figure 3. Deep Canyon Creek is a tributary of the Deschutes River. The confluence between the creek and the Deschutes River is at about River Mile 131. Deep Canyon Creek flows are derived from springs in the canyon. The Page 7 - FIRST OPEN RECORD MEMORANDUM OF ANNUNZIATA GOULD spring discharge point is shown on the USES Cline Falls, Oregon. Quadrangle map (as shown on Figure 3) at a location about 0.56 miles upstream from the creek's confluence with the Deschutes River. Over time, erosional down-cutting has incised the Deep Canyon Creek channel into ground water bearing geologic strata, resulting in the ground water discharge that creates the creek flow. Although the USES quadrangle map depicts a single spring, ground water discharge actually occurs at other points along the creek channel. The point of diversion for the Big Falls water rights is located at the confluence of the creek and the Deschutes River as shown on Figure 3. When the initial 175 acres of irrigation water rights are transferred to instream flow for Phase A mitigation, up to 2.07 cubic feet per second of flow that would otherwise be diverted from the creek for irrigation will remain in the creek as an instream water right. This additional flow will be protected instream from the authorized diversion point on the creek to the Deschutes River near River Mile 132.8, and downstream in the Deschutes River to Lake Billy Chinook near River Mile 120, a distance of nearly 13 miles. Id. at 5-6. Implementation of Thornburgh's water right mitigation plan would result in a total of 1,356 AF annual mitigation at full build-out. Approximately 836.82 AF per year and 5.5 cfs of flow during the irrigation season would come from Deep Canyon Creek as a result of transferring the Big Falls Ranch water rights to instream flow rights. * * * The Big Falls mitigation water offers the additional temperature benefit of providing relatively cool waters from Deep Canyon Creek. Id. at 7. IV. Fish Habitat Potentially Affected by Ground Water Use During the consultation process, ODFW identified two specific Page 8 - FIRST OPEN RECORD MEMORANDUM OF ANNUNZIATA GOULD concerns with respect to potential impacts of ground water pumping on fish habitat: First, the potential for flow reduction due to hydraulic connection that could impact flows necessary for fish and wildlife resources in the Deschutes River system; and second, the potential for an increase in water temperature as a result of flow reductions from ground water pumping. Six species of fish were identified that could potentially be impacted: Redband Trout, Bull Trout, Brown Trout, Mountain Whitefish, Summer Steelhead and Spring Chinook. The general distribution of these fish species is shown on Figure 6. Id. In early correspondence on this issue, ODFW identified concerns about impacts on cold water springs and seeps in the Whychus Creek sub-basin as a result of Thornburgh ground water use, and indicated that the potentially affected resources would be classified as "Habitat Category I" under the ODFW Fish and Wildlife Habitat Mitigation Policy("ODFW Mitigation Policy", OAR Chapter 635, Division 414.) (Letter from Glen Ardt to Thornburgh, dated January 31, 2008.) Under the ODFW Mitigation Policy, Habitat Category 1 means the affected habitat is irreplaceable. In response to the letter, Thornburgh provided additional information to ODFW documenting the OWRD findings regarding the location of impact from Thornburgh wells in the Main Stem Deschutes River. Additionally, ODFW met with staff from OWRD and the Department of Environmental Quality concerning the potential Thornburgh impacts. As a result of this process and further internal review, ODFW revised its preliminary determination regarding the type of habitat potentially affected by the Resort, concluding the habitat would be classified as Habitat Category 2, not Habitat Category 1. This conclusion was based on ODFW's determination that temperature impacts to stream flow, if present, can be mitigated with appropriate actions. As used in the ODFW Mitigation Policy, "Habitat Category 2" describes essential habitat for a fish or wildlife species. Mitigation goals for this category of habitat are no net loss of either habitat quantity or quality and to provide a net benefit of habitat quantity or quality. OAR 635-414-0025(2). Page 9 - FIRST OPEN RECORD MEMORANDUM OF ANNUNZIATA GOULD Based on input from ODFW during the consultation process, Thornburgh has identified the following mitigation and enhancement measures designed to ensure no net loss of habitat quantity or quality and to provide a net benefit for fish habitat. The measures reflect findings by OWRD that the Thornburgh project is expected to affect flow in the Main Stem Deschutes River. * * * V. Mitigation and Enhancement Measures The proposed mitigation measures identified in consultation with ODFW are designed to ensure no net loss of habitat quantity or quality and net benefits to the resource: (A) compliance with OWRD mitigation requirements; (B) inclusion of the Big Falls Ranch water rights as part of the OWRD mitigation program to provide additional cold water benefits; (C) removal of an existing instream irrigation pond in connection with the transfer of Big Falls water rights * * * Id. at 8. B. Specific Mitigation from Big Falls Ranch Thornburgh will fully exercise the option for purchasing 464.9 acres of water rights under its existing option agreement with Big Falls Ranch, Inc. in fulfilling its mitigation obligation under the OWRD water right. By making this commitment, Thornburgh ensures that nearly two-thirds of its total mitigation water (expected total 836.82 AF per year) will come from a source that contributes cold spring-fed water to the Deschutes River above the Thornburgh location of impact. By retiring an existing irrigation water right, this measure will also result in restoration of 5.5 cfs of cold surface water flow to the Deschutes River from Deep Canyon Creek during the irrigation season. C. Elimination of Existing Irrigation Pond In connection with the instream transfer of the Big Falls Ranch irrigation water right rights, Thornburgh will work with the landowner to eliminate the existing instream impoundment used as part of the