Colorado hopes to protect the integrity of conservation easements by cracking down on the monkey business

February 20, 2015
Saguache Creek

Saguache Creek

From the High Country News (Jennie Lay):

Perched at the podium during a Colorado Coalition of Land Trusts gathering, Erin Toll wears a poker face, a smart black pencil skirt and sassy Jimmy Choos. Among the jeans-and-hiking-boot-clad crowd attending, this wry New York transplant seems an unlikely hero. As recently as last fall, Toll, director of the Colorado Division of Real Estate, had no idea what a conservation easement was. But now, she says, protecting the integrity of land conservation is her number-one priority – and she’s cracking down on crooked deals with a vengeance.

Toll’s new enthusiasm for conservation easements, which offer landowners tax breaks in exchange for accepting limits on their right to develop, couldn’t come at a better time for Colorado’s land trusts. The state has seen some of the fastest-paced land conservation in the country, driven by a boom in both land trusts – the nonprofit organizations that hold easements – and in government open-space programs. Coloradans have protected nearly 1.8 million acres with conservation easements, much of it fueled by innovative tools, including a lottery-funded land protection program and a transferable state income tax credit.

Unfortunately, though, tax benefits sometimes breed abuses. And questionable conservation deals are drawing intense scrutiny – including Toll’s investigation into inflated real estate appraisals in Colorado and an ongoing Internal Revenue Service audit of hundreds of tax returns nationwide claiming federal tax breaks for donated easements. While state investigation and reform is moving swiftly, the federal audits have dragged on, frustrating landowners and creating confusion about easement appraisals.

The legal and financial complexities of conservation easements have reached a crossroads in Colorado. “What happens in Colorado could bleed out to the rest of the country,” says Lynne Sherrod, Western policy manager for the national Land Trust Alliance.

To help ferret out abusers, Toll has issued 30 subpoenas since November. So far, she’s suspended two appraisers who inflated appraisal values on more than 35 conservation easements. (She’s still wading through 44 boxes of evidence and says, “Every day we find more.”) The jacked-up appraisal values exploit a state program that offers landowners up to $375,000 in transferable tax credits for conservation easement donations. Land-conservation professionals say the program has been critical in protecting more than a million acres (at a cost of about $274 million) across the state since it took effect in 2000.

Although the majority of the state’s conservation easements are rock-solid, Toll rolls her eyes as she reveals some of the more outrageous exceptions. In a sampling of conservation easements from one group, Noah Land Conservation (also known as Colorado Natural Land Conservation), Toll found gross overvaluations of 111 easements on the eastern plains. The scheme involved 6,100 acres valued at $76.5 million (hence eligible for $37 million in state tax credits) by a mere three appraisers, on parcels that were meticulously subdivided so they could slip past county and state laws regarding acreage or subdivision development. In one particularly egregious example, the appraised value of a single 640-acre ranch leaped more than $14 million in a matter of days. Toll’s investigation is ongoing, but she’s narrowed the state’s spoilers down to about eight appraisers (including the two she’s already sanctioned), a couple of attorneys and a promoter or two – and their offenses, including possible securities fraud, could spread into the realm of other government agencies.

More conservation easement coverage here and here.


The Colorado College State of the Rockies Project releases the 2015 Conservation in the West Poll

February 17, 2015

consesrvationinthewestpoll2015stateoftherockies

Click here to go to the State of the Rockies Project website to read the report. Here’s an excerpt:

The 2015 Conservation in the West Poll, now in its fifth year, was recently released by Colorado College’s State of the Rockies Project. The survey of 2,400 registered voters in six western states provides an annual glimpse of voters’ leanings on land use, water supplies, the impact of public lands on the economy, and a variety of other related issues.

Designed by a bipartisan team of Republican and Democratic opinion researchers, the annual poll provides insight into Western attitudes. This year’s results are consistent with those of previous years, although a few new questions probed opinions of public-land management and the perceived relationship between environment and quality of life.

Four hundred residents in each state – Arizona, Colorado, Montana, New Mexico, Utah, and Wyoming – were asked about such issues as conservation, environment, energy, the role of government, trade-offs with economies, and citizen priorities.

