Opinion 07-1

STATE OF IDAHO OFFICE OF THE ATTORNEY GENERAL LAWRENCE G. WASDEN ATTORNEY GENERAL OPINION NO. 07-1 To: George Bacon, Director Idaho Department of Lands STATEHOUSE MAIL Per Request for Attorney General's Opinion INTRODUCTION At the March 13, 2007, meeting of the State Board of Land Commissioners ("Board"), a formal Attorney General's opinion was requested regarding the legal basis for the Board's practice of requiring a 25-foot public easement in exchange for a disclaimer of the State's ownership of formerly submerged lands. QUESTIONS PRESENTED You ask the following questions: 1. What is the Board's role with respect to management of submerged lands? 2. What are the legal principles that establish the State's interest to lands adjacent to navigable streams? 3. What is the legal basis for the Board's long-standing practice of requiring the exchange of a 25-foot public use easement for the grant of a disclaimer of the State's interest to formerly submerged lands? 4. Does the exchange of a 25-foot public use easement for the grant of a disclaimer of the State's interest to formerly submerged lands constitute a taking of private property for a public purpose? P.O. Box 83720, Boise, Idaho 83720-0010 Telephone: (208) 334-2400, FAX: (208) 334-2530 Located at 700 W. Jefferson Street? Suite 210 Director George Bacon Page - 2 CONCLUSIONS 1. The State of Idaho received title to the submerged lands underlying navigable water bodies below the ordinary high water mark ("OHWM") under the Equal Footing Doctrine upon statehood. Submerged lands are held in tmst by the State for the benefit of the public. The Board was statutorily designated as the trustee of submerged lands within Idaho. 2. The legal principles of accretion, reliction and avulsion govern the ownership of submerged and formerly submerged lands below and adjacent to navigable waterways. 3. The legal basis for the Board's long-standing practice of requiring the exchange of a 25-foot public use easement for the grant of a disclaimer of the State's interest in formerly submerged lands is in the nature of the settlement of a private boundary dispute based upon competing proprietary claims. 4. The exchange of a 25-foot public use easement for the grant of a disclaimer of the State's interest in formerly submerged lands does not constitute a taking of private property for a public purpose without just compensation because the easement represents valuable consideration for the State's relinquishment sf its claim to ownership of the parcel of land in dispute. ANALYSIS A. Under the Public Trust Doctrine, the Board Serves as a Trustee With a Fiduciary Responsibility to Assure Public Aceess to the Beds and Banks of Navigable Waterways Under the Equal Footing ~octrine,' the State obtained title to the beds and banks sf navigable water bodies upon its admission into the Union in 1890. The power to direct, control and dispose of submerged lands is vested in the Board pursuant to Idaho Code 5 5 8- 104(9). The State's ownership and the Board's management responsibilities are not without limitation. In Kootenai Environmegtal Alliance v. Panhandle Yacht Club, 105 Idaho 622,671 P.2d 1085 (1983) ("KEA"), the Idaho Supreme Court ruled that Idaho's submerged lands are subject to the common law Public Tmst Doctrine. In MEA, 1 The Idaho Admission Act provides that Idaho was "admitted into the Union on an equal footing with the original states in all respects whatever." Idaho Admission Act, ch. 656, 5 1, 26 Stat. 215 (1890). The TJnited States Supreme Court in Shively v. Bowlbv, 152 U.S, 1, 14 S. Ct. 548, 38 E. Ed. 331 (1894), determined that one aspect of admission of a state on equal footing with the original states was the title to the beds of navigable waters below the OHWIM. Director George Bacon Page - 3 the Idaho Supreme Court reviewed the common law history of the Public Trust Doctrine and its application in various other jurisdictions to synthesize the parameters of the Public Trust Doctrine to be applied in Idaho. The Public Trust Doctrine requires that the State, through the Board, hold title to the beds and banks of navigable water bodies below the OHWM for the use and benefit of the public. 105 Idaho at 625, 671 P.2d at 1088. The beneficial uses reserved to the public historically included navigation, commerce and fishing. Id. More recently, courts have recognized a broader range of public uses including public recreational activities such as fishing, hunting and swimming. Courts have recognized that the public tmst is dynamic and can expand with the development and recognition of new public uses. Id. The core element of the State's public trust responsibility is that, as trustee on behalf of the public, the State may not abdicate its responsibility for submerged lands in favor of private parties. Id. Nor can the Board dispose of public tmst lands unless explicitly authorized by the legislature. Under the Lake Protection Act, title 58, chapter 13, Idaho Code, the Board is limited to approving encroachments or issuing leases on the submerged lands of navigable lakes consistent with the Public Trust Doctrine. However, such encroachments must be in aid of commerce, navigation and recreation and must not substantially impair the public interest in the remaining submerged lands and waters. 