Lawsuit Between Tribe, Pud May Be Resolved Judge Orders Utility To Pay Kalispels More Than $3 Million

A federal judge’s ruling Monday could settle a 23-year-old lawsuit between the Kalispel Tribe and the Pend Oreille County Public Utility District over flooding of tribal land.

Judge Richard Bilby of Tucson, Ariz., filed an order in U.S. District Court in Spokane that requires the utility district to pay the tribe slightly more than $3 million for past use of tribal land and to make annual payments for future land use.

Bilby said the future payments, to be arranged through the Federal Energy Regulatory Commission, must use the same formula with which he calculated past damages.

The parties say that formula is Bilby’s interpretation of the utility district’s strongest position. Bilby rejected the tribe’s strongest position, which would have resulted in a $29.6 million award. He brushed aside more extreme claims by both sides.

Under either side’s formula, most of the award would be for interest. The dispute dates from 1963, when the utility district got federal permission to raise the level of the Pend Oreille River by 1 foot behind Box Canyon Dam near Ione, Wash.

Tribal attorney Allen Sanders, of Evergreen Legal Services in Seattle, said the tribe has not decided whether to appeal the decision. Utility District General Manager Larry Weis said district commissioners also haven’t decided, but he is recommending against an appeal.

Weis noted the case already has cost the district about $1 million in legal fees. Aspects of the case already have been appealed twice to the 9th U.S. Circuit Court.

“To continue this is not in the best interest of our consumers, nor the relationship between the tribe and the district,” Weis said. “They’re our customers and we live with them.”

The tribe has 243 members on a 10-mile-long, 1-mile-wide reservation along the eastern shore of the Pend Oreille River, north of Usk, Wash.

Bilby said his award would increase the district’s electricity rates by 0.32 mills per kilowatt-hour if paid with 20-year bonds at 7 percent interest. He called the tribe’s $29.6 million proposal an “outrageous amount” that would increase rates by 3.1 mills per kilowatt hour.

Weis said the district now pays a minimum of 3 to 4 mills - tenths of a cent - per kilowatt-hour for its power.

He said the district hasn’t figured out how it would pay the judgment, but it probably wouldn’t cause a rate increase.

Bilby said the tribe’s demand “undoubtedly” would have caused the utility district’s largest customer - Ponderay Newsprint at Usk, Wash. - to move away.

The mill uses 80 percent of the district’s electricity.

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