City of Aspen rejects settlement proposal in Castle and Maroon dam cases — @AspenJournalism

Wild berries in the meadow near the Maroon Bells that would be flooded by a Maroon Creek Reservoir. Photo credit Brent Gardner-Smith.

From Aspen Journalism (Brent Gardner-Smith):

The city of Aspen has rejected an initial settlement offer made in the unfolding water court cases about conditional water rights tied to two large potential dams on Castle and Maroon creeks.

On May 23 the city’s water attorney, Cynthia Covell, sent a letter to the water attorney for the Larsen Family Limited Partnership, rejecting its settlement proposals made on May 8 and 11.

“Aspen cannot accept your client’s settlement offer,” Covell told Larsen Family attorney, Craig Corona.

The Larsen’s proposal required the city to stay, or put on hold, it’s two current applications to the court to extend its conditional storage rights for another six years.

Then the city could file a new request with the water court to change those conditional water rights to another location and size outside of the Castle and Maroon creek valleys and somewhere within the city limits.

“Our offer was quite clear that there were terms that could be negotiated, and the basic concept was that we would support (along with the other opposers) Aspen’s relocation of its dam rights, in a location and amount to be determined through negotiation,” Marcella Larsen of Larsen Family LP said.

In his May 11 letter, attorney Corona told the city, “If there’s no objection and the change is decreed, dams won’t be built in the wilderness and the city will retain its water rights – a win-win.”

But establishing new water storage rights within city limits, with a 1971 priority date, without opposition, may be hard to do, even with the opposing parties in the current cases sitting on the sidelines.

The current water court review was triggered when the Aspen filed two applications in October to maintain its conditional water storage rights, which were decreed in 1971.

Larsen Family LP is one of ten opposing parties in the resulting “due diligence” cases now before the Division 5 water court referee in Glenwood Springs.

The other parties include the U.S. Forest Service, Pitkin County, four environmental organizations, and three owners of high-end residential property in the Castle and Maroon creek valleys.

Corona told the city there was a “general consensus” among the other parties in the case in support of the Larsen Family proposal, which technically only pertained to the Maroon Creek Reservoir case.

But the city decided to sit on its cards.

On May 22, the council held an executive session to discuss, in part, the water court cases.

On May 23, Covell sent Corona the city’s rejection letter.

Corona then sent the letter to the other opposing parties.

“A new application to change the location (of) the Maroon Creek Reservoir conditional storage right would require that a new location be specified,” the city’s May 23 letter said, according to an attorney in the case. “Aspen must complete its supply/demand study and identify an alternative location or locations for the Maroon Creek Reservoir storage right in order to be able to file a change application to move that right, or some portion thereof, to another location.”

Asked about the rejection of the settlement offer, Aspen City Manager Steve Barwick would only say last week via email that ”the City of Aspen is still working with all parties in the water case with the hope of reaching a mutually agreeable settlement. We are still trying to refine water supply and demand estimates and study alternative storage locations.”

A second closed-door and facilitated settlement meeting hosted by the city for the opposing parties is being set up for the first week of August. The first such meeting was held in March.

A map showing the location of the potential Maroon Creek Reservoir.

1965 filing

The city’s conditional storage rights on Castle and Maroon creeks date back to 1965, when the first told the water court it intended to build two reservoirs to meet forecasted demands.

In October 2016, the city again told the state it still intends to build the reservoirs, someday, if necessary.

But since October the city has also has been openly studying alternatives to the two reservoirs, and doing so with the knowledge that it’s possible, in some water court cases, to move and adjust conditional storage rights.

As currently decreed the Maroon Creek Reservoir would hold 4,567 acre-feet of water behind a 155-foot-tall dam just below the confluence of East and West Maroon creeks, within view of the Maroon Bells.

And the Castle Creek Reservoir would hold 9,062 acre-feet of water behind a 170-foot-tall dam across Castle Creek two miles below Ashcroft.

Both dams would flood some portion of the Maroon Bells –Snowmass Wilderness.

The city has done little work on the reservoirs since the mid-1960s. But since 2012 when the rights came into public view, city staffers have increased their warnings to the city council about the city’s lack of storage, save for nine acre-feet at the water treatment plant.

