Transcript:
MR. BARR: This is Jim Barr. It's July 18th. I'm in Alma, Nebraska, visiting with Mike Clements. And, Mike, would you like to just give a little bit of a background on your history and that sort of thing?
MR. CLEMENTS: Absolutely. Well, I grew up in the area. I actually attended Riverton High School through the tenth grade and then the high school closed and I did my last two years at Franklin, so that's where I graduated a long time ago. My grandfather farmed on the Republican River just south of Riverton and my dad, early on, was involved in the farming process. And then later on, he became the postmaster down at Riverton. I went to Kearney State College, got a degree in business administration. And right out of college, went to work for the phone company. Started off with Northwestern Bell, had a long career with Bell, AT&T, Lucent Technologies, and when I finally left back in 2001, I was the regional project manager for Lucent Technologies. And at that point in time, after taking an early retirement, I had a golden opportunity to come back down to where my roots are. I'd been in Omaha for about 26 years. And so, I was very -- the good Lord blessed me and gave me an opportunity with this job. Some people believed in me, because quite frankly, somebody that had worked for the Bell system and AT&T for 25 years doesn't have a whole lot of past experience in natural resources. But this job entails a lot of things. And there's a lot of public speaking, a lot of PR, and a lot of other things that I felt that I had some very good talents in. And a lot of it, I had to learn on my own, which is the best way to do it. And I won't say that the first year or two wasn't a struggle, because it was. But after that, kind of got into a groove and got comfortable and that's essentially kind of how I got started. I came here in July of 2001, so I've been here for just over 13 years now. And it was quite interesting, because that was right about the time that things were heating up once again, with Kansas and Colorado on the Republican River. And I'm sure we will maybe talk more about that later. But I'm divorced. I have two beautiful daughters that are married, live in Omaha, and I have five grandchildren. So, I live right here in Alma and I'm very involved in the community. Serve on the -- I'm the president of the Harlan County Extension Board and I also serve on the Alma City Council.
MR. BARR: What sort of thing -- well, first of all, did you have any recollections of the NRD development from your vantage point or any acquaintance with it at all during that period of time? And, if so, just kind of summarize it.
MR. CLEMENTS: Some, but not to -- I was overwhelmed by, when I got here, about how little I really did know what the NRDs do. I have some good friends, a real good friend from Riverton, who was on the NRD board here at the time, and visited with him, and he would, from time to time, would kind of let me know some of the things that they're involved with. It's a totally different world out here as opposed to the Papio-Missouri in Omaha. I was, again, kind of familiar with some of their projects down there, because they have a lot of recreational sites and such. But out here it's, like I said, it's a completely different ballgame. And that's quite honestly, that's one of the reasons for the creation of the NRDs to begin with is local control. People do things maybe a little bit different in south-central Nebraska than they do in northeastern Nebraska or western Nebraska. And I think it's worked out great.
MR. BARR: What were some of the NRD activities that were ongoing about the time you started?
MR. CLEMENTS: Well, when I started, and I say this and I don't want to say this in a negative manner, but we have become, in the Republican Basin, we have been forced to become more of a regulatory agency than a conservation district, and that troubles me. We still -- I strive really hard to hang on to the conservation programs and measures that we are involved with, because we are still -- we still have a tree program. We still have the NSWCP cost share, chemigation, and all that other stuff. But the litigation with Kansas and everything is the number one priority.
MR. BARR: What stage was that in when you started? I was just trying to recollect.
MR. CLEMENTS: Kansas had already filed suit and they were -- when I started was right about the time that the Special Master suggested that the two states try and reach a settlement agreement. And that's when that process really got started. And that went on, like I said, I started in '01. The settlement agreement was reached in late 2002. And as everybody knows, I think Nebraska kind of come out a little bit on the short end of the stick when it come to that, but it is what it is, and we can't change it. And, you know, we're moving forward and we're doing everything that we can to make sure that we stay in compliance with that settlement agreement.
MR. BARR: Do you want to just kind of recount some of the things that have happened over that period, particularly in relation to the Kansas discussions and lawsuits?
MR. CLEMENTS: Absolutely.
MR. BARR: You can go on as long as you want to.
