no. name address county amount use source qualifications

WATER MANAGEMENT BOARD MEETING

December 8, 2021

No. Name Address County Amount Use Source Qualifications

Water Permit Applications to be Considered as Scheduled 2828-2 Arrowhead Rapid City PE 2.79 cfs 167 acres Rapid Creek iq, 5 special 2829-2 City of Rapid City Rapid City PE 17.19 cfs municipal Rapid Creek 8 special 8516-3 Cedar Grove Httn Brethren Platte BL 11.11 cfs 1,236 acres Torrey Lake deferral 8527-3 Finley Family LLLP Oakes ND BN 1.78 cfs 160 acres 1 well-Middle

James:Columbia wi, wcr, iq

Unopposed New Water Permit Applications Issued Based on the Chief Engineer Recommendations

2826-2 Andy Edsen Bennington NE PE 0.033 cfs commercial 1 well-Crystalline Rock wi, wcr, 2 special 2827-2 A & B Ranch Inc Hermosa PE 3.04 cfs 212.8 acres Spring Creek lf 8515-3 Riverview LLP Morris MN CK 1.45 cfs commercial 3 wells-Pleistocene Series wi, wcr, 2 special 8533-3 BDM Rural Water System Britton ML 1.11 cfs rws 1 well-Middle James:Columbia wi, wcr, 2 special 8535-3 Jay Cutts Mission Hill YA 1.78 cfs 92 acres 1 well-Lower James Missouri wi, iq, 1 special 8536-3 Berwald Family RLLP Toronto DU 2.0 cfs 154 acres 2 wells-Pleistocene Series wi, wcr, iq 8537-3 Berwald Family RLLP Toronto DU 2.0 cfs 160 acres 3 wells-Big Sioux Brookings wi, wcr, iq 8539-3 JD Bieber Enterprises Inc Bowdle MP 1.78 cfs 120 acres 1 well-Grand wi,wcr, iq,1special 8540-3 JD Bieber Enterprises Inc Bowdle MP no add’l 70 acres 2 wells- Grand wi, iq 8541-3 Townsend Family Farms Andover DA 1.78 cfs 90 acres 1 well-Altamont wi, wcr, iq 8542-3 Tyler Anderson Centerville TU 1.61 cfs 103 acres 1 well-Upper Vermillion

Missouri:South wi, wcr, iq, 1special

8543-3 Kokes Farms LLC Tabor YA no add’l 52 acres 1 well-Lower James Missouri wi, iq 8544-3 Ducks Unlimited Bismarck ND CL 100 AF FWP runoff lf, 2 special 8545-3 Larry Braun Farms Limited Ptr Warner BN 2.00 cfs 140 acres 1 well-Elm:South Brown wi, wcr, iq 8546-3 Brandon Valley Baseball Brandon MA 0.13 cfs 7 acres 1 well-Big Sioux:South wi, wcr, iq, 1 special 8548-3 City of Pierre Pierre HU no add’l no add’l Missouri River iq, 1 special 8549-3 James Orris Living Trust Clark CK 3.78 cfs 350 acres 3 wells-Altamont wi, wcr, iq 8550-3 Maxwell Colony Scotland YA/BH no add’l no add’l 90 AF storage dam wi, iq , 2 special 8552-3 WEB Water Development

Association Aberdeen WL 10,000 AF rws Missouri River 3 special

Qualifications: wi - well interference wcr -well construction rules iq - irrigation questionnaire lf – low flow

The audio recording for this meeting is available on the South Dakota Boards and Commissions Portal at https://boardsandcommissions.sd.gov/Meetings.aspx?BoardID=106

MINUTES OF THE 233RD MEETING OF THE

WATER MANAGEMENT BOARD REMOTE VIA AUDIO/VISUAL CONFERENCE AND

LEGISLATIVE CONFERENCE ROOM 414 500 EAST CAPITOL AVENUE

PIERRE, SOUTH DAKOTA

OCTOBER 6, 2021

CALL TO ORDER: Chairman Tim Bjork called the meeting to order at 9:30 a.m. Central Time. The roll was called, and a quorum was present. Chairman Bjork announced that the meeting was streaming live on SD.net, a service of South Dakota Public Broadcasting. The following were present either remotely or in person: Board Members: Tim Bjork, Jim Hutmacher, Leo Holzbauer, and Rodney Freeman participated in person. Peggy Dixon and Chad Comes participated remotely. Bill Larson was absent. Department of Agriculture and Natural Resources (DANR): Jeanne Goodman, Deputy Secretary, Eric Gronlund, Chief Engineer, Ron Duvall, Mark Rath, Adam Mathiowetz, Lindsey Cederburg, Vickie Maberry. Attorney General’s Office: David McVey, board counsel; Ann Mines Bailey, Water Rights Program counsel. Legislative Oversight Committee: Senator Mary Duvall, Pierre. Court Reporter: Carla Bachand, Capital Reporting Services. Public Comment Period: Caryn Lerman, Hot Springs, Randy Luallin, Hot Springs, Rodney Knudson, Hulett, WY, Miana Fay, Rapid City, Oscar Highelk, Eagle Butte, Jason Shald, Alex Dotson, Eagle Butte, Cherlyn Leach Valades, Spearfish, Jeffrey LaRive, Hot Springs, Susan Watt, Mary Helen Peterson, Hot Springs, Jean Roach, Rapid City, Lona Knight, Dupree, Merle Left Hand Bull, Rapid City, Lessa Peters, Rapid City, Cheryl Angel, Rapid City, Debra Lackey, Hot Springs, Tonia Stands, Rapid City/Red Shirt, Julie Santella, Rapid City, Debra Weishaupl, Hot Springs, Monique Mousseau, Rapid City, Nancy Tryon, Piedmont, Carol Hayse. Cancellation Considerations: John Taylor, Counsel for TransCanada Keystone Pipeline. Future Use Permit Application 8512-3, City of Aberdeen: Ron Wager, Counsel for city of Aberdeen, Robert Braun, Aberdeen water superintendent. Consider Motions and Responses Concerning Recommencement of Contested Case Hearing for the Consolidated Case in the Matter of Water Permit Application Nos. 2685-2 and 2686-2 and Ground

