Tuesday, August 9, 2011

NEW UPDATE: 150-mile water pipeline gets Cherokee District nod

Posted By on Tue, Aug 9, 2011 at 2:00 PM

NEW UPDATE: Cherokee Metro District's manager Sean Chambers sends us this explanation of where the process stands in selecting a water provider:

I wanted to let you know that there is no contract or scheduled decision on any of the water supply proposals under consideration by the Cherokee Metro District. At the Board’s direction, I developed a Request For Proposals (RFP) for water supply projects that would meet the District’s short term and possibly long term needs. The District’s short term emergency supply agreement with the City of Colorado Springs Utilities terminates at the end of 2012 and Cherokee depends on that agreement for 800 AF — 1,000 AF, the quantity of water needed to supply 2,300 single family homes for one year. The RFP was reviewed by the Board and consultants and then distributed to folks in the water business and posted to the Cherokee web page on June 27th with all proposal responses due by close of business on July 11, 2011.

Ongoing water supply planning work including at decision support matrix containing detailed information on the seven proposals was presented to the Board at the July 27th Special Meeting on water supply projects and proposals. Following a summary discussion in public session and upon further review, the Board elected to narrow the field to those projects that met the submittal requirements and which posed a realistic possibility of being deliverable on or before December 31st, 2012, when the City Utilities agreement runs out. Four projects remain, the District’s legal consultants have undertaken a data collection and due diligence effort and the District’s Hydro-geology groundwater engineer has been consulted. There is significant diligence work yet to be completed, there is analysis of the business prospects of each deal yet to be completed and there is a financial analysis yet to be run before a final project will be given a notice of award.

The District and its Board take their fiduciary responsibility to our customers very seriously, and we face the prospect of being out 1,000 AF in 17.5 months with eyes wide open and with a concerted effort to seek, budget, identify and close on a water deal that make good fiscal sense to our bottom line while being able to deliver the wet water that our customers desperately need.


[UPDATE posted at 2:33 p.m. Monday]

UPDATE: Colorado Springs Utilities spokesman Dave Grossman says, "As with any potential utility project near our service territory, we will continue to monitor the proposal to determine if there are any potential impacts on our water operations."


[ORIGINAL POST at 11:43 a.m. Monday]

If you think piping water 42 miles uphill from Pueblo Reservoir to Colorado Springs is a stretch, and some people do, how about pumping water 150 miles from Lamar to El Paso County and the Denver area?

That's the idea the Cherokee Metropolitan District is buying into, along with another water provider in Arapahoe County. Nobody knows the total cost of such a project, but Cherokee board member Steve Hasbrouck is afraid to find out.

Hasbrouck: Fighting secret government.
  • Hasbrouck: Fighting secret government.

He opposes the deal, along with board member Larry Kelerher, but the other three board members — Jan Cederberg, Bill Behan and Dave Hammers — approved working out a contract at the board's July 27 meeting.

The board meets against tomorrow to hammer out the details, all behind closed doors.

But not if Hasbrouck has anything to say about it. Citing a Colorado statute governing special districts, he says the board must have a two-thirds majority to go into executive session, which translates to four votes on a board of five. With him and Kelerher opposed, the board can't hold a closed session.

"GP and Cherokee are trying to keep this secret, because GP wants all of this to be private," he says.

Moving water from Lamar to Elbert and El Paso counties and north is the brainchild of Karl Nyquist, head of GP Water Group, which is spearheading the project that will include the pipeline, treatment plant and storage reservoirs.

The Denver Post has written about this guy's proposals for while now, most recently today. It reports a meeting is planned sometime soon in El Paso County, but gives no details.

The Cherokee district needs more water because it lost use of several wells in court decisions in recent years. It had started talking about acquiring water from the Horse Creek Ranch east of the district, but the board on July 27 decided to abandon those talks in favor of GP.

Hasbrouck opposes the 150-mile pipeline and has plenty of legitimate questions about it, such as what quality of water it would deliver and how much it would cost. The district must pay GP $500,000 a year for the next three years in non-refundable earnest money just to get the deal rolling, Hasbrouck says.

Hasbrouck says board member Hammers is the developer of an industrial park that gets water from Cherokee, and stood before the Board of El Paso County Commissioners not long ago outlining a plan to install a massive medical marijuana grow operation of up to 200,000 square feet. One might presume the development, whether MMJ or anything else goes there, would require water.

Cherokee has been buying water the last few years from Colorado Springs Utilities, but that deal expires in 2012. Chances are, the district could negotiate another temporary deal, though, because CSU is looking for customers to whom they can sell water from the expensive Southern Delivery System pipeline that begins bringing water here in 2016.

It was originally designed to serve the Banning Lewis Ranch, but most of those 23,000 acres remain undeveloped and might never be developed if a Houston oil company gets its way. Ultra Petroleum bought 18,000 acres of the ranch out of bankruptcy recently and wants to drill oil and gas, not build homes and businesses there.

Bottom line: CSU might be interested in the same customers to whom GP is marketing its 150-mile pipeline water, such as special districts in the vicinity that rely on dwindling groundwater wells. We've asked Utilities for their thoughts on GP, but representatives haven't responded. If we hear something, we'll let you know.

Meantime, the closed session of the Cherokee board meeting is slated to begin at 3:30 tomorrow at the district headquarters at 6250 Palmer Park Blvd. There might be fireworks if the board tries to break the law and meet secretly.

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