irrigation Page 10 - FIRST OPEN RECORD MEMORANDUM OF ANNUNZIATA GOULD system. This is expected to provide a temperature benefit by eliminating temperature increases due to ponding effects. Id. at 9. Approximately 836.82 AF per year of the mitigation water will come from Deep Canyon Creek as a result of transferring the Big Falls Ranch water rights to instream flow rights. The elimination of the existing diversion of Deep Canyon Creek with water originating from ground water springs, is expected to provide additional flow and temperature control benefits to the Deschutes River during the critical irrigation season. Removal of the Deep Canyon Creek impoundment will further benefit water temperatures in the Deschutes River by eliminating the pond where water temperatures would increase during warm periods. * * * VII. CONCLUSION DCC 18.113.070.D requires that any negative impact on fish and wildlife resources be completely mitigated so that there is no net loss or net degradation of the resource. This Addendum to the Thornburgh Wildlife Mitigation Plan addresses potential impacts to fishery resources as a result of ground water pumping and identifies specific mitigation measures. The plan was developed in consultation with ODFW to address two specific areas of concern regarding the potential for negative impacts: the potential for a loss of habitat due to reduced surface water flows in the area of impact and the potential for loss of habitat due to increased temperature from reduced stream flow or loss of inflow from springs. The potential for loss of habitat due to reduced surface water flows was quantified in connection with the OWRD review of Thornburgh's application for a water right. Under OWRD rules, Thornburgh will fully mitigate for consumptive use associated with the Resort development. Consumptive use represents the amount of water not otherwise returned to the Deschutes River system after initial diversion. Although the OWRD program is necessarily based on estimates of impact and modeling, the program is specifically intended to replace stream flows lost due to ground water use. As an added measure, Thornburgh agrees that it will not rely on Page 11 - FIRST OPEN RECORD MEMORANDUM OF ANNUNZIATA GOULD projects involving canal lining or piping to supply mitigation water and will provide all mitigation through the conversion of existing irrigation water rights to protected instream flow. By committing to fully utilize the Big Falls Ranch water rights as part of its OWRD mitigation requirement, Thornburgh will provide additional benefits to stream flow and temperature by restoring cold water inflow from the Deep Canyon Spring area. This project will also include the elimination of an instream irrigation pond that currently contributes to temperature increases. In addition to complying with the OWRD mitigation requirements, Thornburgh will abandon three existing domestic wells and terminate exempt ground water uses on the property. Although these uses represent a relatively small annual volume of water, they provide additional mitigation in the form of ground water offset, beyond the quantity required by OWRD. This action will result in restoration of about 3.65 acre-feet per of ground water per year that has historically been pumped from the Thornburgh location. * * * Collectively, the mitigation and enhancement measures demonstrate that any potential negative impacts to fish habitat resources as a result of the Thornburgh resort will be completely mitigated so there is no net loss or net degradation of the resource as required by the County code. Id. at 11-12. After the adoption of the above addendum, ODFW became concerned that the removal of one impoundment on Deep Canyon Creek would be insufficient to provide the required flow of cold water. Accordingly, by letter from Thornburgh’s attorney dated August 11, 2008, Thornburgh agreed to an additional condition requiring removal of a second impoundment, not controlled by BFR. A copy of Page 12 - FIRST OPEN RECORD MEMORANDUM OF ANNUNZIATA GOULD that letter is attached hereto as Exhibit B. It states in material part: Following Thornburgh's submission of its Addendum Relating to Ground Water Withdrawals in April, 2008 (“Addendum”), ODFW requested modification of the plan to include removal of two existing dams/ impoundment structures on Deep Canyon Creek. The April Addendum described plans for removing only one dam in connection with acquisition of the water rights from Big Falls Ranch for mitigation purposes. In reviewing and commenting on the Addendum, ODFW requested that Thornburgh seek authorization to remove a second dam located just upstream of the Big Falls Ranch dam, on property owned by other parties. During the public hearing process on Thornburgh s Final Master Plan, Thornburgh indicated its willingness to remove the second dam as part of its Fish and Wildlife Mitigation Plan. This letter confirms that intention and so modifies the Addendum. Thornburgh is also submitting into the hearing record documentation of its agreement with the owners of the second dam to authorize the dam removal. Exhibit B at 1. With respect to the impoundments in Deep Canyon Creek, the evidence before you will show that as of today, 13 years later, neither has been removed. Thornburgh talks about removing the sluice gate in the lower impoundment, but even that drops the level of the pond in question only 40-50 percent. The remainder of the impoundment keeps in place a pond which would still allow overheating of the creek’s “cold” water. In any event, the primary FMP conditions of approval intended to assure Thornburgh’s compliance are Conditions 10 and 38: Page 13 - FIRST OPEN RECORD MEMORANDUM OF ANNUNZIATA GOULD 10. Applicant shall provide, at the time of tentative plat/site plan review for each individual phase of the resort development, updated documentation for the state water right permit and an accounting of the full amount of mitigation, as required under the water right, for that individual phase. 