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Swensen (#8493) FLITTON & SWENSEN 1840 Sun Peak Drive, Suite #B 102 Park City, Utah 84098 Telephone: (435) 940-0842 Facsimile: (435) 940-0852 Attorneys for Plaintiffs IN THE SEVENTH JUDICIAL DISTRICT COURT, IN AND FOR EMERY COUNTY, STATE OF UTAH HEAL UTAH, a Utah non-profit organization; MOKI MAC RIVER EXPEDITIONS, INC., a Utah corporation; BILL AND JUNE ADAMS, individuals; URANIUM WATCH, a Utah non-profit organization; PAMALA R. HACKLEY, an individual; NORM GUICE, an individual; ELFREDA LOU MORTENSON, an individual; LIVING RIVERS, a Utah nonprofit organization; KATHRYN BAKER, an individual; W AID AND CHERYL REYNOLDS, individuals; LISA RUTHERFORD; an individual; PAUL VAN DAM, an individual; NAOMI FRANKLIN, an individual; KATHLEEN CORR, an individual; TOM AND PAMELA MOONEY, individuals; CENTER FOR WATER ADVOCACY, a Utah non-profit organization; AND UTAH RIVERS COUNCIL, a Utah non-profit organization, Plaintiffs,
COMPLAINT AND PETITION FOR REVIEW OF AGENCY ACTION
Civil No. ------Judge: _
KANE COUNTY WATER CONSERVANCY DISTRICT, a Utah water conservancy district, BLUE CASTLE HOLDINGS, INC., a Delaware corporation; and KENT L. JONES, acting in his capacity as Utah State Engineer, Defendants.
The above-captioned plaintiffs ("Plaintiffs") for cause of action against Defendants Kane County Water Conservancy District, Blue Castle Holdings, Inc., and Kent L. Jones, complain and allege as follows: SUMMARY OF CLAIMS 1. This action is an appeal of the State Engineer's Order approvmg Change
Application 89-74 (a35402), which changes the points of diversion, place of use, and nature of use for 29,600 acre-feet of water owned by Kane County Water Conservancy District (hereafter "Kane County"). The Order authorizes the water to be used for power generation at the
proposed Blue Castle Nuclear Power Plant in Green River, Utah. 2. Pursuant to the approved change application, water previously held for the benefit
of the citizens of Kane County will now be consumed by the nuclear plant planned by Blue Castle Holdings, Inc. (Kane County and Blue Castle Holdings, Inc. collectively will be referred to herein as "Applicants" since the information provided to the State Engineer in support of the change application came from both entities). As recognized by the State Engineer's own
decision, "the proposed project presents issues of first impression",
in that it represents
significant consumption of water held under protections of Utah law by public entities "and now leased for a long period of time - perhaps the next 5 decades or more - to a private entity outside the service area of the public entities." (Order of the State Engineer re: Change Application 8974 (a35402), Jan. 20,2012, at 3) (attached hereto as Exhibit A). 3. Further, the proposed usage of Kane County's water for nuclear power in Emery
County raises significant concerns regarding interference with water rights, the availability of
water in the Green River to support the change application, threats to public welfare, harm to the natural stream environment, and the feasibility of the project. The information submitted by the Applicants suffered from substantial gaps, and was further compromised by evidence that
undermined the Applicants' credibility on critical issues (such as BCH's ability to finance and complete the project). 4. Despite these and other issues raised by Plaintiffs in their protests, the State
Engineer erringly approved the change application, not because he found there was significant evidentiary unanswered support for the Applicants' claims, but because he presumed that the many
questions would be addressed in the federal government's
Essentially, the State Engineer deferred to other entities his statutory obligation to ensure that the nuclear project and its massive consumption of water will not detrimentally impact the natural stream environment, public welfare, existing water rights, or public safety. 5. This approach abrogates the State Engineer's responsibility to thoroughly
investigate and evaluate the statutory criteria contained in Utah Code Sections 73-3-3 and 73-38, and his obligation to withhold approval if further investigation is necessary. 6. Essentially, there is little of substance in the State Engineer's decision to warrant The Applicants failed to present adequate evidence to
deference from the reviewing court.
support a positive finding on each of the necessary criteria. 7. Plaintiffs now seek judicial review of the State Engineer's decision in order to
enforce the statutory requirements for a change application and to protect their interests in a thorough review of this very complex, novel, and potentially devastating project.
