Petition for Writ of Certiorari — City of Colorado Springs v. Board of County Commissioners

Supreme Court brief1995

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Text

fp) @upreme Court, U.S.

; FILED

No. OB 428 SEP 5 = 1995'

OFFICE Ur 4c vend —

In The

Supreme Court of the United States

October Term, 1995

CITY OF COLORADO SPRINGS AND CITY OF

AURORA, COLORADO, MUNICIPAL CORPORATIONS,

Petitioners,

THE BOARD OF COUNTY COMMISSIONERS OF THE

COUNTY OF EAGLE, STATE OF COLORADO, et al.,

Respondents.

~ .

Petition For A Writ Of Certiorari To The

Colorado Court Of Appeals

PETITION FOR A WRIT OF CERTIORARI AND

APPENDIX, VOLUME I, Pages ia to 156a

JOHN M. DINGEss Mark T. PIFHER*

DUNCAN, OSTRANDER, JONATHAN C. DEHMLOW

VARNELL & Dtncess, P.C. ANDERSON, GIANUNZIO,

7800 East Union Avenue Dube, PIFHER & Leset, P.C.

Suite 200 104 S. Cascade Avenue

Denver, CO 80237 Suite 204

Grecory L. JOHNSON — apne, CU

Assistant City Attorney, (719) 632-3545

Utilities .

30 S. Nevada, Suite 601 *Counsel of Record

Colorado Springs, CO

80903

COCKLE LAW BRIEF PRINTING CO., (800) 225-6964

OR CALL COLLECT (402) 342-2831

QUESTIONS PRESENTED

1. Does a municipality, acting in its proprietary capac-

ity, have standing under the Fifth Amendment to the United

States Constitution to bring a claim for the taking of its

property without just compensation?

2. Cana local governmental entity deny a local land use

permit for a federally approved project located entirely on

federal Forest Service lands?

PARTIES TO THE PROCEEDING BELOW

In addition to the Board of County Commissioners of the

County of Eagle, State of Colorado, the following individuals

and entities were parties to the appellate proceeding below:

1. George A. Gates, Johnette Phillips, James E. John-

son, Jr., in their official capacities as individual members of

said Board;

2. The Board of County Commissioners of the County

of Eagle, in its capacity as the permitting authority under

C.R.S. § 24-65-101, et seq. (1988);

3. The Eagle County Planning Commission;

4. Mark Donaldson, Robert Tether, Arlene Quenon,

Robert Morris, Donald Price, in their official capacities as

individual members of the Planning Commission;

5. The County of Eagle, State of Colorado;

6. Holy Cross Wilderness Defense Fund;

7. Vail Valley Consolidated Water District.

At the time of the filing of the litigation in the Eagle

County District Court, the following individuals and entities

were also named defendants:

1. Donald H. Welch and Richard L. Gustafson, in their

official capacities as individual members of the Eagle County

Board of County Commissioners;

2. Charles Ridgway, David Slemon, and Dennis Gelvin,

in their official capacities as individual members of the Eagle

County Planning Commission;

” ac tii eit EAA A EATEN AY Ae

ee ee

PARTIES TO THE PROCEEDING BELOW - Continued

In addition, the following entities, which did not actively

participate in the litigation but were parties to the county

permit proceeding, were named defendants in the District

Court litigation: Avon Metropolitan District; Town of Avon,

Colorado; Colorado Council of Trout Unlimited; Colorado

River Outfitters Association; Division of Wildlife, State of

Colorado; Eagle County Sheriff, in his official capacity;

James Franklin Lamont; Red Cliff Water and Sanitation Dis-

trict; Town of Eagle, Colorado; Town of Gypsum, Colorado;

Town of Minturn, Colorado; Town of Red Cliff, Colorado;

Town of Vail, Colorado; Upper Eagle Regional Water Author-

ity; Upper Eagle Valley Sanitation District; Vail Associates,

Inc.; Eagle County Historical Society.

TABLE OF CONTENTS

Page

SAREE NOW GREP MOURN Ci oaccs tins becnccebucnubs vi

Sg ry Oe re ee a ee eee 2

JURISDICTIONAL STATEMENT .................... 3

CONSTITUTIONAL, STATUTORY AND REGULA-

TORY PROVISIONS INVOLVED.................. 3

So RAL Geeee es COE ENO CAD civic cts ccesevddannsds 4

SN a5 dd iron ok 00 BRS Shae be cee neue ee ebs ae) 4

The Federal Permitting Process ..............0se00. 5

Decision of the Eagle County Board of County Com-

rr a ee om 7

The Colorado District Court Decisions ............. 8

The Colorado Court of Appeals Decision........... 9

The Colorado Supreme Court Decision............. 10

REASONS FOR ISSUING THE WRIT............... 10

I. THE SUPREME COURT MUST RESOLVE CON-

FLICTS AMONGST THE LOWER COURTS..... 10

eg re Ty errr eer ee 10

i. OTT PE 6 o's deeb s Con tkaowsiees 14

Il. THE COLORADO COURT OF APPEALS’ DECI-

SION ESTABLISHES BAD PUBLIC POLICY.... 15

Iii. THE COLORADO COURT OF APPEALS DECI-

AEE Wee Ge SE, 9-5-0. 0.c0 koa sn hws eee essa 18

oe ee ere Peer rere ee Te 18

BTR T COR ee 22

1. Conflict with Federal Laws............. 23

TABLE OF CONTENTS - Continued

Page

2. Conflict with Congressional Wilderness

INU o v'00s b bap tddenedeseniawceeus 28

ee wt | eT ere POO rrr err rere ry Ty ree 30

TABLE OF AUTHORITIES

Page

CASEs:

Amato v. Wilentz, 952 F.2d 742 (3rd Cir. 1991)........ 12

Association of Data Processing Serv. Org. v. Camp,

Sl UR FSD Cee cccipccudicetecseavdecdnecases 20

Board of Comm'rs v. City of Fort Collins, 68 Colo.

204, TED Sa Cis a cc canndvoutelenaseanscereses 13

Board of Education v. Allen, 392 U.S. 236 (1968)...... 20

Board of Levee Comm'rs v. Huls, 852 F.2d 140 (Sth

RA. COU. nevcicccaccesas¥ ae Gekunveseoweawereuwese 11

Brendale v. Confederated Tribes, 492 U.S. 408 (1989) .... 28

Brubaker v. Board of County Comm'rs, 652 P.2d 1050

Cae, RUUD dws 6 odutce ee 5 40 ee Ses Ueae eee 9, 14, 26

California Coastal Comm'n v. Granite Rock Co., 480

eR ay: y Preis 9, 1D, 87, Bae Bee ate aes at

Capital Cities Cable, Inc. v. Crisp, 467 U.S. 691

CEE < wine ccutvauttdsh0eSyebh Glessner s ata 23

Castlewood Corp. v. Denver, 41 Colo. App. 565, 594

Pe Cee CRPTE bec casts scene deguenvcbepuncekepuan 22

Citizens for a Better Henderson v. Hodel, 768 F.2d

oe: of a, | ee eee peer na see 26

City and County of Denver v. Bergland, 695 F.2d 465

oo | er oe re pee ey 25, 26

City and County of Denver v. Colorado River Water

Conservation Dist., 696 P.2d 730 (Colo. 1985)....21, 22

City and Couniy of Denver v. Board of County

Comm'rs, 782 P.2d 753 (Colo. 1989)

vii

TABLE OF AUTHORITIES - Continued

Page

| City of Charleston v. Public Serv. Comm'n of W.VA,

| 57 F.3d 385 (4th Cir. 1995) .........- eee eee eeee 11, 12

City of Chester v. Commonwealth Dept. of Transp.,

434 A.2d 695 (Pa. 1981). ..... cece cece cece cececes 10

City of New Orleans v. New Orleans Waterworks Co.,

SAD UD, FO CEG os oc o5-0'c cope ve cvegedscces 18, 19, 22

City of South Lake Tahoe v. California Tahoe

Regional Planning Agency, 625 F.2d 231 (9th Cir.

| MPS eee Te Serer rrr eT TET TET TE eee 11, 20

City of Thornton v. Farmers Reservoir and Irrigation

Co., 194 Colo. 526, 575 P.2d 382 (1978)............ 21

City of Trenton v. New Jersey, 262 U.S. 182 (1923)

Pm Se ss See ey Pe Pert ere te eee 11, 19, 21

City of Worcester v. Worcester Consol. St. Ry. Co.,

SO Boats eee CRs oc cece cies we nevnseconcbase 19, 22

Coleman v. Miller, 307 U.S. 433 (1939)............. 9, 18

Columbia Basin Land Protection Ass'n v. Schlesinger,

643 F.2d 585 (9th Cir. 1981)...........-.---- 9, 25, 26

Duquesne Light Co. v. Barasch, 488 U.S. 299 (1989) .... 22

Federal Power Comm'n v. Oregon, 349 U.S. 435

CONS i ickid cnt ot b4 RRRS WATE CERN e we ee Hewes eee ey 27

Fidelity Federal Savings and Loan Ass'n v. de la

Cosate, 458 US... 141. CIDE) ..cccsvcdecoccccesccecs 22

First lowa Hydro-Electric Coop. v. Federal Power

oy ep oe Re | ere 27

Gomillion v. Lightfoot, 364 U.S. 339 (1960) ........... 20

Holy Cross Wilderness Fund v. Madigan, 960 F.2d

BPE CU GUE SOE isis cicccccetavcesccsesscacs 6, 7

Vili

TABLE OF AUTHORITIES —- Continued

Page

Hunter v. City of Pittsburgh, 207 U.S. 161 (1907)...19, 21

Idaho ex rel Andrus v. Click, 97 Id. 791, 554 P.2d 969

CFR OR cc weds civ epdhie edeee waebad osaniidadeseas 14

In re Application for Water Rights, 799 P.2d 33 (Colo.

i Sy ge eS Neer ee)» rene ee 7

Kleppe v. New Mexico, 426 U.S. 529 (1976)........... 22

Mesa Verde Co. v. Montezuma County, 831 P.2d 482

C.. SEY os ddan ouekdecksbucketieess cadena 21

Montana v. Johnson, 738 F.2d 1074 (9th Cir. 1984) .... 26

Navajo Development Co. v. Sanderson, 655 P.2d 1374

CEG DIED ik so dlnd chine cdaw ten OO a ts Eee esaks 4

New Castle County School Dist. v. State, 424 A.2d 15

i | | Ep err rarcr Pere oF 12, 13, 18

Ogden Environmental Services v. City of San Diego,

G7 ©. Sane. 1456 GD. Gals Tse « ocho avs ieee 14

Public Serv. Co. of Colorado v. FERC, 754 F.2d 1555

COG Gee BED i vc ceviccckeiccdees c¥eecetessvanetes 21

Robinson Brick Co. v. Luthi, 115 Colo. 106, 169 P.2d

Ee Gps ok dbac ak cad d eee teeter ee 28

Rogers v. Brocketie, 588 F.2d 1057 (Sth Cir. 1979)

(avd nhac ate kaves tak oe ene sen eee eee 11, 19, 20

School Dist. of Philadelphia v. Pennsylvania Milk

Marketing Bd., 877 F. Supp. 245 (E.D. Pa. 1995).... 12

Town of Orchard City v. Board of Delta County

Comm’rs, 751 P.2d 1003 (Colo. 1988)............. 9, 18

Trustees of Dartmouth College v. Woodward, 17 U.S.

CD WORLD DE COGENT cco 0 cid nce rne ds tach erPiackice 19

TABLE OF AUTHORITIES - Continued

Page

United States v. 50 Acres of Land, 469 U.S. 24 (1984) .... 10

United States v. New Mexico, 438 U.S. 696 (1978)

PA PI Pe eer goo rays oe tone ope ee Te 15, 16, 23, 24

Utah Power and Light Co. v. United States, 243 U.S.