38. The applicant shall abide by the April 2008 Wildlife Mitigation Plan, the August 2008 Supplement, and agreements with the BLM and ODFW for management of off-site mitigation efforts. Consistent with the plan, the applicant shall submit an annual report to the county detailing mitigation activities that have occurred over the previous year. The mitigation measures include removal of existing wells on the subject property, and coordination with ODFW to model stream temperatures in Whychus Creek. As we have explained, Hearings Officer Olsen held that Thornburgh had not met its burden of proving compliance and hence imposed Condition 17. Now, opponents have supplied incontrovertible evidence that Big Falls Ranch has obtained an Order from OWRD permanently transferring the subject water right, previously in surface water at Deep Canyon Creek, to groundwater on BFR’s ranch land. Perhaps the Hearings Officer has been or will be persuaded that the water right could be transferred back to surface water in the creek following request from Thornburgh at some point in the future.1 Regardless, it has not happened. What 1In this regard, we note as we have before that the memorandum of agreement with BFR which Thornburgh has placed in the record is not evidence a reasonable finder of fact would rely upon, even to establish the feasibility of performance. The copy filed by the applicant’s counsel as part of their “burden of proof statement” in this remand proceeding provides: Page 14 - FIRST OPEN RECORD MEMORANDUM OF ANNUNZIATA GOULD then? The law is clear on this point. Under Meyer v. City of Portland, 67 Or App 274, 678 P2d 741, rev den, 297 Or 82, 679 P2d 1367 (1984) and Rhyne v. Multnomah County, 23 Or LUBA 442 (1992), as long as a local government finds compliance or feasibility of compliance with applicable criteria, it is appropriate to impose conditions of approval to ensure that those criteria are met. The criteria relating to the permanent placement instream of BFR’s water rights in Deep Canyon Creek have not been met at this time. Accordingly, in order to fulfill Thornburgh’s request to remove Hearings Officer Olsen’s TP Condition 17, this Hearings Officer would have to: (1) Determine based on the record that such compliance at some point in the future is feasible; and (2) Impose a condition conditioning the removal of Condition 17 and the The Effective Date of the Agreement is February 13, 2019, and the Agreement expires on June 1, 2021 unless sooner terminated or as may be extended up to December 1, 2022 , pursuant to the terms and conditions of the Agreement.’ The actual agreement with BFR, including the terms relating to “sooner” termination (whether or not unilateral on the part of BFR) remains “top secret.” There is no evidence of an extension beyond June 1, 2021, or of any effort to reverse the transfer to surface water approved by OWRD at BFR’s request. Page 15 - FIRST OPEN RECORD MEMORANDUM OF ANNUNZIATA GOULD applicant’s authority to proceed with the development activity described in Condition 17, upon a future showing by the applicant that BFR has transferred its water right back to surface water, and that said right has been placed permanently instream in Deep Canyon Creek. Alternatively and most simply, Tentative Condition 17 must remain in effect as initially imposed herein. It was imposed for good reasons, and those reasons have only become more compelling over time. In any event, Thornburgh is free to take a third shot at this issue in its pending application for site plan approval of the subject Overnight Lodging Units, just as Condition 17 provides. Dated: August 31, 2021. Respectfully submitted, Jeffrey L. Kleinman _______________________________ Jeffrey L. Kleinman, OSB No. 743726 Attorney for Annunziata Gould Page 16 - FIRST OPEN RECORD MEMORANDUM OF ANNUNZIATA GOULD i . THORNBURGH RESORT FISH AND WILDLIFE MITIGATION PLAN ADDENDUM RELATING TO POTENTIAL IMPACTS OF GROUND WATER WITHDRAWALS ON FISH HABIT AT April 21, 2008 Prept1retl By: Newton Consultants, Inc. 521 SW 6111 Street, Suite 100 Redmond, Oregon 97756 Prept1retl Ft1r: Thornburgh Resorts, LLC 2447 NW Canyon Drive Redmond, Oregon 97756 Prt>}cct Nr,: 1007-101-07 EXHIBIT A THORNBURGH RESORT FISH AND WILDLIFE MITIGATION PLAN ADDENDUM RELATING TO POTENTIAL IMPACTS OF GROUND WATER WITHDRAWALS ON FISH HABITAT I. Introduction This report was prepared on behalf of Thornburgh Resort Co., LLC, ("Thornburgh") as an Addendum to the Thornburgh Resort Wildlife Mitigation Plan prepared by Tetra Tech EC, Inc. The Addendum was developed by Newton Consultants, Inc. ("NCI") with assistance from Tetra Tech, and also reflects discussions with representatives of the Oregon Department of Fish and Wildlife (ODFW) regarding potential impacts on fish habitat and specific measures to mitigate for any negative impacts. II. Background The proposed Thornburgh Resort ("Resort") will have no direct impact on natural surface waters; there are no such resources on the property and the proposed source of water for the Resort is ground water, to be appropriated under a water right approved by the Oregon Water Resources Department ("OWRD"). Use of ground water by the Resort is expected to indirectly impact flows in the Deschutes River as a result of a determination of hydraulic connection between surface and ground waters in the Deschutes Basin. This determination was made by OWRD in connection with its evaluation and approval of Thornburgh's application for a water right authorizing the use of ground water for the Resort. A copy of the Final Order issued by OWRD approving the water right application is attached as Exhibit 1. As a result of the determination of hydraulic connection, the water right approval requires Thornburgh to provide mitigation to offset projected flow reductions in the "zone of impact" identified by OWRD. Additional information about the affected surface and ground water resources is contained in a Hydrology Report prepared by NCI and submitted as part of Thornburgh's application for Conceptual Master Plan. The mitigation to be provided in connection with the Thornburgh water right will serve as a major component of the mitigation measures for this Addendum. As described below, coupled with additional measures recommended by ODFW, the flow replacement plan developed by Thornburgh will address both flow and temperature concerns and is expected to fully mitigate for any negative impacts so that there is no net loss of habitat quantity or quality for fishery resources. The measures will also provide additional benefits to habitat resources. 