JURISDICTION AND VENUE 8. Plaintiffs incorporate by reference the allegations contained in paragraphs 1
through 7 above. 9. This action is brought pursuant to Utah Code Sections 630-4-402, 630-4-404,
73-3-14, and Utah Rule of Administrative Procedures 655-6-18 to review the decision of the State Engineer dated February 28, 2012, which denied the request for reconsideration of his A
January 20, 2012 Order Approving Change Application 89-74 (a35402) ("89-74 Approval").
copy of the State Engineer's denial of the request for reconsideration is attached as Exhibit B, and a copy of the State Engineer's underlying 89-74 Approval is attached as Exhibit A. Both documents are incorporated by reference herein. 10. Venue is proper in this court pursuant to Utah Code Section 73-3-14(1)(b), which
requires that judicial review of a state engineer order shall take place in the county in which the water source is located. See also Utah Code § 630-4-402(l)(b) (2011) (providing that venue for The water source at
judicial review "shall be as provided in the statute governing the agency").
issue in this case, i.e. the Green River, is located in Emery County, State of Utah. PARTIES 11. Plaintiffs incorporate by reference the allegations contained
through 10 above. 12. Each of the Plaintiffs timely protested the change application, raising significant
concerns about the broad impacts of the proposed change in water usage on their individual
water rights, businesses, environment. 13.
a healthy river ecosystem
Plaintiff HEAL Utah is a non-profit, public interest group organized and existing
under the laws of the State of Utah. HEAL Utah advocates on various environmental issues on behalf of its members, including those members in the Green River area, and the citizens of Utah. 14. Plaintiff Moki Mac River Expeditions, Inc. is a Utah business, organized and
existing under the laws of the State of Utah. Moki Mac River Expeditions offers rafting trips on the Green and Colorado Rivers, and is based in Green River, Utah. 15. Plaintiffs Bill and June Adams are residents of Green River, Utah. In addition to
being members of HEAL Utah, the Adams own water rights that authorize the diversion of water directly from the Green River for irrigation, stock watering, and domestic uses under prior approved water rights. Right Number 91-3782. 16. Plaintiff Uranium Watch is a non-profit organization under the fiscal sponsorship Specifically, the Adams own Water Right Number 91-334 and Water
of Living Rivers, a 501(c)(3) non-profit organization organized and existing under the laws of the State of Utah. Uranium Watch advocates for the protection of public health and the
environment from past, current, and future impacts of the nuclear fuel cycle. 17. 18. 19. PlaintiffPamala R. Hackley is a resident of Castle Valley, Utah.
Plaintiff Norm Guice is a resident of Salt Lake City, Utah. Plaintiff Elfreda Lou Mortenson is a resident of Glenwood Springs, Colorado.
Plaintiff Living Rivers is a non-profit organization organized and existing under
the laws of the State of Utah. Living Rivers advocates on behalf of those with interests in the Colorado River and its tributaries. 21. 22. 23. 24. 25. 26. 27. 28. Plaintiff Kathryn Baker is a resident of Snowmass V illage, Colorado. Plaintiff Waid and Cheryl Reynolds is a resident of S1. George, Utah. Plaintiff Lisa Rutherford is a resident ofIvins, Utah. Plaintiff Paul Van Dam is a resident of Ivins, Utah. Plaintiff Naomi Franklin is a resident of Salt Lake City, Utah. Plaintiff Kathleen Carr is a resident of Springdale, Utah. Plaintiffs Tom and Pamela Mooney are residents of St. George, Utah. Plaintiff Center for Water Advocacy is a non-profit public interest law firm, The Center for Water Advocacy
registered and existing under the laws of the State of Utah.
strives to promote the long-term sustainability of water resources in Utah for the benefit of fish and wildlife populations, habitat, aesthetics, recreation, and traditional and cultural activities. 29. Plaintiff Utah Rivers Council is a non-profit organization organized and Utah Rivers Council is a grassroots
existing under the laws of the State of Utah.
organization dedicated to the conservation and stewardship of Utah's rivers, as well as sustainable, clean water sources for Utah's people and wildlife.