ATR: £955. 05 CCU 8 8 LECCE Ln bE ts OTS KORE tees oes 22

Ventura County v. Gulf Oil Corp., 601 F.2d 1080 (9th

Ge BPE sc acae ad kenxene esses caweureees mee, 85; 27

Village of Euclid v. Ambler Realty Co., 272 U.S. 365

ead bid i eral bal ba: C dB Wad WE Od Kee MTN esa 28

Wiebert v. Rothe Bros., 618 P.2d 1367 (Colo. 1980).... 21

STATUTES:

ee te 3, 16, 23

SENS rete)! ti eee Ce 3, 24

A aA ay ee roe SEE Oe, 3, 25

ee ne eee a es 3, 25

riers ies csks eee eke 3, 24

OE ea eee Ie eee rast S 3, 24

ee Be oo a ae 3, 25

CES BAUS sp sn eo dae ods cx bead + 25

Pe Sit, SER SO TART eR OTE BERT Re AB Tt 3

Te ass 6

BOGE EMEA 3, 24

a cs casa ens caiteids 3, 25

I IN i Ga ok fies ee 3, 25

WP 8 9 ee a 3, 24

TABLE OF AUTHORITIES - Continued

Page

AF USC: So PO iS GF eee a 20

FX ie So Oia, . / | Peeaarwer er ras preety hers: a; 20

Act of December 22, 1980, P.L. 96-560, § 102(a)(5),

We Fe, SO os vcdece wince ees teen aes a Sy?

CONSTITUTIONAL PROVISIONS:

U.S. Const. art. IV, § 3, cl. 2 (Property Clause)...... 3s @e

Ce. RE NE es a hb ee a ore eaters 21

oe ae ae SR Se er re rere ry a 21

REGULATIONS:

WO ete io hk eke aed xaeaes eee 4, 25

Pa Ee ee iin OS a 54 aks ee eee eee een 4, 25

ce oe) Ae es) rere or rr rey errr ree 4, 25

eat ORE B.S | epee area perme piney ary 4, 25

OTHER AUTHORITIES:

26 Am. Jur.2d § 179, Eminent Domain, (1966)......... 13

A.S.Klein, Annotation, Condemnation of Public Enti-

68" EMR, Fo Reta Dae CEO t eis Aedes +40 6s 19

Case Comment, Municipal Corporation Standing to

Sue the State: Rogers v. Brockette, 93 Harv. L. Rev.

= Ri EREUR TEC RCT ET ere ce Ore Pea yee 20

1 Julius L. Sackman, Nichols’ The Law of Eminent

Domain, § 2.225[1] (rev. 3d ed. 1993) ........... 13, 18

ie IRAN WR REE IT Ct A a tet on cnt A AA BALI ht aL

In The

Supreme Court of the United States

October Term, 1995

CITY OF COLORADO SPRINGS AND CITY OF

AURORA, COLORADO, MUNICIPAL CORPORATIONS,

Petitioners,

THE BOARD OF COUNTY COMMISSIONERS OF THE

COUNTY OF EAGLE, STATE OF COLORADO, et al.,

Respondents.

Petition For A Writ Of Certiorari To The

Colorado Court Of Appeals

PETITION FOR A WRIT OF CERTIORARI

The cities of Aurora, Colorado and Colorado Springs,

Colorado petition for a writ of certiorari to review the judg-

ment of the Colorado Court of Appeals entered in this case on

November 17, 1994. The Court of Appeals held that a county

could unilaterally deny petitioners a permit under the Colo-

rado Land Use Act for a federally approved project located

entirely on federal lands. In addition, the court found that

petitioners did not have standing under the Fifth or Fourteenth

Amendments to the United States Constitution to assert a

regulatory takings claim. On June 5, 1995, the Colorado

Supreme Court denied the cities’ petition for writ of cer-

tiorari.

OPINIONS BELOW

1. The decision of the Colorado Court of Appeals

reported at 895 P.2d 1105 (1994). App. la-33a.

2. Relevant portions of the FLPMA permit issued for

the Homestake Water Project (“Project”) by the United States

Forest Service. App. 34a-107a.

3. Relevant portions of the Section 404 permit issued

for the Project by the U.S. Army Corps of Engineers. App.

108a-134a.

4. The decision of the Colorado Water Quality Control

Division certifying that the Project met all applicable state

water quality requirements. App. 135a-14la.

5. The resolutions of the Eagle County Board of County

Commissioners (“County”) denying the local land use permits

for the Project. App. 142a-16la.

6. The orders of the Eagle County District Court dis-

missing for lack of standing the claims of the cities brought

under the Fifth and Fourteenth Amendments to the United

States Constitution. App. 162a-172a.

7. The initial decision of the Eagle County District

Court remanding the case to the Board of County Commis-

sioners. App. 173a-19l1a.

8. The decision of the Eagle County District Court

finding that the County had denied the cities’ due process and

acted in an arbitrary and capricious manner in denying the

requested permits. App. 192a-206a.

9. The order of the Eagle County District Court vacat-

ing that portion of its prior decision which had required the

County to issue the permits. App. 207a-212a.

10. The Colorado Court of Appeals decision denying

the cities Petition for Rehearing. App. 213a.

11. The Colorado Supreme Court decision denying the

cities’ Petition for Writ of Certiorari. App. 214a-216a.

12. Relevant portions of the pleadings and briefs below

indicating the manner in which the federal questions were

raised. App. 217a-269a.

DON Bh. teed

ee Cen ee a

LA Nets ea SG AON gt a eb A yn aga A Soe ESS iy 4 ii Ee ns Vo ch ay mn

JURISDICTIONAL STATEMENT

The decision of the Colorado Court of Appeals was

entered on November 17, 1994. The order of the Colorado

Supreme Court denying the petition for writ of certiorari was

entered on June 5, 1995. The jurisdiction of this Court is

invoked pursuant to 28 U.S.C. § 1257.

CONSTITUTIONAL, STATUTORY AND

REGULATORY PROVISIONS INVOLVED

1. Relevant provisions of the Colorado Land Use Act,

C.R.S. §§ 24-65.1-101-502 (1988) are attached as App.

270a-279a.

2. Relevant provisions of the Eagle County land use

regulations promulgated pursuant to C.R.S.

§ 24-65.1-101-502 (1988) are attached as App. 280a-295a.

3. Relevant provisions of the Federal Land Policy Man-

agement Act, 43 U.S.C. § 1700-1784 (1986), are attached as

App. 296a-300a.

4. Relevant provisions of the National Forest Manage-

ment Act, 16 U.S.C. §§ 472a, 476 note, 500, 513, 515, 516,

518, 521b, 528 note, 576b, 581h, 594-2 note, 1600 note,

1600-1614 (1985), are attached as App. 301a-303a.

5. Relevant provisions of the Organic Act of 1897, 16

U.S.C. §§ 475-481 (1985), are attached as App. 304a-30Sa.

6. Relevant provisions of the Multiple Use and Sus-

tained Yield Act, 16 U.S.C. §§ 528-531 (1985), are attached

as App. 306a-307a. |

7. The text of the Property Clause of the United States

Constitution, art. IV, § 3, cl. 2, is set forth at App. 308a.

8. The text of the Fifth and Fourteenth Amendments to

the United States Constitution are attached as App.

309a-31 la.

9. The text of the Supremacy Clause of the United

States Constitution, art. VI, cl. 2, is set forth at App. 312a.

10. Relevant portions of P.L. 96-560, 94 Stat. 3266

(1980) are attached as App. 313a.

11. Relevant portions of the Code of Federal Regula-

tions, 1983 edition, governing the use of federal lands, 36

C.F.R. Part 200 through 299, are set forth at App. 314a-318a.

STATEMENT OF THE CASE

Introduction

This case arises from the denial of land use permits by

Eagle County, Colorado for Phase II of the Homestake Water

Project (“Project”). The Project is to be constructed for the

benefit of the cities of Aurora, Colorado and Colorado

Springs, Colorado and is located entirely on federal lands

within the White River National Forest. The County denial

came after the cities had successfully secured a land use

permit and a dredge and fill permit for the Project from the

U.S. Forest Service and the U.S. Army Corps of Engineers,

respectively.

The Project, a significant part of the cities’ water supply

infrastructure for many decades, would bring additional water

from the western side of the Continental Divide in Colorado

to the East Slope cities. The cities purchased their interest in

the water to be diverted, stored and conveyed through Project

facilities in 1955. The water rights for both Phase I and Phase

II of the Project were decreed to the cities by the water court

in 1962.' Phase I, which consists of a series of surface

diversion points, pipelines, a reservoir and tunnel, was com-

pleted in 1967. The storage and delivery -features were sized

so as to accommodate the anticipated additional flows from

Phase II of the Project, which will bring water into the system

from other streams in the basin. See attached map, App. 319a.

In 1980, thirteen (13) years after the completion of Phase

I, the lands in question were designated by Congress as part

of the Holy Cross Wilderness. However, at the time of desig-

nation, Congress granted the cities a statutory exemption

! Under Colorado’s appropriation doctrine, water rights are a usufruc-

tuary property interest that may be severed from the land. See Navajo

Development Co. v. Sanderson, 655 P.2d 1374, 1377 (Colo. 1982).

- pissed

covering their previously existing rights. P.L. 96-560,

§ 102(a)(5), 94 Stat. 3265 (1980). App. 313a.? As noted by

the Forest Service in the Environmental Impact Statement for

Phase II, the Project was to be treated for permitting purposes

as if it were in a portion of National Forest allocated to non-

wilderness use.

The Federal Permitting Process

In 1981, the cities made application under the Federal

Land Policy Management Act (“FLPMA”), 43 U.S.C. § 1700,

et seq., to the United States Forest Service for a land use

permit authorizing the development of Phase II. This action

triggered the preparation of an environmental impact state-

ment to be prepared under the National Environmental Policy

Act (“NEPA”), 42 U.S.C. § 4321, et seq. The NEPA process

ultimately entailed 19 public meetings, including a Congres-

sional oversight hearing. The NEPA analysis included the

consideration of various project alternatives and concluded

that the cities’ proposed alternative was not only environmen-

tally acceptable, but preferable. App. 56a-60a, 122a. Eagle

County actively participated in the federal permitting process.

in 1983, the Forest Service conditionally approved the

FLMPA permit. The permit contained numerous conditions

addressing environmental concerns, including but not limited

to, wetland preservation and water quality maintenance. It

stated that “[t]his decision includes all practicable means to

avoid or minimize environmental harm.” App. 36a-41a, 50a,

72a-107a.3

2 The cities agreed to construct a more expensive but less environ-

mentally intrusive tunnel system under the wilderness from outside its

perimeter rather than utilizing the original “surface canal” configuration.

3 The Forest Service Record of Decision contained 29 conditions and

mitigation requirements, focusing upon water quality, air quality, aes-

thetics, fish and wildlife. App. 72a-107a. It required “environmental main-

tenance in-stream flow bypasses” at each of the diversion sites. App. 39a,

82a-84a. With specific reference to wetlands, having considered the vary-

ing expert opinions, and having conducted detailed studies with assistance

The cities were further required to secure a Section 404

permit for dredge and fill activities from the U.S. Army Corps

of Engineers. See 33 U.S.C. § 1344 (1986); App. 108a-134a.

The Corps permit, issued in 1984, similarly incorporated an

array of special conditions and mitigation requirements,

including an outright prohibition against wetland loss.

It is the intent of the District Engineer that the

wetlands in the Holy Cross Wilderness Area be

preserved. Therefore the applicants shall prevent

the loss of wetlands in the Fall and Cross Creek

Drainages due to water diversions from the Home-

stake Phase II Project... . App. 113a-114a.4

The permit further mandated the development of “a plan for

preventing or mitigating impacts to the wetlands in the Holy

Cross Wilderness Area,” a draft of which was submitted to

Eagle County. The plan identified operational flow releases as

the mitigation option of first choice for wetlands preserva-

tion.> Both the Forest Service and Corps permits have with-

stood court challenge by opponents of the Project.®

from the United States Fish and Wildlife Service, the Colorado Department

of Wildlife, and the Corps of Engineers, the Forest Service found that

“significant adverse effects will not occur and this action minimizes the

loss of wetlands.” App. 52a.

4 The federal permitting process was the subject of an extensive

administrative review proceeding. See Holy Cross Wilderness Fund v.

Madigan, 960 F.2d 1515, 1519, n.5 (10th Cir. 1992).

> “Operational flow releases” require appropriators to forego certain

water diversions in order to pass additional water through downstream

wetland areas.

ronmental Policy Act were dismissed by the District Court of ‘Colorado and

the Tenth Circuit Court of Appeals. The Tenth Circuit noted that “the

Corps’ permitting review process culminated in a permit requiring a

comprehensive mitigation plan to prevent wetlands’ losses,” and empha-

sized that the Corps, by making its decision “to issue its permit with the

specific condition that there be no wetland losses,” in fact “assumed such

impacts and essentially guaranteed that the cities mitigate those impacts.”

dae ere on

Finally, the cities successfully obtained a Section 401

certification from the Colorado Water Quality Control Divi-

sion stating that the Project would meet all applicable state

water quality requirements.

