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SAM Magazine—Denver, May 24, 2012—The U.S. Forest Service, responding to the NSAA lawsuit regarding water rights, claimed last month that the Forest Service has the legal right to attach restrictions to the water rights included in ski area permits. The issue will eventually be settled in the courts, with NSAA due to file its legal brief on June 1, with amicus briefs due by June 6. Those filings will bring the dispute into sharper focus, and indicate the level and type of support each side has.

In November 2011, the Forest Service inserted a new clause into its ski area permits regarding water rights. The Forest Service says it did so to ensure that water originating in streams on public lands remains dedicated to ski area operations, especially when a leaseholder sells to a new owner. The clause is intended to ensure that the water rights transfer to the new owner and are used for ski area operations. The Forest Service claims that water rights language adopted in 2004 would allow resorts to sell water rights for other purposes.

NSAA claimed that the new clause requires resorts on Federal land to relinquish control over water rights that are worth millions of dollars, value that resorts carry on their balance sheets. Removing those water rights could affect some areas’ credit ratings, the resorts have argued.

The NSAA sued the Forest Service last January, claiming that the Forest Service failed to provide an opportunity for public comment on the changes under the National Forest Management Act, and that it failed to analyze the economic impacts of the permit change on small businesses, as required under the Regulatory Flexibility Act.

The Forest Service says that existing laws allow it to make administrative changes without comment or economic impact analysis.

It will be up to the court to determine who is right.