Colorado Springs Utilities plans to appeal judgment that favored Pueblo-area rancher — The Colorado Springs Gazette

Southern Delivery System route map -- Graphic / Reclamation
Southern Delivery System route map — Graphic / Reclamation

From The Colorado Springs Gazette (Billie Stanton Anleu):

Colorado Springs Utilities has filed notice that it intends to appeal a jury’s $4.6 million judgment in favor of rancher Gary Walker, who let Utilities build a 5.5-mile pipeline on his land for the Southern Delivery System.

Walker and Utilities had agreed that the easement was worth $82,900, and the pipeline was installed on his northern Pueblo County land in 2012 as a conduit for the Southern Delivery System, or SDS.

That regional project is designed to pump Arkansas River water from the Pueblo Reservoir to Colorado Springs, Fountain, Security and Pueblo West, delivering up to 96 million gallons a day to those communities. Water delivery was expected to begin in 2016.

At trial, Walker’s counsel said Walker was negotiating a conservation easement worth more than $30 million with the Nature Conservancy, but degradation of the utility easement destroyed those prospects.

Colorado Springs, which owns Utilities, “had no opportunity to prepare a rebuttal to this surprise, unprecedented argument,” said the notice of intent to appeal filed late Thursday.

The notice questions, among other things, how a property value can be agreed upon at $82,000 and then valued at more than $30 million before a jury, and whether it was appropriate to deny the jury an opportunity to view the property.

The Pueblo County District Court jury deliberated for nine days before rendering its verdict April 23.

Neither Walker and his attorneys nor the Nature Conservancy returned calls Friday.

But SDS spokeswoman Janet Rummel said storms on the land drained water onto the pipeline alignment, causing erosion after the easement had been restored.

“We’ve been working ever since to fully restore it,” Rummel said. “His attorney was claiming actually not as much about the reclamation, but really about his lack of ability to ensure future conservation easements on his property. We really saw no evidence presented that that was the case. That was changing the big concern at the 11th hour of this trial. We need to take into account the effects on our ratepayers.”

Utilities paid Walker about $720,000 to move his cattle and laid irrigation lines along the easement to ensure that plants for restoration would survive, she said.

“From our perspective, we’ve gone above and beyond to address the concerns raised.”

The Fountain Creek Watershed, Flood Control and Greenway District isn’t taking a position on the legal battle, said Executive Director Larry L. Small. But the district is supposed to receive $10 million every year for five years to mitigate the extra flow that Fountain Creek will experience.

“If this drags on, it could impact SDS from becoming operational – and our revenue. That wouldn’t be too good because we’re waiting for that money to begin doing the work we need to do.”

From The Pueblo Chieftain (Chris Woodka):

Rains along the Southern Delivery System pipeline scar through Walker Ranches is again causing flooding problems in northern Pueblo County.

“Prior to the SDS crossing Walker Ranches, we never had floods like these from that area,” said ranchver Gary Walker. “Mother Nature’s defenses took care of it.”

Walker is involved in litigation with Colorado Springs over the 5.5-mile stretch of buried 66-inch diameter pipeline. A jury in April awarded Walker $4.665 million in damages, which Colorado Springs is appealing.

On Friday, rains created a river of mud along the pipeline route, causing some flooding in adjacent areas. Walker supplied aerial photos to The Pueblo Chieftain that show water crossing and sheet off the pipeline scar, with several hundred feet of plastic irrigation pipe — used for revegetation — hanging above a chasm of rushing water.

Walker said this is a violation of Colorado Springs Utilities’ commitments under Pueblo County’s 1041 permit for SDS because the area has not been returned to pre-construction conditions.

He first raised the issue of the pipeline route, which crosses arroyos, in 2008. He wanted the pipeline to follow the route of the Fountain Valley Conduit, constructed in the 1980s, which he said would be less damaging to his ranchland.

“Now Walker Ranches will become part of the flooding problem to downstream residences of Fountain Creek and the Arkansas River,” Walker said. “These are not Biblical events. Our weather is just returning to normal and our drought is ending, as any ‘old-timer’ like me will tell you.

From The Pueblo Chieftain (Chris Woodka):

Colorado Springs Thursday appealed a $4.665 million jury award for damages to Walker Ranches by the Southern Delivery System water pipeline.

The appeal was made in Colorado Court of Appeals in Denver.

The city’s lawyers said the April 23 verdict was delivered after a nine-day trial without any other findings or calculations.

The city’s lawyers added they had no chance to rebut the closing argument of Walker Ranches’ lawyers that the SDS pipeline across 5 miles of the property had diminished the value of surrounding land and that testimony did not support the verdict.

They also claimed the basis for diminished value of the property was not revealed until opening arguments and the value itself only in closing arguments.

A court judgment on the $4.665 million award was entered Wednesday by Pueblo District Judge Jill Mattoon.

Gary Walker, whose family owns the land, said the Nature Conservancy was negotiating with him to buy conservation easements for $1,680 per acre on about 15,000 acres, about $25 million.

“The city had no opportunity to reply to this surprise, unprecedented argument,” Colorado Springs attorneys wrote in the appeal.

Neither side disputed the value of the $82,900 150-foot-wide utility easement for a buried 66-inch diameter pipeline which Colorado Springs offered $1,400 an acre.

Colorado Springs’ filing lists 14 points of law, as well as a catch-all “any other issues” that were not covered by crossappeal.

Among the points raised by Colorado Springs lawyers is whether conservation can be considered the highest and best use for property, a topic Walker elaborated on in an interview with The Pueblo Chieftain after the trial.

Walker explained that conservation is the main purpose for Walker Ranches and illustrated that by pointing out that the millions of dollars from previous conservation easements was used to purchase more land with the intent of preserving ranch land and open spaces for future generations.

Colorado Springs’ attorneys also raised the question of whether Mattoon erred by denying the jury an opportunity to view the property.

More Southern Delivery System coverage here.

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