APPENDIX D DEPARTMENT OF NATURAL 



RESOURCES AND CONSERVATION 



MARCRACICOT DIRECTOR'S OFFICE (406) 444-2074 



GOVERNOR TELEFAX NUMBER (406) 444-2684 



STATE OF MONTANA' 



WATER RESOURCES DIVISION (406) 444-6601 48 NORTH LAST CHANCE GULCH 



TELEFAX NUMBER (406) 444-0533 PO BOX 201601 



, HELENA, MONTANA 59620-1601 



September 2, 1998 



TO: Environmental Quality Council 



FROM: Bud Clinch, Director, Department of Natural Resources and Conservation \y 



RE: DNRC Adoption of the Final Report on Water Leasing by DFWP 



Under 85-2-436 (3)(b), MCA, the Department of Natural Resources and Conservation 

 (DNRC) and the Fish, Wildlife and Parks Commission must approve and adopt the final 

 study report on water leasing by the Department of Fish, Wildlife and Parks (DFWP). The 

 report has already been adopted by the Fish, Wildlife and Parks Commission. 



DNRC has reviewed the Water Leasing Study: Final Report of August 1998 by DFWP. 

 Based on that review, DNRC is approving and adopting the final report on water leasing. 

 In addition, DNRC supports the four recommendations that were included in the report 

 by DFWP. Those recommendations and DNRC's rationale are described below. 



1) DNRC supports making the water leasing statute permanent. After 10 years of 

 study, DFWP has proven its ability to implement instream flow leases that benefit 

 both parties to the lease and the local fisheries without impacting other water 

 users. 



2) DNRC supports increasing the 20-stream limit to an unlimited number of stream 

 reaches. As long as there are individuals willing to lease their water rights for 

 instream flow to benefit fisheries resources, without adversely affecting existing 

 water users, DFWP should be able to establish as many leases as necessary to 

 protect fisheries and especially fish species that are or could be listed under the 

 Endangered Species Act. For each lease, DFWP is required to go through the 

 statutory change process which is designed to protect all other water users on the 

 stream fix)m adverse effects. 



3) DNRC supports the need to remove DNRC's approval of the list of streams for 

 proposed instream leases. Based on the past ten years, there is no need for DNRC 

 to continue to approve each stream for leasing. DNRC's involvement in the formal 

 change process adequately addresses issues relating to DNRC's responsibility. 