1 III. Resort Water Supply and OWRD Flow Mitigation A. Resort Water Supply Ground water will be used by Thornburgh for a variety of purposes common to resorts, including domestic and commercial uses, golf course and landscape irrigation, reservoir/pond maintenance and fire protection. Collectively, these uses are described in the water right as "quasi-municipal" use. The amount and timing of water needs for the Resort are tied to a phased development plan. Water needs were estimated for the first phase (Phase A) and for total resort build-out, as shown below. Phase A water development is estimated to require a maximum annual volume of 1,201 acre-feet (AF) during the first year, followed by 978 AF per year in subsequent years. The difference is due to increased irrigation requirements during the first year of golf course development. The maximum rate of withdrawal during Phase A is estimated at 4.04 cubic feet per second (cfs). Consumptive use for Phase A is estimated at 610 AF per year. The term "consumptive use" means the amount of ground water appropriation that will not otherwise return to surface water flows due to evaporation, transpiration or other factors. (See, OAR 690-505-0605(2).) Maximum water use for the second phase of development (Phase B, or Full Build-out) is estimated at an additional 1,151 AF, with an additional withdrawal rate of 5 .93 cfs, as authorized in the OWRD Final Order. At full build-out, the Final Order allows total use ofup to 2129 AF per year with a maximum withdrawal rate of9.97 cfs. 1. Estimated Phase A Water Use ANNUAL VOLUME WATER USE PEAK RATE 18TYEAR LATER YEARS Golf Courses 1.94 cfs 360AF 269AF Irrigation 0.65 cfs 105 AF 105AF Reservoir Maint 0.47 cfs 144AF 144AF OtherQ/M 0.98 cfs 460AF 460 AF TOTALS 4.04 CFS 1069 AF 978AF 2. Estimated Full Resort Build-Out Water Use WATER USE PEAK RATE ANNUAL VOLUME Golf Courses 5.82 cfs 717 AF Irrigation 1.20 cfs 195 AF Reservoir Maint 0.80 cfs 246 AF OtherQ/M 2.15 cfs 971 AF TOTALS 9.97 CFS 2129 AF CONSUMPTIVE USE 242AF 63 AF 120 AF 185 AF 610AF CONSUMPTIVE USE 645 AF 117 AF 206AF 388AF 1356 AF 2 B. OWRD Mitigation Requirements Mitigation is required for new ground water permits in the Deschutes Basin under ORS 390.835 and related administrative rules in OAR 690-505-0500 et seq. The OWRD mitigation rules were adopted in response to a comprehensive study of ground water resources in the Deschutes Basin conducted by the United States Geological Survey ("USGS") and OWRD. (Ground Water Hydrology of the Upper Deschutes Basin, Oregon," USGS Water Resources Investigation Report 00-4162, 2001.) The study area is shown on Figure 1. The study demonstrates hydraulic connection between the regional ground water aquifer and surface water within the Deschutes Ground Water Study Area as shown on Figure 1. Under the OWRD rules, all new ground water uses within the USGS study area are presumed to be in hydraulic connection with the Deschutes River system. The rules require mitigation to offset the impact of ground water pumping on surface water flows. In reviewing applications for new ground water rights, OWRD determines the total quantity of water to be diverted from ground water and the amount of"consumptive use" associated with the proposed new use. Consumptive use is defined under the rules as the amount of water that does not otherwise return to surface water flows in the basin due to transpiration, evaporation, or movement to another basin. The amount of mitigation required -or "mitigation obligation" -is equal to the amount of consumptive use on an annual basis. Mitigation must be in the form of legally protected water for instream use. In most cases, mitigation is obtained by acquiring existing water rights for irrigation use and converting them into instream water rights held by the state. In addition to specifying the quantity of mitigation water required to offset consumptive use, OWRD identifies the "zone of impact", or location within the surface water system in which the impact of a proposed ground water use is expected to occur. Mitigation must be provided in a location at or above the projected area of surface water impact within the designated zone of impact. Before a water right application may be approved, the applicant must submit a mitigation plan to OWRD describing how the mitigation obligation will be met. Applicants proposing municipal or quasi-municipal use have the option of providing mitigation in incremental units tied to specified phases of development; however, the mitigation obligation for each phase of development must be provided in full before water use may begin for that phase. C. Thornburgh Mitigation Obligation Mitigation for Thornburgh is required in the "General Zone of Impact" shown on Figure 2. The General Zone allows mitigation water to be obtained from any source in the 3 Deschutes Basin above the Madras gage, which is located below Lake Billy Chinook. The broad geographic scope of the General Zone reflects findings in the USGS Study that most ground water within the basin flows toward the confluence area of the Crooked and Deschutes Rivers and discharges into the river and tributaries in an area just above Lake Billy Chinook. In reviewing the Thornburgh application, OWRD detennined that the ground water flow in the area proposed for the Resort wells is towards the north and the area of major ground water discharge, which is about 6 miles from the Resort. OWRD indicated that there is evidence that the proposed ground water use could impact flows in the Deschutes River as shown in Exhibit 2 (Public Interest Review for Ground Water Applications). OWRD did not identify the potential for localized impacts in other portions of the Deschutes Basin based on its review of the proposed Thornburgh wells. The OWRD mitigation rules specifically provide that mitigation may be required in a target area such as the Metolius, Squaw Creek (now known as Whychus Creek), Little Deschutes or Crooked River sub-basins when OWRD determines a proposed use will have localized impact. However, OWRD did not make such a finding for Thornburgh. Mitigation for