https://boardsandcommissions.sd.gov/Meetings.aspx?BoardID=106

Water Management Board October 6, 2021, Meeting Minutes

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Water Discharge Plan CWD 1-13, Powertech (USA) Inc.: Susan Henderson, Edgemont, Jim Sword, Hot Springs, Caryn Lerman, Hot Springs, Randy Luallin, Hot Springs, Rodney Knudson, Hulett, WY, Carol Hayse, Nemo, Rebecca Terk, Rapid City, Bruce Ellison, Rapid City, Lilias Jarding, Rapid City, Miana Fay, Rapid City, Oscar Highelk, Eagle Butte, Cherlyn Leach Valades, Spearfish, SD, P. Jeffrey LaRive, Hot Springs, Mary Helen Pederson, Hot Springs, Jean Roach, Rapid City, Lona Knight, Dupree, Lessa Peters, Rapid City, Merle Left Hand Bull, Rapid City, Sarah Peterson, Hot Springs, Cheryl Angel, Raid City, Debra Lackey Hay, Hot Springs, Tonia Stands, Rapid City, Julie Santella, Raid City, Brenda Gamache, Hot Springs, Debra Weishaupl, Hot Springs, Monique Mousseau, Rapid City, Filipa DeLeon, Rapid City, Nancy Tryon, Piedmont, Gena Parkhurst, Rapid City, Carla Marshall, Rapid City, Richard Williams, Rapid City, Matt Naasz, Rapid City, Mark Hollenbeck, Hot Springs. ADOPT FINAL AGENDA: Motion by Hutmacher, seconded by Freeman, to adopt the final agenda, as posted. A roll call vote was taken, and the motion carried with Freeman, Holzbauer, Hutmacher, and Bjork voting aye. Due to technical difficulties Comes and Dixon’s votes were unable to be heard. CONFLICT DISCLOSURES AND REQUESTS FOR STATE BOARD WAIVERS: None. ORDER APPOINTING BOARD MEMBER PREHEARING OFFICER AND ALTERNATE PREHEARING OFFICER FOR THE UPCOMING YEAR: Ann Mines Bailey reported that she had drafted the Order appointing a prehearing officer and an alternative prehearing officer. In previous years Mr. Freeman was appointed as prehearing officer and Mr. Larson as the alternate prehearing officer. Motion by Hutmacher, seconded by Holzbauer, to adopt the Order appointing Rodney Freeman as prehearing officer and Bill Larson as alternate prehearing officer. A roll call vote was taken, and the motion carried with Freeman, Holzbauer, Hutmacher, and Bjork voting aye. Due to technical difficulties Comes and Dixon’s votes were unable to be heard. ADOPT JULY 7, 2021, BOARD MINUTES: Motion by Freeman, seconded by Hutmacher, to approve the minutes of the July 7, 2021, Water Management Board meeting. A roll call vote was taken, and the motion carried with Freeman, Holzbauer, Hutmacher, and Bjork voting aye. Due to technical difficulties Comes and Dixon’s votes were unable to be heard. DECEMBER 8-9, 2021 MEETING AND LOCATION: Chairman Bjork stated that the December meeting and location would be discussed later in the meeting. STATUS AND REVIEW OF WATER RIGHTS LITIGATION: None. UPDATE ON DANR ACTIVITIES: Eric Gronlund discussed the Water Rights Program activities regarding the drought, USGS gaging stations, the state’s observation well network, new observation wells and data loggers in the Tulare Western Spink and Tulare East James aquifers, compliance checks on permits that were suspended by the board because of irrigation questionnaire violations, and permits for businesses in the Rockerville area.


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Mr. Gronlund introduced Lindsey Cederberg, a newly hired engineer in the Water Rights Program. He also noted that engineers Timothy Magstadt and John Farmer had left the department. PUBLIC COMMENT PERIOD IN ACCORDANCE WITH SDCL 1-25-1: Chairman Bjork stated that anyone wanting to make public comments would be allowed three minutes apiece. He noted that the public comments are not recorded by the court reporter. The following offered public comments: Caryn Lerman Randy Luallin Rodney Knudson Miana Fay Oscar Highelk Jason Shald Alex Dotson Cherlyn Leach Valades Jeffrey LaRive Susan Watt Mary Helen Peterson Jean Roach Lona Knight Merle Lefthand Bull Lessa Peters Cheryl Angel Debra Lackey Hay Tonia Stands Julie Santella Debra Weishaupl Monique Mousseau Nancy Tryon Carol Hayse ADMINISTER OATH TO DANR STAFF: The court reporter administered the oath to DANR staff who intended to testify. CANCELLATION CONSIDERATIONS: Mr. Duvall reported that prior to the meeting, the board members received the board packet, which included a table listing the proposed cancellations, the notices of cancellation, and the chief engineer’s recommendations. Thirteen water rights/permits were scheduled for cancellation. The owners were notified of the hearing and the reasons for cancellation. The department received no comments or letters in response to the notices of cancellation. John Taylor with Taylor Law Firm was present on behalf of TransCanada Keystone Pipeline LP. He stated that TransCanada Keystone Pipeline’s federal permit was revoked on January 9, 2021. On June 9, 2021, TC Energy confirmed its decision with the government of Alberta to terminate the project. Mr. Taylor stated that TransCanada Keystone Pipeline LP, in accordance with its


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administrative responsibility, has requested that the board cancel Permit Nos. 1986-1, 2792-2, and 2793-2 due to termination of the pipeline project. The following water rights/permits were recommended for cancellation for the reasons listed in the table.