In reliance upon the property interests they had obtained,

the cities have spent approximately 78 million dollars to date

in the construction of Phase I, obtaining and protecting their

rights in court proceedings, and pursuing the permitting of

Phase II.

Decision of the Eagle County Board

of County Commissioners

Having obtained all necessary state and federal

approvals, the cities sought a permit from Eagle County under

the Colorado Land Use Act, C.R.S. § 24-65.1-101, et seq.’

Eleven days of public hearings on the permit request were

held in Vail, Colorado before the County Planning Commis-

sion and Board of County Commissioners. The Planning

Commission recommended approval of the application subject

to compliance with 53 conditions. However, the Board of

County Commissioners unanimously voted to deny the per-

mits. The denial was based upon certain findings, including:

(Emphasis in original). 960 F.2d at 1526-27. See also Jn re Application for

Water Rights, 799 P.2d 33, 36 (Colo. 1990) (Colorado Supreme Court

upheld decree for change of water rights to conform the location of the

cities diversion points to the project description given Congress, while

highlighting the fact that the water court had found that the requested

alternate points of diversion would not result in material injury to plant or

animal life or to visual and aesthetic values of the wilderness, especially in

light of state held in-stream flow water rights and Forest Service permit

bypass requirements).

7 The Colorado Supreme Court has described the Act as “Colorado’s

first comprehensive land use law, . . . designed to protect Colorado’s land

resources and allocate those resources among competing uses.” City and

County of Denver v. Board of County Comm'rs, 782 P.2d 753, 755 (Colo.

1989).

3. The evidence presented at the hearing failed to

demonstrate that the significant deterioration of the

wetlands can be adequately mitigated.

4. There will be a significant deterioration in pub-

lic outdoor recreational areas because of loss in the

quality and quantity of the river rafting experience

and construction disturbances in the wilderness

area.

6. Reduction in stream flows and construction

activities in the wilderness area will result in a

significant degradation of natural scenic charac-

teristics. (emphasis added)

App. 147a.8

The Colorado District Court Decisions

The cities appealed the permit denial to the Eagle County

District Court. By two separate orders, App. 162a-172a, the

District Court dismissed the cities’ original “takings” claim

upon determining that the cities, as municipal corporations,

are not citizens under the Fifth and Fourteenth Amendments

to the United States Constitution, and therefore lacked stand-

ing.

The District Court subsequently issued an order upon

cross motions for summary judgment, concluding that many

of the County’s original findings were preempted under state

and federal laws. App. 173a-191la. However, the Court further

found that the County had jurisdiction over “wetlands, aquatic

habitats, and possibly the nuisance factors,” and remanded the

case for further consideration.? App. 187a. In response to the

County’s decision upon remand, the District Court issued an

order finding that the County had deprived the cities of due

8 The County, upon remand from the Eagle County District Court,

adopted Resolution 91-104, App. 157a-16la, which merely reaffirmed

certain of its original findings.

9 The District Court did indicate in its order that the preemption

doctrine has been held to preclude zoning officials from denying a special

use permit for activities on federal lands. App. 186a.

process and acted in an arbitrary and capricious fashion given

that its decision was unsupported by any competent evidence.

App. 192a-206a.'° The County decision was vacated and the

County was ordered to issue the requested permits.'!

The Colorado Court of Appeals Decision

The County appealed the District Court decision. The

Colorado Court of Appeals reversed, finding “ample evidence

to support the Board’s determination that the criteria in the

two areas which the trial court found were not preempted -

wetlands protection and nuisance factors — had not been

satisfied.” App. 7a. The Court implicitly rejected the cities’

argument that the County “denial” decision was, in fact,

preempted by federal law.'?

The Court of Appeals, relying upon Town of Orchard City

v. Board of Delta County Comm'rs, 751 P.2d 1003 (Colo.

1988) and Coleman v. Miller, 307 U.S. 433 (1939), upheld the

lower court determination that the cities lack standing to

bring a claim for compensation under the Fifth Amendment to

the United States Constitution. App. 29a.

The cities filed a Petition for Rehearing with the Court of

Appeals, asserting that the Court’s conclusions upon federal!

10 The Court also stated in its July 14, 1992 order that the holdings in

California Coastal Comm'n v. Granite Rock Co., 480 U.S. 572 (1987) and

Columbia Basin Land Protectio 1 Ass'n v. Schlesinger, 643 F.2d 585 (9th

Cir. 1981) supported the cities’ contention that the county could not deny a

permit for a federally approved project located on federal land. App. 201a.

11 Upon reconsideration, the District Court vacated that portion of its

prior decision which had required the county to issue the permits, and

remanded the permitting decision to the County with direction to take

official notice of the mitigation requirements imposed by the federal

agencies. App. 207a-212a.

12 The Court reached this conclusion despite the cities’ citation to the

decisions in Brubaker v. Board of County Comm'rs, 652 P.2d 1050 (Colo.

1982), Ventura County v. Gulf Oil Corp., 601 F.2d 1080 (9th Cir. 1979),

and California Coastal Comm'n v. Granite Rock Co., 480 U.S. 572 (1987).

App. 244a-256a.

preemption and standing were clearly erroneous. App.

262a-265a. The cities’ Petition was summarily denied. App.

213a.

The Colorado Supreme Court Decision

The cities filed a petition for writ of certiorari with the

Colorado Supreme Court, identifying as issues whether the

Court of Appeals erred in allowing the County to veto a

federally approved project located entirely on federal lands

and in finding that the cities lacked standing under the Fifth

Amendment. On a 5-2 vote, the Supreme Court denied cer-

tiorari. App. 214a-216a.

REASONS FOR ISSUING THE WRIT

I. THE SUPREME COURT MUST RESOLVE CON-

FLICTS AMONGST THE LOWER COURTS

A. Standing to Sue

A genuine conflict currently exists on an issue squarely

presented in this case: whether one subdivision of a state may

assert a Fifth Amendment takings claim against another sub-

division. The conflict involves the Delaware and Pennsylva-

nia Supreme Courts, as well as the Fourth, Fifth and Ninth

Circuits.

The Pennsylvania Supreme Court and the Ninth Circuit

have adopted a per se rule that one state entity may not assert

a takings claim against another. In City of Chester v. Com-

monwealth Dept. of Transp., 434 A.2d 695 (Pa. 1981), the

Pennsylvania State Department of Transportation condemned

a municipal park. The city sued for just compensation. The

Pennsylvania Supreme Court allowed the claim under the

state constitution. 434 A.2d at 702. The Court ruled, however,

that the Fifth Amendment does not allow a school district to

claim a taking, as the Amendment concerns only “private

property.” 434 A.2d at 701. Cf: United States v. 50 Acres of

Land, 469 U.S. 24, 25-26 (1984) (the reference to “private

property” in the takings clause of the Fifth Amendment can

encompass the property of state or local governments).

_ ne

In City of South Lake Tahoe v. California Tahoe Regional

Planning Agency, 625 F.2d 231, 233 (9th Cfr. 1980), cert.

denied, 449 U.S. 1039 (1980), a California state agency

adopted plans and regulations limiting residential develop-

ment in a city. The city sued, alleging that the plan would take

property without just compensation in violation of the Fifth

Amendment. See 625 F.2d at 232. The Ninth Circuit held that

the city lacked “standing” to challenge the plans and regula-

tions on constitutional grounds. 625 F.2d at 233.

On a similar note, in Board of Levee Comm'rs v. Huls,

852 F.2d 140 (Sth Cir. 1988), the Louisiana legislature passed

an act requiring the Orleans Levee District to convey some

land that it owned. The Levee Board sued the state, arguing

that the statute constituted an uncompensated taking. Relying

upon City of Trenton v. New Jersey, 262 U.S. 182 (1923), the

Fifth Circuit concluded that under the facts before it the

“Board cannot sue the state for an uncompensated taking of

property.” 852 F.2d at 142.'3

In City of Charleston v. Public Serv. Comm'n of W.VA, 57

F.3d 385 (4th Cir. 1995), on the other hand, the Fourth Circuit

recently had occasio:> to re-examine the question of whether a

political subdivis*.1 may sue its maker on constitutional

grounds. After noting the existence of a conflict on the issue,

the Court assumed that such suits are indeed allowed.

Moreover, doubts have been expressed as to

whether the “broad dicta” that “a political subdivi-

sion may never sue its maker on constitutional

grounds” is really “the rule.” See San Diego Unified

Port Dist. v. Gianturco, 651 F.2d 1306, 1309 (9th

13 The Court, nevertheless, failed to overrule its prior decision in

Rogers v. Brockette, 588 F.2d-1057 (Sth Cir. 1979), cert. den., 444 U.S. 827

(1979), stating that the Rogers decision “dealt only with the theoretica!

possibility that a city has standing to sue its state.” 852 F.2d at 143.

However, the Rogers court had specifically noted that the Trenton line of

cases simply “hold that the Constitution does not interfere in the internal

political organization of states” and, in fact, Trenton “implicitly [acknowl-

edges] that a municipality could raise the claim that its private contract and

property rights have been impaired.” 588 F.2d at 1069-1070.

Cir. 1981), cert. denied, 455 U.S. 1000, 102 S.Ct.

1631, 71 L.Ed.2d 866 (1982); see also City of South

Lake Tahoe v. California Tahoe Regional Planning

Agency, 449 U.S. 1039, 1042, 101 S.Ct. 619, 621,

66 L.Ed.2d 502 (1980) (White & Marshall, JJ.,

dissenting from denial of certiorari) (“Such a per se

rule is inconsistent with [Board of Educ. v.] Allen,

{392 U.S. 236, 88 S.Ct. 192, 20 L.Ed.2d 1060

(1968)]”); Gomillion v. Lightfoot, 364 U.S. 339,

344-45, 81 S.Ct. 125, 129, 5 L.Ed.2d 110 (1960);

United States v. Alabama, 791 F.2d 1450, 1455

(lith Cir. 1986), cert. denied, 479 U.S. 1085, 107

S.Ct. 1287, 94 L.Ed.2d 144 (1987); South Macomb

Disposal Authority v. Township of Washington, 790

F.2d 500, 504-06 (6th Cir. 1986); Rogers v.

Brockette, 588 F.2d 1057, 1067-71 (Sth Cir.), cert.

denied, 444 U.S. 827, 100 S.Ct. 52, 62 L.Ed.2d 35

(1979).

Thus, whether the cities have standing to bring this

suit is unclear. . . . Accordingly, we assume -

witnout deciding — that the cities have standing to

assert the Contract Clause claim made here and

address the merits of that claim.'4

Id. at 389-90.

In New Castle County School Dist. v. State, 424 A.2d 15

(Del. 1980), the Delaware Supreme Court also rejected any

exclusionary rule on standing. The Delaware legislature had

passed a law requiring a particular school district to convey

land to a state agency for use as a park. The school district

challenged the state law as a taking. The Delaware Supreme

Court directly contradicted the Pennsylvania Supreme Court

and the Fifth and Ninth Circuits. It held that, under the Fifth

Amendment, the rule “regarding compensation to municipal

'4 See also School Dist. of Philadelphia v. Pennsylvania Milk Market-

ing Bd., 877 F. Supp. 245, 250 (E.D. Pa. 1995) (“In recent years, however,

a split has developed among the circuits on this [standing] issue.”); Amato

v. Wilentz, 952 F.2d 742, 754-755 (3rd Cir. 1991) (judicial support for a per

se rule excluding municipal standing may be “waning with time”).

corporate entities” is that “property which is held in a propri-

etary capacity cannot be taken by the State unless just com-

pensation is paid.” 424 A.2d at 16-17.

The Delaware Court relied on the leading treatise in the

field which, citing many cases from a variety of jurisdictions,

states: “The property acquired by municipal corporations for

the private benefit of their inhabitants is protected by the

constitution, and can be taken only by eminent domain, and

upon payment of its value.” 1 Julius L. Sackman, Nichols’

The Law of Eminent Domain, § 2.225[1], at 2-158 (rev. 3d ed.

1993).

The Delaware Court also relied on a section of a promi-

nent legal encyclopedia, which provides:

The common constitutional provision against taking

of private property without payment of compensa-

tion is generally held to be applicable to the taking

by the state or a subdivision or agency thereof of

the property held by another subdivision or agency

in its proprietary capacity.