Defendant Kane County Water Conservancy District ("Kane County") is a water
conservancy district of the State of Utah, and the owner of Water Rights 89-74, 89-1285, and 891513. Kane County is organized to provide for the conservation and development of water for the citizens within Kane County. 31. Defendant Blue Castle Holdings, Inc. ("BCH"), is a Delaware corporation
registered to do business in the State of Utah. BCH is the developer and licensing agent for the proposed nuclear plant, for which it is leasing the water from Kane County. 32. Defendant Kent L. Jones is the State Engineer of Utah and is joined in his
representative capacity only. GENERAL ALLEGATIONS 33. Plaintiffs incorporate by reference the allegations contained
through 32 above. 34. On March 30, 2009, Kane County filed Change Application 89-74 (a35402)
(hereafter, "the Change Application") to change the points of diversion, places of use, and nature of use of 29,600 acre-feet of water to be used for the proposed nuclear power plant in Emery County. Together with companion Change Application 09-462 (a35874), the Change
Application also seeks approval to store up to a total of 2,000 acre-feet of water from the Green River. BCH supported this application with various information and statements to the State
Engineer. A copy of the Change Application is attached hereto as Exhibit C. 35. The Kane County water rights at issue were previously approved to be diverted
from locations on Lake Powell and Wahweap Creek, but had not been put to beneficial use as
The County continued to hold the unperfected water rights, as permitted by Utah
law, for the benefit of its citizens and future use. 36. BCH, through its predecessor in interest Transition Power Development, LLC,
entered into leases with Kane County and San Juan County Water Conservancy District to supply the total volume of water - 53,600 acre-feet - that would be required for a nuclear power plant in Green River, Utah. The leases were entered into on July 14,2010, and June 17,2010, respectively. BCH has stated that the plant will require approximately 70 cubic feet per second
(cfs) of flow, and would consume 100% of the water diverted. (See Ex. A at L) 37. The Change Application provides a necessary part of the 70 cfs of water required
to permit and operate the proposed nuclear power plant. 38. The San Juan County Water Conservancy District lease and related change
application are the subject of a separately pending lawsuit. 39. Notice of the Change Application was published in the Emery County Progress
on April 28 and May 5,2009, and in The Times-Independent on April 30 and May 7, 2009. This lead to protests against the Change Application being filed by a wide and diverse group of concerned entities, including the Plaintiffs in this matter, as well as organizations such as:
United States Department of the Interior, Bureau of Reclamation; United States Department of the Interior, Fish and Wildlife Service; Uintah Water Conservancy District; Green River
Companies; Moab Local Green Party, Utah Green Party; The Sierra Club, Utah Chapter; Center for Biological Diversity; Red Rock Forests; and Western Resource Advocates.
Notably, the State Engineer did not publish notice of the Change Application in a
newspaper of general circulation in Kane County, such as the Southern Utah News. 41.
An informal administrative hearing was held January 12, 2010, in Green River,
Utah, at which the protestants raised their concerns regarding the Change Application. BCH provided limited information regarding its water use plans at the hearing. The administrative
record was left open and additional information was submitted by protestants and applicants after the hearing. 42. During the administrative proceedings, each of the statutory requirements for (i) the lack of unappropriated
approval of a change application was challenged by protestants:
water in the source; (ii) the likely interference with existing rights or more beneficial use of the water; (iii) the significant doubts regarding the physical and economic feasibility of the project; (iv) the deleterious effects on public welfare; (v) the lack of evidence that BCH has the financial ability to complete the project; (vi) the speculative nature of the proposed use, particularly with water previously reserved for the public; and (vii) the negative effect on more beneficial uses, including irrigation, domestic or culinary, recreation, and the natural stream environment. Utah Code Section 73-3-8(1). 43. On January 20, 2012, the State Engineer issued his decision approving Change See
Application 89-74 (a35402), allowing the diversion and full depletion of 29,600 acre-feet of water annually, at a rate not to exceed 7S cfs when combined with the companion application from San Juan County Water Conservancy District.
Following the 89-74 Approval, protestants filed Requests for Reconsideration on
February 9, 2012, outlining concerns with the State Engineer's unwillingness to evaluate the evidence necessary to approve or reject a change application under Utah law. The Requests for Reconsideration emphasized the statutory duty to review all relevant criteria, pointing out that
the State Engineer is the only state official who will have any opportunity to weigh in on this proposed project. 45. In a brief, one page order, the State Engineer denied the Requests for
Reconsideration on February 28, 2012. FIRST CAUSE OF ACTION Absence of Unappropriated Water and Interference with Existing Water Rights (Section 73-3-8(1)(a)(i)-(ii)) 46. Plaintiffs incorporate by reference the allegations contained
through 45 above. a. 47. No Unappropriated Water
Utah Code Section 73-3-8(1)(a)(i) requires that there be unappropriated water in
the source available to support the proposed diversion and use of water under the Change Application. 48.
