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Multi-county Colorado River district preparing ballot issue to double property taxes

GLENWOOD SPRINGS–The Colorado River Water Conservation District (CRD) is preparing a ballot issue for the November election to double the mill levy on property taxes to fund water projects on Colorado’s Western Slope.

The CRD comprises 12 counties and part of three other counties in the Colorado River watershed including Delta, Garfield, Eagle, Grand, Gunnison, Hinsdale, Mesa, Moffat, Montrose, Ouray, Pitkin, Rio Blanco, Routt, Saguache and Summit counties.

Formed in 1937 in response to the Colorado Big Thompson project, which diverts water from west of the Continental Divide to Denver and other eastern communities, the District’s mandate is to protect water rights in western Colorado. The District now serves about half a million people.

If passed by voters within the District, the doubling of the mill levy will raise it 0.248 mills, bringing the total mill levy to 0.5 mills.

“It’s a raise of just under 1/4 of a mill,” CRD Director Andy Mueller told Complete Colorado. “The increase for $100,000 of residential value depends greatly on the county. For instance, the increase would be about $2.71 of additional taxes in Mesa County, whereas in Pitkin County, the increase is roughly $22.60. The average increase is about $7.80. But it it’s hard to take the average because we have such a disparate property values within our district.”

The proposal also de-TABORs the District’s taxes so moving forward it can retain any revenues collected in excess of the limits imposed by the Taxpayer’s Bill of Rights without having to ask voter permission first.

In the Act creating the District, the maximum mill levy rate was capped at 2.5 mills, 10 times what it is today.

“We cannot and would not try to get out from underneath that tax rate cap,” said Mueller.

The initial ask is predicted to provide an additional $4.9 million to the District’s coffers.

Mueller says the District is facing not just potential water raids by Front Range water interests, but also the effects of drought. Part of its mission is to help find and fund ways for agriculturalists, who use the bulk of the state’s water, to do so more efficiently and with less waste.

Colorado’s complex water appropriation doctrine makes it imperative that water rights owners protect their place in the “first in time, first in right” queue and be able to prove they are continuously putting it to “beneficial use,” because by law if you don’t use it, you lose it.

One extremely important senior water right is that held by Xcel Energy, owner of the Shoshoni power plant in Glenwood Canyon. The water right is one of the most senior rights on the Colorado River.

“That’s a 1902 water right on the main stem of the Colorado River,” Mueller said. “It’s certainly not the oldest, but it’s the oldest major water right. When that water right is in priority, then Denver, the Northern Water Conservancy District, the Windy Gap project, Colorado Springs and Aurora all have to curtail their diversions of Colorado River water because they divert upstream in, unfortunately, a huge number of different places.”

What happens to the Shoshoni power plant’s water rights if the aging plant is shut down is in question.

“The permanency of that [water right] is important for our users on the Western Slope, for our recreation-based economies in places like Glenwood Springs and Eagle, and for agriculture, even down in the Grand Valley,” Mueller said. “Even more so for our compliance with with the endangered Species Act. If we don’t have a certain amount of water in that 15 mile reach [near Grand Junction] for the endangered fish, the Fish and Wildlife Service will start enforcement actions against our our water diverters, both on the West Slope and on the East Slope. We honestly don’t ever want to see that happen, so we we cooperate to make sure that there’s enough water down there for the fish.”

Another concern is a dam on the river in DeBeque Canyon, just east of Grand Junction.

“Look at the roller dam in the Grand Valley that irrigates thousands and thousands of acres of land,” Mueller said. “It diverts about 2,300 cubic feet per second of water, depending on the time of year. It’s a 110 year old structure that has huge maintenance issues. The Bureau of Reclamation transferred ownership and operation and maintenance obligations to the local irrigation districts. They need help to keep that dam functioning. Our district has helped them in a number of ways over the years, with money to help them rehab it, with purchases of land to help them re-time their water so they can use it more efficiently.”

Mueller acknowledges that the tax hike proposal, at six pages, is “wordy,” but said people need to understand the complexity of the issues facing the District.

“I think that as the chief operating officer of the district, I have an obligation to make sure the public can understand what we’re going to use the money for, and that they can trust us to do that,” Mueller said. “And they can.”

Mueller welcomes close scrutiny of the plan.

“I would hope people are critical and examine what we’re talking about and what we’re doing,” Mueller said. “I think it’s really important to have healthy dialogue around this kind of stuff. And I also respect people who disagree with us on a tax increase.”

The collapse of the oil and gas industry on the Western Slope caused by Senate Bill 19-181 has devastated CRD revenues, and the closure of coal mines and electrical generating plants under Governor Polis’ 100% renewable energy mandate is expected to do even greater damage, says Mueller.

“As recently as 2013 that sector represented about 24% of our total revenue at the District,” Mueller said. “Today they are closer to 10% of our total revenue. And given the announcements by Excel and Tristate, combined with the the reduction in value on on natural gas, as well as the regulatory environment, we can predict a significant decline in those revenues.”

“Those industries provide tremendous jobs in a lot of our small rural communities, they’re the best jobs anybody can get and to see them disappearing and to see the impacts on those communities is really hard,” Mueller said.

The faltering energy economy has led to substantial budget reorganization at the District.

“We’re already belt tightening and we’ll continue to do that. Since I came in, we have eliminated 15% of our staff positions, we reduced our vehicle fleet by 25%. This year alone I instituted 15% across the board cuts on our budget,” Mueller said.

Mueller doesn’t want the CRD to fail in its mission to protect the water resources of western Colorado, which is why he’s asking for this tax increase.

“My job as the head financial officer is to say I can’t just sit back and watch that happen because our mission is too important to to let it happen,” said Mueller.

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