A staff memo for the May 15 work session, for example, said “the Aspen community will face significant challenges maintaining its water supply as we experience changing precipitation and runoff patterns, and possible increased fire, drought, change in runoff timing and lower snowpack levels due to climate change.”

But a raw water availability study prepared by Wilson Water Group in June 2016 indicated the city would not need any storage in the future, although it may need to curtail some irrigation if it wants to maintain minimum flow levels on Castle and Maroon creeks.

And while the council adopted the Wilson Water study as a formal planning document last year, it also recently contracted with an economist at Headwaters Corp. to develop new scenarios illustrating a range of needs and varying levels of risk in a hotter and drier future.

Margaret Medellin, a utilities portfolio manager with the city, told the city council on May 15 that the work from Headwaters will not be complete until the end of summer. And more studies may then be necessary.

That’s been a frustration to Corona.

“Instead of engaging in meaningful settlement discussions, the city engaged a myriad of consultants at great expense to study its ‘needs’ when it already has a demand study,” Corona told the city on May 11. “This work should have been done before filing the application, not after.”

Corona’s May 11 settlement letter also contained a number of other messages for city.

“The City is concerned with giving up the current locations for the dams,” Corona wrote. “But, the City can’t build the reservoirs there, anyway. It would take twenty to forty million dollars (at least) to condemn private property for the Castle Creek dam. The City would need a special use permit to inundate Forest Service property, and private legislation from Congress to inundate wilderness – highly improbable, if not impossible. So, if the City transfers the rights to a new location that has challenges, the City will be no worse off than they are now.”

“The City’s claims are weak,” he also told the city. “In almost fifty years, the City has done almost nothing to develop these rights. The City has no need for storage, especially not a sixty-year supply, according to the City’s engineers. Unless the City settles, it will not come out of these cases with its water rights intact.”

“The delay for the City’s studies is unnecessary and is self-inflicted. With no need for storage, it should be simple to determine a reasonable supply amount and risk,” he also wrote. “The 1,200 acre feet we originally offered would give the City a five-year supply. Is the City concerned that Castle Creek and Maroon Creek will be completely dry for more than five years? If that happens, 1965 reservoir rights are not going to help.”

And he told the city it can expect ongoing opposition from Larsen Family LP.

“Larsen Family LP will never stipulate to diligence for dams in the wilderness,” Corona wrote. “It seems it should be easy for the City to say it will never dam the Maroon Bells. But, apparently, that’s not the case.”

The location of the potential Maroon Creek Reservoir.

How much water?

There is also a question about how much storage the city thinks is really necessary.

The combined storage of the two potential reservoirs in Castle and Maroon creeks, is 13,629 acre feet, or almost 14,000 acre-feet. Ruedi Reservoir, by comparison, holds 100,000 acre feet.

Aspen city council member Bert Myrin said on May 15 he did not think that the city would ever need more than about ten percent of the conditional 14,000 acre-feet described in the city’s conditional rights.

Myrin said council members should know the size of the need before studying various alternatives, such as an “in-situ” reservoir under the city’s golf course, which could hold about 1,200 acre feet.

“I think it would help us to have a better idea of the problem we’re trying to solve before we try and solve the problem,” he said.

But Scott Miller, Aspen’s public works director, said the result of the Headwaters Corp. study will not be a single number.

“We’ll have a range of risks,” Miller told the council members. “A range of need, and a range of risk. Then you guys are going to lead the discussion about where we go from here.”

Marcella Larsen, of Larsen Family LP, Larsen also responded to questions in writing from on Aspen Journalism on May 31 about the settlement proposal:

Larsen is a retired attorney and served for four years as the assistant Pitkin County attorney from 1997 to 2001. Her remarks, as perhaps the most aggressive of the opposing parties in the two cases, are notable.

AJ: In a May 23 letter, the city informed your attorney that it could not accept your settlement offer because it had not developed an alternative location for the Maroon Creek Reservoir storage right. First, to clarify, your settlement offer was for both the Maroon and Castle creek reservoirs, correct?

ML: The Larsen LP is a party only in the Maroon Creek case, but it was our understanding that the other opposers, including Pitkin County, the U.S. Forest Service, the multiple environmental non-profits, and other private property owners whose properties would be inundated by Aspen’s dams were all generally open to pursuing the offer further. The offer was a concept that would be worked out among the parties, and could have included the Castle Creek side, but unfortunately Aspen rejected it out of hand.