The points of diversion identified on the Change Application place full reliance
the flows of the Green River to satisfy the proposed diversion requirements, despite the fact
that the underlying water rights are not historically appurtenant to the Green River, and the Green River contributes only to a minority portion of the underlying water rights.
Kane County's underlying water rights are based primarily on waters flowing
from the main stem of the Colorado River. 50. The State Engineer has previously determined that the upper Colorado River Applicants also concurred at the
Basin, which includes the Green River, is over-appropriated.
public hearing that "on paper" the Green River is over-appropriated. 51. Applicants improperly rely on instream flow releases from Flaming Gorge
Reservoir as their basis for claiming unappropriated water.
Importantly, the water rights on which the Change Application is based do not
have a call on storage from Flaming Gorge Reservoir. 5" . J Moreover, no releases from Flaming Gorge are made during period of low flow
except for those releases designated as minimum instream flows under the Endangered Species Act. 54. Accordingly, any water available for the Change Application must be based on
natural flows in the Green River and not be dependent on water stored under prior rights in Flaming Gorge Reservoir. 55. Releases of water from Flaming Gorge Reservoir are subject to the Flaming
Gorge Operating Plan, which establishes minimum flow releases that must be maintained through all reaches of the Green River to the confluence with the Colorado River in order to meet the requirements of the Endangered Species Act.
to satisfy mrrumum
requirements cannot be diverted or used by subsequent downstream appropriators, including Applicants. 57. Significantly, the State Engineer's 89-74 Approval found that "[ajpproval of this Ex. A at 19 (emphasis
application has the potential to exacerbate the low flow situation." added).
Based on the year-round beneficial use requirement of the proposed nuclear power
facility, the State Engineer's finding confirms that there is no unappropriated water in the source as required to support the proposed uses because of the legal requirement that the remaining water be left undiverted under the Flaming Gorge Operating Plan. 58. Applicants failed to meet their burden of showing unappropriated water in the
Green River, and in particular that the water flowing at the proposed point of diversion is not subject to prior appropriation or other legal restriction. b. Interference with Existing Water Rights 59. Utah Code Ann. § 73-3-8(1)(a)(ii) provides that the proposed use must not impair
existing rights or interfere with the more beneficial use of the water. 60. The uses under the Change Application will interfere with the existing rights of
Plaintiffs on the Green River. 61. Notwithstanding that Plaintiff water right owners expressed their concern that the
new diversion and consumption would adversely impact their ability to use water under their own water rights, the State Engineer concluded that there was "reason to believe that this application will not impair existing rights ... " (Ex. A at 9.)
However, the State Engineer conditioned his approval on subordinating the 89-74
application to the water rights held for various entities for use in the Central Utah Project (CUP).
(See Ex. A at 16).
The State Engineer justified this notable carve-out by essentially conceding the of water, and deciding that the significant
risk posed by the nuclear plant's consumption
investment in and public benefits of the CUP "should not be placed at risk by water rights, although held by public entities, that are not being used to supply water to the populations they represent." 64. (ld.) In conjunction with the State Engineer's finding that approval of this Change
Application could "exacerbate the low flow situation," the CUP carve-out tacitly acknowledges the threat to existing water rights. 65. Protestants repeatedly raised concerns over the ability of Applicants to respect the Several water right owners testified at the
priority system for water rights under Utah law.
public hearing regarding their existing difficulty in obtaining water at their approved points of diversion during low flows, and the efforts they have undertaken to ensure that they obtain their full measure of water supply. 66. The significant withdrawal of water proposed by Applicants will directly interfere
with and impair the rights of the vested water right holders on the Green River. 67. Moreover, there is a real danger that the proposed nuclear power plant will not be
able to respect priority cuts based on its own relatively late priority of water rights.
The cooling requirements of the nuclear facility are continuous and year-round.
