Court orders government to pay for water losses

The federal government must compensate two regional water authorities for water diverted to preserve the environment, a federal appeals court ruled this week in a landmark decision that could open the floodgates for agencies who contend the government is taking water from them for fish. After a 16-year legal battle, the 2-1 decision came down as California is coping with a drought and new environmental rules that are cutting into the water supplies of farmers and cities across the state. The ruling appears to create an opening for San Joaquin Valley farm districts that are lashing out at environmental regulations to seek payment for water lost to environmental needs. Whether the districts are entitled to recover damages from the government will depend on language in their water contracts, why specifically water was not delivered and issues beyond the scope of the decision handed down this week, lawyers said. The ruling, by the U.S. Court of the Appeals for the Federal Circuit, appears to be the first in which an appeals court has concluded the government has breached a water contract when water is diverted from contractors to environmental needs...read more