26 Am. Jur. 2d § 179, at 858. Eminent Domain, (1966).

The Cities of Aurora and Colorado Springs, like other

cities, hold their water rights as proprietary property. See 26

Am. Jur. 2d § 179, at 858. Eminent Domain, (1966) (propri-

etary property includes “the property which the inhabitants of

a city or town have acquired for the purposes of supplying

them with the necessities of life, such as water, gas or electric

light.”); Board of County Comm'rs v. City of Fort Collins, 68

Colo. 364, 367, 189 P. 929, 930 (1920) (in operating a

waterworks system a city acts in its proprietary or business

capacity and not in its political or governmental capacity).

As a result, if this case had arisen in Delaware or the

Fourth Circuit, the Cities of Aurora and Colorado Springs

could have raised their Fifth Amendment takings claims. Yet,

because the case arose in Colorado, they could not. These

circumstances warrant review by this Court.

B. Federal Preemption

By implicitly assuming that federal law did not preempt

the county’s denial decision, the Colorado Court of Appeals’

opinion clashes with decisions by the Ninth Circuit and this

Court. The Ninth Circuit was faced with a similar set of

circumstances in Ventura County v. Gulf Oil Corp., 601 F.2d

1080 (9th Cir. 1979), aff’d mem., 445 U.S. 947 (1980). In that

case, the County insisted that Gulf obtain a land use permit if

it wished to continue its mineral exploration activities on

federal lands within the county. In finding that the governing

federal legislation preempted the exercise of such county veto

authority, the Ninth Circuit observed:

Despite this extensive federal scheme reflecting

concern for the local environment as well as devel-

opment of the nation’s resources, Ventura demands

a right of final approval. Ventura seeks to prohibit

further activity by Gulf until it secures an Open

Space Use Permit which may be issued on whatever

conditions Ventura determines appropriate, or

which may never be issued at all. The federal Gov-

ernment has authorized a specific use of federal

lands, and Ventura cannot prohibit that use, either

temporarily or permanently, in an attempt to substi-

tute its judgment for that of Congress.

Id. at 1084. The Court then continued: “[T]he states and their

subdivisions have no right to apply local regulations imper-

missibly conflicting with achievement of a Congressionally

approved use of federal lands. ... ” /d. at 1086. See also

Idaho ex rel. Andrus v. Click, 97 Id. 791, 554 P.2d 969 (1976);

Ogden Environmental Services v. City of San Diego, 687 F.

Supp. 1436 (S.D. Cal. 1988).!5

'S The Ventura County decision is, in turn, consistent with the Colo-

rado Supreme Court’s opinion in Brubaker v. Board of County Comm'rs,

652 P.2d 1050 (Colo. 1982), wherein the Court held that a county special

use permit denial was preempted by federal law, as it stood as an “obstacle

to the accomplishment and execution of the full purposes and objectives of

Congress.” Jd. at 1055. Simply stated, the Court determined that “such a

veto power is not consistent with the Supremacy Clause.” /d. at 1056.

The Colorado Court of Appeals’ decision is likewise at

odds with the direction taken by this Court in California

Coastal Comm’n v. Granite Rock Co., 480 U.S. 572 (1987).

Although this Court found therein that reasonable state “envi-

ronmental” regulations covering Forest Service land were not

per se preempted by federal law, the 5-4 majority described

this holding as a “narrow” rejection of a “purely facial chal-

lenge.” /d. at 580, 593. Granite Rock had not even applied for

a state permit, arguing that there was no possible set of

conditions that the state could place on its permit which

would not conflict with federal law. It therefore had “lost the

possibility of making this argument [prohibition] in this liti-

gation.” Jd. at 588.'© In the present case, not only has that

prohibition of a federally permitted project located on federal

lands occurred, but the County made no attempt whatsoever

to impose conditions, reasonable or otherwise.!7

Thus, this Court is being called upon to clarify an issue

of critical importance to both federal land managers and

proponents of project development, i.e., the authority of a

local governmental entity to “deny,” based on the same

impacts reviewed in the federal process, a local permit for a

federally approved activity located on federal lands.

‘II. THE COLORADO COURT OF APPEALS DECI-

SION ESTABLISHES BAD PUBLIC POLICY

Approximately forty-six (46) percent of the West is fed-

erally owned lands, much of it managed by the Forest Service

or Bureau of Land Management. United States v. New Mexico,

16 Significantly, the majority decision assumed without deciding, an

assumption deemed “correct” in the dissent and consistent with the deci-

sion in Ventura County, supra, that “the combination of the NFMA and the

FLPMA preempt the extension of state land use plans . . . in national forest

lands.” 480 U.S. at 585, 612.

17 As further explained below, the County findings, with specific

reference to their reliance on the “wilderness” designation, nuisances,

aesthetics, and in-stream flow needs, were more nearly akin to preempted

“land use” controls than to environmental regulations.

aoe

438 U.S. 696, 699, n.3 (1978). Congress set aside such lands

for specific purposes including, in the case of national forest

lands, the securing of favorable water supplies and timber

production. 16 U.S.C. § 475 (1985).

Utility projects, be they water, electric or gas, oftentimes

cross federal lands, especially in the more arid and sparsely

populated Western portions of this country, where water and

power are transported across great expanses. Existing projects

on federal lands will need to be maintained, repaired and

replaced in the future, while new projects, especially those

designed to bring essential services to growing Western cities,

will have to be constructed. At the time of federal permitting

for such projects, alternatives will be examined, public hear-

ings will be held, and necessary mitigation conditions will be

imposed. Allowing the lower court decision to stand will

negatively impact upon these important activities and frus-

trate the Congressional purposes underlying national forest

legislation.

First, the decision below allows, and indeed encourages,

“local” branches of government to sit quietly on their hands

during federal review proceedings, only to play their “trump

card” at the end of the process. Second, the decision permits

local entities to “second guess” federal determinations upon

impacts and mitigation requirements over the federal govern-

ment’s land — just as occurred in this instance.'*® Third, it

exposes permittees to duplicitous and potentially conflicting

requirements. Each separate jurisdiction which the pipeline,

power line, canal or other project crosses could apply its own

unique mandates, without regard for either the federal condi-

tions or the requirements imposed by neighboring govern-

mental bodies. Fourth, the decision exposes permittees to the

18 For example, the Corps found that there would be no unacceptable

harm to wetlands as a result of this project, but in an abundance of caution

mandated the completion of a complex monitoring and mitigation plan,

inserted a “no loss” condition in the § 404 permit, and required a bypass of

project diversions should unanticipated wetland damage occur. The county

then vetoed the project based on wetland mitigation concerns.

prospect of “unreasonable” conditions which amount, in and

of themselves, to a prohibition.!9

Finally, a failure to reverse the Court of Appeals decision

would allow local entities to foreclose, by use of their

“denial” authority, certain federally approved uses on federal

lands, thereby not only usurping federal authority, but harm-

ing the federal programs governing resource use which were

developed to fulfill Congressional directives. This result,

openly antagonistic to federal land management interests,

could be accomplished under the guise of “environmental

regulation,” when in fact the governmental body is imple-

menting a local land use scheme. It is the very result feared

by the dissenting opinion in Granite Rock, i.e., “duplicative”

processes wherein a local regulator has given itself final

authority to determine how federal lands are to be used.

Granite Rock, 480 U.S. at 605.

The lower court’s decision on municipal standing would

likewise have far-reaching impacts, potentially touching

every municipality across the country.2°9 Though munici-

palities oftentimes purchase water rights, real property, or

other tangible goods in the free market, and pay market price

therefor, under the decision below they would have no

recourse to seek just compensation if those assets were subse-

quently taken by the state or an agency of the state. This

would be true whether or not the municipality was constitu-

tionally created, and thus not subject to dissolution by the

state, and whether or not it was acting in its proprietary

capacity in the provision of an essential utility service.?!

19 To the extent the county would argue that the federal mitigation

plan was inadequate, despite its operational flow release option, there is no

reasonable environmental regulation available for this otherwise federally

permitted Project. That is to say, there exists a de facto prohibition, the very

exception to allowable “environmental” regulation noted in the Granite

Rock decision, 480 U.S. at 587.

20 The decision would also adversely affect quasi-governmental enti-

ties to the extent they are deemed “creatures of the state.”

21 In addition, where the regulating entity need not be concerned

about having to pay another governmental body for a complete or partial,

Finally, as also evidenced by this case, without a deter-

mination that municipalities have such standing, there could

be a “regulatory redistribution,” by local agencies, of essen-

tial natural resources, including water. If, for example, a

county can deny a permit because the county wants additional

flows in the stream for wetlands inundation, aesthetics, and

rafting, yet it does not have to acquire those flows in a water

court adjudication, purchase them in the marketplace, or pay

the permittee for its senior decreed rights, the county has, in

effect, reallocated the resource without any cost to its local

citizens. This is not the type of “planning” which leads to a

considered and orderly distribution of essential commodities

— particularly those regulated by federal agencies in fur-

therance of Congressional purposes, goals and mandates.

lil. THE COLORADO COURT OF APPEALS’ DECI-

SION WAS IN ERROR

A. Standing to Sue

Relying upon dicta in Town of Orchard City v. Board of

Delta County Comm’rs, 751 P.2d 1003, 1006 (Colo. 1988),

and this Court’s opinion in Coleman v. Miller, 307 U.S. 433

(1939), the Court below found that the mere identity of the

cities stood as an absolute bar to standing under the Fifth and

Fourteenth Amendments to the United States Constitution.

App. 29a.

As previously noted, the above conclusion is directly

contrary to the black letter law upon this subject, as well as

the decision of the Delaware Supreme Court in New Castle

County School District v. State, 424 A.2d 15 (Del. 1980). See

1 Julius L. Sackman, Nichols on Eminent Domain § 2.225[1]

at 2-158 (3d Ed. 1993). In support of the determination that

standing does exist in such cases, Nichols cites numerous

court opinions, including such early decisions of this Court as

City of New Orleans v. New Orleans Waterworks Co., 142

temporary or permanent deprivation of the reasonable use of its property,

that entity lacks any incentive to reach a mutually satisfactory resolution

where competing local interests are at stake.

U.S. 79 (1891) and City of Worcester v. Worcester Consol. St.

Ry. Co., 196 U.S. 539 (1905), in which a proprietary/govern-

mental distinction was explicitly recognized. The same con-

clusion is reached at A.S. Klein, Annotation, Condemnation

of Public Entities’ Land, 35 A.L.R.3d 1293 at 1307 (1971):

The common constitutional provision against the

taking of private property without payment of com-

pensation is generally held to be applicable to the

taking by the State or subdivision or agency thereof

of the property held by another subdivision or

agency in its proprietary capacity.

Cases finding an absence of standing in such situations

are the descendants of Trustees of Dartmouth College v.

Woodward, 17 US. (4 Wheat.) 518 (1819), wherein New

Hampshire was prohibited under the Contract Clause to the

U.S. Constitution from modifying a charter that the colonial

government had issued to the College. In the famous dicta to

that decision, Chief Justice Marshall sought to avoid a situa-

tion wherein citizens of the state could claim they had a

“contract” with the state, because such an interpretation

would bar the state from impairing any such contract. This

would leave a state practically unable to legislate or allocate

political power within its subdivisions. Justice Marshall’s

solution was to enunciate the principle that certain guarantees

of the U.S. Constitution should not be interpreted to interfere

with a state’s control over the allocation of its political

powers.

Typical of the series of cases following Dartmouth is

City of Trenton v. New Jersey, 262 U.S. 182 (1923). In City of

Trenton, the state modified a charter that it had previously

given to the municipality. In holding that the municipality had

no standing to challenge the change, the Court quoted exten-

sively from Hunter v. City of Pittsburgh, 207 U.S. 161, 178-9

(1907), which is considered the leading example of such

standing limitations. Rogers, 588 F.2d at 1067, 1068.22

22 The Cities submit that the Supreme Court implicitly acknowledged

in Hunter, 207 U.S. at 179-80, that a municipality can raise a claim that its

“private” contract and property rights have been impaired.

However, when these cases were decided, “standing”

meant something different from what it means today. See

Rogers, 588 F.2d at 1057. The old legal standing test went to

the merits of the case. Association of Data Processing Serv.

Org. v. Camp, 397 U.S. 150, 153 (1970). By resolving these

substantive issues under the rubric of standing principles,

these decisions have been misinterpreted as a broad denial of

access to the courts. As a result, substantive issues have

become distorted and parties’ claims have been deprived of

the full consideration they deserve. Case Comment, Munici-

pal Corporation Standing To Sue The State: Rogers v.