In order for the plant to operate safely, the full measure of water under the Change Application is required at the point of diversion, regardless of river conditions or priority cuts. 69. The State Engineer did not evaluate whether the Applicants have proposed
adequate water storage to enable the nuclear power plant to safely and effectively shut down in times of shortage. 70. Applicants claimed that their 2,000 acre-feet storage reservoir would meet
requirements of"30 days of water for safe shutdown and cooling." (Ex. A at 14). 71. Based on calculations of the total water flow requirements of the nuclear power
plant, 2,000 acre-feet is less than half the necessary storage capacity to operate the plant for thirty days. 72. This detail is critical, because if Applicants' storage facilities are inadequate to
allow safe shut-down in times of shortage, safety concerns would dictate that diversions continue, irrespective of the priority rights of other water users on the Green River. 73. Establishing a de facto priority right due to safety concerns would directly
interfere with respecting the vested rights of water users both upstream and downstream of the Applicant's proposed nuclear plant. 74. Moreover, low flow diversions of water by Applicants would directly interfere
with downstream water rights on the Green River and reduce flows in the river to below the target flows under the Flaming Gorge Operating Plan.
SECOND CAUSE OF ACTION Not Physically or Economically Feasible (Section 73-3-8(1)( a)(iii)) 75. Plaintiffs incorporate by reference the allegations contained
through 74 above. 76. Utah Code Section 73-3-8(1)(a)(iii) requires that the proposed plan for diversion
and use of water be economically and physically feasible, and not contrary to the public welfare. 77. During the administrative proceedings, Applicants presented mere assurances
regarding future potential contracts and permits, rather than any actual evidence of existing contracts, or basis for gaining access to facilities, land, or customers. a. Not Physically Feasible 78. There is insufficient evidence to gIVe reason to believe that Applicants will
qualify for all necessary federal and state permits. 79. Absent NRC evaluation of the potential site, and submission of studies and
information required under federal law governing nuclear facility siting, Applicants cannot make any credible claim regarding the physical feasibility of the plant. 80. Water resources in the State of Utah are scarce and the requirement of physical
feasibility is meant to ensure that valuable water rights are not tied up in projects that do not have a substantial likelihood of feasibility and success. 81. Although Applicants presented their assertion that they believe they have the
capability to apply for an NRC license, the State Engineer's decision neglected to address any of the specific reasons that Applicants may fail in this licensing attempt.
For example, Applicants have failed to demonstrate how the proposed nuclear
power plant can be safely and efficiently operated under the Change Application, particularly in light of the late priority of the water rights, subordination of the Change Application to CUP water rights, Endangered Species Act Requirements and inadequate on-site storage rights. 83. In addition, Applicants have not yet acquired the land for their proposed nuclear
site. Nor have Applicants provided full disclosure regarding the capital structure of the project or the identity ofthe future owner-operator they (at times) claim will manage the nuclear plant. 84. Applicants have also failed to provide the information necessary to determine a BCH omitted any information regarding the NRC's suitability criteria
project's site suitability.
such as: location and description of nearby industry; existing and future projected population; site safety assessment, including a risk analysis of fission product release; and radiological consequences ofleaks offsite. See 10 CFR § 52.l7(a). 85. Importantly, Applicants have not demonstrated that the proposed site complies
with the requisite criteria for geologic and seismic site suitability studies. 86. time. Necessary details of design and technology also have not been disclosed at this
Applicants are not yet prepared to divulge the basic parameters of the proposed plant
design, including the intake structures and the proposed diverting channel. 87. Without these details, Applicants cannot even guarantee that the amount of water
they have secured under the Change Applications will be sufficient for the operation of the nuclear power facility. This renders it impossible to deem the project "physically feasible."
h. Not Economically Feasible 88. Applicants have failed to demonstrate that there is adequate demand for power
sufficient to make the plan economically feasible and that their proposal is capable of supplying that demand in a cost-effective manner. 89. of nuclear The State Engineer relied on underlying reports that acknowledge the uncertainty power as an economically feasible power source. Specifically, the 2008
Budget Office report found that without government subsidies and proposed (Ex. A at 11)
carbon dioxide charges, "investment in nuclear energy would be unlikely."
(emphasis added). In fact, without those incentives, nuclear power "would be roughly 30-35% more expensive than conventional coal and gas technologies." 90. (ld.)
