From Aspen Journalism via the Aspen Daily News (Brent Gardner-Smith):
“The city of Aspen water department does not have the water rights for a hydro plant on Castle Creek, period,” Dick Butera told Aspen City Council at a June 27 meeting. Butera owns a large home overlooking Castle Creek just below the city’s diversion dam on the stream. He told the council that he and a group of other local landowners are willing to sue the city to prevent the hydro project from going forward.
Butera made his comments at a meeting when council approved increasing the spending authority for the hydro plant and an associated pipeline from $7.3 million to $8 million, and transferring $2.8 million from the water fund to the renewable energy fund to cover the cost. “Two of the leading water attorneys in the state of Colorado have both said to our committee that we have a 90 percent chance of winning the case to prove that the water department does not even have the water rights,” Butera said.
But Aspen’s water attorney maintains that the municipal government’s water rights remain in good standing and the city has never intended to abandon its option to use the water for hydropower. “The city has decreed absolute water rights,” said Cynthia Covell, an attorney with Alperstein and Covell in Denver. “They are decreed for power purposes and they have never been found to be abandoned in any court proceeding. I think that the city can do the project that it wants to do with the water rights it has.”[…]
Sarah Klahn, an attorney hired by Pitkin County to independently review the city’s hydro project, said last week that even if an abandonment lawsuit was successful, the city could still likely obtain new water rights for the new hydro plant. “I know that it is possible to still get a new appropriation, especially on a non-consumptive use,” said Klahn, who is with White & Jankowski in Denver…
Covell, the city’s water attorney, has a different take on the matter. “The fact that the city stopped generating electricity at that time does not mean they abandoned the right to do so,” Covell said. “The city has not intended to abandon. And intent is a piece of abandonment. We think we can defend an abandonment case.” Still, city officials are aware there is a danger of losing all or some of their water rights by not exercising them.