Number

Original Owner

Present Owner(s) & Other Persons Notified

Reason

DIVISION I WATER PERMITS PE 1962A-1 ECB LLC, Elton Bierman Same Abandonment PE 1986-1 TransCanada Keystone

Pipeline LP John Taylor w/Taylor Law Firm

Abandonment

DIVISION II WATER PERMITS PE 2792-2 TransCanada Keystone

Pipeline LP John Taylor w/Taylor Law Firm

Abandonment

PE 2793-2 TransCanada Keystone Pipeline LP

John Taylor w/Taylor Law Firm

Abandonment

DIVISION III WATER PERMITS AND WATER RIGHT VR 721-3 Town of Strandburg Same (%Tammy Rufer,

Finance Officer) Abandonment/Forfeiture

RT 2406-3 Medary Creek Ranch (% Darrell Deboer)

Same Abandonment/Forfeiture

PE 5181-3 Cold Springs Granite Co Same (%Steven Chouanard) Abandonment PE 5564-3 Cold Springs Granite Co Same (%Steven Chouanard) Abandonment PE 7074A-3 Calvin Hanson Same Non-Construction PE 7520-3 John Gunderson Same Abandonment/Forfeiture PE 7644-3 John S Donnelly Same Non-Construction PE 7655-3 Thomas Brady Same Non-Construction PE 7784-3 Koletzky Family Ltd (%

Robert Koletzky) Same Non-Construction

PE 7989-3 Tetonka LLP (% Jeffrey Oyen)

Same Non-Construction

PE 8020-3 Dustin Reiff Same Non-Construction PE 8170-3 Jerald Zubke Same Non-Construction PE 8171-3 Friessen Construction Co Inc Same (% Cindy Friessen

Monnin, President) Abandonment

PE 8353-3* Oscar Inc (Floyd Peterson) Same Abandonment

*The diversion authority & acreage under No. 8353-3 were transferred three miles NW of the permitted area and are now authorized under Permit 8353A-3.


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Motion by Freeman, seconded by Hutmacher, to accept the chief engineer’s recommendations for cancellation of the thirteen water rights/permits for the reasons listed. A roll call vote was taken, and the motion carried unanimously. CONSIDER FUTURE USE WATER PERMIT APPLICATION NO. 8512-3, CITY OF ABERDEEN: Mark Rath reported that Future Use Permit Application No. 8512-3 proposes to reserve for future use 6,154 acre-feet of water at a diversion rate of 8.5 cubic feet of water per second (cfs) from the James River. SDCL 46-2A-10 and 46-5-38.1 set out the criteria and conditions under which a future use permit may be approved and ARSD 74:02:01:24.01 defines the limits the Water Management Board may place on a future use permit. The James River diversion site is located approximately 10 miles northeast of Aberdeen SD in Brown County. The water is to be reserved for future water supplies for municipal use by the city. As part of the application, the city provided a consultant’s report demonstrating that the city’s average annual use is expected to increase from 4,290 acre-feet as of 2017 to 6,090 acre-feet by the year 2045. In 1965, the SD Water Rights Commission, a predecessor to the SD Water Management Board, placed maximum diversion limits over reaches of the James River in South Dakota. A 300 cfs diversion limit restriction applies to the river reach between the North Dakota border to the Yankton-Hutchinson County Line (Water Rights. 2021). Of this restriction, a 200 cfs diversion limit restriction was placed from the North Dakota border to the USGS gaging station in Huron, SD. The SD Water Management Board has adopted these diversion limits. Mr. Rath stated that if this future use permit is approved, it will leave 1.1 cfs of the 300 cfs limit remaining for future appropriation for the James River reach from the North Dakota border to the Yankton-Hutchinson County Line. The chief engineer recommended approval of Future Use Water Permit Application No. 8512-3, city of Aberdeen with the following qualifications: 1. Future Use Permit No. 8512-3 reserves 6,154 acre-feet of water annually from the James

River. 2. That Future Use Permit No. 8512-3 is approved with the stipulation that this permit is subject

to review by the Water Management Board as to accomplishment in developing reserved water upon expiration of seven (7) years. This permit shall be subject to cancellation if the Water Management Board determines during the review that the holder cannot demonstrate a reasonable need for the Permit.

3. At such time as definite plans are made to construct works and put the water reserved by this

permit to beneficial use, specific application for all or any part of the reserved water must be submitted prior to construction of facilities pursuant to SDCL 46-5-38.1.


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Ron Wager, Aberdeen city attorney, and Bob Braun, water superintendent, were available remotely to answer questions. There were no questions from the board. Motion by Hutmacher, seconded by Holzbauer, to approve Future Use Water Permit Application No. 8512-3, city of Aberdeen with the qualifications set forth by the chief engineer. A roll call vote was taken, and the motion carried unanimously. CONSIDER WATER PERMIT APPLICATION NO. 8523-3, NICK & SCOTT BEBO: Mr. Rath reported that Water Permit Application No. 8523-3, proposes to appropriate 1.10 cubic feet of water per second (cfs) from the James River for irrigation of an additional 154.6 acres. The diversion site is located approximately 5 miles northeast of Redfield SD in Spink County. The applicant currently holds Water Right No. 1172-3, which authorizes 1.50 cfs from the James River to irrigate 105.4 acres. This application, if approved, and Water Right No. 1172-3 combined will authorize a total of 2.60 cfs and irrigation of 260 acres. Mr. Rath noted that since this application is from the James River, the 300 cfs limit applies. If this application is approved 0.01 cfs of the 300 cfs limit will remain. Mr. Rath stated that since the board just approved the Future Use Permit Application for the city of Aberdeen, that water could be appropriated on a temporary basis. For example, if an application to irrigate is submitted, the board could approve the application as a temporary use permit, but if the city of Aberdeen were to construct and place to beneficial use water reserved from their future use, the temporary use permit will become subject to cancellation upon six months notice to the permit holder. The chief engineer recommended approval of Water Permit Application No. 8523-3, Nick and Scott Bebo with the following qualifications:

1. This permit does not authorize diversion of water from the James River after August 10th of each calendar year, or at any time the river’s flow is obviously low, unless written orders have been issued by the Chief Engineer. Diversions under this permit are subject to senior water rights and any written orders issued by the Chief Engineer.