Brockette, 93 Harv. L. Rev. 586 at 590, 591 (1980).

This Court subsequently discussed its prior rulings on

this topic in Gomillion v. Lightfoot, 364 U.S. 339 (1960).

While recognizing that the numerous decisions dealing with

the creation of municipalities and with taxation clearly state

that the due process clause affords no immunity against “mere

inequalities in tax burdens .. . as an indirect consequence of a

State’s exercise of its political powers,” the Court noted that

the Hunter opinion itself “intimates that a state legislature

may not be omnipotent even as to the disposition of some

types of property owned by municipal corporations.”

Gomillion, 364 U.S. at 344. The Court warned that “exalting”

the State’s political power to an absolute would “misconceive

the reach and rule” of Hunter and related cases:

. a correct reading of this seemingly unconfined

dicta of Hunter and kindred cases is not that the

State has plenary power to manipulate in every

conceivable way, for every conceivable purpose, the

affairs of its municipal corporations, ....

Id. at 344.23

23 In City of South Lake Tahoe v. California Tahoe Regional Planning

Agency, 449 U.S. 1039 (1980) (White, J., dissenting from denial of cer-

tiorari), Justice White was critical of what he termed the “per se rule” of

standing, finding it to be inconsistent with the decision in Board of

Education v. Allen, 392 U.S. 236 (1968). In addition, Justice White refer-

enced Rogers v. Brockette, supra, a decision upon which a conflicting line

of cases has developed.

i aeceneenaemnnmeenreesiisinssiaiiiiiiiaiiiiiitiiiiiiaiiaiiiiiéd

In this case, the court below operated under such a

misconception. Rather than a situation involving the alloca-

tion of political authority, it was faced with a set of facts

which ran directly to the property interests of the cities, i.e.,

their water rights and water delivery facilities.24

Furthermore, the “creature of the state” rationale simply

cannot apply to all Colorado municipalities. The “home rule”

provisions of the Colorado Constitution, Colo. Const., Art.

XX, Sect. 1 and 6, confirm that the cities are not creatures of

the state legislature. Rather, they derive certain powers

directly from the state Constitution,25 powers which cannot be

abrogated by legislative fiat. City of Thornton v. Farmers

Reservoir and Irrigation Co., 194 Colo. 526, 575 P.2d 382,

389 (1978).2© Therefore, the language found in Hunter ». City

of Pittsburgh and City of Trenton v. New Jersey, supra, allow-

ing the state “at its pleasure” to “modify or withdraw all such

powers” to “take without compensation such property,”

“repeal the charter, and destroy the corporation” is neither

relevant nor applicable to the facts presented here. City of

Trenton, 262 U.S. 182, 187 (1923); Hunter, 207 U.S. 161,

178-9 (1907).

Finally, it must not be forgotten that the cities are acting

in their proprietary capacity as the owners and developers of

decreed conditional water rights. See City and County of

Denver v. Colorado River Water Conservation Dist., 696 P.2d

24 The water rights and federal location approvals of the cities are

vested property interests. See Public Serv. Co. of Colorado v. FERC, 754

F.2d 1555 (10th Cir. 1985), cert. den., 474 U.S. 1081 (1986), Wiebert v.

Rothe Bros., 618 P.2d 1367 (Colo. 1980).

25 One such power bestowed upon Colorado home rule munici-

palities is the authority “within or without its territorial limits to construct

... Maintain, conduct, and operate water works . . . and everything required

therefore .. . .” Colo. Const., Art. XX, Sect. 1.

26 In addition, the Colorado Supreme Court has expressly stated that

“as a home rule city with its own constitutional underpinning, Denver

[Colorado Springs and Aurora] was not a political subdivision of the

state... .” Mesa Verde Co. v. Montezuma County, 831 P.2d 482, 485 (Colo.

1992).

730, 742 (Colo. 1985) (in operating a waterworks system a

city acts in its proprietary or business capacity and not in its

political or governmental capacity); see also City of New

Orleans v. New Orleans Waterworks Co., 142 U.S. 79 (1891)

and City of Worcester v. Worcester Consol. St. Ry. Co, 196

U.S. 539, 551-553 (1905). None of the rationale concerning

actions by “creatures of the state” is pertinent where a munic-

ipality is acting in such a capacity. Rather, it is to be treated

essentially the same as a private corporation. Castlewood

Corp. v. Denver, 41 Colo. App. 565, 567, 594 P.2d 1062

(1978); see also Duquesne Light Co. v. Barasch, 488 U.S. 299

(1989) (“private” utility allowed to bring Fifth Amendment

takings claim).

B. Federal Preemption

Pursuant to the Property Clause of the United States

Constitution, art. IV, § 3, cl. 2, Congress has exclusive and

unlimited power over the use and disposition of federally-

owned lands. Kleppe v. New Mexico, 426 U.S. 529, 537, 539

(1976). State law cannot divest Congress of that power. Utah

Power and Light Co. v. United States, 243 U.S. 389, 403-405

(1917). Though the state may exercise its civil and criminal

jurisdiction over lands belonging to the United States,

[T]his jurisdiction does not extend to any matter

that is not consistent with full power in the United

States to protect its lands, to control their use, and

to prescribe in what manner others may acquire

rights in them.

243 U.S. at 404. Stated another way, “where those state laws

conflict with . . . legislation passed pursuant to the Property

Clause, the law is clear: the state law must recede.” K!eppe,

426 U.S. at 543; Fidelity Federal Savings and Loan Ass'n v.

de la Cuesta, 458 U.S. 141, 153-154 (1982).

The question in this case is an extension of that faced by

this Court in California Coastal Comm’n v. Granite Rock Co..,

480 U.S. 572 (1987), i.e., “whether Congress has enacted

legislation respecting this federal land that would preempt”

the permit denial by a local branch of government. /d. at 581.

State law can be preempted in either of two general

ways. If Congress evidences an intent to occupy a

given field, any state law falling within that field is

preempted. [Citations deleted]. If Congress has not

entirely displaced state regulation over the matter in

question, state law is still preempted to the extent it

actually conflicts with federal law, that is, when it

is impossible to comply with both state and federal

law, [citations deleted] or where the state law stands

as an obstacle to the accomplishment of the full

purposes and objectives of Congress, Hines v.

Davidowitz, 312 U.S. 52, 67 [85 L.Ed. 581, 61 S.Ct.

399] (1941). Silkwood v. Kerr-McGee Corp., supra,

at 248, 78 L.Ed.2d 443, 104 S.Ct. 615.

480 U.S. at 581.27 Just such a conflict and frustration of

Congressional interests exists in this instance.

1. Conflict with Federal Laws

The 1897 Organic Administration Act established the

management mandate for the forest reserves and identified

their primary purposes:

No national forest shall be established, except to

improve and protect the forest within the bound-

aries, or for the purpose of securing favorable con-

ditions of water flows, and to furnish a continuous

supply of timber for the use and necessities of

citizens of the United States.

16 U.S.C. § 475 (1985). In interpreting the above provision,

this Court has held that the national forests were created “for

only two purposes”, i.e., to secure favorable conditions of

water flows for Western settlers and to furnish a continuous

supply of timber for the people. United States v. New Mexico,

438 U.S. 696, 707, 718 (1978). In particular, favorable water

flows were to “be used for domestic, mining, milling, or

irrigation purposes, under the laws of the State wherein such

27 Federal regulations have no less preemptive effect than federal

statutes. Capital Cities Cable, Inc. v. Crisp, 467 U.S. 691, 699 (1984).

national forests are situated, or under the laws of the United

States and the rules and regulations established thereunder.”

Id. at 712; 16 U.S.C. § 481 (1985).

In rejecting the government's claim in New Mexico that

Congress intended to reserve water in national forests for

“secondary” uses, such as “aesthetic, environmental, recre-

ational, or wildlife preservation purposes,” /d. at 705, this

Court stated:

Not only is the government's claim that Congress

intended to reserve water for recreation and wildlife

preservation inconsistent with Congress’ failure to

recognize these goals as purposes of the national

forest, it would defeat the very purpose for which

Congress did create the national forest system. . . .

As this provision [16 U.S.C. § 481] and its legisla-

tive history evidence, Congress authorized the

national forest system principally as a means of

enhancing the quantity of water that would be

available to the settlers of the arid West. The Gov-

ernment, however, would have us now believe that

Congress intended to partially defeat this goal by

reserving significant amounts of water for purposes

quite inconsistent with this goal. (emphasis added)

Id. at 712-713. These “inconsistent purposes,” i.e., flows for

aesthetics, recreation and environmental enhancement, are the

very objectives utilized by the County to deny the cities the

permits necessary to complete their water delivery system.

The conflict between the County’s actions and the federal

legislative scheme is undeniable.

In addition, the Forest Service Management Plan for the

area in question specifically states that the White River

National Forest is for multiple use. This is in keeping not only

with the language of the Organic Act as quoted above, but

also with the provisions of the Federal Land Policy Manage-

ment Act (“FLPMA”), 43 U.S.C. § 1701, 1732 (1986), the

National Forest Management Act, 16 U.S.C. § 1600, 1604

(1985), et seqg., and the Multiple Use Sustained Yield Act, 16

U.S.C. § 528 (1985).28 Included within the “multiple uses”

encouraged by each of these Acts is water resource develop-

ment. 43 U.S.C. § 1761(a)(1) (1986) specifically authorizes

the Secretary to grant rights-of-way over the national forest

system for “reservoirs, canals, ditches, flumes, . . . and other

facilities and systems for the impoundment, storage, transpor-

tation, or distribution of water.” Nothing in these Acts would

counsel in favor of “local” supremacy over decisions affect-

ing the forest lands.29

Though § 505(a) of FLPMA, 43 U.S.C. § 1765(a) (1986),

states that rights-of-way granted thereunder are to contain

terms and conditions which “require compliance with state

standards for . . . environmental protection . . . if those

standards are more stringent,” the regulations at issue here are

“local” in nature, and hence do not fall within the clear terms

of the statutory language. Columbia Basin Land Protection

Ass'n v. Schlesinger, 643 F.2d 585 (9th Cir. 1981); City and

County of Denver v. Bergland, 695 F.2d 465, 485 (10th Cir

28 As previously noted, in Granite Rock, 480 U S. at 585, this Court

correctly “assumed” that the National Forest Management Act and the

Federal Land Policy Management Act “preempt the extension of state land

use plans onto unpatented mining claims in national forest lands.” /d. at

585. See 16 U.S.C. § 1604(a) (1985); 43 U.S.C. § 1712(c) (1986). The

same preemption analysis holds true for water projects on federal lands.

29 See, e.g., 43 U.S.C. § 1712(c)(9) (1986) (federal land use plans are

to be consistent with state and local land use plans to the “maximum

extent” the Secretary “finds consistent with federal law” and the purposes

of FLPMA); 16 U.S.C. § 530 (1985) (Secretary is to “cooperate with

interested state and local governmental agencies . . . in the management of

the national forests”); 16 U.S.C. § 1612(a) (1985) (state and local govern-

ments are given an “opportunity to comment upon the formulation of

standards, criteria and guidelines applicable to Forest Service programs’).

The pertinent federal regulations governing the management of national

forests likewise support the cities preemption analysis. See, e.g., 36 C.FR.

Part 219 (1983) (establishment of a coordination effort, § 219.7, wherein

local government input is solicited, § 219.6, and an appeal process !s

available, § 219.10.) However, the Forest Service remains the final deci-

sion maker, 36 C_ER. §§ 219.8, 219.10 (1983).

1982); Citizens for a Better Henderson v. Hodel, 768 F.2d 1051

(9th Cir. 1985).3° Further, the Forest Service expressly found that it

complied, through the incorporation of stipulations and conditions

in the FLPMA permit, with the requirements of this statutory

provision, App. 49a-50a, and concluded that “appropriate state and

local agencies” would specify “mitigation measures for non-federal

lands ... .” App. 46a.*!

In Granite Rock, this Court took as true the Coastal

Commission’s assertion that it did not seek to veto or prohibit

the activity, but only to regulate the environmental aspects

thereof. 480 U.S. at 586, 587. Given the “as yet unidentifiable

conflicts with the federal scheme” and the “barren record,”

the Court cautiously accepted the possibility that the state

might impose certain reasonable environmental controls. /d.

at 594.32 In other words, the state had a role in deciding

“how” an activity was to be conducted on federal land, bw

had no authority to decide “if” that particular activity was

going to go forward.