The poll, conducted Dec. 29, 2014 and Jan. 3-11, 2015, has a margin of error of 4.9 percent.

Here’s an excerpt from the Colorado poll:

Colorado15stateoftherockies


“Conservation has been successful and will be an integral part of meeting our future water needs” — Jim Lochhead

February 10, 2015
Cheesman Dam spilling June 2014 via Tim O'Hara

Cheesman Dam spilling June 2014 via Tim O’Hara

From The Denver Post (Bruce Finley):

Maybe it is projects such as replacing 10,000 toilets in Denver Public Schools. Maybe it is Denver Water’s ceaseless “Use Only What You Need” campaign. Or maybe residents seeing scarcity are self-motivated. Whatever the reasons, water use in metro Denver has dipped to 40-year lows.

The total amount residents used in December decreased to 3.19 billion gallons, and in January to 3.36 billion gallons — down from previous winter highs topping 4 billion gallons, utility officials said.

The last time December use dropped this low was in 1973 when Denver had 350,000 fewer people.

“Our customers are responding. … Conservation has been successful and will be an integral part of meeting our future water needs — along with reuse and new supply,” Denver Water manager Jim Lochhead said.

The low use this winter continues a trend of declining water use despite a growing population. Denver residents use 82 gallons a day per person for all indoor and outdoor purposes, utility data show. That’s down from 104 gallons in 2001 and puts Denver ahead of other Western cities that are counting on conservation to avoid running dry.

Water supply has become more of a challenge around the West, with population growth and droughts projected to be more frequent and severe. The crisis in California, where mountain snowpack lags at 25 percent of normal, prompted Interior Secretary Sally Jewell to meet with Gov. Jerry Brown last week to hash out relief.

Farmers use the most water, by far, for food production — an 85 percent share in Colorado. Yet it is city dwellers who are making the greatest strides in water conservation.

Denver Water leaders last week declared a new target for 1.3 million customers: 30 gallons a day for indoor use.

The overall water conservation effort relies on a widening strategy: rebates for those who switch to water-saving appliances, tiered water rates that encourage using less, summer lawn-watering restrictions, and a rule that all new development must include soil “amendments” so that soil retains more water.

Water bills still are relatively low. Denver Water charges about $455 a year for households using less than 115,000 gallons, compared with $1,283 in Arapahoe County and $890 in Colorado Springs.

The recent low use likely resulted partly from citywide conservation projects, utility officials said — including the replacement of toilets in 140 public schools with low-flow models designed in Japan.

Denver Public Schools field supervisor Jeff Lane said current toilets use 3.5 gallons per flush while the Toto toilets use 1.25 gallons. That’s expected to save the city 65.9 million gallons a year.

So far, district crews have replaced 3,200 toilets, Lane said this week at Colfax Elementary. The rest should be done by 2018.

Less water coursing through 4-inch iron and clay sewer lines could complicate the effort, Lane said. “It could get caught up.” But Denver Water officials said they’ve investigated and that, as long as lines are in good condition, there shouldn’t be a problem.

Denver Water pays DPS rebates of $90 per toilet. DPS officials said they’ll also sell old brass parts, $2 a pound, to help finance the switch.

The reduced water use also is attributed to Denver Water “messaging” using billboards, television and utility bills. Last month, bills contained blurbs touting the 30-gallon target. “Each person in an average single-family house should use roughly 30 gallons inside per day, or better yet, shoot for less!”

This is “something to aspire to,” Lochhead said.

Water bill blurbs also exhorted residents to “rethink your fixtures,” consult with neighbors because “understanding how others conserve will help you, too,” and replace portions of lawns with low-water shrubs.

A widening awareness of water supply challenges also appeared to be motivating residents to use less. “Whether it is a drought in Colorado or the West,” Lochhead said, “water availability is becoming a more familiar topic for many people.”

More conservation coverage here.


Connecting the Drops: #COWaterPlan discussion Sunday, January 25

January 23, 2015
Colorado Water Plan website screen shot November 1, 2013

Colorado Water Plan website screen shot November 1, 2013

From email from the Colorado Foundation for Water Education:

Join radio listeners around Colorado for a statewide conversation on Colorado’s Water Plan during a live call-in discussion this Sunday January 25th from 5-6 pm.