2. This permit does not authorize diversions from the James River when there is less than 20 cfs bypassing the gage at Huron, SD after pumping.

3. This Permit is approved subject to the irrigation water use questionnaire being submitted each year.

Motion by Freeman, seconded by Hutmacher, to approve Water Permit Application No. 8523-3, Nick and Scott Bebo, as a temporary use permit subject to the qualifications set forth by the chief engineer. A roll call vote was taken, and the motion carried unanimously. CONSIDER MOTIONS AND RESPONSES CONCERNING RECOMMENCEMENT OF CONTESTED CASE HEARING FOR THE CONSOLIDATED CASE IN THE MATTER OF WATER PERMIT APPLICATION NOS. 2685-2 AND 2686-2 AND GROUND WATER DISCHARGE PLAN GWD 1-13, POWERTECH (USA) INC.: Chairman Bjork stated that at this


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time the board would hear the motions and oral arguments regarding recommencement of the contested case hearing. Board member Comes recused himself due to prior commitments. Appearances Matt Naasz and Rich Williams, counsel for Powertech (USA) Inc. Ann Mines Bailey, counsel for DANR Water Rights Program and Surface Water Quality Program Bruce Ellison, counsel for Clean Water Alliance Steven Gunn, counsel for Oglala Sioux Tribe Tom Ballanco, counsel for the Institute for Range and the American Mustang and Susan Watt Matt Naasz, counsel for Powertech, requested that the board recommence the contested case proceedings that were continued in 2013. In 2012, Powertech submitted applications for two water permits and one Ground Water Discharge Plan permit in connection with the proposed in-situ uranium mining operation in the southwest corner of South Dakota called the Dewey Burdock Project. These three permit applications were consolidated for hearing. After several days of testimony, Powertech filed a motion to continue the matters until such time as federal permits were issued from the Nuclear Regulatory Commission (NRC) and the Environmental Protection Agency (EPA). Powertech filed its motion to continue in order to narrow the issues before the Water Management Board so that the board would not have to revisit issues addressed at the federal level. Mr. Naasz stated that those permits have now been issued, and Powertech is now requesting the opportunity to proceed with the contested case hearing. The license issued to Powertech by the Nuclear Regulatory Commission has been appealed to the DC Circuit of Appeals. The Underground Injection Control (UIC) permits approved by the EPA and the Aquifer Exemption permit have also been appealed. These permits have been issued, they are in final form, they can be read, and they identify the issues addressed at the federal level, and therefore, allowing the Water Management Board to identify which issues it does not need to reconsider. The financial assurances have been set by the various federal agencies, which was another question that arose during the 2013 proceedings. During the public comment period earlier in the board meeting there was a suggestion that Powertech is requesting 9,000 gallons of water per minute. While that is the amount listed on the application, 98 percent of the requested appropriation will be recirculated resulting in a net consumptive amount of approximately 2 percent of that 9,000 gallons of water per minute. There is no legal impediment or restriction on the Water Management Board regarding considering these three applications at this time. Powertech should have the opportunity, like every other applicant for its surface water discharge permit or water permit, to have its application heard by the Water Management Board, to have the relevant testimony of intervenors heard by the board, and for Powertech’s application to be decided upon on the merits by the board. Prior to the 2013 hearing on these applications, a procedural order was entered. The procedural order contained dates for completion of discovery, designation and disclosure of expert witnesses and expert reports, disclosure of witnesses, disclosure of exhibits, and it also described how the hearing process would proceed. The disclosure deadlines have passed, the Class B intervenors testified and were cross-examined. One witness testified for Powertech, and cross-examination of that witness had begun.


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Mr. Naasz requested that the Water Management Board consider its March 2022 regularly scheduled meeting as an appropriate time to recommence these proceedings. He also requested that the board amend the procedural order to provide a prompt and reasonable schedule for the resolution of this matter. Powertech filed a motion for a status conference in this matter in April 2021. It has been six months between that date and today’s meeting. Powertech finds itself in a classic Catch 22 position. At the federal level, the permits are on appeal. At that level, in briefing, both agency and intervenors point to the fact that further delays at the federal level won’t prejudice Powertech because they don’t have their state permits. The Board of Minerals and Environment, to whom Powertech also filed an application for a large-scale mining permit in the 2012-2013 timeframe, has entered an order indicating that it will not consider Powertech’s large-scale mining permit application until such time as the Water Management Board addresses the water appropriation issues. Armed with a decision from the Water Management Board on the relevant evidence and on the merits, Powertech can then go before the Board of Minerals and Environment and have its large-scale mining permit application heard. With the South Dakota Water Management Board permits and the South Dakota Board of Minerals and Environment large-scale mining permits, Powertech can proceed with pre-operation activities on the ground at the Dewey Burdock Project. Mr. Naasz requested that the board recommence the hearing on the permit applications. Ann Mines Bailey stated that in November 2013, Powertech requested continuance of this matter so it could obtain the federal permits. Powertech needs to obtain several federal permits: Materials License from the NRC, Class III and Class V well permits and an Aquifer Exemption from EPA, and a Plan of Operations approval from the Bureau of Land Management (BLM). Just as it was in 2013, it is in the board’s discretion to determine whether a motion to continue should be granted or denied. In granting that order, the board did not divest itself of any authority or jurisdiction over this matter, so it remains within the board’s jurisdiction to determine whether that continuance of the hearing should continue or if the hearing should resume at this time. Ms. Mines Bailey said the department respectfully disagrees with Powertech and its attorneys as to whether the federal permits have been resolved. The NRC has issued its permits, and those permits are under appeal before the Court of Appeals of the District of Columbia. That matter has been fully briefed and is set for oral argument before the Court of Appeals on November 9, 2021. There is no date-certain for when the Court of Appeals will hand down a decision. The Materials License was initially issued by the NRC in 2014. It went through an appeals process and was eventually remanded to the NRC for further proceedings. That subsequent license is now on appeal. The EPA granted an Aquifer Exemption in November 2020. The Aquifer Exemption is on appeal to the Circuit Court of Appeals for the Eighth Circuit, and the Eighth Circuit is holding that case in abeyance until the Class III and Class V well permits have been resolved. The EPA has issued those permits, but the EPA provides for different levels of review within the agency and one of those levels of review is with the Environmental Appeals Board (EAB). The EAB now has those permits and is holding off on making a decision until the Court of Appeals with the District of Columbia has ruled on the NRC licensing because there are similar issues. Regarding the Plan of Operations approval, the BLM took comments in August 2020, and there is no indication as to where that is in the process. Ms. Mines Bailey said she understands from Powertech’s pleadings that approval of the Plan of Operations is not considered an essential portion of the permitting process. To most people in this context, the word resolve would mean to have the permits in hand