There is no evidence that Applicants will qualify for the government incentives,
or that the proposed carbon dioxide charges will take effect. 91. Moreover, the high costs of constructing nuclear power plants render investment
in nuclear power uncertain at best. See, e,g Ex. A at 11 (citing Annual Energy Outlook 2011). 92. At best, the limited information presented by Applicants merely predicts that at
some point in the future, assuming several changes in the law and economic incentives, nuclear power may become more competitive. 93. Applicants did not conduct any sort of risk analysis determining potential benefits
and liabilities, nor did they evaluate the least cost, lowest risk option for energy generation.
Water resources in the State of Utah are scarce, and Applicants have the burden of
showing that the proposed diversion and use of water is economically feasible in order to warrant approval by the State. 95. Accordingly, Applicants fail to meet their burden to establish econonuc
feasibility, particularly given the gaps in the information regarding the final form, cost, funding, and even ownership of the project. THIRD CAUSE OF ACTION No Financial Ability to Complete the Project (Section 73-3-8(1)( a)(iv» 96. Plaintiffs incorporate by reference the allegations contained
through 95 above. 97. Utah Code Section 73-3-8(1)(a)(iv) requires that the applicant have the financial
ability to complete the proposed works. 98. Applicants estimate the cost of constructing the proposed nuclear plant at $12-18
billion, plus an additional $100 million to secure an Early Site Permit from the NRC. See Ex. A. at 12. 99. Given the significant costs involved in this project, Applicants' (particularly
BCH's) financial status and representations regarding their ability to secure funding are critical to satisfying the statutory requirement regarding financial ability. 100. Applicants provided a "capital schedule for the licensing" which projects that,
even in the short-term, they will require significant funding, e.g. $10 million in 2010, $21 million in 2011, and $26 million in 2012. (District's Response to Supp. Protests at 15.)
Applicants have presented no evidence that even those early funding requirements
have been met, and the State Engineer did not sufficiently investigate funding for the proposed project. 102. At a minimum, Applicants should be able to demonstrate sufficient funding or
investment commitments to meet the capital schedule in the short-term. Their submissions to the State Engineer lack any support for this essential detail. 103. Subsequent to the State Engineer's 89-74 Approval and prior to the Requests for
Reconsideration, information came to light indicating that one of the primary investors Applicant identified to the State Engineer is being investigated by the SEC for fraud and financial wrongdoing. 104. Just as importantly, it appears that the investor, LeadDog Capital L.P., never had
sufficient assets to satisfy their alleged commitment to BCH of $30 million. 105. In response, BCH claimed that it never completed the funding agreement with
LeadDog, although that detail was not presented to the State Engineer. 106. Despite the now apparent shortfall of $30 million in BCH's funding plan, the denial of the Request for Reconsideration simply indicated that "Securing
funding from a specific source was unnecessary to reach my decision ... " (Ex. B. at 1.) 107. Further, the State Engineer clarified that although his original order stated that
Applicants had signed term sheets with 17 utilities, that "fact," as well, was incorrect. (Id.) 108. The State Engineer did not find that these changes in the factual record impacted
his evaluation of the Applicants' financial ability (or their credibility on that issue).
Applicants have not provided any substantiated source for their funding, either the
$100 million needed for permitting, or the billions needed for actual construction and completion of the nuclear plant. 110. In short, Applicants fail to produce sufficient record evidence to give reason to
believe that they have the ability to secure the significant funding needed or the financial ability to complete the proposed proj ect.
According} y, the Change Application does not satisfy the statutory requirements
regarding financial ability. FOURTH CAUSE OF ACTION Speculative Nature of the Proposed Project (Section 73-3-8(1)(a)(v)) 112. Plaintiffs incorporate by reference the allegations contained in paragraphs 1
through 111 above. 113. The Change Application must not be filed for purposes of speculation and
monopoly. Utah Code Ann. § 73-3-8(l)(a)(v). 114. Applicants' lack of disclosure and diligence in secunng necessary resources,
permits and approvals demonstrate the speculative nature of the Change Application.
At the public hearing, Applicants
conceded that an "owner-operator
identified" will construct, own and operate the proposed nuclear facility, since BCH itself does not have the "wherewithal to build a nuclear power plant." (Green River Hearing Transcript at p. 263:5-7).
