For a few months it was standing room only in the meeting room at the Pagosa Area Water and Sanitation District. Lately, the room has been more than half empty.
Half of that more-than-half-emptiness is owing to decisive action taken by the PAWSD board to dramatically reduce impact fees for half the future construction market: commercial, lodging, multifamily and affordable housing.
 Half of that emptiness is due to the full realization by local builders and realtors that the water districts are going to do nothing decisive about impact fees for single family residential construction during this construction season. Arguments against $70,000 fees for small restaurants are easy to make. Arguments for and against the residential fee schedule recently adopted are much more complicated. Meeting fatigue has also set in for many.
Of course, boards are not permitted meeting fatigue. And the Special Joint Meeting of PAWSD and the San Juan Water Conservancy District is worth attending. Discussion of any aspect of the Dry Gulch Reservoir Project can become a discussion of every aspect, so a discussion of nearly every aspect could produce anything.
First, the water boards will discuss whether or not to join in a joint impact fee study with the Town and County to be undertaken by Economic and Planning Systems (EPS). EPS is perhaps the most highly regarded public finance and land use consultant in the Mountain West. In 2006, the firm calculated a reservoir impact fee of $1129 for the Dry Gulch Reservoir. PAWSD rejected that figure and imposed a per tap fee of $6343 based upon the calculations of its water engineer Steve Harris.
Can PAWSD work with the Town and County on a joint impact fee program? The odds are not great. Impact fees calculated by professional methods attempt, with as much mathematical precision as possible, to calculate the impact of new development and divide that cost over every new home or business. PAWSD is planning to construct a 35,000 acre-foot facility at Dry Gulch which would service nearly twenty times present demand.
Simply put, PAWSD in 2006 priced the cost of a 150-year project over the next 40 years of new customers (remember growth was inevitable then), resulting in an impact fee 400% higher than any buy-in or replacement methodology would permit. Note, however, that PAWSD has only raised this fee 10% over the past two years, a period during which building costs for water infrastructure has jumped over 200%. Perhaps over 300%.
PAWSD may find itself charging the same fee in 2009 for a 12,500 acre-foot reservoir that it assessed for a 35,000 AF project in 2006, and able to more fully distribute the costs over the taps that reservoir would service. The districts will also consider a proposal later in the session to employ a different impact fee analyst — the highly regarded BBC Consulting — to develop a professional impact fee program based upon updated costs (emphasis on “up”) for both the 12,500 AF and 35,000 AF Reservoir Models.
Key here is the meaning of “both.” Will the districts seriously consider the costs of a 12,500 AF reservoir (114 feet high; 1 million cubic yards in volume)? Or only a 12,500 AF stage within a 35,000 AF project? Will the cost estimate be for a reservoir 12,500 AF high but 35,000 AF thick (2.3 million cubic yards)? If the districts choose to build 35,000 AF thick, the cost savings of building a 12,500 AF “stage” will not be great.
Next, the boards will consider critical land acquisitions. First, land needed for any reservoir at Dry Gulch, in particular a parcel owned by the Laverty family which will form the western wall of the reservoir. That parcel, whose cost in loan documents this summer was “not to exceed $1.5 million”, has already been raised to $2,020,000. How high might this price go? Would the districts go to court and force the sale by eminent domain? And would a court force the sale of more than the small fraction of the Laverty property needed for the reservoir, taking property from the Laverty’s not for a reservoir but for a recreation facility and campground?
Second, the boards will consider future purchases of land not needed for the Dry Gulch project. Will the districts seek a readily obtainable special use permit for Forest Service land needed for a 12,500 AF project or will they pursue over $10 million in land purchases and swaps to gain ownership of land needed to build the 35,000 AF model?
And will these land swap negotiations continue with no public input or oversight, and under the direction of SJWCD President de facto Fred Schmidt, who must juggle these responsibilities with his frequent appearances in court for juggling the books of his own enterprises?
The driest topic on the agenda concerns water rights. The districts possess a medley of water rights along the San Juan they would like to concentrate at the diversion point at the Dry Gulch site. If permitted, this would either provide the project with water rights it may fail to win in its present court case, or add to rights it may win in that case.
Finally, there will be discussion about the public education program the district is initiating. This will include the possible formation of a citizens committee. Who is to be educated? The public about the board’s unerring perspectives? Or the board about the concerns and criticisms of the project? Or both? Will this be an honest dialog amongst supporters, critics and agnostics of the current 35,000 AF project or more of the Ballot Measure 1A eyewash?