AJ: Next, the city says it is still defining how much storage it needs. Do you yet understand whether that means the city needs something less than a combined nearly 14,000 acre feet of storage?

ML: The City hasn’t said they need less than the 14,000 acre feet claimed and, at their latest work session, they maintained the possibility they will need all 14,000 acre feet. However, Aspen’s own 2016 Wilson Water Group Water Supply Availability report shows that Aspen has no need for any water storage, much less giant dams in wilderness areas. As in zero need. That study concludes that Aspen will only need 231 acre feet per year in 2064.

Wilderness Workshop and Western Resource Advocates recently shared their analysis of how Aspen might simply conserve water to avoid dams in wilderness areas. Instead of trying to justify 14,000 acre feet of storage that would provide sixty-five years of unneeded storage, we wish Aspen would identify a realistic storage amount and location. As evident from our settlement offer, we will support Aspen storage in locations other than the White River National Forest and wilderness areas—and that’s even if Aspen choses to build storage it does not need.

AJ: Your settlement offer included a condition that the storage be located within the city of Aspen. Was that a firm condition? If so, why was it included?

ML: Our offer was quite clear that there were terms that could be negotiated, and the basic concept was that we would support (along with the other opposers) Aspen’s relocation of its dam rights, in a location and amount to be determined through negotiation. Again, that offer was rejected by Aspen. The reason we included a condition that the relocated water storage be located in Aspen (and let’s be clear about what we are talking about here, which would be industrial-scale development, similar to other extractive industries), is because we believe Aspen should not externalize the impacts of its growth and force others (Pitkin County, the Forest Service, private property owners, and the public) to bear the burden of Aspen’s failure to adequately plan for and control its own growth. (Again, this assumes that storage is actually needed, or will be built by Aspen regardless of need.)

AJ: What do you expect from the city’s supply/demand study from Headwaters?

ML: The credible and credentialed expert Aspen hired in 2016 to prepare Aspen’s Water Supply Availability report concluded that Aspen “can always provide sufficient potable and raw water supplies” without dams/reservoirs. When Aspen realized that the Wilson Water Group’s finding conflicted with their desire to continue with dam rights up Castle and Maroon Creek, they hired an economist (not a scientist) to prepare a new report.

We expect this new “study” from Headwaters will do what Aspen wants it to do: prove up an extreme “Mad Max” scenario where both Castle and Maroon Creeks are obstructed for a long period of time, wildfires burning, land sliding, and water short. Also, expect huge projected population increases, where many in this dystopian “Mad Max” world decide to make Aspen their full-time home. In short, we expect this new “study” will attempt to demonstrate the “need” for storage Aspen’s prior experts, the Wilson Water Group, did not support.

AJ: Have you heard a credible explanation why the Wilson Water study is somehow incomplete?

ML: No. Wilson Water Group provided the type of demand analysis typical for municipal planning, and prior to Aspen’s water court filing, there was no indication Aspen believed it was “somehow incomplete.”

AJ: You’ve reserved the right to re-refer the case to the water judge at the July status conference. Do you think you will do that at that time?

ML: We reserved the right to re-refer the case at any time between the last status conference on May 9 and the next one on August 10. The City wants to have a settlement conference in late July or early August. We are looking for some indication from Aspen that they will commit to moving the dams out of wilderness areas, along the lines we already offered. If Aspen continues to advocate for wilderness dams without any offer of settlement, then, yes, of course we will re-refer the case. Aspen’s wilderness area dams, in the iconic Maroon Bells, should be opposed by everyone, except for perhaps the Trump Organization. We will do our part to further that cause, as I’m sure the other opposers will do as well, because Aspen’s dams in national forest and wilderness areas is fundamentally bad public policy and contrary to the values of our environmentally-conscious, nature-respecting, slow-growth community.

Editor’s note: Aspen Journalism is collaborating with The Aspen Times, the Glenwood Springs Post Independent, the Vail Daily and the Summit Daily on coverage of water and rivers in the upper Colorado River basin. The Times published a shorter version of this story on June 13, 2017.

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