30 As concluded in Montana v. Johnson, 738 F.2d 1074 (9th Cir.

1984), this provision of FLPMA does not require compliance with local

permit procedures, but only a consideration of state substantive standards

by the permitting “federal” agency. In accord, Columbia Basin, 643 F.2d at

605 (to require “state” certification “would imply that the state could deny

the permit.”)

3! The FLPMA permit indicated that “Eagle County . . . advise[d] the

Forest Service that various permits are needed,” App. 67a. This is not an

indication of Forest Service concurrence in the application or propriety of

local regulations, and is certainly not dispositive of the preemption anal-

ysis. See Brubaker, 652 P.2d at 1057 (since state law is not applicable if it

is preempted, the scope of a federal permit’s reference to compliance with

applicable state and local requirements is dependent upon, rather than

determinative of, the proper resolution of the preemption issue).

32 The “state” regulatory scheme referenced in Granite Rock, 480

U.S. at 583, is absent in this instance. See City and County of Denver v.

Bergland, 695 F.2d 465, 485 (10th Cir. 1982) (regulations under the

Colorado Land Use Act are deemed “local” promulgations).

33 The Court warned that “one may hypothesize a state environmen-

tal regulation so severe that a particular land use would become

In the present instance, the record is voluminous and it

clearly demonstrates that the County did not seek to impose

reasonable environmental conditions. In fact, it made no

attempt whatsoever to cooperate with the cities or federal

agencies in identifying potential mitigation conditions, argu-

ing instead that it was not the County’s duty to propose any

mitigation requirements.34 Rather, the County vetoed the fed-

erally-approved project, despite the extensive federal permit

requirements which were based on the same set of facts and

addressed the very same concerns. The County thus created

an irreconcilable conflict with federal law, and erected an

unlawful barrier to fulfillment of the water supply purposes of

national forests as envisioned by Congress.

As previously indicated, the Colorado Court of Appeals

decision is likewise inconsistent with the opinion of the Ninth

Circuit in Ventura County v. Gulf Oil Corp., 601 F.2d 1080

(9th Cir. 1979), aff'd mem., 445 U.S. 947 (1980). See also

Federal Power Comm'n v, Oregon, 349 U.S. 435 (1955); First

lowa Hydro-Electric Coop. v. Federal Power Comm'n, 328

U.S. 152, 164, 181-183 (1946) (local veto power which con-

flicts with the federal scheme is preempted). As in Ventura

commercially impracticable.” 480 U.S. at 587. To the extent one could

characterize the County regulations as “environmental,” this is such a

situation. The “commercial” value of the Prcject lies in its yield, yet the

county decided that the water should remain in the stream for purposes of

wetland flooding, aesthetics, and recreational rafting.

34 Though the county has argued that it did not prohibit other “alter-

native projects,” this response ignores the fact that (a) Colorado has no

NEPA-type statute; (b) the cities had no decree for alternate points of

diversion; (c) the cities had only one set of federal permits and easements;

(d) the alternatives analysis had already been performed as part of the

federal EIS process; (e) the cities had only one Congressional exemption;

(f) the county had no alternative analysis requirements in its regulations;

(g) the county found the application complete without requiring an alterna-

tives discussion; and (h) the county specifically found, in response to a

motion in limine filed by the cities, that it could not require an alternatives

analysis.

County, Eagle County seeks to prohibit the federally autho-

rized activity, having denied the requested permits.

Finally, even assuming for purposes of argument that

local “denial” authority could be exercised where local “envi-

ronmental” regulations are being applied, the County’s char-

acterization of its findings herein as other than “land use”

controls is nothing more than an attempt to definitionally

obfuscate the issues.35

2. Conflict With Congressional Wilderness

Exemption

As noted at the outset, in 1980, Congress provided the

Project with a specific exemption from those additional con-

straints which would be associated with the creation of the

Holy Cross Wilderness. That exemption stated, in part:

Provided, that no right or claim of right, to the

diversion and use of existing conditional water

rights for the Homestake Water Development Pro-

ject by the cities of Aurora and Colorado Springs

shall be prejudiced, expanded, diminished, altered,

or affected by this Act. Nothing in this Act shall be

35 The “quality and quantity of the river rafting experience” is a land

use determination, i.e., will the county allow domestic water diversions to

support residential and commercial growth or preserve aquatic play-

grounds. Similarly, regulation of the area as a “wilderness” is a clear land

use choice. Further, the application of “nuisance” factors as a basis for

permit denial also constitutes the application of “land use” controls. Nui-

sance factors, such as increased traffic and dust from construction activ-

ities, have been historically characterized as matters within the ambit of the

“local zoning” authority. See Village of Euclid v. Ambler Realty Co., 272

U.S. 365 (1926) (a regulatory zoning ordinance is analogous to the com-

mon law of nuisance); Brendale v. Confederated Tribes, 492 U.S. 408

(1989) (zoning is driven by concerns such as health and safety, aesthetics,

or other public values and closely parallels nuisance law); Robinson Brick

Co. v. Luthi, 115 Colo. 106, 111, 169 P.2d 171 (1946) (where the legislature

has declared by statute and zoning resolution what activities may be

conducted in a certain zone, it has in effect declared what is a public

nuisance).

construed to expand, abate, impair, impede, or

interfere with the construction, maintenance or

repair of said project, nor the operation thereof, or

any exchange or modification of the same agreed to

by the cities and the United States, acting through

any appropriate agency thereof.

P.L. 96-560, § 102(a)(5), 94 Stat. 3265 (1980). App. 313a.

Thus, a compromise was reached wherein the cities would not

oppose the creation of a wilderness area which encompassed

their previously decreed points of diversion. In return, devel-

opment of the cities water rights would not be adversely

impacted by the new land designation.*©

However, both the County and the Colorado Court of

Appeals ignored this Congressional directive and specifically

considered the impacts of the Project upon so-called “wilder-

ness” values, thereby undermining Congressional intent. See

App. 14a; App. 147a-148a.

36 In the Final Environmental Impact Statement for the project, the

Forest Service acknowledged the above compromise by stating:

The wilderness was established recognizing the cities’ pro-

posal. As a result, the Homestake Phase II proposal is not

subject to the Wilderness Act (16 U.S.C. 1131, et seq.). Con-

gress has determined that the Homestake Phase II Project

proposal should be reviewed as if it were in a portion of

National Forest allocated to non-wilderness use.

<i aaa ia iii

CONCLUSION

The petition for writ of certiorari should be granted.

Respectfully submitted,

Joun M. Dincess

DUNCAN, OSTRANDER, VARNELL

& Dincess, P.C.

7800 East Union Avenue

Suite 200

Denver, CO 80237

Grecory L. JOHNSON

Assistant City Attorney,

Utilities

30 S. Nevada, Suite 601

Colorado Springs, CO 80903

Mark T. PirFHer*

JONATHAN C. DEHMLOW

ANDERSON, GIANUNZIO, Dupe,

PirHer & Leper, P.C.

104 S. Cascade Avenue

Suite 204

Colorado Springs, CO 80903

(719) 632-3545

*Counsel of Record

Appendix A:

Appendix B:

Appendix C:

Appendix D:

Appendix E:

Appendix F:

Appendix G:

App. i

INDEX TO APPENDICES

VOLUME I

The decision of the Colorado Court of

Appeals reported at 895 P.2d 1105 (1994).

App. 1a-33a.

Relevant Portions of the FLPMA permit

issued for the Homestake Water Project

(“Project”) by the United States Forest

Service. App. 34a-107a.

Relevant portions of the Section 404 per-

mit issued for the Project by the U.S.

Army Corps of Engineers. App.

108a-134a.

The decision of the Colorado Water Qual-

ity Control Division certifying that the

Project met all applicable state water

quality requirements. App. 135a-14la.

The resolution of the Eagle County Board

of County Commissioners (“County”),

dated February 22, 1988, denying the

local land use permits for the Project.

App. 142a-156a.

VOLUME II

The resolution of the Eagle County Board

of County Commissioners (“County”),

dated December 17, 1991, denying the

local land use permits for the Project.

App. 157a-16la.

The order of the Eagle County District

Court dated July 22, 1988, dismissing for

lack of standing the claims of the cities

brought under the Fifth and Fourteenth

Appendix

App. ii

Amendments to the United States Consti-

tution. App. 162a-167a.

The order of the Eagle County District

Court dated July 22, 1988, dismissing for

lack of standing the claims of the cities

brought under the Fifth and Fourteenth

Amendments to the United States Consti-

tution. App. 168a-172a.

The initial decision of the Eagle County

District Court remanding the case to the

Board of County Commissioners. App.

173a-191a.

The decision of the Eagle County District

Court finding that the County had denied

the cities’ due process and acted in an

arbitrary and capricious manner in deny-

ing the requested permits. App.

192a-206a.

The order of the Eagle County District

Court vacating that portion of its prior

decision which had required the County

to issue the permits. App. 207a-212a.

The Colorado Court of Appeals decision

denying the cities Petition for Rehearing.

App. 213a.

The Colorado Supreme Court decision

denying the cities’ Petition for Writ of

Certiorari. App. 214a-216a.

Relevant portions of the pleadings and

briefs below indicating the manner in

which the federal questions were raised

App. 217a-269a.

Appendix O:

Appendix P:

Appendix Q:

Appendix R:

Appendix S:

Appendix T:

Appendix U:

Appendix V:

Appendix W:

App. iii

Relevant provisions of the Colorado Land

Use Act, C.R.S. §§ 24-65.1-101-502 (1988)

are attached as App. 270a-279a.

Relevant provisions of the Eagle County

land use regulations promulgated pur-

suant to C.R.S. § 24-65.1-101-502 (1988)

are attached as App. 280a-295a.

Relevant provisions of the Federal Land

Policy Management Act, 43 U.S.C.

§ 1700-1784 (1986), are attached as App.

296a-300a.

Relevant provisions of the National Forest

Management Act, 16 U.S.C. §§ 472a, 476

note, 500, 513, 515, 516, 518, 521b, 528

note, 576b, 581h, 594-2 note, 1600 note,

1600-1614 (1985), are attached as App.

301a-303a.

Relevant provisions of the Organic Act of

1897, 16 U.S.C. §§ 475-481 (1985), are

attached as App. 304a-305a.

Relevant provisions of the Multiple Use

and Sustdined Yield Act, 16 U.S.C.

§§ 528-531 (1985), are attached as App.

305a-307a.

The text of the Property Clause of the

United States Constitution, art. IV, § 3, cl.

2, is set forth at App. 308a.

The text of the Fifth and Fourteenth

Amendments to the United States Consti-

tution are attached as App. 309a-311a.

The text of the Supremacy Clause of the

United States Constitution, art. VI, cl. 2, is

set forth at App. 312a.

Appendix X:

Appendix Y:

Appendix Z:

App. iv

Relevant portions of P.L. 96-560, 94 Stat.

3266 (1980) are attached as App. 313a.

Relevant portions of the Code of Federal

Regulations, 1983 edition, governing the

use of federal lands, 36 C.F.R. Part 200

through 299, are set forth at App.

314a-318a.

Map of Homestake Delivery System is

attached as App. 319a.

APPENDIX A

COLORADO COURT OF APPEALS November 17, 1994

No. 93CA0386

No. 93CA0412

City of Colorado Springs and City of Aurora, Colorado,

municipal corporations,

Plaintiffs-Appellants and Cross-Appellees,

The Board of County Commissioners of the County of

Eagle, State of Colorado; George A. Gates, Johnette Phil-

lips, James E. Johnson, Jr., in their official capacities as

individual members of said Board; The Board of County

Commissioners of the County of Eagle, in its capacity as

the permitting authority under §24-65-101 et. seq., C.R.S.;

The Eagle County Planning Commission; Mark Dona-

ldson, Robert Tether, Arlene Quenon, Robert Morris,

Donald Price, in their official capacities as individual

members of said Commission; The County of Eagle, State

of Colorado; Holy Cross Wilderness Defense Fund; and

Vail Valley Consolidated Water District,

Defendants-Appellees and Cross-Appellants.

Appeal from the District Court of Eagle County

Honorable William L. Jones, Judge

No. 88CV142

Division III JUDGMENT AFFIRMED

Opinion by JUDGE IN PART, REVERSED IN

DAVIDSON PART, AND CAUSE

Jones and Rothenberg, JJ., REMANDED WITH

concur DIRECTIONS

Anderson, Johnson & Gianunzio, P.C., Mark T. Pifher,

William Kelly Dude, Colorado Springs, Colorado, for

Plaintiffs-Appellants and Cross-Appellees

James R. Fritz, County Attorney, Eagle, Colorado; Holme

Roberts & Owen, L.L.C., Dennis J. Herman, Henry W.