Aaron Tilton, CEO of BCH, explained at the public hearing that BCH is merely (Green River Hearing Transcript at 60:10). The plan, as
"a sponsoring development company."
explained to the public by Applicants, was that BCH would shoulder the project through licensing and then allow (currently unknown) utility participants to construct and operate the project. (See id. at 63: 23-25.) 117. From the public hearing, as well as the publicly available documents, it was clear
that BCH had no intention of being the entity that actually puts the water to use under the Change Application. 118. In fact, it is extremely unusual (if not unprecedented) for a small startup company
with no track record in nuclear power to attempt to build a nuclear power facility. Of the six applications for Early Site Permits currently in front of the NRC, all are either from major utilities (e.g., Exelon) or companies that already own and run reactors. 119. Subsequently, the Applicants reversed their position, conveniently insisting to the
State Engineer that BCH does not plan to transfer the water leases and "will be the entity that will put to beneficial use the leased water under the applications." 120. (Ex. A at 13.)
The State Engineer apparently saw no conflict between the representation that
BCH lacked the ability to build and operate a nuclear power plant, and the later assertion that they certainly would be the owner-operator in question. 121. Without factual basis, the State Engineer concluded that "there is no reason to the water resource or profit from
believe that the applicant intends only to monopolize speculation on its eventual use." (Ex. A at 14.)
However, there is no record evidence that BCH in fact has the ability to construct
and operate a nuclear facility, and thus put the water to beneficial use itself, or that it will be anything more than a straw man holding the legal right to the water until a suitable group of investors with the necessary money and expertise presents itself at some point in the indefinite future. 123. Moreover, the plan presented by Applicants fails to demonstrate how the nuclear in direct
facility will be funded, operated and approved, rendering it wholly speculative, contradiction ofthe statutory requirements. FIFTH CAUSE OF ACTION Detrimental Impact on Natural Stream Environment And Public Welfare (Section 73~3-8(1)(a)(iii), (b)) 124. Plaintiffs incorporate by reference the allegations contained
through 123 above. 125. The Change Application will detrimentally impact the natural stream
enviromnent, public recreation and the public welfare. 126. The U.S. Fish and Wildlife Service has listed four species of fish unique to the All four species are present in the Green River, and the
Colorado River system as endangered.
entire river has been designated as "critical habitat" for those fish species (the Colorado pikeminnow, razorback sucker, bony tail, and humpback chub). 127. The Flaming Gorge Operating Plan requires base flows to remain undiverted in
the Green River to satisfy the requirements of the Endangered Species Act.
Implementation of the flows required under the Flaming Gorge Operating Plan is the continued existence of the endangered species ... and to
"necessary to avoid jeopardizing
voluntarily and cooperatively take steps to facilitate recovery of the fish .... " Record of Decision for the September 2005 Operating Plan at 6. 129. The State Engineer found that "during drought years flows at the [USGS Green
River Utah flow monitoring] station have typically fallen below the 1,300 cfs base flow target recommended by USFWS." (Ex. A at 19.) 130. Further, the State Engineer found that approval of the Change Application "has
the potential to exacerbate the low flow situation." (Jd.) 131. Statements from the Plaintiffs also supported the vital importance of maintaining
flows in the Green River to their local businesses, ranging from farming to river trips. 132. Moreover, the future availability of water was raised in multiple protests citing
the negative effects of greater climate variability and projected decreases in runoff to the Colorado River Basin of 10-30% by 2050. (Ex. A. at 6). 133. The State Engineer's only response to these concerns was concluding that he was
"not aware that any available predictive model has been scientifically validated as a definitive predictor of future conditions." (Ex. A at 6). Nowhere did the State Engineer explain why a
"definitive predictor" was necessary to invoke concern under the statutory criteria. 134. Further, the State Engineer deferred to the NRC on the critical criterion of public
welfare, holding that "health and safety issues related to the development of a nuclear power plant will be addressed by the NRC." (Ex. A at 16.)
