Ranchers: Ditch water down after Friend Ranch work

The new investor-group Bent Tree LLC recently acquired the financially troubled Friend Ranch development and as it works to move forward, neighboring ranchers have a greater, lingering concern. What happened to the water flowing in their ditches?

Some ranchers have seen less water in their ditches. They say the work of excavators on the property formerly known as Friend Ranch was downright sloppy instead of delicate, and it’s drained the bog of some water. The way they see it, trenches and holes were dug arbitrarily without any knowledge of the ditches and their sources. Trucks drove over one ditch, then filled it with dirt. Ranchers worry that the work may have affected their  seepage water and injured their water rights.

They also question whether the development has enough water for a golf-course community.

“They’re diverting groundwater, which holds up ditch or irrigation water,” says Dana Roberts, who owns the 300-acre Post Office ranch nearby with her husband, Dean, and other family members. “It took us all by surprise. We never knew what this development could do.”

Groundwater is defined as water beneath the surface, often between saturated soil and rock, that supplies wells and springs. Seepage or seep water is water that appears on the surface from a source of groundwater.

To a ranching outsider, a ditch hardly sounds valuable or even significant but ranchers can’t overemphasize its importance. These thin brown ribbons with their languid curves, then straight and purposeful, are cautiously cleaned and maintained. Local ditches are lined with a barrier of silt and organic matter, over a clay lens above gravel. This geology is characteristic of the Arkansas River valley. The silt barrier holds the water similar to a plastic pool lining. If the clay is punctured, the water is lost, trickling down and away through the gravel. It’s a thing of beauty to see this water rushing strong, cold and clear, safely contained in a natural water slide.

The timing of turning on particular ditches to irrigate is well-orchestrated. Like old friends, ranchers know what to expect. A priority system honors the seniority of a rancher’s water right, which determines the right to divert water relative to other rights during periods of limited supply.

What concerned ranchers from the beginning was a general disregard for the ditches and their value to ranchers. Dean Roberts said the former developers’ “whole attitude toward ditches bothered me.” For starters, several major ditches were left off application maps to Poncha Springs.

One Friend Ranch project gone wrong, according to some ranchers, was the installation of the water-sewer line from Poncha Springs along the Monarch Spur toward the development.

Ditch owners say equipment showed up one day in January 2009 and work started on the water line. They say the project manager was unaware of the ditches, or that the water-sewer lines would run under them. They walked him along the railroad-right-of-way, identifying the ditches.

When construction of the trench for water and sewer pipes began near the Ouray Ditch, “they dug a 10-foot hole and got a lake, and this was January,” Dana Roberts said. “They were totally surprised.”

Bewildered that the team was unaware of the ditches, ranchers wrote Poncha Springs, asking to delay the project. Sixteen neighbors signed the letter.

Eventually, developers did come around and make agreements with some ditch owners. For example, at least one ditch owner requested a lining of bentonite to create a seal between the ditch and gravel. But, again, after construction had started.

Excavators ran three pumps, 24 hours a day, to pump water from the site, the Roberts say. Apparently, Friend Ranch developers spent $200,000 to pump the water.

Work continued on the trench on a 2 percent gradient along the old railroad easement. In early February of 2009 the Roberts say workers used 1-inch rock gravel to bed the line rather than material that would contain or stop the water. The gravel caused a French drain, which pulled precious water down and away. “That gravel was a mistake,” said Dean Roberts. “They’ve got to use different bedding material.”

According to the Roberts, workers tried to correct the problem by pouring concrete dams every 200 feet to stop the flow. Then groundwater came up as ranchers irrigated in the spring, putting an end to construction of the dams.

Dean Roberts shook his head and added, “This land shouldn’t have been tampered with.”

This is curious because Poncha Springs passed a resolution in July 2008 stating the “developer made good faith effort to enter into agreements with owners of ditches,” and “these efforts shall continue.” This resolution gave Friend Ranch the green light for construction, possibly to meet bank deadlines.

Ditch owners were also mentioned in the September 2007 annexation and development agreement between Friend Ranch and Poncha Springs. It stipulated Friend Ranch must prove reasonable efforts with ditch owners on crossings, relocations and alterations within the development. Overtures were made over ditches on Friend Ranch, but not outside property lines. Had the water-sewer line been completed along the railroad right-of-way, it would have 12 ditch crossings over easements. Seventeen people have rights to these ditches.

The Poncha annexation plan may have been Friend Ranch’s downfall with regard to water.
Septic and leach fields could have helped return flows instead of running a water-sewer line to Poncha.