Hear from:

  • James Eklund, Director of the Colorado Water Conservation Board
  • Jim Pokrandt with the Colorado River Water Conservation District
  • Chris Woodka with the Pueblo Chieftain
  • Listen online or on the radio with KGNU, KRCC, KDNK and other community radio stations across the state. Your calls and questions will be welcome at 800-737-3030, engage online by emailing water@kdnk.org or join the discussion on Twitter using #cowaterplan. Hear about the basics of the water plan, how you can get engaged, what input is still needed and phone in to ask your questions and direct the discussion.

    Sunday’s program is part of Connecting the Drops, a collaboration between the Colorado Foundation for Water Education and Rocky Mountain Community Radio Stations.

    More Colorado Water Plan coverage here.


    Colorado Water Wise: Sign up for the @projectwet workshop on February 10 in Greeley

    January 22, 2015


    Resolve to conserve in 2015

    January 2, 2015

    Originally posted on Mile High Water Talk:

    2015 on snow at mountains
    We all can take more steps to use water wisely. This year, make a resolution to conserve with these five easy steps:

    1. Look at the upper right corner of your bill. See that chart? That’s how much water you’re using on average per day. Each person in an average single-family house should use roughly 40 gallons inside per day. Aim for that number, or better yet, shoot for less!
    2. Rethink your fixtures. Some people think their 10-year-old toilet is efficient, when it probably isn’t. You can save on your water and sewer bill by replacing your toilets with an ultra-high-efficiency model. And as an added bonus, get a rebate for up to $150.
    3. Make a plan to modify part of your landscape. Winter is the perfect time to outline changes for your outside living area. Maybe your landscape could benefit from an efficient drip system, or maybe part of…

    View original 98 more words


    “There are a lot of good tools out there that could create informal and formal benefits” — Amy Beatie

    December 26, 2014

    Screen shot from Peter McBride's video arguing that the Crystal River should be left as is

    Screen shot from Peter McBride’s video arguing that the Crystal River should be left as is


    From Aspen Journalism (Brent Gardner-Smith) via The Aspen Times:

    The Pitkin County Healthy Rivers and Streams Board unanimously agreed Thursday to approve a $45,000 grant to help the East Mesa Water Co. repair an irrigation ditch on the Crystal River as long as the ditch company agrees to talk with the county about ways to leave more water in the river.

    The grant comes with the condition “that the shareholders of the East Mesa Ditch agree to engage with the river board and consider working with Pitkin County on matters of irrigation efficiency and measures to protect instream flows and the free-flowing nature of the Crystal River.”

    The condition was left broad, as there are no routine ways in Colorado to improve an irrigation system and then leave any saved water in a river despite the fact that 86 percent of the water diverted from Colorado’s rivers is for agriculture.

    On Friday, Dennis Davidson, a consultant helping East Mesa secure funding for the ditch-repair project, said the 12 shareholders in the ditch company would likely accept the county’s condition.

    “I don’t see why they wouldn’t,” said Davidson, who had not conferred with the shareholders yet. “There is no reason for them not to talk with them.”

    After presenting to the river board Nov. 20, Marty Nieslanik, president of East Mesa Water Co., said, “I think all of us we want to see the river healthy, too. I mean, it’s not like we’re trying to hog all the water; it just takes water to do what we do.

    “We need the water to maintain our lifestyle, but if there is any way that we can make that water more efficient, then maybe there is some way that we can leave some of it the river.”

    The East Mesa Ditch repair project includes shoring up a collapsing tunnel and installing 1,200 feet of new pipe. The project is still being engineered, and the projected cost is now $700,000.

    East Mesa has raised $410,000 for the project from state and federal sources so far. That does not include the river board’s $45,000 grant, which still must be approved by the Pitkin County commissioners, who are set to review it Jan. 6.

    The repairs to the ditch are not expected to result in more water for the river, but other improvements, such as piping or lining more sections, installing high-tech control gates and using sprinklers in fields, could likely save water.

    The 8.5-mile-long ditch irrigates 740 acres of land southeast of Carbondale. Of the 740 acres, 180 acres are under a conservation easement either through Pitkin County Open Space and Trails or the Aspen Valley Land Trust.

