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Klamath Water:  Some ranchers backing out of Agreement

By Erika Bentsen
July 3, 2014
Western Ag Reporter
Billings, MT

            Several upper basin irrigators who signed an intent to proceed with the Upper Klamath Basin Comprehensive Agreement are having second thoughts.  The validity of promises made to these upper basin ranchers in order to get their signatures on the bottom line of the Agreement are open to uncertainty.  Among numerous misgivings is a growing concern about the Landowner Entity's absolute control over private property.  In the Agreement, a Landowner Entity made up of member elected officials will be established to directly oversee irrigation and riparian improvements on individual properties.  The corporate laws of this Landowner Entity are defined in Section 554 of the Oregon Revised Statues (ORS).  Ranchers believe the language in the laws and the power granted to this new establishment are overreaching and detrimental to their personal property and freedoms.  It removes their ability to make their own management decisions, and by the attachments of liens for corporate debt to their property, it may devalue their property values permanently.  Many are concerned if the corporation is mismanaged or it proves unable to sustain itself for any reason, such as if government funding isn't approved for completed projects, the onus falls on landowners, which can lead to bankruptcy and undue hardship.

            The devil is definitely in the details.  As the new Landowner Entity is being established, some ranchers are digging deeper into the new regulations that are about to affect their land.  Furthering their growing doubts, it is now being discovered that some of the ranchers' own representatives at the settlement talks, some of whom are now in pivotal positions in the burgeoning Landowner Entity, are being paid to promote the Agreement.  This is leaving many to question how much truth was told to the public in the informational meetings held prior to the signing deadline, and others to wonder who's best interest is actually being represented today.

            No eminent domain?

            Repeatedly during the push to get upper basin ranchers' signatures, proponents were adamant that eminent domain would not be used to acquire lands in the Agreement.  However, ORS 554.080(4) clearly gives the Landowner Entity the power "To purchase, condemn by the power of eminent domain, possess and dispose of real and personal property as necessary and convenient to carry out the purposes of the corporation." 

            No easements will be placed on private property?

            Many ranchers voiced concerns that they would be forced to grant easements, especially tribal easements, to their riparian lands.  Proponents assured them that would not happen.   It would only involve a small strip of land along the water, around a hundred feet or so, but sometimes more.  Intrusion onto their land would be minimal, maybe a few visits initially and then probably once every few years.  It's all voluntary, it's not a big deal.  Proponents also downplayed the fact that the Landowner Entity is required to have tribal representation on its board.  Furthermore, ORS 554.350(b) states the corporation may "jointly acquire, control and manage any works, improvements, easement, or right of way necessary to fulfill its contractual obligations."  This does not leave much room for "voluntary," "maybe," or "probably."

            Stabilized property values?

            By settling the water problems for the area, this Agreement was supposed to stabilize the plummeting land values and not continue to hurt landowners financially.  Ranchers were assured they would not be financially responsible for any fencing or riparian habitat improvement work done on their land as a result of the new requirements spawned by the Agreement.  In the finer print, however, it can be found that property titles and deeds must be altered as easements and liens will be attached to properties.  "The notice shall be recorded in the office where deeds and other instruments affecting the title to real property are recorded . . . such notice shall be a covenant to and with the corporation and its members and creditors, attaching to and running with the described land and every part thereof, granting the rights, privileges and liens [to the corporation]."  ORS 554.190(1).  This statute goes on to say "land described in the articles of incorporation shall be subject to any indebtedness incurred by the corporation, all debts and obligations of the corporation thereto and thereafter created shall be a lien upon the land described in the notice prior to every other lien attached to the land." 554.190(2).

            Once you're in YOU'RE IN

            Landowners were told to sign on to the Agreement and give it a few years.  If they decide they aren't happy with the way it's working, they can back out later.  ORS 554.300 makes this reversal of decision extremely difficult at best.  "No land can be excluded until its proportionate share of all existing debts of the corporation has been paid."  Also, it requires the vote of 2/3 majority of members present or by proxy at a regular or specially scheduled meeting to include or exclude land.  Some landowners strongly question whether or not they would be notified of these special meetings, thus allowing the Landowner Entity to "save itself" by loading the meeting with one-sided, pro corporation voters.

            With so many doubts being discussed among ranchers, the questions are endless.  Few have answers, and even fewer know where to go for the honest truth.  As more awareness of these facts are being circulated throughout the community, time will tell how much momentum will be created by the movement to withdraw from the Agreement, if it isn't already too late.




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