The railroad easement isn’t the only excavation project that has ranchers worried. Sam Scanga raises cattle, alfalfa and cuts hay on his 160-acre ranch across Highway 50 from the Friend Ranch development. Scanga, whose ranch has been in his family since 1905, makes room for a map of ditches on his kitchen table, stacked high with records.

He points out the Newby Bowring Ditch by County Road 210, which runs through the former Friend Ranch development. Besides the Newby Bowring and Velotta seepage, which comes off Friend Ranch and dumps into the Newby Bowring, Scanga has water rights in the Pinon ditch.

“That’s how I get water to my ranch,” Scanga said.

Scanga says Friend Ranch workers bored under his ditches to install a fiber optic cable under the Newby Bowring Ditch and power line under the Burnett and Velotta seepage ditches, without a ditch crossing permit or his permission. He’s supposed to be notified of any work that could affect his water. Scanga says, yes, he was notified – two weeks after the job was completed.

He’s watched workers dig trenches through the bog, getting dozers and backhoes stuck in the mud. “Every time they do that, I think they’re taking seep water,” Scanga said.

Scanga says excavators didn’t realize what they were doing to the groundwater. When he asked why they dug three trenches, workers said they wanted to see which way the groundwater flowed, according to Scanga.  “Don’t need to dig to see it’s flowing toward the river,” he said.  “Water seeks low spots, doesn’t it?”

Last year, the seepage water ran equal to the drought of 2002, Scanga says, and “last year was a good water year.” He measures what the ditches produce, what he takes and puts back. “I started keeping good records,” he said. “It’s down.”

The Roberts agree and see a correlation between Friend Ranch excavators “digging around” and their seep water dropping. Their seep water is seepage- and spring-fed.

New developers, new relationships

Dana Roberts said she hopes owners of the newly named Bent Tree will be “more empathetic” to their concerns and have a “better understanding of the source of supply, especially of spring and seep ditches.” Ranchers want better working relations with the Bent Tree group, particularly on the next phase of the water-sewer line installation.

Gary Findlay is managing partner of Bent Tree, which purchased a bank note and took a deed on Friend Ranch in lieu of foreclosure. Findlay will manage the development. He understands neighbors are upset and says he hopes to “prevent it from happening in the future.” He also says he wants to “extend a friendly hand” and “be good neighbors.”

“We plan on meeting with everyone concerned,” Findlay said. “If they see something they don’t like, they can bring it to us right away and we can work it out. That’s where we want to be. We want to work it out.”

Bent Tree’s financial reorganization doesn’t assume any prior obligations from Richard Chick’s time managing the development. “We’re a new group, said Dennis Saffell of Winter Park, who is a broker and member of the Bent Tree group. Saffell is heading up homes sales, advertising and marketing. “We didn’t get old money or incur old expenses.”

Findlay said members of Bent Tree got involved because they were original investors and had deposits on lots. “We wanted to help the project survive and protect our investments,” he said.

On its own, Friend Ranch appears to have enough historic water rights for the golf course with 4.76 cubic feet per second. As Poncha applies for a change in water use from irrigation to municipal use, the court will consider historic factors, such as return flows, groundwater, diversions and irrigation practices.

The Friend Ranch group had to buy more water to be consumed by homeowners. It purchased 21.6 acre feet of water with a value of $756,000.00, then transferred this water to Poncha.

Friend Ranch’s price to develop was paid in water rights. The 2008 resolution also notes “water rights and other real estate required to be conveyed to the town, following final plat approval.” The reservoir at Friend Ranch shimmers in the sun like silver. It’s Poncha’s bank account for water with interest paid in evaporation.

‘Water is a court-dominated structure’

Bruce Smith, state water commissioner, says the development has enough water because land that had been historically irrigated became a golf course. “They’ve got enough because they’ve been growing a crop on it,” Smith said.

Part of the controversy centers on land that courts have determined were historically irrigated. Ranchers say some fields were not irrigated or haven’t been since the ’60s. They say the state’s got it wrong. State records from water court decisions don’t always match what ranchers say they’ve seen day in, day out, year after year.

“Water is a court-dominated structure,” said Smith.

Friend Ranch submitted its own water study called the Wheeler Report from Englewood-based Wheeler and Associates Inc. in December of 2009. Ranchers take issue with water measurements, specifically the amount of water historically used for irrigation. Water is measured by acre-foot, which is the amount of water needed to cover one acre to a depth of one foot.

Scanga says the Wheeler Report “irrigated more (acreage) historically than is factual.” He mentions “flaws” and “discrepancies,” such as the omission of the Huntzicker Ditch. He says the fields on his aunt and uncle’s former property across CR 120, bordering Friend Ranch, depended on the Huntzicker Ditch, and it ran full decree from the headgate until 2007. Decree, in this instance, is a court decision about a water right. “That doesn’t show,” he said. “I used to mow that hay every year. That gives you an idea how bad this report is.”