Although Applicants assert that their nuclear plant will never pose the same threat
to public safety as the failed nuclear reactors in Fukushima, Japan, there is no record evidence substantiating that claim. 136. In fact, the State Engineer acknowledged the incomplete state of the record
evidence, noting that, "No definite plans for the facility and its water diversion, conveyance, or storage works have been developed such that the State Engineer can review the plans and design to make an engineering determination as to the adequacy of those works with respect to public welfare," (Ex. A at 16.) 137. Finally, the State Engineer's determination that it was necessary to carve out the
CUP water rights in order to protect them from potential impairment by the Change Application raises additional concerns about the need to extend that protection to other water users with senior priority rights. 138. Taken in conjunction, these findings give reason to believe that the proposed
nuclear facility will detrimentally affect the natural stream environment and public welfare. PRAYER FOR RELIEF WHEREFORE, Plaintiffs pray for judgment as follows: 1. With respect to the First Cause of Action, Plaintiff prays for the following relief: a. For an order of the Court overturning the State Engineer decision and rejecting Change Application 89-74 (a35402) on the basis of Applicants' failure to show unappropriated water in the source or the Change
Application's potential interference with existing water rights;
For all costs, including attorney's fees incurred in prosecuting this action (except as against the State Engineer); and
For such other relief as the court may deem just and proper.
2. With respect to the Second Cause of Action, Plaintiff prays for the following relief: a. For an order of the Court overturning the State Engineer decision and rejecting Change Application 89-74 (a35402) on the basis of Applicant's failure to show their proposed feasible; b. For all costs, including attorney's fees incurred in prosecuting this action (except as against the State Engineer); and c. For such other relief as the court may deem just and proper. plan is physically and economically
3. With respect to the Third Cause of Action, Plaintiff prays for the following relief: a. For an order of the Court overturning the State Engineer decision and rejecting Change Application 89-74 (a35402) on the basis of Applicant's failure to show the requisite financial ability to complete the proposed project; b. For all costs, including attorney's fees incurred in prosecuting this action (except as against the State Engineer); and c. For such other relief as the court may deem just and proper.
4. With respect to the Fourth Cause of Action, Plaintiff prays for the following relief: a. For an order of the Court overturning the State Engineer decision and rejecting Change Application 89-74 (a35402) on the basis of Applicant's failure to show their proposed plan is not for the purposes of speculation; b. For all costs, including attorney's fees incurred in prosecuting this action (except as against the State Engineer); and c. For such other relief as the court may deem just and proper. 5. With respect to the Fifth Cause of Action, Plaintiff prays for the following relief: a. For an order of the Court overturning the State Engineer decision and rejecting Change Application 89-74 (a35402) on the basis of Applicant's failure to show their proposed plan does not unreasonably natural stream environment, recreation, or public welfare; b. For all costs, including attorney's fees incurred in prosecuting this action (except as against the State Engineer); and c. For such other relief as the court may deem just and proper. DATED this affect the
day of March, 2012. FLITTON & SWENSEN
John S. Flitton Lara A. Swensen Attorneys for plaintiff
Addresses of Plaintiffs: Heal Utah 824 So. 400 W. #B 11 Salt Lake City, Utah 84101 Uranium Watch P.O. Box 466 Moab, Utah 84532 Moki Mac River Experditions P.O. Box 116 Green River, Utah 84525
Bill & June Adams P.O. Box 293 Green River, Utah 84525 Pamala Hackley HC 54 Box 3208 Castle Valley, Utah 84532 Norm Guice 5 South 500 West #312 Salt Lake City, Utah 84101 Elfreda Lou Mortensen P.O. Box 461 Glenwood Springs, CO 81602 Living Rivers P.O. Box 466 Moab, Utah 84532 Kathryn Baker P.O. Box 5093 Snowmass Village, CO 81615
Waid & Cheryl Reynolds 4983 Bonita Bay Drive St. George, Utah 84790 Lisa Rutherford 173 Painted Hills Drive Ivins, Utah 84738 Paul Van Dam 173 Painted Hills Drive Ivins, Utah 84738 Naomi Franklin 1411 Utah Street #4 Salt Lake City, Utah 84104
Kathleen Corr P.O. Box 613 Springdale, Utah 84767 Tom & Pamela Mooney 1231 West Cantamar St. George, Utah 84790 Center for Water Advocacy P.O. Box 15332 Fritz Creek, AK 99603 Utah Rivers Council 1055 East 2100 South, Suite 204 Salt Lake City, Utah 84108
Addresses of Defendants: Kane County Water Conservancy District 190 West Center Street #200 Kanab, Utah 84741
Kent Jones, Utah State Engineer 1594 W. North Temple, Suite 220 Salt Lake City, Utah 84116 Blue Castle Holdings 86 N. University Avenue, Suite 400 Provo, Utah 84601
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