105 Idaho at 626,671 P.2d at 1089. From Massachusetts, Wisconsin and California, the Idaho Supreme Court fashioned the remaining factors for determining whether the alienation of state-owned submerged lands violates the Public Trust Doctrine. From Massachusetts jurisprudence, the Idaho Supreme Court chose the following requirement: [Plublic trust resources may only be alienated or impaired through open and visible actions, where the public is in fact indbmed of the proposed action and has substantial, opportunity to respond to the proposed action before a final decision is made thereon. 105 Idaho at 628,671 P.2d at 1091. 2 Idaho's legislature recognized this broad scope of interests to be protected in the enactment of the Lake Protection Act, title 58, chapter 13, Idaho Code. Idaho Code 5 58-1301 states in pertinent part that: "The legislature of the state of Idaho hereby declares that the public health, interest, safety and welfare requires that all encroachments upon, in or'above the beds or waters of navigable lakes of the state be regulated in order that the protection of property, nav~gation, fish and wildlife habitat, aquatic life, recreation, aesthetic beauty and water quality be given due consideration and weighed against the navigational or economic necessity or justification for, or benefit to be derived fiom the proposed encroachment ." Director George Bacon Page - 4 From Wisconsin jurisprudence, the Idaho Supreme Court established that the final determination whether an alienation or impairment of state-owned submerged lands violates the Public Trust Doctrine will be made by the judiciary. 105 Idaho at 629, 671 P.2d at 1092. In so doing, the court will not supplant its judgment for that of the State, but will take a "close look" at the State's action. Id. In determining whether the State's action violates the public trust, the court will weigh the effect of the proposed project on the public trust resources impacted such as navigation, fishing, recreation or commerce. Id. The court will also look at the impact of the proposed project along with the cumulative impact of the existing impediments to full use of the public trust resource on the specific public trust resources impacted by the alienation or impairment. 105 Idaho at 629-30, 671 P.2d at 1092-93. Examining California law, the Idaho Supreme Court determined that the allocation of public trust resources could be subject to future modification based on changed circumstances. The court determined that even where the State has appropriately allocated a public trust resource to a private use, a change in circumstances could change the validity of the allocation of that public trust resource. 105 Idaho at 63 1, 671 P.2d at 1094. Therefore, the grant of a private use to the State's submerged lands remains subject to the Public Trust Doctrine. Id. The State's alienation or impairment of the formerly submerged beds and banks must take into account the highly dynamic nature of the boundary lines along navigable rivers and the difficulty of drawing a firm boundary line. The following analysis sets forth the legal and factual complexities inherent in evaluating State ownership of the beds and banks of navigable waterways below the OHWM. These complexities add uncertainty to the Board's exercise of its fiduciary responsibility as trustee of the public trust. B. The Ownership of the State's Public Trust Resources Cannot Easily Be Factually or Legally Ascertained As previously noted, the State owns the beds and banks of presently or formerly submerged lands that were part of navigable waterways below the OHWM at the time the State was admitted into the Union. Idaho Forest Industries, Inc. v. Hayden Lake Watershed Improvement District, 112 Idaho 512, 733 P.2d 733 (1987) ("WJ"). The location of the OHWM was established by Idaho common law in Raide v. Dollar, 34 Idaho 682,203 P. 469 (1921). In Dollar, the court determined that: The high water mark of the river, not subject to tide, is the line which the river impresses on the soil by covering it for sufficient periods to deprive it of vegetation and to destroy its value for agriculture. Director George Bacon Page - 5 34 Idaho at 689, 203 P. at 471. This standard was subsequently codified at Idaho Code 5 58- 104(9) which provides in pertinent part: The term "natural or ordinary high water mark" as herein used shall be defined to be the line which the water impresses on the soil by covering it for sufficient periods to deprive the soil of its vegetation and destroy its value for agricultural purposes. Thus, determining the State's ownership is predicated upon the physical location of the line that water impresses on the soil by covering it for sufficient periods to deprive it of vegetation at the time of statehood. Because of man's modification