Scanga says the water commissioner’s records are just as bad.”The water commissioner showed water diverted at Henry Ditch,” he said. “That’s baloney.”

Flood irrigation vs. sprinklers

With a golf course replacing crops, sprinklers will be used instead of flood irrigation, which has more predictable return flows. Prior to the Friend Ranch development, within the distance of about a mile, water was taken from Pass Creek and Cotchetopa Creek, used for irrigation and returned to drainage areas. Ranchers have rights to divert water from this drainage. With sprinklers on the course, it’s hard to predict what the return flows of water will be.

Neighbors worry that sprinkler irrigation will affect their seep water by decreasing return flows. Smith agrees that sprinkler irrigation does decrease return flow to the river and groundwater. Yet, he says most of the land had been irrigated by sprinklers “for a number of years prior to the Friend Ranch subdivision.”

The Roberts are concerned not enough water will be returned to their drainage, which is where they divert water.  Pass Creek feeds into the Cotchetopa Creek. Dean Roberts worries that this water will be taken, fed to the reservoir, then bypass one of his vital ditches.

And Poncha can turn off the water to the golf course during an especially dry year. “I’d like to know that if buying a lot,” Scanga said.

Dean Roberts says the water plan currently in place for the golf-course community “will affect every ditch and every drop of water we own.” The question remains, by how much?

Imagine an underground lake

Visualize groundwater as an underground lake, flowing downhill. A confining layer keeps the water under pressure. If this geology is compromised and pressure is released, seepage could drop.

Excavators gone wild could surely affect ranchers’ seep water. “It’s entirely possible,” Smith said. But there’s “no mechanism in place other than court to prove this.”

Smith has faith in the water court system because “too many other people are looking,” crunching numbers of return flows of water, priority and amount consumed. “The state is looking, engineers and attorneys,” Smith said. “The main purpose is to not injure vested water rights. It’s important that they stay balanced. Water court’s an engineering game. How many places beyond the decimals do you want to go?”

But why does it have to go as far as water court? From the beginning, Scanga insisted on a “reputable” hydrological study, and wrote the county and town of Poncha about potential problems. The process has been exasperating. “My concerns are the same but haven’t been addressed,” he said.

Scanga saw Friend Ranch’s hydrology report from Futura Engineering of Colorado Springs  in March 2009 as “totally inadequate” and “worthless.” AMEC Earth and Environmental Inc. of Englewood reviewed the report and wrote that Futura’s design drawings of the utilities trench “do not clearly indicate how the trench will be isolated from groundwater.” AMEC found that the “trench may act as a conduit for groundwater flow from the site, which could result in a long-term lowering of the groundwater table.” AMEC also agreed with the review from the engineering firm Applegate Group Inc. of Denver, which found Futura’s work to be incomplete.

Poncha’s hired independent consultant even found lapses in Futura’s hydrology report. A report from Kumar and Associates of Denver, a group of geotechnical and materials engineers and environmental scientists, said Futura’s analyses were “simplistic” and “limited” on potential impacts of its drainage plan to flows in adjacent ditches.

Meanwhile, ranchers contracted their own hydrological study through Buena Vista-based Source Water Consulting, headed by Jord Gertson. Monitoring wells, 10-feet deep, were installed to measure groundwater. Gertson declined comment for this story.

‘Not increasing number of front doors’

Findlay says the Bent Tree development will stick with the original number of homes platted, 500 density units, some multi-family, some single-family homes. A duplex, for example, is two units; a single-family home is one unit. Like the Friend Ranch plan, Bent Tree will build in phases.

“We’re not increasing the number of front doors,” said Saffell.

Bent Tree can’t sell lots just yet. It needs a HUD disclosure, a prospectus-like document to give buyers. Next, the group must bond and guarantee infrastructure to homesites. And there are those pesky liens in the millions, continually increasing, that must be cleared. The courts will sort the liens, deciding which ones will be paid and which ones won’t.

“It looks like we’re going to make it because the buyers are out there,” Saffell said. “We’ve tested the waters and it’s very encouraging. We have multiple reservations.”

The first 10 lots range from $57,500.00 to $89,500.00, about a third of the original pricing. Reservations require a $2,000 deposit, held by a title company, fully refundable. Deposits for lots with the original developer were closer to $29,000.00, or 20 percent down. “We’re anticipating closings to begin in November,” Saffell said.

In the interim ranchers have an eagle eye on water in their ditches and are recording measurements. And you can bet, when construction begins again, ranchers will be watching Bent Tree.

“Ranching’s difficult enough without these kinds of concerns,” said Dana Roberts.