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and to be able to commence with the operations. The meaning of resolve is to reach a firm decision or determination. The position of the Water Rights Program and the Surface Water Quality Program is that the issue with the permits has not been resolved. Because the department feels that the terms of the original order have not been met and it would be appropriate to continue holding this case is abeyance. The board has an inherent authority to manage its docket and to decide whether it is appropriate to proceed. Prior to Powertech’s motion to continue the hearing, several of the intervenors filed a motion to continue on the grounds that the federal permits should be obtained before proceeding with the state permits. That motion was denied. Although Powertech has the right to have their applications heard in a timely fashion, they consented to a delay. They did not waive their entire right to be heard, but they consented to a delay and in doing so, they changed the landscape. It has now been eight years since the hearing began. The Water Rights Program now has a new chief engineer and the engineer who wrote the original report has retired. The Water Rights Program will have to recreate a lot of the information. Powertech has different legal counsel representing them. Ms. Mines Bailey requested that the board continue the hearing until the federal permits have been finalized. Steven Gunn, counsel for the Oglala Sioux Tribe, stated that the Oglala Sioux Tribe has a significant interest in this proceeding. The tribe is an “A” intervenor with full rights as a party. The water resources subject to the proposed Powertech permits are located on lands within the unceded territory of the Great Sioux Nation of which the Oglala Sioux Tribe is a constituent tribe. The Oglala Sioux Tribe has been actively engaged in working to protect its significant water, land, and cultural resources from impacts threatened by the proposed Dewey Burdock mine since 2010. The Oglala Sioux Tribe agrees, in principle, with the arguments opposing reinitiating of any proceedings filed by the South Dakota Attorney General’s Office on behalf of the Water Rights Program and the Surface Water Quality Program as well as the Black Hills Clean Water Alliance. The Oglala Sioux Tribe concurs that moving forward with these complex proceedings at this time would risk wasting an enormous amount of party and agency resources on proceedings dealing with permits applications that may be substantially altered as a result of ongoing federal, judicial, and administrative reviews of the Dewey Burdock mine proposal. In its November 19, 2013 motion to continue, Powertech asserted that the board’s granting of the continuance “will serve to significantly narrow the issues before the board” primarily because the resolution of the federal permits will provide certainty as to whether and how the mine will be developed. However, because each of the four federal permits and licenses at issue are still under both administrative and federal court litigation, including as to fundamental aspects of the groundwater use and disposal, that certainty has not been achieved, specifically, with respect to the EPA UIC permits. In accordance with EPA regulations, those permits have been stayed and rendered ineffective pending resolution of the issues presented by the Oglala Sioux Tribe before the EPA’s Internal Administrative Environmental Appeals Board (EAB). The EAB process has been stayed pending resolution of the Oglala Sioux Tribe’s challenge to the U.S. Nuclear Regulatory Commission license in the U.S. Circuit Court for the District of Columbia. Regardless of how the EPA’s internal administrative review through the EAB is resolved, EPA regulations require that EPA staff must take affirmative additional action before the permits can be labeled issued or effective, let alone final. The Oglala Sioux Tribe’s challenge to the NRC license is scheduled for oral argument before


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the court on November 9, 2021, thus the issues are nearing resolution and there’s no need to rush the Water Management Board’s process when the need for focus that forms the basis of Powertech’s original motion to continue is reasonably close at hand. Bruce Ellison, counsel for Clean Water Alliance, stated that Clean Water Alliance is an “A” intervenor. Powertech seemed to suggest that the idea of a continuance until the federal matters were done was at their discretion. Counsel for the Water Rights Program suggested that a previous motion filed by the intervenors, including Clean Water Alliance, for a continuance had been denied. In the 2013 order, Hearing Chair Freeman specifically noted that all intervenors who recently filed submissions regarding the board’s jurisdiction and authority over Powertech’s pending applications have requested that the board continue the hearing pending resolution of Powertech’s federal applications regarding the Dewey Burdock Project. Intervenor’s position is consistent with their previous motions to continue the hearing. (Exhibit 2, order granting Powertech’s motion to continue dated November 25, 2013). In the order, Mr. Freeman found that there would be no prejudice to the parties and that until resolution by the federal agencies of Powertech’s pending applications these matters would be stayed. The decision of the NRC, which includes the integrity of the environmental analysis, is pending in front of the DC Court of Appeals. It has already been remanded once and it could be remanded again or reversed. An opinion by the DC Circuit could take months. Mr. Ellison stated the Clean Water Alliance opposes Powertech’s motion to amend the procedural order and recommence the hearing. He requested that the board hold a status hearing on these matters in a year or put it off indefinitely until the federal matters are resolved. Tom Ballanco, counsel for the Institute for Range and the American Mustang and Susan Watt with the Wild Horse Sanctuary, stated that there are many pending permit issues at the federal level that remain unresolved, foremost is the hearing pending before the DC Circuit. The license that was issued in the NRC was amended by the Atomic Safety and Licensing Board panel to add a condition that prior to beginning operation Powertech identify and plug thousands of abandoned boreholes in the proposed project area that were identified by leaks in the pumping test data from TBA in the 1970’s and from recent pumping tests conducted as part of the NRC licensing. There are many things that have to take place prior to the Water Management Board weighing in and expending considerable time and resources. Mr. Ballanco said it is in the best interest of the board and Powertech that this proceeding remain stayed until resolution of those federal issues. Martin Meyer, intervenor, said he would echo the sentiments of most of the public comments and Ms. Mines Bailey, Mr. Gunn, Mr. Ellison, and Mr. Ballanco. He asked that the hearing be continued. Dr. Lilias Jarding, intervenor, stated that Powertech’s parent company is not merging with an American mining company; it is being bought out by another Canadian company. Dr. Jarding questioned how the board would handle the witnesses and evidence already presented in 2013 if it were to allow a re-start of the proceedings. She noted that one of the expert witnesses she relied on has passed away since 2013 so there will be new experts and new evidence, and the hearing should be open to new intervenors as well. Dr. Jarding asked that the board keep people on the intervenor


