City Reaches Agreement with Plaintiffs in Lawsuit over Hydro Water Rights


 

 

PRESS RELEASE

 

City Reaches Agreement with Plaintiffs in Lawsuit over Hydro Water Rights

 

 

Contact:  Steve Barwick, Aspen City Manager, 970-920-5212 and steve.barwick@cityofaspen.com and Dave Hornbacher, Director of Utilities and Environmental Initiatives, 970-429-1983 or dave.hornbacher@cityofaspen.com



 

Aspen, Colorado – October 21, 2013 – The City of Aspen and a group of plaintiffs claiming Aspen has abandoned the hydro purpose of its water rights on Castle and Maroon Creeks have reached an agreement to stay an upcoming trial and instead hire a mutually agreed upon consultant to study stream health and potential impacts of the Castle Creek Energy Center (CCEC).  The agreement, which was filed in court on October 18, 2013, states the study will examine Aspen’s proposed CCEC project and determine a bypass amount of water to be left in the streams when and if the CCEC hydro plant is operating.  The study will also “evaluate the effects of Aspen’s CCEC diversions of water on Castle Creek (a) from the point of diversion to the point of return on Castle Creek and (b) on Maroon Creek from the point of diversion to the confluence of Maroon Creek and the Roaring Fork River.”  The plaintiffs, who live near Castle Creek or Maroon Creek, have expressed concerns about appropriate bypass amounts.



 

The agreement stipulates both parties, the City and the plaintiffs, will work in good faith to identify and agree upon a consultant, a Request for Proposals and the scope of the study.  Both parties agree to pay half of the consultant fee up to $150,000 unless they agree to raise that amount.  If the two sides cannot reach agreement on a consultant, scope or terms of the study, the case will proceed to trial.



 

The study will include a means for public input, which is important for this project specifically but also because it is part of Aspen’s larger goal of having a 100% renewable electric utility by 2015.



 

“The policy discussion should take precedence over lawsuits, so we’re happy to stay this trial,” said Barwick.  “There are upcoming policy questions that the City Council and community will have to discuss about how Aspen should achieve its renewable energy goals.”

Both parties have agreed that once the study is completed they will either dismiss the lawsuit and enter an agreement on how Aspen will operate the CCEC and any future hydro projects that divert these water rights in compliance with the study’s findings or adopt a Consent Decree that will include a finding of non-abandonment of the water rights and Aspen’s agreement to divert those rights for hydro purposes in compliance with the study’s bypass amounts.



 

A complete copy of the Memorandum of Understanding is below.

 

MEMORANDUM OF UNDERSTANDING

This Memorandum of Understanding (“MOU”) is entered into on the date set forth below, by and between T. Richard Butera, Maureen Hirsch, Christopher Goldsbury, Jr.; Elk Mountain Lodge, LLC; Crystal, LLC; Ashcroft, LLC; American Lake, LLC; and the Bruce E. Carlson Trust (“Plaintiffs”), and the City of Aspen, Colorado (“Aspen”), collectively referred to herein as “the parties.”

RECITALS:

A.    The parties to this agreement are parties to a lawsuit, Case No. 11CW130, Water Division 5, T. Richard Butera et al. v. City of Aspen (the “Lawsuit”). In the Lawsuit, Plaintiffs allege that the hydroelectric purposes of certain Water Rights (as defined in paragraph 3 below) owned by Aspen have been abandoned, and Aspen denies that the Water Rights (or any portion or purpose thereof) have been abandoned.



 

B.    The parties have reached a conceptual agreement, as described below, which will involve the parties moving the court to stay the trial in the Lawsuit, currently set to begin on October 28, 2013, under the terms of this MOU.



 

C.    By this MOU, the parties wish to reduce to writing their conceptual settlement and agreement for staying the lawsuit.

NOW, THEREFORE, the parties agree as follows:

1.     Stay of Lawsuit. Upon execution of this MOU by their respective counsel, the parties agree to immediately and jointly move the Court to vacate the trial date and to stay the Lawsuit, and counsel will work with the Division 5 Water Court to accomplish this as soon as possible (the “Stay”).



