After months of hearings the Bent County Commissioners addressed the findings of the Arkansas River Farms and Lower Arkansas Water Management Association show cause hearing last week.
At the last show cause hearing on Jan. 17, commissioners had further prodded Karl Nyquist, partner at Arkansas River Farms, over the transfer of water shares between his company and the Lower Arkansas Water Management Association. They also raised revegetation and 1041 permit compliance issues. 1041 regulations are rules that give local governments the power to regulate areas and activities of state interest, namely development projects, through a local permitting process.
In total there were six findings that the commissioners would address during the morning. The findings dealt with the reporting, a missed deposit, the role of Colorado Springs Utilities, compliance with reclamation standards, the use of water management association shares in Bent County and economic development.
One of the major findings dealt with the failure of ARF to utilize a substantial portion of its remaining 3,580 water management association shares on up to 4,300 acres of pivot farms in the county. Bent County Commissioner Kim MacDonnell said that this finding goes all back to the failure to disclose Colorado Springs Utilities, who received 2,500 water management association shares as a result of the permit.
“The statement that a substantial portion of the remaining 3,580 LAWMA shares were going to be utilized on x, y, or z in Bent County could not have been true, given the fact that 2,500 of those 3,500 shares … was already in the process of being sold to Colorado Springs utility,” MacDonnell said.
She went on to say that one of the main reasons behind agreeing to the terms of the permit was based on a proposal that would’ve brought in a dairy farm.
“I understand for those in the room who are already saying ‘we didn’t promise a dairy,’ I know you didn't promise a dairy. But the fact remains that a dairy wasn't even possible given the fact that the water shares that are being discussed were already out the door,” she said.
MacDonnell said that the projections of annual tax revenue from the proposed dairy farm was roughly $648,000 a year. Now those projections show that the projects they’ve started will only average $88,000 per year in new property tax over a 10 year period.
She continued to say that they would be remiss to the residents of the community if they accept the replacement value now. Which is why the commissioners encouraged the applicants to come forward with a direct cash contribution to Bent County Economic development.
The failure of the applicants to identify Colorado Springs Utilities in the permit application affected the permit in more ways than one according to the commissioners.
“This violation is the most egregious violation in my opinion … as we go on through the continued order this failure to disclose impacted other areas of the permit and precluded the county from making decisions with full knowledge,” MacDonnell said.
Bent County Commissioner Jean Sykes said that if they would’ve known that the water wasn’t going to be left here it would’ve made a difference in their decision making.
“I wasn’t on the board at that time, but from the information I read it just seems like Bent County was led to believe there was going to be this large dairy and it would consume a lot of farm products, provide a lot of jobs and add over $600,000 a year in property tax revenue,” Bent County Commissioner Chuck Netherton said.
Instead Netherton said ARF sold off the water to Syracuse Dairy and then sold the remaining 2,500 shares to Colorado Springs Utilities. Sykes piggybacked off this by saying that the commissioners were told on the 1041 permit that the idea was to take the additional water shares and stack them to make some of the farm ground more efficient. However, that wouldn’t have been possible because the water shares were already sold off at that point.
One potential remedy given by MacDonnell was through a direct hard cash contribution to Bent County Economic Development. She asked that participation by Colorado Springs Utility in direct reclamation efforts have a resolution within the next 90 days.
“I’m on the tail end but I’d like to see Colorado Springs Utility held somewhat responsible or liable for this. Because they were kind of hiding in the weeds all along and no one knew, I just think they should have been on the permit to start with,” Netherton said.
Another finding was about the failure to comply with standards for reclamation of Dry-up parcels. MacDonnell said that there was a lot of discussion at the show cause hearing about when non-compliance kicked in.
While that question could still remain on the table she said that the language shows the county can intervene if the conditions are required if the process is inadequate. Based off of information given to the commissioners by experts they were shown that the process of reclamation of dried up lands as it stands is inadequate.
The commissioners voted unanimously to increase reclamation cost based on information they have been given at hearings. The reporting done by the applicants was also mentioned as one of the failures by commissioners.
“As you said, paragraph 2f of the permit provided that at each interim review a report would be submitted … The initial report that was submitted was inadequate and the first interim report was woefully inadequate, there was not even a name attached to the author of the report,” MacDonnell said.
This led MacDonnell to state that the reporting area continues to be inadequate. She added that the reports need to be detailed and substantive in terms of methodology, inspections, locations and dates.
The commissioners voted unanimously to find failure by the applicants to provide accurate and complete reporting. Which led them to direct staff to continue discussion with the applicants to shore up exactly when the reporting is done and its substance.
The second finding addressed had to deal with the alleged failure by applicants to deposit $20,000 to Bent County to cover costs associated with the counties experts’ participation in annual field inspections.
“I would like to state that I think that also was a mistake that has been corrected. But I guess one of my concerns is that there is going to be an increased cost with the inspections just due to inflation and the amount of inspections needed and that amount may need to be bolstered a little bit to cover the counties expenses,” Netherton said.
To address this the commissioners voted unanimously to direct staff to work with the applicants to try and require the additional funds necessary to complete the inspections.
It was the commissioner's determination on Thursday that this hearing wasn’t a final order to the show cause. Jean Sykes said that they have found preliminary findings of the violations, so the matter will remain open.