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list who replied after the deadline to update addresses because those people have the right to participate in the process. Powertech is complaining about a situation that it helped to create. If Powertech feels that it is a Catch 22, they could have objected anytime between now and eight years ago. If they dislike what they consider a Catch 22, they hold the keys to an easy solution, which would be to withdraw its applications for the state permits until the federal process is done and we know if there was even a need for applications for new water permits. Ms. Jarding said she opposes the motion to continue the process. Sara Peterson, intervenor, stated that Powertech has no permits. They have none of the nine permits that they need to start mining. Both the EPA and NRC permits are in litigation. Ms. Peterson said she supports the recommendations of the Ms. Mines Bailey, Mr. Gunn, Mr. Ellison, and Mr. Ballanco and everyone else that is against restarting the hearing. Gina Parkhurst, intervenor, stated that Powertech claims that their federal permits have been issued. The permits from the BLM have not been issued. Other federal permits are not free and clear to use. Ms. Parkhurst said she supports the state’s recommendation not to proceed with the Powertech water permit hearing. Many intervenors have died or moved out of state since 2013 and new residents are coming into the state. The South Dakota State Constitution says that the water in the state belongs to the people of the state, so it makes sense to open the hearing up to new intervenors. Brenda Gamache, intervenor, asked the board not to restart the hearing. Susan Henderson, intervenor, objected to the recommencement of the hearing for Powertech. Mary Helen Peterson, intervenor, requested that the hearings not recommence. Carla Marshall, intervenor, requested that the board not recommence the water permit hearing as it would be premature and contrary to principles of judicial economy given its pending and incomplete federal permits and license applications. She said it would be in the best interest of the state of South Dakota and the people of South Dakota for the board to open the hearing to new intervenors due to the length of time that has passed. She asked the board to deny Powertech’s request to amend the scheduling order. Julie Ames Curtis, intervenor, requested that the board deny Powertech’s request to recommence the hearing and that the board allow more intervenors to join hearing. Rebuttal Mr. Naasz stated that in its presentation DANR indicated that Powertech consented to a delay by filing its motion to continue in 2013. He read the following from Powertech’s motion, “Comes now applicant, Powertech (USA) Inc. and moves the hearing chair to continue the December 9, 2013 in these matters until 1) the US Nuclear Regulatory Commission staff has issued a source and by-product material license to Powertech for the Dewey Burdock Project and has determined the financial assurance, and 2) the US Environmental Protection Agency has made aquifer exemption determinations and issued underground injection control Class III and Class V permits to Powertech for the Dewey Burdock Project and has determined the financial assurance.” Mr. Naasz stated that


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the permits have been issued and the financial assurances have been determined by those agencies. The motion does not request that this matter continue until such time as the BLM acts. The November 25, 2013 order by Mr. Freeman states, “It is hereby ordered that Powertech’s motion to continue is granted.” It does use the term “resolved” but if DANR’s legal position to deny Powertech the opportunity to move forward is premised on Powertech’s consent to delay, that consent hinged on issuance of permits and determination of financial assurances. Those have all been addressed. The board has heard that the DC Court of Appeals will hear oral argument on the NRC permit on November 9, 2021. The board has also heard that after that oral argument, there will be additional proceedings. The board has not heard any legitimate reason why the federal appeal process and the state permitting process can’t be maintained and proceed in parallel. Mr. Naasz said the board has been asked to deny the motion to move forward because it is the easy thing to do, but Powertech has the right to have its applications heard on the merits. The review that the Water Management Board will undertake is limited to the state statutes regarding availability of water, impairment of existing rights, and public interest; not the issues that the different federal appellate courts and agencies are dealing with. Powertech’s motion to continue, if that is what the authority to further delay these proceedings is based on, could have requested that this matter be delayed until final agency action. Additionally, an order could have stated that these matters are continued until final agency action or final agency from those courts of appeals who may consider the issues. Neither the motion nor the order said that. Mr. Ellison requested that this be put off for a year or indefinitely until the agencies and courts have made final decisions on this matter. That is a clear effort to delay the Water Management Board from hearing this matter indefinitely. As identified by the board eight years ago and as agreed to by DANR in their briefing, there is no legal impediment or no reason preventing moving this matter forward now. As Ms. Mines Bailey identified in her presentation, this board has never before said “we’re not going to hear your state permit until all your other permits are in line.” Mr. Naasz asked that the board not overlook the precedent in doing that now by saying that Powertech does not have the right to have their application heard because everything else, over which this board has no jurisdiction, has not been decided. Mr. Naasz requested that the board schedule a date for hearing on these matters. Ms. Mines Bailey stated that the Water Management Board does not have any other litigation that has been on hold for eight years. The determination of whether to resume these proceedings is within the board’s discretion. The board has the duty and the opportunity to examine the different interests. While the applicant clearly has an interest to be heard on the merits in a timely fashion, they did consent to a delay. The department disagrees about whether the reason for that delay that Powertech consented to has concluded. Ms. Mines Bailey said she does not believe the board would be setting a precedent by delaying continuation of the hearing. The department’s position is not to delay these proceedings indefinitely. Ms. Mines Bailey said several comments were made about reopening the intervention process and requiring a new application process. The department’s position is that the process cannot be opened for further intervention under the state statutes. Under the state statutes for water rights, there is a specific statute that allows for the transfer of an application when the interested party changes hands. Under the statute, the board has the option of granting an application, denying an application, or deferring an application, but Ms. Mines Bailey said she is unable to locate any authority that would allow the board to require a new application. Regarding a new application for the groundwater discharge plan, there is no specific statute, but a certification of applicants is required, but that does not trigger the need for a new application.