the Resort will focus on the Middle Deschutes Zone shown on Figure 2, which is within the General Zone specified in the Thornburgh water right. The first phase of water development (Phase A) is estimated to require a maximum annual volume of I ,201 AF with a consumptive use estimate of 610 AF. The mitigation obligation for Phase A is 610 AF, equal to consumptive use. Maximum water use for Phase Bis 2,129 AF per year (full build-out, including Phase A use). The estimated consumptive use and related mitigation obligation at full build-out is 1,356 AF. Under the Final Order, and OWRD rules, mitigation must be provided in advance for the full amount of water to be pumped under each phase of development. The Final Order also includes conditions requiring Thornburgh to measure and report water use and authorizing OWRD to require additional mitigation beyond the amount specified in the mitigation obligation if OWRD determines that the average annual consumptive use is greater than the amount estimated and reflected in the original mitigation obligation. D. Thornburgh Mitigation Plan for OWRD Water Right Prior to approval of its water right application, Thornburgh submitted an "Incremental Mitigation Plan" to OWRD, describing the proposed timing and methods for meeting the mitigation obligation. (Exhibit 3). The Incremental Mitigation Plan, proposes two phases of water development and describes the general approach and feasibility of meeting the total mitigation obligation through a combination of sources including primarily irrigation water rights purchased within the Central Oregon ltTigation District (COID) and from Big Falls Ranch Inc. 4 1. OWRD Mitigation for Phase A COID Water Rights The Resort has already secured 85.24 acres of water rights located within the COID and in the General Zone of Impact. The water rights will be converted to mitigation water by completing permanent water right transfers to change the use from "irrigation" to "instream flow." These transactions are projected to result in 153.43 AF of mitigation water per year. (OWRD typically allows 1.8 AF of mitigation water for each acre of irrigation water rights transferred to instream use. The quantity is based on the average consumptive use associated with irrigation in the Deschutes Basin.) The transfers will be accomplished in accordance with the COID Ground Water Patron Policy, a set of procedures under which landowners within the COID service boundaries may convert existing surface water rights held by the district into instream water rights, to offset new ground water development. Thornburgh is within the COID boundaries and is working cooperatively with COID under the Ground Water Patron Policy. Under a Development Irrigation Plan ("DIP") filed with COID, Thornburgh will be entitled to acquire the remaining amount of mitigation needed to satisfy its water right mitigation obligation through COID water rights. (A copy of the DIP has previously been filed with the County.) Big Falls Ranch Water Rights The Resort also has entered into an agreement to purchase existing surface water rights from Big Falls Ranch located near Lower Bridge, within the General Zone oflmpact. The 464.9 acres of irrigation water rights are expected to generate a total of 836.82 AF per year of mitigation water when transferred to instream water rights. Thornburgh is currently working with Big Falls Ranch on transfer applications for the first 175 acres of water rights to be acquired under the agreement and transferred to instream use. The instream water right would protect flow from a point near Lower Bridge downstream to Lake Billy Chinook. This initial transfer is expected to result in 315 AF of mitigation water. The first 175 acres of Big Falls Ranch water rights that are proposed for transfer are located in Sections 8, 9 and 17, Township 14 South, Range 12 East, as shown on Figure 3, a map prepared for the water right transfer application. These water rights are designated as "FROM" acres on Figure 3. The source of water for these rights (and the total of 464.9 acres of irrigation) is Deep Canyon Creek. The authorized point of water diversion from the creek is shown on Figure 3. Deep Canyon Creek is a tributary of the Deschutes River. The confluence between the creek and the Deschutes River is at about River Mile 131. Deep Canyon Creek flows are derived from springs in the canyon. The spring discharge point is shown on the USGS Cline Falls, Oregon. Quadrangle map (as shown on Figure 3) at a location about 0.56 miles upstream from the creek's confluence with the Deschutes River. 5 Over time, erosional down-cutting has incised the Deep Canyon Creek channel into ground water bearing geologic strata, resulting in the ground water discharge that creates the creek flow. Although the USGS quadrangle map depicts a single spring, ground water discharge actually occurs at other points along the creek channel. The point of diversion for the Big Falls water rights is located at the confluence of the creek and the Deschutes River as shown on Figure 3. When the initial 175 acres of irrigation water rights are transferred to instream flow for Phase A mitigation, up to 2.07 cubic feet per second of flow that would otherwise be diverted from the creek for irrigation will remain in the creek as an instream water right. This additional flow will be protected instream from the authorized diversion point on the creek to the Deschutes River near River Mile 132.8, and downstream in the Deschutes River to Lake Billy Chinook near River Mile 120, a distance of nearly 13 miles. 2. OWRD Mitigation for Phase B/Full Build-Out Mitigation water for Phase B will come first from the transfer of the remainder of the Big Falls Ranch water rights. The locations of the Big Falls Ranch water rights for Phase B mitigation are shown on Figure 4. The remaining mitigation water will come primarily from water rights acquired within the COID that will be converted into mitigation credit through permanent instream transfers. The COID currently serves a total of approximately 45,000 acres of land. A significant portion of this land is expected to become converted to urban land uses in the next three to five years. Under the Ground Water Patron Policy, COID Patrons are given preference for the acquisition of water rights associated with these lands, before such water rights could be transferred outside of the District. As a result, Thornburgh is in a position to gain priority access to water rights available within COID for mitigation purposes. When such rights are acquired and transferred instream, they will be protected as instream flow rights from the COID diversion on the Deschutes River at Bend, downstream to Lake Billy Chinook. The Resort also has an agreement to purchase land with an additional 100. 