MR. CLEMENTS: Well, it's interesting, because in -- because of the settlement -- let me back up and just say a couple of things about the settlement. Really, what it really affected was primarily the accounting procedures that apply. The big hit, I guess, what Nebraska had contended all along was that there was no connection between surface water and groundwater. We recognize the connection in the alluvial, but not from the Upland Basin. And when the Court ruled that there is and that the consumptive use from all wells that are hydrologically connected to the Republican River must be counted. Prior to that, it was only -- it was essentially municipal usage, evaporation, and consumptive use of alluvial wells that was primarily counted. With the settlement agreement, we threw in all wells. And at that -- with that ruling also came the fact that, hey, there needs to be some way of tracking this usage. So, the three states went together, hired a number of consultants, and put together a groundwater model in less than a year's time that all three states agreed to and that we're abiding by to this day. Is it 100 percent accurate? Absolutely not. But there are flaws in the model and the most recent litigation with Kansas, Nebraska pointed out a major flaw that will be corrected. But anyway, so because of the settlement agreement, in December 9th of 2002, our district implemented a moratorium on drilling any new irrigation wells. And that was quite a deal back then as you can well imagine. But I will take my hat off to the producers of this region, because they have adapted very well. And it's been just one thing right after another, and every time -- they don't like it, but they've learned to live with it. And so then, because of LB 962, in December of 2004, we implemented a moratorium on developing any new irrigated acres. Right about that same time, in 2004, we certified all of our irrigated acres. A major process. We got that 327,000 acres, you set down with each and every landowner in the district and you go through maps and aerial photos, and I still take my hat off to all my staff, my field office secretaries that were very involved in this process. Since that time, we have -- we still have all the old maps and everything that we use a lot, but we have digitized all that to where we have it on computer. But anyway, we did that, we got that process done, and then, we developed -- our district developed one of the first integrated management plans in the state of Nebraska in conjunction with the Middle and the Upper Republican NRDs. We were all about the same time. And that was in 2005. It became a -- it was a three-year plan. It ran for '05, '6, and '7. And that particular plan, it was kind of unique. Highway 183, which runs through Alma, is about in the middle of our district, and we had a split allocation. If you were west of 183, you had 12 inches a year for three years, for a total of a 36-inch allocation. If you were east, you had 11, simply because of the differing rainfall amounts as you move from east to west. We had that, like I said, '5, '6, and '7. And what you have to realize is, we're still in a severe drought in 2005 and started to come out of it a little bit in '06, and then, '07, things really turned around. But when you're going from essentially no regulation to pretty drastic regulation, it takes a while to adapt and it takes a while for you to really see the measures that you put in place, particularly when you're regulating groundwater. I mean, you don't shut a well down or cut it back and see an immediate impact on the river unless it's setting 50 feet from the bank of the river. So, I think the things that we did with that first integrated management plan did work. I think that we were a bit -- and the Middle and the Upper River in the same boat, a little bit behind the eight ball because of the severity of the drought. And needless to say, Nebraska did overuse our allocation in 2005 and 2006. And I can talk a little bit more about that as I get further down the road here. But in 2008, we introduced, approved our second generation, if you will, integrated management plan. And that was a five-year plan. That was one of the things that the producers said, we'd like to see a little bit longer as far as allowing us to be able to plan our operations, which I totally agree with, too. And so, that went from '8, '9, '10, '11, and '12. 2012 was the last year. We did cut the allocations back and we did eliminate the divide in the middle of the district. We went with nine inches district-wide. And again, producers, they adapted.The Republican Basin is probably 95 percent, in our district, 95 percent no-till. We're light years ahead of other parts of the state. You don't even have to get very far north of here or east of here to see a lot of tillage. And it just -- it's one of the things that the guys had to do down here to conserve water. Nine inches on the east end of the district in most years is plenty. When you get on the west end of the district, it's deficit irrigation, unless we've got average or above average rainfall. So, the second generation integrated management plan, that was the big change was cutting the allocations back. We made some other minor adjustments in the plan, but that was pretty much it. Then in late 2012, we came out with our third generation, which, you know, five-year plan runs for '13, '14, '15, '16, and '17. And that plan essentially made some -- we made some major modifications in how we're going to manage groundwater in drought situations. And this is -- we work closely with the Department of Natural Resources to come up with -- you've heard of the terminology water-short year. Well, there's one step beyond that and that is a compact call year, where the Department will determine whether or not a particular district is in the red or in the black for a particular year. And this plan addresses all that, how we're going to handle it. It even goes as far -- it acknowledges augmentation projects, dry year leasing programs, various things that we can do before we would ever have to get to shutting a well off. And it does address that, too. Worst case scenario, if everything that we have in place is still not enough to meet a short-fall for a particular year, rapid response wells will be shut off. And I pray to God that that's something that we never have to do. We were this close to it, very close to it this year, and if we would not have had our N-CORPE project in place when we got it in place, there would have been -- all of the rapid response wells in our district would have been off this year. But the new integrated management plans, I think, were instrumental in helping Nebraska defend herself against a second lawsuit that was brought forward by Kansas because of the overuse of water by Nebraska in 2005 and 2006. And that second Supreme Court trial was held in Portland, Maine, in August of 2012. And I was going to go out, but I got subpoenaed by Kansas so that solidified the fact that I would be there. I'd planned on sitting a little further back in the courtroom --(Laughter.)-- than where I had to sit for a couple of hours one day. But I just can't say enough about Nebraska Attorney General's Office and the outside legal counsel that they had helping them. They just did an outstanding job. Very prepared. Out-performed Kansas. I mean, it was just unbelievable the job that they did.
MR. BARR: Do you want to mention a name or two?
MR. CLEMENTS: Yeah, Justin Lavene, Don Blankenau, Tom Wilmoth. They're the three that carried the ball for the State of Nebraska. And as I said, throughout that trial, I think what Nebraska was able to convince to the Special Master was, we have -- these NRDs down here have a third generation integrated management plan that has very drastic measures in it. And we need to give these plans a chance to work. We were just rolling them out. They were going -- they rolled out in 2013. This trial takes place in 2012. And the Special Master bought into it. And there was essentially -- the main issues that were on the table was Kansas wanted 80- -- actually, it was up to $85 million in damages. Kansas wanted to see 300,000 groundwater irrigated acres in the Republican Basin shut off permanently. Not in water-short years, not in compact call years, permanently. And also, Kansas wanted the appointment of a river master to the Republican Basin. And then, it was quite unique, because Nebraska brought a major issue to the table, too, because we had found probably four or five years ago, a major flaw in the accounting and how the imported water that comes into the district from the Platte was counted -- the consumptive use of that water, any of that water that's pumped should not be counted as a consumptive use because it's not water that originated here. And the accounting has it, as it's doing as we speak, it's still counting that. And so, that was a flaw that cost Nebraska anywhere from 10- to 16,000 acre feet every year over a higher consumptive use number than what we really should have. And at the end of the day, when the Special Master made his final ruling, he awarded Kansas five million dollars in damages, not 85. He dismissed their contention of shutting off 300,000 acres permanently. He dismissed the appointment of a river master. And he ruled in favor of Nebraska on the accounting problem, said it should be corrected back to 2007, and said we should use the formula that Nebraska has developed to correct the problem. And so, that was huge. That was his final recommendation to the Supreme Court. That came out last September, and we're just waiting -- the Supreme Court can allow oral arguments, if they -- the high court actually, before the high court, and I just found out a couple days ago that they are going to do that. And it's October 14th at 10:00 a.m. And I think each state will have about 30 minutes to go up before the Court. And obviously, Kansas was pressing for this, because they lost on the Special Master rulings. So, that's kind of where we're at. I expect a final ruling from the Court in -- hopefully, by the first of the year, but probably early on in 2015. As all of this was taking place in September of 2012, at our fall convention that the NRDs have every year in Kearney, we learned of a property out by North Platte, Nebraska, a large, essentially one-owner property. It was owned by a group of out-of-state investors, that was about 12 miles southwest of North Platte, that was for sale. And 19,500 total acres, of that about 16,000 irrigated acres. Immediately, the light went on and the three managers, myself, Jasper Fanning, and Dan Smith at the time for the Middle Republican, sat down, started talking about it that very day that we learned of this. And this thing escalated. The next thing you know, we've