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Mr. Ellison stated that Powertech made a motion, and they are trying to limit it to simply the EPA and the NRC; however, there are also the BLM permits. When the Water Management Board decided in 2013 to continue the proceedings, it granted Powertech’s motion. The order ultimately concluded that the hearing would be continued until all pending federal applications are completed. The board had already decided that they do not want to duplicate efforts. Mr. Ellison said there have been NRC hearings that have taken years, and he can’t understand the idea for judicial economy and the resources, that we have too few of, to make the administrative decisions that need to be carefully decided. The board could spend weeks conducting the hearing, then two years from now a federal court or agency says “no.” One of the reasons the EPA asked for an extension of time in the administrative process was not only the DC Circuit decision, but there is also a new administration that seems to be looking at things differently that the previous administration. That alone could change what EPA does. Mr. Ellison asked how much we are going to do to satisfy Powertech’s needs when they can’t do anything with the water permit anyway. They haven’t plugged the bore holes and they haven’t shown they are ready to start. Why waste time and resources until this matter is decided by people who have looked at it very carefully after many days of hearings and whether the propriety of those decisions stand up to the law. Mr. Ballanco stated that the order staying these proceedings and the practical matter that when these federal issues are resolved makes the Water Management Board’s role easier. It makes sense to continue this stay, and it is in the board’s best interest to continue this stay until there is actual resolution. Chairman Bjork requested board questions and discussion. In response to questions from Mr. Hutmacher, Mr. Naasz stated that the BLM’s authority only exists on its portion of a lease that Powertech would have with them. Powertech intends to plug the old boreholes before operations begin because that is a condition of the NRC permit. Mr. Naasz said he is not in a position to discuss a specific timeline today. If the Water Management Board authorizes this permit, Powertech will go back to the Board of Minerals and Environment and request that the large-scale mining permit hearing resume. If the permit is approved, that will allow Powertech to open up the property, which will then permit them to start operations, including plugging the boreholes. There were no other questions from the board. Chairman Bjork requested a motion. Motion by Freeman, seconded by Hutmacher, to deny the motion to reopen the hearing and to wait, as the original order stated, until the federal issues are resolved to the board’s satisfaction. Mr. Freeman stated that this motion should not be construed by any of the parties as a window into the merits of the case. He said he does not believe it is appropriate for the state of South Dakota and the Water Management Board to spend millions of dollars once again on an issue, then have the rug pulled out from under them after the board has made a decision. Mr. Freeman said he believes that is a cowardly approach to make possibly some future board deal with issues that could be confronted now, but in this circumstance, it does not make sense for this board to move forward when the federal appeals court and the other agencies could pull the rug out from under the board.


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Mr. Freeman said he agrees that this a unique situation, and he does not believe the board is sending a message to the citizens of the state that want to apply for a permit that every other permit on the federal and state level needs to be obtained before the board will discuss it. This is a unique situation and, based on the board’s recent experience, Mr. Freeman said he does not want to go through that again. Mr. Hutmacher stated that he agrees with Mr. Freeman. After the board’s experience with the pipeline matter when one stroke of the pen jerked the rug out from under the board after spending months working on that project, it was disheartening. Mr. Hutmacher said he knows that Powertech has the right to have a speedy hearing of the permit applications, and he agrees with that, but he is not comfortable at this point to proceed. He suggested that the board revisit this matter in six months to a year. Mr. Freeman agrees that a status report within six months to a year would be appropriate. There was no other board discussion. Chairman Bjork requested a vote on the motion. A roll call vote was taken, and the motion carried unanimously. Mr. McVey will prepare an order regarding the board’s decision. The order will also set the date of the status report and specifying that the notice of the status report be sent to the updated intervenors list. Mr. Ellison stated that, on behalf of the Clean Water Alliance, he had submitted a motion to permit electronic service. Allowing electronic service would reduce time and the cost of copying and mailing of documents. Chairman Bjork asked if the statute states that the information has to be mailed. Mr. Ellison said in the past electronic filing was permitted then there seemed to be a decision a couple of years ago to paper documents being mailed. He said the original pleading has to be filed on paper in writing with the chief engineer. Ms. Mines Bailey stated that SDCL 46-2A-6 requires that the originals of all pleadings including petitions to contest, petitions to intervene, and motions shall be filed with the chief engineer and served upon other parties, either personally or by mail. ARSD 74:50:02:07 requires mailing the original of any petition, motion, or other pleadings shall be filed with the department. Ms. Mines Bailey stated that in the TransCanada matter, the board allowed for intervenors to accept service by electronic email; however, they were supposed to opt into it. Ms. Mines Bailey said she did not opt into it because as an office policy, she must receive a paper copy. She noted that in that case she did not receive several of the pleadings through either email or the U.S. Postal Service. Ms. Mines Bailey said the department opposed Mr. Ellison’s motion to permit electronic service because of the statute and administrative rules and because of the pragmatic problem of actually receiving service through email.