of river flows and intervening hydrologic events, establishment of the OHWM is highly complex and difficult. Original government land surveys used meander lines as a surveying technique to determine the approximate acreage of upland lots abutting navigable rivers and lakes. The meander line in a government survey was used because it was virtually impossible to survey the actual OHWM along a river. Meander lines are an approximation of the OHWM along a navigable river. However, the meander line is not intended as either a boundary line or a determination of the OHWM. Smith v. Long, 76 Idaho 265,281 P.2d 483 (1955). An owner of riparian property may attempt to prove that the State does not own title to property because it is above the OHWM. In addition, a riparian owner may also attempt to prove that they have acquired ownership of formerly submerged lands under the theory of accretion. Accretion has been defined as the addition of riparian property by the gradual deposit, by water, of solid material causing to become dry land what was previously covered by water. Aldape v. Akins, 105 Idaho 254, 668 P.2d 130 (1983). The adjoining riparian owner acquires title to alluvial deposits between the water and the land bordering thereon. Nesbitt v. Wolfkiel, 100 Idaho 396, 398, 598 P.2d 1046, 1048 (1979). The law presumes a change in the submerged lands occurred as a result of accretion, but the presumption may be rebutted by evidence that the change that occurred was a ~ l s i v e . ~ Id. Formerly submerged lands of the State may also be acquired by adverse possession. Rutledge v. State, 94 Idaho 121,482 P.2d 5 15 (1971). However, in order for formerly submerged lands to be adversely possessed, the lands must have lost their value 3 Avulsion is the sudden and perceptible loss to land by the action of water or a sudden change in the bed or the course of a stream. Joplin v. Kitchens, 87 Idaho 530, 394 P.2d 313 (1964). If avulsion is the cause of the shift in the river's bed, title remains as before the change of course. Id. Director George Bacon Page - 6 as a public trust resource. 94 Idaho at 123, 482 P.2d at 517. This can occur where the formerly submerged lands have dried up and been put to a public use over a long period of time. Id. In Rutledge, for example, the former bed of the river had been developed as a motel property. 94 Idaho at 121,482 P.2d at 5 15. There is a defense, however, to a claim of title to the formerly submerged lands under a claim of adverse possession. In m, Justice Huntley's concurrence4 cited with approval the principle that man-made alterations below the OHWM will not result in the loss of public tmst resources. Justice Huntley noted that the Rutledge case only addressed adverse possession resulting from natural forces without the contribution of man-made alterations to the natural river system. 112 Idaho at 521, 733 P.2d at 742. In establishing the rationale for this precedent, Justice Huntley stated that if artificial modification of river systems could result in adverse possession: "the state would be left vulnerable to surreptitious drain and fill operations which would destroy important wetlands and rob Idahoans of the associated resources and values." Id. Relating this precedent to the public trust obligation, Justice Huntley noted that: If we held otherwise, adverse claimants could accomplish by wrongful, unilateral action what the state itself could not accomplish by voluntary conveyance, namely the alienation of public trust land for purely private purposes. Id. C. The Board's Long-Standing Practice of Requiring the Exchange of a 25-Foot Public Use Right-of-way for the Grant of a Disclaimer of the State's Interest to Formerly Submerged Lands is a Programmatic Means of Resolving Boundary Disputes Consistent With the Board's Fiduciary Duty to Protect Public Trust Lands Given the complexity and expense of resolving disputes between the State and riparian owners, the Board often chooses to compromise disputes relative to the State ownership of submerged land.' The State's disclaimer process provides a legally Justice Huntley's concurring opinion was joined in by Justices Donaldson and Bistline. Therefore, the concurring opinion is binding precedent. 5 The Board does not always choose to compromise disputes regarding the ownership of claimed submerged lands. In those cases, the Board does not enter into the disclaimer process. Examples where the State has litigated its ownership of submerged lands include: Erickson v. State, 132 Idaho 208, 970 P.2d 1 (1998) (the State contested an allegation of the OHWM of Lake Coeur d'Alene below 2128'); Idaho Forest Industries. Inc. v. Havden Lake Watershed Improvement District, 112 Idaho 512, 733 P.2d 733 (1987) (the State challenged the ownership of portions of Hayden Lake); State of Idaho v. U.S. Director George Bacon Page - 7 defensible means of resolving disputed claims between the riparian owner and the Board. Claims to the State's formerly submerged lands constitute an expansion of the adjoining riparian owner's