7 acres of water rights outside of the COID (McCabe Family Trust property.) Transfer of these rights to instream use would result in permanent protection under an instream flow right in the Deschutes River from the river River Mile 140 downstream to Lake Billy Chinook, a distance of about 20 miles. River Mile 140 is about 6.5 miles upstream from Lower Bridge. The location of the mitigation area is shown on Figure 5. Thornburgh does not plan to provide any of its required mitigation for Phase A or B through canal lining or piping projects that save water through increased efficiency of water use. Although such conservation measures can be beneficial by reducing current diversions of surface waters, the practice has been questioned as a means of providing mitigation water to offset new ground water pumping. In recognition of these concerns, Thornburgh will not utilize this option. 6 E. Summary of OWRD Mitigation Plan Implementation of Thornburgh's water right mitigation plan would result in a total of 1,356 AF annual mitigation at full build-out. Approximately 836.82 AF,per year and 5.5 cfs of flow during the irrigation season would come from Deep Canyon Creek as a result of transferring the Big Falls Ranch water rights to instream flow rights. The remaining 519.18 AF per year is expected to come from upstream sources through the COID water rights that would be acquired and transferred instream, or in combination with the McCabe water rights. These mitigation measures, as required by OWRD, are specifically designed to offset impacts of ground water pumping. The initial Big Falls transfer of 175 acres is projected to result in 315 AF per year of mitigation water. This water, originating from springs, will flow to the Deschutes River. Transfer of the remaining 289.9 acres under the Big Falls water rights, as mitigation for Phase B, will generate an additional 521.82 AF per year from Deep Canyon Creek flow that otherwise would be diverted for irrigation use. This water, along with that resulting from the transfer of 175 acres for Phase A mitigation, will be protected as instream flow from approximately River Mile 132.8 downstream to Lake Billy Chinook, near River Mile 120. The Big Falls mitigation water offers the additional temperature benefit of providing relatively cool waters from Deep Canyon Creek. Mitigation transfers for remaining Resort needs (approximately 288.5 acres of water rights generating a total of at least 519.18 AF per year of mitigation water) will involve rights from the COID and the other sources under purchase options and agreements with the Resort. The instream flow created by these transfers is expected to be protected instream from the COID diversion at Bend, near River Mile 166.5, to Lake Billy Chinook near River Mile 120. Figure 5 shows the distribution of mitigation flows between the COID diversion at Bend and Lake Billy Chinook. IV. Fish Habitat Potentially Affected by Ground Water Use During the consultation process, ODFW identified two specific concerns with respect to potential impacts of ground water pumping on fish habitat: First, the potential for flow reduction due to hydraulic connection that could impact flows necessary for fish and wildlife resources in the Deschutes River system; and second, the potential for an increase in water temperature as a result of flow reductions from ground water pumping. Six species of fish were identified that could potentially be impacted: Redband Trout, Bull Trout, Brown Trout, Mountain Whitefish, Summer Steelhead and Spring Chinook. The general distribution of these fish species is shown on Figure 6. In its consultation with Thornburgh regarding these issues, ODFW recognized that the OWRD ground water mitigation program was specifically designed to identify and mitigate for the impacts of flow reduction as a result of new ground water pumping in the 7 basin. Although the OWRD rules and USGS study on which the rules are based do not directly address temperature issues, ODFW also recognized that with the flow replacement required under OWRD rules the potential impact to temperature as a result of the Thornburgh project -or any similar individual project -is expected to be negligible... However, ODFW acknowledged a concern about the potential for cumulative impacts from on-going ground water development in the basin, over time. In early correspondence on this issue, ODFW identified concerns about impacts on cold water springs and seeps in the Whychus Creek sub-basin as a result of Thornburgh ground water use, and indicated that the potentially affected resources would be classified as "Habitat Category I" under the ODFW Fish and Wildlife Habitat Mitigation Policy ("ODFW Mitigation Policy", OAR Chapter 635, Division 414.) (Letter from Glen Ardt to Thornburgh, dated January 31, 2008.) Under the ODFW Mitigation Policy, Habitat Category 1 means the affected habitat is irreplaceable. In response to the letter, Thornburgh provided additional information to ODFW documenting the OWRD findings regarding the location of impact from Thornburgh wells in the Main Stem Deschutes River. Additionally, ODFW met with staff from OWRD and the Department of Environmental Quality concerning the potential Thornburgh impacts. As a result of this process and further internal review, ODFW revised its preliminary determination regarding the type of habitat potentially affected by the Resort, concluding the habitat would be classified as Habitat Category 2, not Habitat Category I . This conclusion was based on ODFW's determination that temperature impacts to stream flow, if present, can be mitigated with appropriate actions. As used in the ODFW Mitigation Policy, "Habitat