Ipsen, Mary H. Stuart, Denver, Colorado, for Defendants-

Appellees and Cross-Appellants The Board of County

Commissioners of the County of Eagle, State of Colorado;

George A. Gates, Johnette Phillips, James E. Johnson, Jr.;

The Board of County Commissioners of the County of

Eagle, State of Colorado; The Eagle County Planning

Commission; Mark Donaldson, Robert Tether, Arlene

Quenon, Robert Morris, Donald Price; The County of

Eagle, State of Colorado

Sierra Club Legal Defense Fund, Lori J. Potter, Denver,

Colorado; Land and Water Fund of the Rockies, Frances

M. Green, Boulder Colorado, for Defendant-Appellees

and Cross-Appellants Holy Cross Wilderness Defense

Fund

Grimshaw & Harring, P.C., Wayne B. Schroeder, Ronald

L. Fano, Denver, Colorado, for Defendant-Appe.lees and

Cross-Appellants Vail Valley Consolidated Water District

In this action pursuant to C.R.C.P. 106, and C.R.C.P.

57, defendants, Eagle County; the Eagle County Board of

Commissioners; George A. Gates, Johnette Phillips, and

James E. Johnson, in their official capacities as individual

members of the Eagle County Board of Commissioners;

the Eagle County Planning Commission; Mark Don-

aldson, Robert Tether, Arlene Quenon, Robert Morris,

and Donald Price, in their official capacities as individual

members of the Eagle County Planning Commission (col-

lectively the Board); Holy Cross Wilderness Defense

Fund; and Vail Valley Consolidated Water District (Vail

Valley), appeal from the judgment of the trial court vacat-

ing a denial of certain land use permits to plaintiffs, the

City of Aurora and the City of Colorado Springs (the

cities), and remanding the matter to the Board of County

Commissioners. The cities cross-appeal from the trial

court’s dismissal of certain of their claims against the

Board. We affirm in part and reverse in part.

The cities hold water rights in the Holy Cross Wilder-

ness area, located in Eagle County. In order to complete a

transbasin water diversion project there, the cities

applied to the Board for a special use permit, a permit to

conduct a major extension of an existing water collection

system, and a permit to conduct a municipal water pro-

ject, pursuant to regulations enacted under §24-65.1-101,

et seq., C.R.S. (1988 Repl. Vol. 10B) (the Land Use Act)

and §29-20-101, et seq., C.R.S. (1986 Repl. Vol. 12A) (the

Local Government Land Use Control Act). After a series

of public hearings, the Board denied the permits, and the

cities filed this C.R.C.P. 106 action protesting the denial.

See §24-65.1-502, C.R.S. (1988 Repl. Vol. 10B).

On review, the trial court found that certain of the

land use regulations relied upon by the Board to deny the

permits were preempted by various state and federal

statutes. The trial court then found the remaining regula-

tions, concerning wetlands protection and nuisance fac-

tors, to be valid under the Land Use Act, but concluded

that it could not discern whether the Board would have

denied the permits absent consideration of the preempted

regulations. Thus, it vacated the denial of the permits and

remanded the matter to the Board for reconsideration.

The Board denied the permits on remand and the

cities again appealed. On different grounds, the trial

court again vacated the Board’s order and, in addition,

ordered the Board to approve the permits because it

found that the Board had violated due process by

improperly refusing to consider a final wetlands mitiga-

tion report submitted to the Army Corps of Engineers.

On the Board’s motion for reconsideration, the trail

court deleted the portion of its order requiring approval

of the permits and remanded the matter with instructions

to consider the final wetlands mitigation report.

We will address the matter raised by defendants on

appeal first and then consider the issues raised by the

cities’ cross-appeal.

Defendants argue that the trial court’s first order

vacating the denial of the permits and remanding the

matter to the Board was in error. We agree.

Review of an agency decision under C.R.C.P.

106(a)(4) is limited to matters contained within the record

of the proceeding before the agency and “[t]he burden is

on the [party] challenging the action to overcome the

presumption that the agency’s acts were proper.” Fedder

v. McCurdy, 768 P.2d 711, 713 (Colo. App. 1988).

Consequently, a court may reverse an administrative

tribunal’s decision under C.R.C.P. 106 if there is no com-

petent evidence to support its decision, that is, only if

“the ultimate decision of the administrative body is so

devoid of evidentiary support that it can only be

explained as an arbitrary and capricious exercise of

authority.” Ross v. Fire & Police Pension Ass’n, 713 P.2d

1304, 1309 (Colo. 1986); Platte River Environmental Conser-

vation Organization, Inc. v. National Hog Farms, Inc., 804

P.2d 290 (Colo. App. 1990) (The relative merits of the

decision are not within the inquiry on review.)

Section 24-65.1-501, C.R.S. (1988 Repl. Vol. 10B) pro-

vides that, if a county has designated certain matters as

areas or activities of state interest under §24-65.1-401,

C.R.S. (1988 Repl. Vol. 10B), and as defined by

§§24-65.1-201 and 24-65.1-203, C.R.S. (1988 Repl. Vol.

10B), the county should enact a permitting process for

future development.

Pursuant to this authority, the Board designated as

activities of state interest the site selection and construc-

tion of major new domestic water and sewage treatment

systems, major extensions of existing domestic water and

sewage treatment systems, and the efficient utilization of

municipal and industrial water projects. The Board then

developed guidelines for the administration of these des-

ignated matters of state interest as required by

§24-65.1-402, C.R.S. (1988 Repl. Vol. 10B) and a permitting

process as prescribed by §24-65.1-501.

According to §24-65.1-501(4), C.R.S. (1988 Repl. Vol.

10B):

[The county] may approve an application for a

permit to conduct an activity of state interest if

the proposed activity complies with the

[county’s] regulations and guidelines for con-

duct of such activity. If the proposed activity

does not comply with the guidelines and regula-

tions, the permit shall be denied.

Here, the trial court found that several, but not all, of

the criteria which the Board had applied to the cities’

proposed project were preempted. The court then

remanded the matter to the Board for reconsideration in

light of the remaining criteria.

In doing so, defendants argue, the trial court over-

looked the regulatory provisions which implement

§24-65.1-501(4), and which dictate that the permit must be

denied if the applicant fails to satisfy all of the criteria

contained in the applicable regulations. We agree.

According to this regulatory scheme - and the cities

apparently do not dispute this — if a proposed project fails

to satisfy even one criterion, the Board must deny the

requested permits. See Eagle County Land Use Regula-

tions 6.04.15(2) (“The permit [for a major extension of

existing domestic water or sewage treatment system]

shall be denied if the applicant fails to satisfy all the

criteria outlined in Subsection 6.04.15(1).”); and Eagle

County Land Use Regulations 6.05.16(2) (“The permit [for

development of a municipal or industrial water project]

shall be denied if the applicant fails to satisfy all the

criteria outlined above.”).

Therefore, the court erred by remanding on the

ground that it was unable to ascertain what the Board’s

decision would have been had the preempted criteria not

been considered. The trial court should have focused

solely upon whether the record contained any competent

evidence to support the determination that any one of the

remaining criteria had not been met.

Defendants next argue that a remand to the trial

court at this point is unnecessary as the Board's original

decision is supported by competent evidence. Again, we

agree.

In a C.R.C.P. 106 appeal, the appellate court is in the

same position as the trial court concerning review of the

agency proceeding. Empiregas, Inc. v. County Court, 713

P.2d 937 (Colo. App. 1985). And, our review of the record

reflects ample evidence to support the Board’s determina-

tion that the criteria in the two areas which the trial court

found were not preempted - wetlands protection and

nuisance factors — had not been satisfied.

For example, there was extensive testimony at the

public hearings that the cities’ plan to mitigate the impact

of water diversion on the Holy Cross wetlands was defi-

cient and would be ineffective to prevent a substantial

destruction of certain plant species in the area, including

a rare species of moss which had been found in very few

areas in the continental United States. Other witnesses

testified that the plans for mitigation of the noise, dust,

and other disruptions caused by the construction of tun-

nels would not prevent a degradation of the recreational

and scenic value of the area.

All the findings necessary for a resolution of the

issue under the regulatory scheme were made by the

Board and are supported by the record. Therefore, the

trial court was required to uphold the denial of the per-

mits; it had no basis upon which to remand the matter for

further consideration. See Garland v. Board of County Com-

missioners, 660 P.2d 20 (Colo. App. 1982); Cline v. City of

Boulder, 35 Colo. App. 349, 532 P.2d 770 (1975).

Because we have concluded that the trial court's first

order remanding the matter to the Board for further

consideration was erroneous, we need not address either

defendants’ or the cities’ arguments concerning the effect

of the Board’s subsequent refusal to take administrative

notice of the final wetlands mitigation report.

Similarly, because we have determined that the trial

court’s first order was invalid, and that the Board’s origi-

nal order is supported by competent evidence in the

record, we need not reach defendants’ argument that the

trial court erred by finding that certain of the Eagle

County Land Use regulations were preempted.

II.

After it determined that certain specific Eagle County

Land Use regulations were preempted by state and fed-

eral regulation, the trial court found, inter alia, that the

Board had relied properly upon regulations concerning

wetlands protection and nuisance factors. On cross-

appeal, the cities argue that, even if there is competent

evidence in the record to support the Board’s decision,

the Board exceeded its authority by enacting and apply-

ing the non-preempted regulations.

Specifically, the cities contend that the Board

exceeded its statutory authority because the wetlands

and nuisance regulations, as enacted, and as applied to

their permit applications, do not serve the objectives of

the statutory criteria set forth in §24-65.1-204. We dis-

agree and conclude that the regulations do not exceed the

statutory authority of the Land Use Act and the Local

Government Land Use Control Act, either facially or as

applied by the Board.

Section 24-65.1-204, provides, in pertinent part:

(1)(a) New domestic water and sewage treat-

ment systems shall be constructed in areas

which will result in the proper utilization of

existing treatment plants and the orderly devel- .

opment of domestic water and sewage treatment

systems of adjacent communities.

(b) Major extensions of domestic water and

sewage treatment systems shall be permitted in

those areas in which the anticipated growth and

development that may occur as a result of such

extension can be accommodated within the

financial and environmental capacity of the area

to sustain such growth and development. .. .

(8) Municipal and industrial water projects

shall emphasize the most efficient use of water,

including, to the extent permissible under exis-

ting law, the recycling and reuse of water. Urban

development, population densities, and site lay-

out and design of storm water and sanitation

systems shall be accomplished in a manner that

10a

will prevent the pollution of aquifer recharge

areas.

The Board found that the cities’ application for a

major extension of a domestic water system did not meet

the criteria set out in Eagle County Land Use Regulation

6.04.15(1)(o0) which states that:

The proposed development or its associated col-

lector or distribution system will not signifi-

cantly deteriorate aquatic habitats, marshlands

and wetlands, groundwater recharge areas,

steeply sloping or unstable terrain, forests and

woodlands, critical wildlife habitat, big game

migratory routes, calving grounds, migratory

ponds, nesting areas and the habitats of rare and

endangered species, public outdoor recreational

areas, and unique areas of geologic, historic or

archaeological importance.

The Board also found that the cities’ application for a

major extension of a domestic water system did not meet

the criteria in Eagle County Land Use Regulation

6.04.15(1)(p) which states that:

The proposed development or its associated col-

lector or distribution system will not signifi-

cantly degrade existing natural scenic

characteristics, create blight, or cause other nui-

sance factors such as excessive noise or obnox-

ious odors.

Finally, the Board found that the cities’ application

for development of a municipal water project did not

meet the requirements of Eagle County Land Use Regula-

tions 6.05.15(1)(g) which states that:

lla

The proposed development and the potential

diversions of water from the source develop-

ment area will not significantly deteriorate

aquatic habitats, marshlands and wetlands,

groundwater recharge areas, steeply sloping or

unstable terrain, forests and woodlands, critical

wildlife habitat, big game migratory routes, cal-

ving grounds, migratory ponds, nesting areas

and the habitats of rare and endangered species,

public outdoor recreational areas, and unique

areas of geologic, historic or archaeological

importance.

The cities’ appear to make three distinct arguments

in regard to these regulations.

The cities first argue that the wetlands and nuisance

regulations do not relate to the statutory guidelines. We

disagree.