property, not a contraction of the riparian owner's claim to title. The State in its role as the trustee exercising its fiduciary responsibility to the citizens of the State of Idaho must ensure that the public trust asset is not compromised. Thus, the Board adopted the policy of requiring a 25-foot public right-of-way when disclaiming title to formerly submerged lands. The right-of-way preserves the public trust value while providing clear title to the adjoining landowner. The Department's disclaimer policy is analogous to the resolution of a private boundary dispute by two contiguous real property owners. The Idaho Supreme Court has consistently recognized the validity of agreements between adjoining property owners to establish a disputed property line by agreement. In Downing v. Boehringer, 82 Idaho 52, 349 P.2d 306 (1960), the Idaho Supreme Court explained the doctrine of boundary agreement as follows: [Wlhere the location of a true boundary line on the ground is unknown to either of the parties, and is uncertain or in dispute, [the] coterminous owners [of the parcels involved] may orally agree upon a boundary line. When such an agreement is executed and actual possession is taken under it, the parties and those claiming under them are bound thereby. 82 Idaho at 56,349 P.2d at 308. In boundary by agreement, the parties forego litigation in the form of a quiet title action or adverse possession action and compromise on the appropriate boundary. The compromise may involve the payment of compensation or a compromise dividing the disputed property line along an agreed allocated basis. The same may be said of the Department's disclaimer process. A dispute exists as to the exact location of coterminous properties, with the riparian owner holding title to the landward parcel and the State holding title to the waterward parcel. The owner of the riparian parcel seeks for various reasons to establish title to formerly submerged State Department of the Interior, No. 97-0426-BLW (D. Idaho 2002) (Deer Flat Refuge) (the State challenged the federal government's ownership of federal reserve water rights); Heckman Ranches. Inc. v. State, 99 Idaho 793, 589 P.2d 540 (1979) (State challenged contention of the OHWM of the Salmon River). These cases constitute a significant commitment of State resources both in terms of cost and time. These cases also include only those which have been subject to substantial litigation. The Department administratively denies ownership of State-owned submerged lands which are not challenged through the courts. Director George Bacon Page - 8 lands.6 If the Department determines that the disclaimer sought is not of a significant importance, the disclaimer process goes forward. As compensation for the uncertainty in locating the precise demarcation between State-owned submerged lands and contiguous riparian land, the State receives compensation in the form of a 25-foot public use easement. If the riparian owner does not agree that the compensation sought by the Department is fair, the riparian owner is under no obligation to complete the disclaimer process. The Board's long-standing practice of requiring the exchange of a 25-foot public use right-of-way for the grant of a disclaimer of the State's interest to formerly submerged lands is a legitimate compromise in settlement of a disputed property line between adjacent property owners. It is a voluntary agreement entered into between willing parties to resolve a disputed boundary line. It does not constitute a claim by the State against the riparian owner, nor does it represent the Department or the Board acting in its regulatory capacity. Rather, it represents the Board exercising its proprietary interest to State submerged lands. D. The Exchange of a 25-Foot Public Use Right-of-way for the Grant of a Disclaimer of the State's Interest to Formerly Submerged Lands Does not Constitute a Taking of Private Property for a Public Purpose The Takings Clause of the Fifth Amendment provides: "Nor shall private property be taken for public use, without just compensation." U.S. Const. amend. V. The aim of the clause is to prevent the government "from forcing some people alone to bear the public burdens which, in all fairness and justice, should be borne by the public as a whole." Armstrong v. United States, 364 U.S. 40, 49, 80 S. Ct. 1563, 1569, 4 L. Ed. 2d 1554 (1960). A taking can occur directly through the exercise of the governmental power of eminent domain. See, e.g., United States v. 564.54 Acres of Land, 441 U.S. 506, 99 S. Ct. 1854, 60 L. Ed. 2d 435 (1979). A taking can also occur indirectly when the government acts in a manner which causes an inverse condemnation. First English Evangelical Lutheran Church of Glendale v. Los Angeles County, 482 U.S. 304, 107 S. Ct. 2378, 96 L. Ed. 2d 250 (1987). Inverse condemnation can occur in two manners. Inverse condemnation can occur through a direct physical invasion of a party's property known as a physical taking. Loretto v. Teleprompter Manhattan CATV Cow., 458 U.S. 419, 102 S. Ct. 3 164, 73 L. Ed. 2d 868 (1982). In addition, inverse condemnation can occur by virtue of the government's restriction on land use through its regulatory Historically, parties seehng disclaimers have done so to clear title to facilitate lending or sale or to establish an ownership interest for purposes of subdivision. Director George Bacon Page - 9 authority. Penn Central Transportation Company v. New York City, 438 U.S. 104, 98 S. Ct. 2646,57 L. Ed. 2d 631 (1978). As previously noted, the Board's long-standing practice of requiring an exchange of a 25-foot public use easement for the granting of a disclaimer of the State's interest to formerly submerged lands is an exercise of the State's proprietary role as the owner of the State's public trust res~urce.