brought in a partner from the Platte, the Twin Platte. And we had the property purchased by November and were ready to let bids and start construction by late December or early January. The purchase price of the property was $82 million. We were able to buy it for about four million under the appraised value. There were two other parties that were interested in the property. We were able to get it bought. We were just at the point to where we were going to issue bonds for the purchase price of the property when we got sued by two irrigation districts down here, the Frenchman-Cambridge Irrigation District and the Bostwick Irrigation District. And that lawsuit was filed in late December. Well, obviously, you can't issue bonds when you're in litigation. Nobody will write those. So, that really -- that lawsuit held this project up almost an entire year before we got a -- before the suit was dismissed in district court -- federal court, I should say. And so, we actually got started on the construction phase in the fall, late fall, October of 2013. And by April -- actually, by mid-March of 2014, it was pretty much done on the Republican side. There's still -- the Platte still hasn't run their pipeline. Obviously, we had a few minor issues that we had to work out, but all 30 wells that are supplying the water to the project were operating at 100 percent by mid-April and they have been since then. We spent, on the Republican side, an additional about $16 million on developing the well field, the infrastructure in the well field, and the 42-inch diameter pipeline that went south about five miles to Madison Creek. On the Platte side, they're also going to be spending close to $20 million on running the pipeline approximately ten miles to the Platte River. So, all in all, the total project is coming in at about $120 million. We have bonded the money we've spent for the purchase of the property. We've bonded the money we spent for the development of the well field. And we have bonded the money that we had tied up in interim financing. The unfortunate thing is the litigation cost us about a percentage point on issuing the bonds. And so, it ended up costing us -- when you look at a 25-year term, one percent, I'm not going to tell you exactly how much, but it was several million dollars. But anyway, that's -- it is what it is. The project is moving forward. And had we, for the Lower Republican and for the Middle Republican, as well, but I'll just speak for our district, for the Lower Republican, had we not had this project online this year when we did, if I didn't say it before, we would have been shutting off all of the rapid response wells in our district in the summer of 2014. So, it was huge to us. The project is paid for by the irrigators with a $10 an acre occupation tax. And obviously, they're the prime beneficiaries of this, although everybody benefits from this. Main Street Alma benefits from this. But the irrigators are paying the lion's share of it.
MR. BARR: What's the project do on the Twin Platte area?
MR. CLEMENTS: Okay. On the Twin Platte, and I didn't explain either how much we can pump out of that. On the Republican side, at full capacity, we can pump 60,000 acre feet a year. On the Platte side, they are going to need about 7,500 acre feet every year. And it's for the Platte River Implementation and Recovery Program. They do not need that until 2016, so that construction's going to take place next year. But they need a steady supply of 7,500 acre feet. A little different situation on the Republican side. We're hoping that on average we only need to pump it one out of every three years, but that remains to be seen. The whole purpose is to not pump any more water than what was historically being pumped onto the crops year after year after year.
MR. BARR: This is a fairly sensitive recorder.
MR. CLEMENTS: I'm sorry, we should have --
MR. BARR: No problem. I think it'll be all right. It generally just gets what's in front of us here. If all goes well, do you think this is kind of the pattern that we're going to see that we've got ways to react to the problems as they come up?
MR. CLEMENTS: I do.
MR. BARR: In at least average and unremarkable drought periods. But I suppose there may be some years that even exceed this possibility.
MR. CLEMENTS: I think, and I've said this many times before, there's no silver bullet that's going to be the answer to everything, and that includes N-CORPE, the Upper Rock Creek Augmentation Project. I think it takes a combination of a lot of different things. And that's where I get back to the management actions that we've implemented back in 2005. We're seeing results from that today. And it's cutting back on groundwater pumping, and it's doing a combination of things, of management. Dry Year Lease Program, we've had two very successful back-to-back years with that where we temporarily retired 4,000 acres and we did the same 4,000 the second year and got twice the bang for our buck. So, things like that, the CREP program, EQIP program, Irrigated to Dry, the AWEP program, which was wonderful. We were fortunate enough to get a $4 million grant. We had to put a million in for match, and we retired thousands of acres permanently. That particular program had a permanent or a temporary retirement.
MR. BARR: What does that stand for, AWEP?
MR. CLEMENTS: Agricultural Water Enhancement Program.
MR. BARR: And that is run by?