    East Mesa is the second-largest diversion on the Crystal River, which in summer can run well under the environmental minimum set by the state of 100 cubic feet per second.

    The ditch has two water rights that allow it divert as much as 42 cfs of water. One right is from 1904 and is for 32 cfs. The second is from 1952 and is for 10 cfs.

    Pitkin County’s river board, created in 2008, is funded with a 0.1 percent sales tax, which is expected to generate $850,000 in 2015. The board has budgeted $150,000 for grants next year.

    The board is charged with “improving water quality and quantity” in the Roaring Fork River watershed and “working to secure, create and augment minimum stream flows” in conjunction with nonprofits and government agencies. The board also can improve and construct “capital facilities.”

    While the vote to award East Mesa the grant was unanimous, some board members questioned whether fixing an irrigation ditch was consistent with the board’s mission.

    “Our job isn’t supporting ag and open space,” said Andre Wille, the chairman of the board. “Agriculture and healthy rivers are two different things.”

    But board member Bill Jochems supported the grant, saying it could increase support among irrigators for federal protection of the upper Crystal River.

    And board member Dave Nixa suggested that East Mesa talk to the nonprofit Colorado Water Trust, which works with water-rights owners to find ways to leave water in rivers.

    “There are a lot of good tools out there that could create informal and formal benefits,” said Amy Beatie, the executive director of the water trust, who was pleased Friday with the river board’s decision.

    Rick Lofaro, the executive director of the Roaring Fork Conservancy, is working with irrigators in the Crystal River Valley as part of developing a management plan for the river.

    “The goodwill and the momentum this could create could really be precedent-setting,” Lofaro told the river board Thursday.

    Aspen Journalism and The Aspen Times are collaborating on coverage of rivers and water. More at http://www.aspenjournalism.org.

    Meanwhile, he East Mesa Water Company is asking Pitkin County’s Healthy Rivers and Streams Board for dough to pipe the ditch, according to this article from Brent Gardner-Smith writing for Aspen Journalism:

    The East Mesa Water Company is asking Pitkin County’s Healthy Rivers and Streams Board for a $45,000 grant to help cover the $550,000 cost of installing 1,450 feet of new pipe in the 8.5-mile-long East Mesa Ditch.

    The irrigation ditch can divert up to 42 cubic feet per second of water out of the Crystal River 9 miles above Carbondale, but it typically diverts about 32 cfs.

    The proposed East Mesa Ditch project entails installing 48-inch plastic pipe on a failing section of the irrigation ditch that includes an 80-year-old, 650-foot-long tunnel and a hillside that often sheds rock and mud down toward the ditch.

    The work will keep the ditch functioning but won’t result in more water being left in the Crystal River, which is a goal of the county river board.

    “As a board, with our mission, we’d like to keep as much water in the river as we can,” Andre Wille, the chair of the county river board, said Nov. 20 during the review of the East Mesa application. “If we can improve the efficiency of that ditch, and leave the rest in the river, that would be in our interest.”

    Dennis Davidson, a consultant for East Mesa Water Co. with more than 40 years experience at the Natural Resource Conservation Service, said there would be “minimal” water added to the river from the repair project, as it only included adding 1,450 feet of pipe to a 8.5-mile-long ditch.

    But, he noted, if the ditch were fully piped, which he said would cost $20 million, there would be water savings.

    “If we lined the East Mesa Ditch from beginning to end, we would probably get by diverting 50 percent of the water that we divert,” Davidson told the river board.

    The ditch “loses as much as 35 percent of the water in the ditch due to seepage through the course and rocky soil,” according to a feasibility study from East Mesa submitted to the Colorado Water Conservation Board in a funding application.

    The East Mesa Ditch typically runs the first two weeks of May until about mid-October. It sends water to 740 acres of land between 1 and 5 miles south of Carbondale, most if it with big views of Mount Sopris and some of it protected with conservation easements.

    The water is used for cattle ranching, and growing nursery trees, forage crops and hay.

    On paper, the East Mesa Ditch is the second biggest diversion on the lower Crystal.

    The largest diversion on the river is the Sweet Jessup Canal, which can divert 75 cfs. It is located about a mile-and-a-half upstream from the East Mesa diversion structure.

