Southern Delivery System: Stonewall Springs Reservoir?

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Colorado Springs area residents Mark and Jim Morley are trying to sell their potential gravel pit reservoir at Stonewall Springs to Colorado Springs as terminal storage for reusable water from the proposed Southern Delivery System. Here’s a report from J. Adrian Stanley writing for the Colorado Springs Independent. From the article:

Morley, his brother Jim, and their partners own this land. But they’re offering most of it to Colorado Springs Utilities for the apparently bargain-basement price of $38.8 million. The Morleys say Utilities needs this land for the Southern Delivery System water project. And here’s the cherry: If Utilities bites, the Morleys will donate $12 million to the city for use in funding the just-revised U.S. Olympic Committee retention deal. The clock is ticking for Utilities’ decision and, like any proposal involving water, this one’s full of details. Here’s what is certain: The city could use the money. And the Morleys know it. In fact, everyone in City Council chambers knows it…

What the Morleys want to sell is basically a swath of gravel-packed soil. For people in the water business, though, it’s prime. It can be dug up to create storage reservoirs that could hold 34,400 acre feet of water. The gravel that’s removed in the process can be sold, or used for another purpose, like, say, bedding for the SDS pipeline. The Morleys’ project is also fully permitted, which means Utilities could avoid a lengthy, expensive approval process.

And, the Morleys say, the location is ideal. Here’s why: In the SDS system, treated wastewater from Colorado Springs will flow down Fountain Creek to Pueblo, where it meets the Arkansas. Colorado Springs owns this water and wants to be able to sell it to as many people as possible. But right now, that water just flows on by the ditches of many possible buyers, and ends up in a reservoir over 60 miles away. Two things happen in that process. First, a lot of water evaporates. Second, by passing by all those ditches, the Springs loses a lot of customers for its water — unless it wants to pay to pump the water back uphill. With the Morleys’ land, Utilities could store the water much sooner, which minimizes evaporation and gives the Springs more possible downstream buyers. Also, gravity will draw the water into the reservoir, and back out of it as well, eliminating the need for expensive pumps. The Morleys say their reservoirs could replace one of two reservoirs Utilities plans to build, at less than a fifth of the cost. The kicker: Utilities doesn’t need to make a payment to the Morleys for five years…

So the Morleys get a small profit, the city gets $12 million (which the Morleys will get by taking out a loan), and Utilities saves money. Not a bad deal. Only problem is, Utilities wasn’t planning on even thinking about its reservoir issue until 2016, and as good as the Morleys make it sound, Utilities may see drawbacks. Another possible negative: The Morleys paid just $6.275 million for the whole lot of land in 2005, and now they want nearly $40 million for just one part of it. The Morleys say it’s worth the extra cash — and then some — because the land is permitted and the reservoirs are partially engineered. But Utilities may disagree.

More Southern Delivery System coverage here and here.

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