MR. CLEMENTS: It's USDA. You would be very familiar with that.
MR. BARR: Well, the transcriber (indiscernible). (Laughter.)
MR. CLEMENTS: I can't say enough about our involvement with the USDA and with NRCS and with FSA. Obviously, the CREP program was the FSA's, was their baby. I was fortunate enough to be on the advisory committee when that particular program was developed, and I was actually fortunate enough to be with the individual whose idea it was to begin with one afternoon on the golf course. His name is Bob Bettger.
MR. BARR: Oh, sure.
MR. CLEMENTS: And it was his idea. And it just took off from there.
MR. BARR: He was in a position to work with his boss on that, Tom Osborne.
MR. CLEMENTS: Yes. Had it not been for them, we would not have seen CREP as it existed today, because we used it for a different purpose than what it had been used previously. But getting back to your question, you know, all of these other things, we still need to have in place. And then, if we can put, the big kicker, if you will, something that we can use when we really get into a severe drought, because when we're in a normal weather pattern, we're not going to need to pump this. If we'd have had the N-CORPE project in 2007, '8, '9, '10, and '11, there's five years in a row that we would not have pumped. So, it's
just -- and the nice thing about N-CORPE Rock Creek is you see an immediate benefit from a measurable -- immediate measurable benefit. Whereas, if you're regulating wells, you're at the mercy of the groundwater model. And, you know, not to say that the models aren't tremendous tools, but –
MR. BARR: Is there work going on in terms of the evaluation of the models and --
MR. CLEMENTS: Obviously, the latest thing is correcting the problem, but as far as other things, I'll be honest with you. It's really difficult to get all three states to agree to anything, because they're so protective that, “Well, if you're going to change that, is that really going to help us or hurt us?” I don't see a lot of ongoing work to fix the problems.
MR. BARR: You mentioned earlier that close to 95 percent of the cropland is no till.
MR. CLEMENTS: Yes.
MR. BARR: What other changes in agricultural practices have you seen in the course of the 15 years or whatever?
MR. CLEMENTS: Well, obviously, the big change is converting from gravity to pivot. Just huge. When I came down here, I would say there was probably more gravity than pivot in 2001. That has just completely turned around and being more efficient. And when you look at that, there's two sides of that, too, because there's -- not that we're not all for the pivots, because we are, but when you have a pivot, you have less runoff, and when you have less runoff, the Republican River is a runoff river. And so that's another reason why you don't see the flows like you did, even, 15 or 20 years ago. Like I said, the pivots are huge. We have even seen conversion to subsurface drip, not to the extent that we -- that I thought it would be at this point in time, and I think we're still looking at a cost factor and some issues with rodents and other things. But we have a substantial number of drip systems in our district. I'd say those two things coupled with the no-till farming practices, and seeing guys going into rotations where -- or going into a corn, beans, wheat type of a pattern. We're seeing a number of people doing that rather than just corn on corn on corn every year. And there's a lot of added benefits to that, too, from a conservation standpoint.
MR. BARR: Just talked with a producer who's using peas and a wheat follow-up.
MR. CLEMENTS: I've heard about that and I've heard -- that'll be interesting to see how that turns out.
MR. BARR: He said last year his peas -- dryland peas made a little better than his dryland beans. And the interesting thing is that the water requirement is in a different time of the year than -- the beans take a good share of it towards the end.
MR. CLEMENTS: Right. So, the peas take it --
MR. BARR: He's harvesting now. So, I mean, there won't take much after this until it's put wheat.
MR. CLEMENTS: So, they have local markets for those, then?
MR. BARR: No, that's a problem. He has one, because he's doing it for seed, but I think Gering or Scottsbluff is the closest market, so that is a problem. But I don't know, if this develops, that might be something that could develop in a more local situation, too.
MR. CLEMENTS: Absolutely.
MR. BARR: That's a pretty good description on what's happened on the Kansas situation. Do you want to have any thoughts on how that's affected the rest of the operation of NRD, other programs or projects or how those had developed in that period, too?