Lastly, the boards will disappear into executive session to discuss future land purchases and swaps. Actually, the room will be told to clear.
Before the taxpayers leave the room, they might ask two questions. First, have the boards made the decision to make audiotapes of these meetings, and thereby join every other major board in Archuleta County? That, of course, would require taping of the executive sessions where the million dollar land swaps are discussed.
And second, why is the public leaving the room while Fred Schmidt remains behind in charge of these land purchases? Do the districts honestly expect a public education campaign to be effective when millions of dollars in controversial land swaps are being overseen by the most disreputable businessman in the County. A man who has been described by Judge Lyman as having a “disposition to defraud”?
One final note. The controversial decisions made by the PAWSD board about the 35,000 AF project and corresponding fees weren’t made for no reasons. They followed the deepest drought in 300 years and an unprecedented buying and building boom (perhaps more buying than building). It is only natural to start out committed to planning and wind up more committed to your plans than the planning.
These plans won’t change without public input. How do you feel about the growth that a 35,000 AF Project — 1700% times present demand — presumes? Even if you wish to see an Archuleta County with 17 City Market Plazas and 17 high schools, should we take on the debt to build such a project in ten years? Who pays the tab if this staggering growth doesn’t follow the $300 or $400 million investment?
Well, of all the questions posed in this piece, that’s the easiest to answer.
What are the costs if this 1700% growth does follow approval of the 35,000 AF Project? That may be incalculable.
Official Notice
NOTICE IS HEREBY GIVEN that a Work Session and Special Meeting of the Board of Directors of the Pagosa Area Water and Sanitation District have been scheduled for Monday, September 8, 2008, at 3:30pm. The primary purpose of this Work Session and Special Meeting is for joint discussions with members of the Board of Directors of the San Juan Water Conservancy District related to various water matters and raw water development projects. Following the Work Session, the Boards of Directors are expected to convene to a Special Meeting and enter into executive session for the purposes of discussing matters related to property acquisition, other matters subject to negotiation and legal advice pursuant to Sections 24-6-402(4)(a), 24-6-402(4)(b),and 24-6-402(4)(e), C.R.S. The Work Session and Special Meeting will be held at the District’s administrative offices located at 100 Lyn Avenue, Pagosa Springs, Colorado.
PAWSD/SJWCD JOINT MEETING
DRY GULCH RESERVOIR PROJECT
SEPTEMBER 8, 2008 3:30PM
AGENDA
I. EPS PROPOSAL
A. PARTICIPATION
II. LAND ACQUISITION
A. LAVERTY
B. DAVIDSON
C. AREI
D. USFS
1. LAND EXCHANGE
2. FOREST SERVICE SPECIAL USE PERMIT
III. DIVERSIONS AND DUE DILIGENCE CASES
A. SNOWBALL WATER RIGHT USE AT DRY GULCH (PAWSD)
B. UPDATE REGARDING SAN JUAN INTAKE DUE DILIGENCE
C. UPDATE REGARDING TOWN IRRIGATION WATER RIGHTS DUE DILIGENCE
D. RESOLUTION TO AUTHORIZE FILING OF WEST FORK DUE DILIGENCE IN WATER COURT (SJWCD)
E. RESOLUTION TO AUTHORIZE FILING OF DRY GULCH RESERVOIR DUE DILIGENCE IN WATER COURT (SJWCD)
IV. TECHNICAL TEAM STATUS
A. COORDINATION OF TEAM MEMBERS
B. 2008 ACTIVITIES
C. COST PROPOSALS FOR FEE ANALYSIS (MWH, BRILIAM, BROWN BORTZ, CODDINGTON)
D. 2009 ACTIVITIES
V. FUNDING
A. GRANTS
B. LOANS (CWCB, WELLS FARGO)
C. FEES (DISCUSSION REGARDING M. WEILER’S MONTHLY ASSESSMENT SUGGESTIONS)
D. PARTICIPATION WITH OTHER ENTITIES
VI. PUBLIC EDUCATION
A. DRY GULCH LISTENING LOG
B. PUBLIC PRESENTATION
C. NEWSLETTERS
D. WEBSITES
E. RADIO
F. NEWSPAPER
G. CITIZENS COMMITTEE
VII. EXECUTIVE SESSION
A. DRY GULCH LITIGATION
B. PROPERTY ACQUISITION
C. FOREST SERVICE SPECIAL USE PERMIT
D. DIVERSIONS
1. SNOWBALL WATER RIGHT USE AT DRY GULCH
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