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Mr. Ellison asked if the statute says, “by U.S. Mail” or “by mail.” Ms. Mines Bailey answered that the statutes states, “by mail” and the statute was promulgated in 1983 when email was not yet contemplated. Mr. Ellison urged the board to exercise its authority to interpret mail to be either U.S. mail or email. Richard Williams stated that Powertech agreed with the department regarding the statute. Mr. Hutmacher suggested that the board request an official opinion from the Attorney General regarding whether mail means email or U.S. Mail. Mr. McVey stated that from a pragmatic concern he is not aware that the board has a record of all the email addresses for all intervenors or if all the intervenors even have access to email. Essentially, the department would have to obtain email addresses from all the intervenors. That pragmatic concern coupled with the fact that sending a letter to a group of intervenors to try to get them provided with electronic mail when those addresses may be stagnant. Motion by Freeman, seconded by Holzbauer, to deny the motion to permit electronic service. A roll call vote was taken, and the motion carried unanimously. December 8-9, 2021, Meeting Location: The December meeting will be held in Pierre. ADJOURN: Motion by Holzbauer, seconded by Dixon, to adjourn. Motion carried unanimously. Chairman Bjork declared the meeting adjourned. A court reporter was present, and a transcript of the proceedings may be obtained by contacting Carla Bachand, Capital Reporting Services, PO Box 903, Pierre SD 57501, telephone number (605) 222-4235. The audio recording for this meeting is available on the Boards and Commissions Portal at https://boardsandcommissions.sd.gov/Meetings.aspx?BoardID=106. Approved on the 8th day of December 2021. Water Management Board

https://boardsandcommissions.sd.gov/Meetings.aspx?BoardID=106

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WATER MANAGEMENT BOARD MEETING

October 6, 2021

Unopposed New Water Permit Applications Issued Based on the Chief Engineer Recommendations


2007-1 Ridge on Lookout Mt Homeowners Association

Spearfish LA 0.078 cfs wds 1 well-Minnekahta Aquifer wi, 2 special

2008-1 City of Lead Lead LA 0.022 cfs industrial 1 well-Deadwood Aquifer wi, 2 special 2817-2 Aspen Meadows Horse &

RV Campground Box Elder CU 0.10 cfs commercial 1 well-Crystalline Rock wi, 2 special

2819-2 Fall River Water Users Dist. Oral FR 0.09 cfs rws 1 well-Inyan Kara wi, 2 special 2820-2 Jim & Crystal Wiese Keystone PE 0.044 cfs commercial 2 wells-Crystalline Rock wi, 2 special 2821-2 Valerie Lauen Rapid City PE 0.017 cfs commercial 1 well-Crystalline Rock wi, 2 special 2822-2 Johnson Land & Cattle LLC Cody NE BT 2.56 cfs 180 acres 1 well-Ogallala Aquifer wi, wcr, iq 2823-2 Steve Zwetzig Rapid City PE 0.033 cfs commercial 1 well-Crystalline Rock wi, 2 special 2824-2 Cosmos of the Black Hills Rapid City PE 0.011 cfs commercial 1 well-Crystalline Rock wi, 2 special 8510-3 TR Golf LLC Dakota Dunes UN 1.11 cfs no add’l acres 1 well-Dakota Aquifer wi, wcr, iq,1special 8511-3 Bowes Construction Inc Brookings BG 1.67 cfs industrial 1 pit/lake-Big Sioux:Aurora wi, 4 special 8513-3 John S Donnelly Vermillion CL 1.78 cfs 179 acres 1 well-Missouri:Elk Point wi, wcr, iq 8514-3 Tyler Childress Sioux Falls MA 0.044 cfs commercial 1 well-Split Rock Creek Aqu wi, iq, 1 special 8517-3 Bratberg Family Protection Gayville YA 1.78 cfs 132 acres 1 well-Missouri:Elk Point wi, wcr, iq 8518-3 Bryce Sombke Conde BN 0.033 cfs recreation/fwp 1 well-Dakota Aquifer wi, wcr, 3 special 8519-3 Melvin Donnelly Elk Point UN 1.78 cfs 70 acres 1 well-Missouri:Elk Point wi, wcr, iq,1special 8520-3 City of Aberdeen Aberdeen BN 0.33 cfs recreation/fwp 2 wells-Elm:Southern Brown wi, 2 special 8521-3 CBM Land & Cattle Clear Lake DU 1.78 cfs 200 acres Lake Alice iq, 4 special 8522-3 Mooody County Dairy LP Sioux Falls MA 0.333 cfs commercial 1 well-Split Rock Creek Aqu wi, 4 special 8324-3 Samantha Hagedorn Yankton YA 1.78 cfs 72 acres 1 well-Lower James Missouri wi, iq, 1 special 8525-3 Banner Farms RE LLC Pipestone MN BD 0.22 cfs commercial 2 wells-Dakota Aquifer wi, 5 special 8526-3 L G Everist Inc Sioux Falls MA 3.33 cfs industrial pit-Big Sioux:South Aquifer wi, 2 special

(continued)

Qualifications: wi - well interference wcr -well construction rules iq - irrigation questionnaire lf - low flow

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8527-3 Finley Family LLLP Oakes ND BN 1.78 cfs 160 acres 1 well-Middle James Columbia wi, wcr, iq 8528-3 Bluestem Family Farms LLC Pipestone MN DN 0.223 cfs commercial 3 wells-Dakota Aquifer wi, wcr, 5 special 8529-3 Chico Ag LLC Elk Point UN 1.78 cfs 110 acres 1 well-Missouri Elk Point wi, wcr, iq,1 special 8530-3 Nat’l Field Archery Assoc. Yankton YA no add’l 7 acres 1 well-Missouri Elk Point wi, iq 8531-3 Old Tree Dairy Volga BG 2.22 cfs 222 acres 1 well-Big Sioux:Brookings wi, wcr, iq 8532-3 Brehmer Family Farms LLC Hoven WL 0.044 cfs 2 acres 1 well-Bowdle:Hoven North wi, iq 8534-3 Terry L Frick Yankton YA no add’l 23 acres 1 well-Lower James Missouri wi, iq, 1 special 8538-3 City of Springfield Springfield BH 0.98 cfs municipal Missouri River 3 special

Future Use Reviews

No. Name Address County Amount Remaining in Reserve

Use Source Qualifications

5862-3 Watertown Municipal Utilities

Watertown CD 760 AF municipal Big Sioux:North Aquifer none

no. name address county amount use source qualifications

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