MR. CLEMENTS: Yeah. Obviously, we -- my staff has grown tremendously from when I started and we were in the basement of the courthouse here in Alma, Nebraska. We've grown to -- we've got 12 full-time people at the essentially working for the district, eight full-time people here at the district office. And we had some other things, too. We had another major event that happened, I think. We developed our rural water project back in 2004. Huge to this area. It took a lot of time and a lot of effort for several years to get this thing to happen. And that was a major star for our district. And we provide -- we started off with 120 users, and the system is up to 180, as we speak today. So, we've grown.
MR. BARR: What general area does that cover?
MR. CLEMENTS: It goes, basically, from three miles west of Franklin to about seven miles east of Guide Rock. So, it's about 45 miles long, about eight miles wide, and it goes right down the river valley. It goes to the state line, and then we have some connections just north of Highway 136. But that's kind of where it goes, right down the valley. A number of reasons for developing the project. You know, we had nitrate problems, okra problems, that's one of the main issues. And then, even quantity problems in some areas where guys couldn't even get good domestic wells for their house and livestock. So, we developed that. It's been a huge success. We've really, really tried to -- very hard to continue on with the conservation measures and the other programs that we have going on. And there is more than just dealing with Kansas and regulating wells. That's our number one responsibility. But, you know, we're involved -- right now our guys -- I have three full-time field technicians. When I started in 2001, we had one. I have an administrative assistant that handles a lot of my correspondence and stuff for me, as well as she handles all of our board meeting criteria. We have a full-time water resources administrator who has a lot of responsibility, and she's in charge of tracking all the water usage. I have an information and education person that also serves as our rural water secretary, and three field technicians, and an assistant manager all here at the district office. And then, we have field office secretaries in four of the NRCS offices in our district. But we've still very involved in, like I said, we're doing chemigation right now. We measure about 300 wells every spring to -- for static water level measurements. We take water samples on about 280 wells every -- throughout the summer to check for nitrates. We're just -- these are the kinds of conservation issues that the district is involved with. We still plant trees. We sold over 22,000 trees this year, which was good. You say that, you know, 20 years ago, we were selling 60, but those times have changed. And so, we are very -- promoting the Nebraska Soil and Water Conservation program. We have cost share -- we provide cost share for that, which will help pay for buried pipeline, pivot points, or dugouts, you know, a number of different things that we cover with that particular program.
MR. BARR: You've also had a fairly close working relationship with the other two NRDs haven't you? What sort of developments have happened as, not only the Nebraska side, but perhaps maybe there's some Kansas connection, I don't know.
MR. CLEMENTS: I've worked very, very closely with the Middle and the Upper Republican. And, you know, I'm so proud of my board and I'm so proud of, particularly, the board at the Upper Republican, because, as you well know, you go back a few years, we were not always good neighbors. I don't know if that's the right way to put it, but we were able to see that maybe some things needed to be changed and we needed to be more open-minded about some of the things what we're involved with and how we work together. And over the course of the last few years, we've really, really become strong allies, good partners, and we're in N-CORPE with the Middle and Upper end, and Twin Platte NRD. And I can't say enough about how good we work together. We have a great communication between the managers. And, you know, it's just the reflection on what we can do if we really want to try. We can fold up and crawl into a shell and just want to protect our own turf, or we can try and be more creative and work together as a group. And I think one of the things that is going to be coming up here now, because of legislation that was passed just this year, is the implementation of a basin-wide integrated management plan. And we're going to be working very closely with the Lower, the Middle, the Upper, and Tri-Basin, and the Department of Natural Resources. And I think, most importantly, a number of stakeholders that will be involved in developing these basin-wide plans that include a wide array of individuals and organizations.
MR. BARR: Well, at this point, I don't have any more specific questions, but we have this reflection question of if you have any thoughts on this general area or anything else you'd like to add to the interview, this is the time to do it.
MR. CLEMENTS: I guess I would just close in saying that as I've stated in the past, you know, we need to still hang on to our conservation district as much as we can. And I've really tried very hard to make sure that we've been able to do that, because, like I said, Kansas is always there. Regulating wells is always there. And that's always been our number one priority and it still is. But there's a lot of other good things that we do that I don't want to lose. And I think that my message to the producers is keep doing what you're doing. You guys are tremendous, you're creative. And I will commit to working as hard as I can to make this district successful.
MR. BARR: Well, thank you very much.
MR. CLEMENTS: Jim, thank you.
