Colorado Springs Utilities offloads property, city Parks Department gains 

Taking a loss

click to enlarge Rough terrain in northeast Colorado Springs would become city open space. - COURTESY COLORADO SPRINGS UTILITIES
  • Courtesy Colorado Springs Utilities
  • Rough terrain in northeast Colorado Springs would become city open space.
Sage- and cactus-covered bluffs in far northeast Colorado Springs afford million-dollar views of the Front Range.

Make that $6.5-million-dollar views.

That’s how much Colorado Springs Utilities paid to buy about 400 acres of land — including some deals with wildly inflated prices — in the Jimmy Camp Creek area for a reservoir about 16 years ago.

Those plans washed out, though, and now Utilities is liquidating the property.

The biggest beneficiary of that Utilities miscalculation is the public.

That’s because the city’s Parks, Recreation and Cultural Services Department plans to buy about 300 of those acres dotted with yucca, prairie grasses and antelope that connect Jimmy Camp Creek Park with Corral Bluffs Open Space.

So what began as a scramble to snap up property amid a drought to advance a city water project — storage for water pumped through the Southern Delivery System pipeline from Pueblo Reservoir — has emerged as a conservation effort to secure property before the developers’ bulldozers arrive.

One part of the plan — selling homes back to some owners — was expected to receive approval on Oct. 8 from City Council, which was slated to act as the Independent went to press.

The second step — the Parks purchase — goes to Council next month.

So all’s well that ends well in a years-long escapade that cost Utilities ratepayers a bundle.

“It’s almost like a dream come true,” says Britt Haley, the city’s parks design and development manager, “to have so much consolidated property.”

click to enlarge The city Parks Department hopes to purchase most of the Jimmy Camp Creek parcels. - COURTESY COLORADO SPRINGS UTILITIES
  • Courtesy Colorado Springs Utilities
  • The city Parks Department hopes to purchase most of the Jimmy Camp Creek parcels.

In 2003, as
drought persisted and the city’s water needs grew, Utilities was willing to pay any price for the Jimmy Camp reservoir land — and it did.

Utilities shelled out $4.3 million for 15 parcels and paid another $2.2 million to fund some owners’ relocation costs. It then handed long-term leases to those who decided to stay on those properties, charging a mere $300 a month until construction on the reservoir project was imminent, which never happened.

In one case, Utilities paid a couple $840,925 for a parcel with a two-bedroom home — $500,000 for the property and $340,925 in moving costs. That property appeared on tax rolls at the time with a market value of $182,000. (The real estate deals triggered sharp criticism from City Council, which also serves as the Utilities Board. Eventually, in 2007, Council imposed new rules for land acquisitions, including requirements that Council be consulted on certain transactions rather than leaving them to staff.)

The negotiated purchases granted 10 of the 15 property owners first dibs to buy back their properties if the city ever deemed them surplus.

Utilities made that ruling on the property’s being surplus earlier this year — three years after the SDS pipeline from Pueblo Reservoir went on line in April 2016, and 10 years after Utilities abandoned Jimmy Camp as a reservoir site when researchers discovered archeological values there.

The alternative, 2,500 acres in the Upper Williams Creek area on Bradley Road, cost ratepayers more than $20 million. (The reservoir, yet to be built, is named for Gary M. Bostrom, a former Utilities water official, who died in 2017.)

Of those allowed to buy back their properties, four have opted to do so at appraised value, says Utilities spokesperson Natalie Eckhart.

Taken together, those four properties’ agreed-upon sales prices total $941,300, according to backup materials provided to Council.

That’s $173,700 less than the $1,115,000 paid by Utilities for those properties in 2003 and 2004 but more than their combined current value of $801,550, as reported by the El Paso County Assessor’s office.

The remaining 11 parcels destined for city open space, with Council approval, carry a pricetag of $3,188,100. That’s less than the nearly $3.3 million Utilities paid. Today, the assessor sets values on those parcels at a combined total of just over $3.4 million.

If $420,000 in rental income received by Utilities over the years is figured in, Utilities will show a $1,950,856 loss on its Jimmy Camp reservoir venture.

Councilor Bill Murray regrets the loss, but supports the plan to liquidate the property.

“Hindsight is rarely 100 percent,” he says via email. “The first purchase was thought to be needed for the SDS system. Now it’s considered surplus and the owners have first right of refusal and have taken advantage of this right.”

As for the land Parks wants to buy, Murray says, “Failure to secure these properties now will result in opportunities lost. While I regret the [financial] loss and will constantly be diligent in monitoring expenses, I will stand behind these specific transfers as being in the best interests of our city.”
Utilities’ loss is the Parks Department’s gain, it seems, and Parks gets first crack under the city’s real estate procedures that require shopping surplus property to other city departments before it’s advertised to outsiders.

The Trails and Open Space (TOPS) Working Committee, which Haley says has $11.5 million in uncommitted open-space funding, unanimously approved the proposed acquisition on Oct. 2. Council is due to consider the purchase on Nov. 12.

Trekking over the sandy soil the Parks Department hopes to acquire, Haley, Eckhart and Utilities’ land resources specialist Jessica Davis survey the rugged landscape that provides habitat for antelope, deer, foxes, porcupines, golden eagles and falcons.

The purchase, as Haley notes, enables the city to secure the property ahead of development’s creep as the adjacent Banning Lewis Ranch takes shape. “Parks wants to do this before development comes,” she says.

Nor’wood Development Group, which owns most of the vast 20,000-acre ranch, has indicated a desire to “work together” on expanding the open space, Haley says, but those talks remain in the early stages. (Nor’wood has previously expressed interest in selling or donating land to the city in that vicinity but didn’t respond to a recent email seeking comment.)

“It’s rare to have one landowner capable of selling a connection like this,” Haley says, referring to the Utilities property. “If Parks is fortunate enough to get the [land] connection, that would allow us to do a master plan for both [Jimmy Camp and Corral Bluffs].”

Perched on a ridge, an unoccupied adobe-style home seems to provide an obvious opportunity to be converted into a visitors center, which Haley acknowledges is being considered.

Snapping up the span between the 665-acre Jimmy Camp Creek Park, as yet undeveloped, and 900-acre Corral Bluffs will help bring balance in the Eastside’s open space inventory with that of the Westside.

Over decades, the city has pieced together thousands of acres of open space and parks along the city’s mountain backdrop, from Blodgett Peak to Cheyenne Mountain State Park. Among those: Garden of the Gods Park, 1,334 acres; Stratton Open Space, 318 acres; North Cheyenne Cañon Park, 1,600 acres; Red Rock Canyon Open Space, 1,474 acres.

Moreover, Council was poised on Oct. 8 to approve spending another $1.3 million in TOPS money to add 164 acres to 1,680-acre Cheyenne Mountain State Park.

Aside from Corral Bluffs and the 650-acre Bluestem Prairie Open Space south of Colorado Springs Airport, the Eastside hasn’t seen a similar level of investment.

“The east side of the city deserves it and wants it,” Haley says.

The TOPS Working Committee also is contemplating another acquisition on the city’s far northeast side, namely 154 acres around Kettle Creek, which has appraised at $5.8 million.

For now, Parks officials are thrilled to add the Utilities property to its stable, helping to close a rather sticky chapter in which Utilities bought and sold land it never used.

“I do believe the big win is for Parks,” Eckhart says.

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