Category 2" describes essential habitat for a fish or wildlife species. Mitigation goals for this category of habitat are no net loss of either habitat quantity or quality and to provide a net benefit of habitat quantity or quality. OAR 635-414-0025(2). Based on input from ODFW during the consultation process, Thornburgh has identified the following mitigation and enhancement measures designed to ensure no net loss of habitat quantity or quality and to provide a net benefit for fish habitat. The measures reflect fmdings by OWRD that the Thornburgh project is expected to affect flow in the Main Stem Deschutes River. Given that finding, NCI determined the potential temperature impacts attributable to the project are expected to be slight and below levels that can be effectively measured. V. Mitigation and Enhancement Measures The proposed mitigation measures identified in consultation with ODFW are designed to ensure no net loss of habitat quantity or quality and net benefits to the resource: (A) compliance with OWRD mitigation requirements; (B) inclusion of the Big Falls Ranch water rights as part of the OWRD mitigation program to provide additional cold water benefits; (C) removal of an existing instream irrigation pond in connection with the transfer of Big Falls water rights; (D) elimination of existing ground water uses on the Resort property; and (E) a measure to provide $10,000 in funding to complete an on- 8 going thermal modeling project on Whychus Creek or a suitable alternative enhancement project. Collectively, these measures will address ODFW mitigation policy requirements and ensure compliance with the County land use standard. A. Compliance with OWRD Mitigation Requirements Thornburgh will at all times comply with the terms and conditions of the OWRD water right approval. As described above, the terms and conditions include providing flow mitigation for each phase of development prior to beginning water use, and monitoring and reporting water use to OWRD. In addition, Thornburgh will obtain all of its mitigation water through the conversion of existing irrigation water right into protected instream water rights and will not rely on canal lining, piping or similar conservation measures as part of its OWRD mitigation. Although conservation actions can be beneficial and reduce total surface water use, they have been questioned as viable measures for mitigating new ground water development. By providing mitigation water from the conversion of existing water rights, Thornburgh will eliminate approximately 7.5 to I 0.4 cfs of existing surface water diversions during the irrigation season, restoring natural stream flow to the system at or above the area of impact from Thornburgh wells during the time period when stream flows are typically the lowest and temperatures are warmest. B. Specific Mitigation from Big Falls Ranch Thornburgh will fully exercise the option for purchasing 464.9 acres of water rights under its existing option agreement with Big Falls Ranch, Inc. in fulfilling its mitigation obligation under the OWRD water right. By making this commitment, Thornburgh ensures that nearly two-thirds of its total mitigation water (expected total 836.82 AF per year) will come from a source that contributes cold spring-fed water to the Deschutes River above the Thornburgh location of impact. By retiring an existing irrigation water right, this measure will also result in restoration of 5.5 cfs of cold surface water flow to the Deschutes River from Deep Canyon Creek during the irrigation season. C. Elimination of Existing Irrigation Pond In connection with the instream transfer of the Big Falls Ranch irrigation water right rights, Thornburgh will work with the landowner to eliminate the existing instream impoundment used as part of the irrigation system. This is expected to provide a temperature benefit by eliminating temperature increases due to ponding effects. D. Terminate Use of Existing "Exempt" Wells on Thornburgh Property Thornburgh will terminate domestic and livestock use and abandon three existing wells on the Resort property when the Resort water system is developed. The three wells were originally constructed for domestic use serving three homes on the property. All three wells were in use for domestic purposes until the property was acquired by Thornburgh; 9 currently, two of the wells are used for such purposes. The approximate location of the three wells is shown on Figure 7. Domestic water use for each of the three wells was estimated at 250 gallons per day (gpd). Of the three exempt wells, one is used to irrigate about one-half acre that is used to pasture goats. Until recently, another well was also used to irrigate about one-half acre and for livestock watering for up to about 20 horses at a time. The third well was used for domestic/household uses with only incidental landscape irrigation. Irrigation uses were estimated at 30 inches per year of irrigation water applied over a 7-month irrigation season, resulting in a rate of 2260 gpd per well. Livestock watering for the horse operation was estimated at 200 gallons per day. Although the amount of water to be saved as a result of this mitigation measure is relatively small, the action was recommended as a mitigation measure by ODFW and will provide ground water offset of approximately 3.65 AF in addition to the amount of mitigation water otherwise required by OWRD. E. Funding for Thermal Modeling As an enhancement measure, Thornburgh will provide $10,000 to assist with completion of an on-going thermal modeling project on Whychus Creek. Thornburgh water use is not projected to impact Whychus Creek based on OWRD analysis; however, ODFW has identified the Whychus Creek sub-basin as an area of particular concern with respect to the potential for cumulative impacts from ground water development in the basin. This measure is intended to support state efforts to gather additional information that may inform future policy and management decisions relative to natural and anthropogenic activities, including ground water use, on stream temperatures. In the course of investigating this issue, Thornburgh learned that the DEQ has begun development of a computer thermal model of Whychus Creek but