 

2.     Stream Ecology Study.  The purpose of the Stay is to allow the parties to cooperate in engaging a qualified independent, neutral, stream ecology expert with experience studying streams which have comparable characteristics to Castle and Maroon Creeks (the “Consultant”), to study Aspen’s proposed Castle Creek Energy Center (“CCEC”) project, and determine a bypass amount of water, to be left in the stream by Aspen when and if operating the Midland Flume Ditch, Castle Creek Flume Ditch, and Maroon Ditch water rights (the “Water Rights”) for hydroelectric purposes at the CCEC. The parties agree that they shall use their best efforts to define the stream health goals to be achieved by said bypass amount of water.  The study will evaluate the effects of Aspen’s CCEC diversions of water on Castle Creek (a) from the point of diversion to the point of return on Castle Creek and (b) on Maroon Creek from the point of diversion to the confluence of Maroon Creek and the Roaring Fork River.



 

a.      There are certain conceptual stipulations the parties have agreed to regarding the Study for purposes of this MOU, as follows:



 

                                                    i.     Study Scope: The parties will work together in good faith to identify and agree upon the Consultant and to define more precisely the scope of the study (the “Scope”), after discussing reasonable issues to be addressed with Consultant candidates. The agreed-to scope will cover the anticipated study duration.



 

                                                  ii.      Cap on Costs: The parties agree that the cost of the study shall be limited to $150,000.00 or less, with Plaintiffs paying half of the cost and Aspen paying half of the cost (the “Cap”), unless the parties agree in writing to raise the cap. In the event no qualified responses are received to the RFP for $150,000 or less, or only one such response is received from a prospective Consultant who is not acceptable to the parties, then the parties agree to negotiate in good faith about raising the Cap, and if so to what amount.



 

                                                iii.     Soliciting Bids: the parties agree to work together in good faith to agree on language for a Request For Proposals (“RFP”) from prospective consultants. The parties agree that the RFP will be generated and issued in accordance with Aspen’s standard request for proposal procedures and shall not include reference to the Cap.

 

                                                iv.     Public Input: the parties agree that the Study shall include a means for public input, and Aspen is free to seek public input as part of the process of defining the Scope.

 

                                                  v.     No prejudice to Aspen in the Lawsuit: Plaintiffs agree that they will not use the Stay period as evidence of abandonment of Aspen’s Water Rights at issue in the Lawsuit.

 

                                                vi.     CCEC Project Outcome: The parties understand that Aspen is currently analyzing renewable energy alternatives, including and in addition to the CCEC, in furtherance of its goal of having its municipal electrical utilities be 100 percent renewable by 2015. The parties understand that in this process, it is possible that Aspen may choose not to proceed with the CCEC, in which case the parties agree that the Study may not be necessary. If that is the case, the parties agree that they will pursue the Study only if they mutually agree to do so.

 

3.     Resetting of the Trial. If the parties are unable despite their best efforts to reach agreement concerning the Consultant, the Scope, or terms of the Study, they agree promptly to reset the trial at the earliest possible date reasonably available to them and to the Court with jurisdiction over the Lawsuit.  The parties agree that a new trial setting will not result in resetting any pretrial deadlines that have already passed, and that there shall be no additional pretrial discovery in the Lawsuit, except for the already agreed two hour continuation of the deposition of Kerry Sundeen, currently scheduled for October 23, 2013 and completion of his supplemental expert report in the Lawsuit, currently due October 22, 2013.  In the event trial is reset, that supplemental expert report shall be completed and served not more than thirty days after the any resetting of the trial date as provided herein.

 

4.     Completion of Study and Dismissal of Lawsuit or Consent Decree: Upon completion of the Study, the parties agree that they will either (1) jointly move the Court to dismiss the Lawsuit with prejudice and enter into an Agreement under which Aspen shall operate the CCEC project, and any future hydropower project using the Water Rights, in compliance with the Study’s recommended bypass amounts; or (2) work together to reach, and jointly move the Court to adopt, a Consent Decree that shall include a finding of non-abandonment of the Water Rights as of the date of the Consent Decree and shall further agree to use the Water Rights in compliance with the Study’s recommended bypass amounts.

 

 

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Posted on Tuesday, October 22, 2013 (Archive on Tuesday, October 29, 2013)
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