Colorado Springs Utilities officials attended a public meeting at the Bent County Courthouse in Las Animas on Friday to address the concerns of the Bent County Board of Commissioners and the public regarding Colorado Springs' purchase of Lower Arkansas Water Management Association shares from Arkansas River Farms.
Colorado Springs Utilities acquired 2,500 LAWMA shares in a purchase agreement with LAWMA and ARF on July 11, 2018. Colorado Springs Utilities did not, however, disclose their participation in the purchase to Bent County, despite a 1041 permit issued to LAWMA and ARF in April 2018 that required, in addition to other stipulations, that all benefactors of the acquisition be disclosed.
Private negotiations between ARF, LAWMA and Colorado Springs Utilities began as early as July 2017, even though Bent County did not learn of Colorado Springs Utilities' involvement until a year later, according to a memorandum from the Denver-based water law firm of Petros & White compiled from over 7,200 pages of correspondence and thousands of documents obtained from Colorado Springs Utilities through a Colorado Open Records Act request. Ray Petros serves as counsel for Bent County in relation to water issues.
Bent County commissioners want to know why Colorado Springs Utilities opted to not reveal its participation in the agreement and whether they intend to adhere to the 1041 regulations.
"For me personally, you've already stepped in it because of the fact that you were not honest and open with us at the very beginning," said Commissioner Jean Sykes. "My question is, why did you make concerted efforts to keep this from Bent County?"
Kim Gortz of Colorado Springs Utilities Water Resources Planning answered that Colorado Springs Utilities signs non-disclosure agreements with its partners when they enter into a term sheet, an agreement that sets forth the basic terms and conditions of an agreement.
"At that point, none of the partners could have discussions with anybody," said Gortz. "It wasn't just Bent County, it was with anybody else who might undermine that deal.
"In the end, we needed water and, again, we really want to look at how we go forward and not as much look at the past. We understand that this is the where we are today and we hope that we can find a path forward with Bent County and with others."
"It scares me that all of this property is being dried up permanently," said Bent County Commissioner Kim MacDonnell. "Even if it's being shared elsewhere in the LAWMA system, including other places in Bent County, it would have been nice to have that discussion around the table."
"They did do that and so, I can't give you a good answer, or I'm not even going to attempt to answer, why Bent's not at the table," said Scott Lorence of Colorado Springs Utilities. "All I can tell you is we're here now saying 'Let's work through this.'"
MacDonnell asked what responsibilities Colorado Springs Utilities believes it has due to being beneficiaries of some of the water in the 1041 permits granted to LAWMA and ARF.
"I think that having terms and conditions negotiated with the county prior to even filling out a decree that spells out what those obligations are, I think that's the road we should be working on," Lorence replied.
Colorado Springs Water Services Officer Earl Wilkinson said the utilities department is concerned about revegetation and wants address it.
Residents, farmers and ag-businessmen voiced their concerns over Colorado's Springs Utilities acquisition of 2,500 shares, with some sharing their distrust for the municipal entity's claims of intent to revegetate the land associated with the shares and not to pursue more LAWMA shares in the future.
Petros said of the public hearing that he heard, in essence, an apology for the secrecy behind the deal between ARF and LAWMA.
"And, I think, a pledge not to transact that kind of business again," said Petros. "I think there was also a pledge not to acquire additional Fort Lyon shares in this manner, unless they have the support of Bent County, which I think was an important pledge. A lot of work needs to be done, though, to work through this.
"Why that doesn't cover their need now for their demand of 136,000 acre feet needs to be examined," continued Petros. "I understand issues of uncertainty with climate change and so on, but it certainly impacts the communities here [when] they go after the water."