AURORA, Colo.—On an isolated road in the southeast corner of Aurora, a water battle boils over land with more bushes than homes, and more questions than answers.
The former Lowry Bombing Range has had only one suitor since the Colorado State Board of Land Commissioners awarded a development bid to Australian-based developer Lend Lease in 2006. Nearly a decade before selecting Lend Lease, the Rangeview Metropolitan District and state land board selected Pure Cycle to develop water resources on the barren land.
There’s been little consensus between the parties since.
Late last month, Lend Lease announced its intentions to possibly terminate its deal at the end of the year to develop what many call the most profitable land in the Denver metro area. Lend Lease Communities President Chris Waggett said the company would “not be able to obtain an adequate water supply or adequate wastewater treatment facilities at a commercially reasonable cost” for development of the 21,000 desolate acres.
Lend Lease’s October announcement avoided any finality. Instead, Lend Lease president Waggett outlined the major challenges facing the project, while hinting at its grand possibilities.
“Our plans for the Lowry Range community were slated to bring great benefit to the State of Colorado at large and the Denver Metro region,” Waggett wrote in a release dated Oct. 24. The release outlined a development that would bring in an anticipated $334 million for the Colorado School Trust and K-12 public schools during the next 20 years, establish a large-scale zero-net energy mixed-use and set aside thousands of acres for conservation and open space.
It was a grandiose vision, one that required a dependable and long-term source of water.
Waggett laid partial blame for the project’s failure on the cost and the scant supply of water facilities for the project, originally designated to include 17,000 acres of perpetual park land and about 3,800 acres of residential development. The cost of development was originally estimated at around $1.2 billion.
From the beginning, the idealistic vision of a world-class, self-sustaining development was sullied by the realities of water availability. The water issue was one of the first major objections Aurora officials had to the deal, and it helped forge pre-development conditions that were initially set in June 2007.
Lend Lease said an initial agreement with Rangeview Metropolitan District and its contractors, which would have provided water supplies and wastewater treatment facilities for two of the land’s six sections, proved too expensive. Lend Lease said that as the potential price tag grew, the 2007 stipulations gradually became more unrealistic.
“Various, essential pre-development conditions set forth in the Development Management Services agreement dated June 22, 2007, are seemingly unlikely to be met by the end of this year,” Waggett wrote. “As such, Lowry Range LLC has fulfilled a procedural obligation under the agreement with the Colorado State Land Board by formalizing in writing the intent to terminate.”
Since the Oct. 24 statement, Lend Lease officials have been hesitant to comment, citing the sensitivity and precariousness of their current negotiations with Pure Cycle and the state Land Board.
The silence, coupled with the logistics of the site, have caused some to assume the worst.
In addition to Lend Lease’s goals to create funding for local public schools and a large-scale site for conservation, other potential benefits were tied to the Lowry deal.
One potential benefit was a second water reservoir for the city, one that would meet rising storage demands as Aurora established its new water infrastructure and dealt with a booming population.
“The city did want to build a second reservoir just immediately east of the Aurora Reservoir,” said City Councilman Bob Broom. “With the water coming from the south end of the South Platte project. At some point in the future the city does need additional storage.”
But the prospect of a nullified Lend Lease project does not rule out future water development, Broom said.
“It means we’ll have to find another reservoir site—or it means that we can eventually utilize that site when the time comes to do it,” Broom said.
If Lend Lease does pull out completely, and another residential development rushes in to take its place, Broom said a newcomer would have to agree to similar conditions and address the city’s underlying concerns.
Several suitors petitioned the State Land Board in 2006, and it’s unclear if any would return to develop the land after the board’s decision to choose Lend Lease two years ago.
In addition to securing dependable water sources, so the city wouldn’t become a last resort for water, a developer would have to project how new development would affect traffic patterns in the area.
“From the city’s standpoint, we had concerns. We didn’t want it to develop out there and then have those folks come to us once the wells went dry,” Broom said.
Shortly after Lend Lease announced its intention to pull away from the initial deal, Pure Cycle, the corporation selected by the State Land Board in 1996 to develop water for such a project, reacted in writing.
“We are disappointed with Lend Lease’s attempts to intervene in the State Land Board’s water assets and pre-existing agreements,” President and CEO Mark Harding wrote. Harding was referring to a City of Aurora filing in water court seeking rights to provisional sites for an additional reservoir site east of the Aurora Reservoir. “Nevertheless, Pure Cycle continues to work closely with its long standing partner, the State Land Board, to find cooperative solutions that meet the interest of its shareholders as well as the School Trust beneficiaries.”
Harding declined to comment specifically, citing the current suit between the City of Aurora and the State Land Board and Pure Cycle. That suit is pending in the Colorado Supreme Court. Harding did say the water supplies and treatment options offered to Lend Lease were at or below fair market value.
“Our rates are contractual governed under our agreement with the State Land Board to be market based. This was to balance the fact the State Land Board receives a royalty on water sales at Lowry as well as being a customer purchasing water taps and delivered water,” Harding said in an e-mail. “Our rates and charges are set based on the average of three neighboring water providers. For comparison purposes our water tap fees are $21,500. Aurora’s water taps are over $22,000 and looking at I believe I read an 8 (percent) increase next year, which would put them close to $24,000.”
Pure Cycle was selected nearly 12 years ago by the land board and the Rangeview Metropolitan District to provide water to the Lowry Range, which they say would come from a culmination of several sources including over 25,000 acre feet of groundwater and over 8,000 feet of surface water to satisfy demand for development on the Lowry Bombing Range.
Despite unwillingness to talk directly about the negotiations and upcoming judgment by the state Supreme Court, both sides have said they will continue operations as normal until Dec. 31, when Lend Lease has indicated they would terminate.
“Pure Cycle has been providing domestic water and wastewater services to customers on and off the Lowry Range for over 10 years,” Harding wrote. “In the event Lend Lease terminates its interest in the Lowry Range, Pure Cycle will continue to provide … water and wastewater services to current and future developments at the Lowry Range and the region.”
“Through December 31, 2008, it is our intention to maintain the same level of commitment to the Lowry Range project that we have exercised since it was awarded,” Waggett wrote.
Even though both statements are clear that the possibility for a deal could be struck before the end of the year, Broom, like many others know time is short.
“They have a month,” he said.
———
On the Net:
Colorado State Board of Land Commissioners:
Former Lowry Bombing Range:
Lend Lease:
Pure Cycle:
