Douglas County will not use COVID funds on San Luis Valley water project

County may consider proposal in future, but Laydon's vote puts on brakes for now


The Douglas County commissioners have decided not to use American Rescue Plan Act dollars on a controversial water supply project but may consider it again in the future.

Commissioner Abe Laydon, the decisive vote on the issue, announced his vote during a May 24 work session.

“Right now there are simply too significant and enormous of hurdles for us to move forward on this project,” he said. “That’s not to say that we can’t explore this in the future, I think we certainly can, but RWR will have to do significant additional homework on all of these fronts to accomplish that.”

Laydon said his decision was because the county’s outside legal counsel concluded that the project was not eligible for ARPA funds and recommended the county not participate.

The project, proposed by a private company called Renewable Water Resources, would have attempted to pull 22,000 acre-feet of water per year from the San Luis Valley, permanently drying up wells in the area, and transporting it to Douglas County. Residents and water districts from the valley along with politicians and leaders throughout the state have come out strongly against the project, saying there is no extra water to remove from the valley and that it would irreparably damage the community.

Commissioner George Teal, who has long been in support of the project, urged the commissioners to still consider it despite the legal counsel recommendation.

“Douglas County needs water,” he said. “We should be moving forward on everything, on every possibility.”

Teal received campaign contributions for his commissioner seat from Sean Tonner, one of the leaders of RWR.

Laydon said he is not closing the door on the project but that some of the major hurdles identified would need to be mitigated before they can move forward.

“I’m OK with continuing conversations with RWR on innovative ways to address this,” he said. 

One issue outlined in the memo, prepared by outside counsel and water attorney Steve Leonhardt, is that RWR has not formed an augmentation plan — as would be required by law — showing how they will avoid injury to other water rights through their project.

"RWR’s augmentation plan is still in the early, conceptual stages; RWR has not yet developed an augmentation plan in sufficient detail to demonstrate that its plan will meet the requirements of the rules and avoid injury to other water rights," according to the memo.

The legal analysis found "several enormous hurdles" in the proposal, including that there is "no unappropriated water" available for RWR's proposal, inconsistency with the state's water plan and projected struggles with needed permitting.

"The permanent retirement of thousands of acres of irrigated lands makes it very difficult to create a 'win-win' with the San Luis Valley," according to the memo.

The memo went on to say that the valley is "genuinely in crisis" due to its persistent drought conditions.

"The socioeconomic and environmental implications of this dryup are difficult to predict and difficult to resolve," according to Leonhardt's memo. "Some of the rhetoric from local opponents has been overblown or has misconstrued RWR’s proposal. However, many of the fears are real, can’t be dismissed and won’t be easily resolved."

Commissioner Lora Thomas has been against the proposal since it was brought before the county and said she is not in support of continuing any conversations with RWR or paying for outside legal counsel to continue assessing it. 

Thomas added that the county has heard from South Metro Water Supply Authority that no water providers in the county have voiced interest in participating in the RWR proposal since they have dedicated funds to other projects.

“We aren’t water providers,” Thomas said. “I think that the commissioners need to listen to our water providers on what they need from us for before we continue spending county dollars for things that are not our expertise.”

RWR initially asked the county for $20 million to fund the project but later amended their request after ARPA rules were announced, giving a time limit on projects funded by the money. They suggested the county instead invest $10 million from their general fund and then use a portion of ARPA funds to backfill the budget. Laydon said the memo analyzed that option and disagreed with RWR’s legal counsel that such an action would be allowed under the federal rules. 

The two legal memos prepared for the commissioners and used by Laydon to make his decision are available to the public upon request now that the decision has been announced.

In an emailed statement, Protect Our Waters, a coalition  of water districts, local governments and environmental groups, called the decision good news. 

"We will remain vigilant to continue to monitor Douglas County’s ongoing discussions with RWR to ensure that we continue to fight this at every turn,” according to the release.

A spokesperson for RWR also emailed a statement following the decision:

"Our team is eager to address the county’s remaining questions as raised in the legal analysis. We are confident in our ability to mitigate any areas of concern," according to the statement.


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