has not completed the work in part because of a lack of available funding. Approximately $10,000 is needed to complete the modeling work. When the modeling is done, the state agencies and other stakeholders in the Whychus Creek watershed will be able to identify sources of stream heating and in turn determine the most cost effective steps to take to improve the creek's thermal environment. Accordingly, as part of the overall mitigation package for fish and wildlife impacts, Thornburgh will provide $10,000 to complete the thermal modeling project. This funding will be provided by Thornburgh within 90 days after the close of Phase 1 lot sales for the project. If the modeling project has already been completed at that time, Thornburgh will work with ODFW to identify an alternative priority project for data collection, modeling, or habitat enhancement. VI. Mitigation Results Implementation of the OWRD approved mitigation plan is expected to result in replacement flow of 1356 AF per year of mitigation water at full build-out of the Resort, an amount equal to consumptive use. All required mitigation will be provided in advance 10 of water use. The mitigation action will also result in restoration of approximately 7.5 to 10.4 cfs of surface water flow currently diverted for irrigation use based on elimination of irrigation diversions from Big Falls Ranch and COID . Approximately 836.82 AF per year of the mitigation water will come from Deep Canyon Creek as a result of transferring the Big Falls Ranch water rights to instream flow rights. The elimination of the existing diversion of Deep Canyon Creek with water originating from ground water springs, is expected to provide additional flow and temperature control benefits to the Deschutes River during the critical irrigation season. Removal of the Deep Canyon Creek impoundment will further benefit water temperatures in the Deschutes River by eliminating the pond where water temperatures would increase during warm periods. The remaining 519.82 AF of mitigation water under the water right is expected to come from upstream sources through the COID water rights that would be acquired and transferred instream. This action will eliminate existing surface water diversions during the irrigation season, thereby restoring flow between Bend and Lake Billy Chinook. The decommissioning of existing onsite wells and ground water uses will provide additional habitat benefits in excess of the OWRD approved mitigation plan. Funding to be provided for temperature modeling will further state efforts to quantify and assess cumulative impacts associated with ground water development. VII. CONCLUSION DCC 18.113.070.D requires that any negative impact on fish and wildlife resources be completely mitigated so that there is no net loss or net degradation of the resource. This Addendum to the Thornburgh Wildlife Mitigation Plan addresses potential impacts to fishery resources as a result of ground water pumping and identifies specific mitigation measures. The plan was developed in consultation with ODFW to address two specific areas of concern regarding the potential for negative impacts: the potential for a loss of habitat due to reduced surface water flows in the area of impact and the potential for loss of habitat due to increased temperature from reduced stream flow or loss of inflow from springs. The potential for loss of habitat due to reduced surface water flows was quantified in connection with the OWRD review of Thornburgh's application for a water right. Under OWRD rules, Thornburgh will fully mitigate for consumptive use associated with the Resort development. Consumptive use represents the amount of water not otherwise returned to the Deschutes River system after initial diversion. Although the OWRD program is necessarily based on estimates of impact and modeling, the program is specifically intended to replace stream flows lost due to ground water use. As an added measure, Thornburgh agrees that it will not rely on projects involving canal lining or piping to supply mitigation water and will provide all mitigation through the conversion of existing irrigation water rights to protected instream flow. 11 By committing to fully utilize the Big Falls Ranch water rights as part of its OWRD mitigation requirement, Thornburgh will provide additional benefits to stream flow and temperature by restoring cold water inflow from the Deep Canyon Spring area. This project will also include the elimination of an instream irrigation pond that currently contributes to temperature increases. In addition to complying with the OWRD mitigation requirements, Thornburgh will abandon three existing domestic wells and terminate exempt ground water uses on the property. Although these uses represent a relatively small annual volume of water, they provide additional mitigation in the form of ground water offset, beyond the quantity required by OWRD. This action will result in restoration of about 3.65 acre-feet per of ground water per year that has historically been pumped from the Thornburgh location. The potential for an increase in stream temperature resulting in a negative impact to fish and wildlife resources was also evaluated. In developing recommendations for this plan, it was clear that the slight potential for increased stream temperature attributable to Thornburgh's proposed ground water use was not significant enough to result in any quantifiable negative impact to fish habitat. However, the above-described measures will mitigate any negligible temperature impact that may be attributed to the Resort. In addition, in response to concerns about the potential cumulative impacts of ground water development in the Deschutes Basin, Thornburgh will provide funding to support thermal modeling or other enhancement measures recommended by ODFW to develop information that can inform future policy and management decisions regarding cumulative impacts of ground water pumping Collectively, the mitigation and enhancement measures demonstrate that any potential negative impacts to fish habitat resources as a result of the Thornburgh resort will be completely mitigated so there is no net loss or net degradation of the resource as required by the County code. 12