    When the Sweet Jessup, the East Mesa and the Lowline Ditch, which is just downstream of East Mesa, are all diverting, water levels in the Crystal River often drop well below the environmental minimum of 100 cfs set by the state.

    According to a study done by consultant Seth Mason in 2012, the river below the diversions dropped to 4 cfs Sept. 4 and to 1 cfs Sept. 22, 2012.

    “Near complete dewatering of the stream channel was observed through much of September at Thomas Road and near the Garfield/Pitkin County line,” Mason, with Lotic Hydrological, LLC, said in his 2012 report.

    Need to divert all the water?

    The East Mesa Ditch has a senior water right for 32 cfs that dates back to 1894 and a second water right for 10 cfs from 1942.

    Davidson told the river board that in his experience in the Roaring Fork River Valley, 20 cfs is usually enough to irrigate 800 acres of land.

    As the East Mesa Ditch typically diverts 32 cfs to irrigate 740 acres, does that mean there is as much as 12 cfs of water that could potentially be left in the river and still allow for adequate irrigation?

    No, according to Marty Nieslanik, president of the East Mesa Water Co.

    He said the full 32 cfs of water needs to be diverted today to act as “push water” to convey water to the end of the long irrigation ditch.

    “We figure we lose two feet of water from our head gate to the last person who takes it out,” Nieslanik said.

    He also said that some of the diverted water also returns to the river.

    “After it dumps out at our ranch, it comes down the draw and drops in right below the fish hatchery,” Nieslanik said. “So that’s why you see the big difference as you drive down the Crystal, it’s almost dry and then all of a sudden there is a lot of water there.”

    Nieslanik told the river board that the company was “trying to make our water go further.”

    “If we can get that whole mesa irrigated with 25 feet of water, we may let six or eight of water go by to help the river maintain its levels,” he said.

    “It would be good to understand the benefits,” river board member Lisa Tasker told Nieslanik about the project. “We are very interested in the natural hydrograph and trying to mimic that as best as possible.

    “Speaking for myself, I would love to leave a little bit of water coming down the river to help the river out, if we could somehow make that happen,” Neislanik said after the meeting. “We need the water to maintain our lifestyle, but if there is any way that we can make that water more efficient, then maybe there is some way that we can leave some of it the river.”

    Money for water

    The East Mesa Water Company is on track to raise $410,000 toward its ditch-repair project, whether or not the county’s Healthy Rivers and Streams Board agrees to a grant.

    The company will receive a $300,000 grant from the federal Natural Resource Conservation Service when the work is complete.

    It has secured a $60,000 grant from the Colorado River Basin Roundtable and a $25,000 grant from the Colorado River District. And it has requested a $25,000 grant from the Colorado Soil Conservation Board.

    The company also has obtained a $375,000 loan from the Colorado Water Conservation Board, which is to serve as a bridge loan until the project is complete and grant funds come in, Davidson said.

    There are 12 shareholders in the East Mesa Water Co., and 1,003 shares have been issued to them, based on the size of their land holdings. Owners are assessed an annual fee of $15 a share, which brings in $15,000 a year. The company has no debt.

    “The East Mesa Water Co. operates on assessments of the water users,” according to the feasibility study given to the Colorado Water Conservation Board. “For many years, the ditch company has kept the assessments as low as possible as many of the users are just getting by.”

    The largest shareholders in the company include Paul Nieslanik, who owns 200 shares, John Nieslanik, who owns 185 shares, Tom Bailey, whose Iron Rose Ranch owns 185 shares and Richard McIntrye, who owns 168 shares.

    Marty Nieslanik told the county the hay grown with water from the East Mesa ditch was worth about $500,000 a year under a calculation of four tons of hay per acre, on 740 acres, at $170 per ton.

    At the end of Nieslanik’s presentation, the members of the Healthy Rivers and Stream Board agreed to meet in December to continue to review East Mesa’s application.

    The Healthy Rivers and Streams Board will next consider the East Mesa application Thursday at 4 p.m. in Pitkin County’s Plaza 1 meeting room.

    Aspen Journalism and The Aspen Times are collaborating on coverage of rivers and water. More at http://www.aspenjournalism.org.

    More Crystal River coverage here.


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