~ Therefore, cases relating to takings based upon the State's regulatory authority are inapplicable. Since these lands were formerly submerged lands, they remain impressed with the public trust. Actions to protect the public trust are not the imposition of state regulation over private parties. The State is giving up its interest to formerly submerged lands over which it could exert a claim. In doing so, the State retains the right of public access over a small portion of those formerly submerged lands thereby satisfying its fiduciary role to the public. The Board's policy requiring the exchange of a 25-foot public use easement in exchange for a disclaimer constitutes the settlement of the State's claim to title to formerly submerged lands. The riparian owner gains unencumbered title to the State's formerly submerged lands. The State satisfies its fiduciary responsibility under the public trust by providing public access but surrenders its legally cognizable defenses to the riparian owner's claim to title. A riparian owner that enters into a disclaimer agreement with the State has entered into a legally binding contractual agreement regarding the coterminous boundary of the riparian land and public trust land. This agreement is not a regulatory hnction and therefore cannot constitute a taking of private property for a public purpose. CONCLUSION The Board has a fiduciary responsibility under the Public Trust Doctrine to maintain public access to the submerged lands underlying navigable waterways. Private interests may attempt to claim formerly submerged lands. However, due to the complexity of the legal and factual prerequisites to a claim of title, the Board is justified in requiring compensation in the form of a 25-foot public use right-of-way from the party claiming title. This compensation is a settlement of a disputed boundary and does not constitute the taking of private property for a public purpose. The Board is acting in a proprietary capacity in compromising a disputed claim to public trust resources. 7 Courts have recognized that talungs cannot occur by the State's exercise of its proprietary powers founded on the Public Tmst Doctrine. See Marine One, Inc. v. Manatee County, 898 F.2d 1490 (1 lth Cir. 1990) (rescission of marine construction permits was exercise of the state's proprietary interest in submerged lands and therefore not a taking of private property). Director George Bacon Page - 10 AUTHORITIES CONSIDERED 1. United States Constitution: Fifth Amendment. 2. United States Statute: Idaho Admission Act, ch. 656, tj l,26 Stat. 2 15 (1 890). 3. Idaho Code: 5 58-104(9). 5 58-1301. Title 58, chapter 13. 4. U.S. Supreme Court Cases: Armstrong v. United States, 364 U.S. 40, 80 S. Ct. 1563,4 L. Ed. 2d I554 (1960). First English Evangelical Lutheran Church of Glendale v. Los Angeles County, 482 U.S. 304, 107 S. Ct. 2378,96 L. Ed. 2d 250 (1987). Loretto v. Teleprompter Manhattan CATV Corp., 458 U.S. 419, 102 S. Ct. 3164, 73 L. Ed. 2d 868 (1982). Penn Central Transportation Company v. New York City, 438 U.S. 104, 98 S. Ct. 2646,57 L. Ed. 2d 631 (1978) Shively v. Bowlby, 152 U.S. 1, 14 S. Ct. 548,38 L. Ed. 33 1 (1894). United States v. 564.54 Acres of Land, 441 U.S. 506, 99 S. Ct. 1854, 60 L. Ed. 2d 435 (1979). 5. Idaho Cases: Aldape v. Akins, 105 Idaho 254, 668 P.2d 130 (1983). Downing v. Boehringer, 82 Idaho 52,349 P.2d 306 (1960). Erickson v. State, 132 Idaho 208, 970 P.2d 1 (1998). Director George Bacon Page - 11 Heckrnan Ranches, Inc. v. State, 99 Idaho 793, 589 P.2d 540 (1 979). Idaho Forest Industries, Inc. v. Hayden Lake Watershed Improvement District, 112 Idaho 512,733 P.2d 733 (1987). Joplin v. Kitchens, 87 Idaho 530,394 P.2d 313 (1964). Kootenai Environmental Alliance v. Panhandle Yacht Club, 105 Idaho 622, 671 P.2d 1085 (1983). Nesbitt v. Wolfkiel, 100 Idaho 396, 598 P.2d 1046 (1979). Raide v. Dollar, 34 Idaho 682,203 P. 469 (1921). Rutledge v. State, 94 Idaho 12 1,482 P.2d 5 15 (1 97 1). Smith v. Long, 76 Idaho 265,281 P.2d 483 (1955). State of Idaho v. U.S. Department of the Interior, No. 97-0426-BLW (D. Idaho 2002). 6. Other Cases: Marine One, Inc. v. Manatee County, 898 F.2d 1490 (I lth Cir. 1990). DATED this 7@ day of May, 2007. Attorney General Analysis by: C. NICHOLAS KREMA Deputy Attorney General Department of Lands