Section 24-65.1-402(3), C.R.S. (1988 Repl. Vol. 10B),

states that: “No provision of this article shall be con-

strued as prohibiting a local government from adopting

guidelines or regulations containing requirements which

are more stringent than the requirements of the criteria

listed in [§24-65.1-204].”

When considering an argument that §24-65.1-402(3)

represents an unconstitutional delegation of legislative

powers to local governments because the grant of author-

ity to regulate activities of state interest lacked specificity,

the supreme court found that the broad and general grant

of authority afforded by this provision was understand-

able “since the guidelines contained in [§24-65.1-204] are

12a

phrased in general terms to provide local governments

with the flexibility to achieve the objectives in the guide-

lines in an efficient manner. Even though local govern-

ments may adopt more stringent regulations, the

regulations must still serve the objectives contained in the

guidelines in [§24-65.1-204].” City & County of Denver v.

Board of County Commissioners, 782 P.2d 753, 760 (Colo.

1989).

Eagle County Land Use Regulation 6.04.15(o)

requires, inter alia, that the proposed development must

not significantly deteriorate aquatic habitats, marshlands,

and wetlands. Regulation 6.04.15(p) requires that the pro-

posed project will not significantly degrade existing natu-

ral scenic characteristics, create blight, or cause other

nuisances such as excessive noise and obnoxious odors.

The Board, within its authority to enact “more strin-

gent” regulations, could determine that the environmen-

tal capacity to accommodate development, as set forth in

§24-65.1-204(1)(b), C.R.S. (1988 Repl. Vol. 10B) should

include consideration of the potential impact on naturally

occurring aquatic habitats, marshlands, wetlands, and

scenic characteristics within that area and also consider-

ation of the effect of noise and odors associated with the

project.

Similarly, Eagle County Land Use Regulation

6.05.15(g) requires, inter alia, that the proposed project

must not, by the diversion of water, significantly deterio-

rate aquatic habitats, marshlands, and wetlands. Again,

within its authority to enact “more stringent” regulations,

the Board could determine that a water diversion project

that significantly alters aquatic habitats, marshlands, and

13a

wetlands from their natural state without adequate mit-

igation is not one which emphasizes the efficient use of

water as prescribed by §24-65.1-204(8).

The cities’ apparently also are challenging the

authority of the Board to apply the statutory criteria set

forth in §24-65.1-204 if the end users of the water are

located elsewhere. Again, we do not agree.

If the statutory authority to regulate the development

of water projects extends only to the area in which the

water is to be used, the Land Use Act could never enable

a county to regulate construction of water diversion pro-

jects located within the county but which transport water

to end users outside the county. In our view, this was not

the result intended by the General Assembly.

The supreme court has determined that the construc-

tion and operation of municipal water projects outside

municipal boundaries is a matter of concern to the munic-

ipality but is also a matter of concern to the area in which

the municipality proposes to build and operate the pro-

ject. See City & County of Denver v. Board of County Com-

missioners, supra. Certainly, it is questionable to

characterize such a project as one of solely municipal

concern. See City & County of Denver v. Bergland, 517 F.

Supp. 155 (D.Colo. 1981), modified on other grounds, 695

F.2d 465 (10th Cir. 1983).

This is especially true in circumstances such as here

in which the water project is to be located on public land

accessible to anyone who cares to journey to Eagle

14a

County to visit the area. The environmental impact of the

cities’ proposed project upon this public land, designated

a wilderness area by the federal government, will have

consequences for all Colorado citizens.

Interpreting the statute to mean that the Board can-

not apply its regulatory criteria here because the Board

cannot presume to control growth, development, and use

of existing facilities in the cities would eviscerate a fun-

damental objective of the Land Use Act.

To the contrary, as the supreme court concluded,

although a municipality may possess the right to con-

struct water projects outside its borders, it must nonethe-

less submit to the permit process as provided by the Land

Use Act. See City & County of Denver v. Board of County

Commissioners, supra. Thus, the regulations enacted by the

Board are applicable to development of water diversion

projects which are located within Eagle County even if

the end users of the water are not.

The cities’ also appear to contend that because, in its

order, the Board stated that certain Eagle County Land

Use regulation criteria - which mirror statutory criteria

contained in §24-65.1-204(1)(b) and §24-65.1-204(8), C.R.S.

(1988 Repl. Vol. 10B) — did not apply to the cities’ permit

applications, the Board lacked the authority to apply any

other regulations.

During preliminary proceedings before the Board,

the cities argued in limine that the need for the water

project within the cities and the impact of the project

15a

upon the cities were issues which should not be consid-

ered in the permitting process because these matters were

beyond the control of Eagle County. The Board agreed,

and in its order denying the permits, the Board specified

that Eagle County Land Use Regulations 6.04.15(1)(e), (f),

(g), (h), (i), (j), and (s) and 6.05.15(a) and (e) did not

apply. All of these regulations relate to the need and

impact of the water projects within the cities. Regulation

6.04.15(1)(a), which contains language almost precisely

mirroring §24-65.1-204(1)(b) and 6.05.15(1)(c), which mir-

rors the language of 24-65.1-204(8), were also specified as

inapplicable to the cities’ applications, presumably for the

same reasons.

By agreeing that 6.04.15(1)(a) and 6.05.15(1)(c) did not

apply to their permit applications, the cities contend, the

Board lacked any authority to deny them. According to the

cities, the only legitimate criteria for permit approval are

those criteria which emphasize “statewide concerns,” and

which are enumerated in §§24-65.1-204(1)(b) and

24-65.1-204(8). We disagree.

As discussed, §§24-65.1-204(1)(b) and 24-65.1-204(8)

are relevant not only to the geographical area in which

the water is to be used, but also to the geographical area

where the water project is to be located. See City & County

of Denver v. Board of County Commissioners, supra. The

entire purpose of the permitting process here was to

determine if the expected impact of the proposed project

on the area in which it was to be built would meet the

statutory and regulatory criteria.

Without determining whether the Board was correct

in completely excluding any consideration of the need for

l6a

or impacts of the proposed projects in and upon the

cities, based upon the dual applicability of

§24-65.1-204(1)(b) and 24-65.1-204(8), we interpret the

Board’s findings as excluding regulations 6.04.15(1)(a)

and 6.05.15(1)(c) from consideration only to the extent

that they relate to impacts of the project outside the

county boundaries.

Ill.

Next, the cities assert several facial constitutional

challenges to the regulations. We reject each, in turn.

The cities assert that the Eagle County regulations

are unconstitutionally vague. We do not agree.

When determining whether a regulation is imper-

missibly vague, the words and phrases employed must be

considered by the interpreting court in light of their

generally accepted meaning. Colorado State Board of Medi-

cal Examiners v. Hoffner, 832 P.2d 1062 (Colo. App. 1992).

Moreover, “courts will attempt to construe [the legisla-

tion challenged on vagueness grounds] in a manner

which will satisfy constitutional due process require-

ments, if reasonable and practical construction of the

[legislation] will achieve such result.” See People v. Rostad,

669 P.2d 126, 127 (Colo. 1983).

“The due process clause, in part, requires that a

regulation not be so vague that [persons] of common

intelligence must necessarily guess at its meaning and

differ as to its application.” Watson v. Board of Regents, 182

17a

Colo. 307, 313, 512 P.2d 1162, 1165 (1973). The regulation,

however, need not be drafted with mathematical preci-

sion because the terms used must be general enough to

deal with the problem addressed by the regulation under

diverse circumstances. Regency Services Corp. v. Board of

County Commissioners, 819 P.2d 1049 (Colo. 1991).

According to the cities, persons of ordinary intel-

ligence must guess at the meaning of Eagle County Land

Use Code §§6.03.15.1 and 6.03.15.1.p which provide that a

project may not “significantly deteriorate” aquatic habi-

tats and wetlands and may not “significantly degrade”

existing natural scenic characteristics. We disagree.

“Degrade” means “to lower in grade or desirability.”

See Webster’s Third New International Dictionary 594.

“Deteriorate” means “to make inferior in quality or

value.” See Webster’s Third New International Dictionary

616. “Significant” means “deserving to be considered;

important; notable,” and “significantly,” thus means “to a

significant degree.” See Webster’s Third New International

Dictionary 2116. The antonyms of “significant” include

meaningless, trivial, trifling, paltry, and picayune. See

Roget’s Thesaurus 639 (Bantam Rev. Ed. 1990).

“Significant” is a term used extensively throughout

statutory language in Colorado to describe the extent of a

specific status or condition. See §13-21-401(1), C.R.S. (1987

Repl. Vol. 6A) (“[Manufacturer] also includes any seller of

a product who is owned in whole or significant part by

the manufacturer or who owns, in whole or significant

part, the manufacturer.”); §16-4-101(1)(b), C.R.S. (1994

Cum. Supp.) (no bail required in cases of certain crimes

of violence if the court finds the proof is evident that the

18a

crime occurred and that “the public would be placed in

significant peril if the accused were released”);

§22-20-103(1.5), C.R.S. (1994 Cum. Supp.) (children with

disabilities includes children with “significant limited

intellectual capacity” or “significant identifiable emo-

tional disorder[s]”). Indeed, our research has revealed

over 200 statutory sections which have used the term

without any reported interpretative difficulty.

“Significantly deteriorate” as applied to aquatic habi-

tats and wetlands plainly means to make inferior in qual-

ity or value to a significant, as opposed to trivial, degree.

“Significantly degrade” as applied to natural scenic char-

acteristics plainly means to lower in grade or desirability

to a significant, as opposed to trifling, degree.

The terms encompass the degradation or deteriora-

tion of the naturally occurring habitat or scenic charac-

teristics to such a degree as to be worthy of consideration.

Thus, we conclude that the regulations are not uncon-

stitutionally vague.

The cities also challenge the requirement in Eagle

County Land Use Code §6.04.15.1.1 that the benefits of

the project outweigh the losses of any natural resources.

According to the cities, neither they, nor the Board, could

reasonably perform such a balancing.

However, the concept of balancing or of weighing

benefits against risk of loss is common in our jurispru-

dence. See Moody v. Corsentino, 843 P.2d 1355 (Colo. 1993)

(assessing whether a defendant's speedy trial right have

19a

been infringed requires the court to apply a four-part

balancing test); People v. Rister, 803 P.2d 483 (Colo. 1990)

(assessing the constitutionality of highway sobriety

checkpoints requires the court to balance the state’s inter-

est in preventing drunken driving against the privacy

interests of the drivers who are briefly stopped); Belle

Bonfils Memorial Blood Center v. District Court, 763 P.2d

1003 (Colo. 1988) (when determining to what extent mate-

rials sought by pretrial discovery may be protected the

trial court must balance the competing interests that

would be served by granting or denying disclosure);

Camacho v. Honda Motor Co., 741 P.2d 1240 (Colo. 1987) (in

product liability cases certain factors are of value in bal-

ancing the attendant risks and benefits of a product to

determine if it is unreasonably dangerous); Barrett v. Uni-

versity of Colorado Health Sciences Center, 851 P.2d 258

(Colo. App. 1993) (determining whether a public

employee’s speech is constitutionally protected requires

balancing the interests of the employee in commenting on

matters of public concern against the interests of the state

in the efficient provision of public services).

The Board, acting in its quasi-judicial capacity, is

capable of performing a balancing test which weighs the

potential adverse environmental impact of the project

against its potential benefits. Contrary to the cities’ con-

tention, the regulations do not lend themselves to arbi-

trary and discriminatory enforcement simply because

they require balancing benefits against the risk of loss of

natural resources. See Ciiy of Lakewood v. Colfax Unlimited

Ass'n, 634 P.2d 52 (Colo. 1981).

20a

The cities also contend that the Eagle County Land

Use regulations relied upon to deny the permits are

unduly oppressive because they require the preservation

of “purely subjective scenic characteristics” at the

expense of the cities’ constitutional and statutory entitle-

ment to water. According to the cities, if they must com-

ply with the Board’s criteria for wetlands protection and

nuisance factor limitations, they will be unable to exercise

their validly held water rights. We disagree.

Section 24-65.1-106(1)(b), C.R.S. (1988 Repl. Vol. 10B)

provides that nothing in the Land Use Act shall be con-

strued as “[mlodifying or amending existing laws or

court decrees with respect to the determination and

administration of water rights.” This provision dces not

give the holder of any pre-existing water rights a blanket

exemption from regulation by local governments, but

may afford a basis for invalidating particular regulations.

City & County of Denver-v. Board of County Commissioners,

supra.

Every local government exercise of land use regula-

tion is likely to affect the legitimate property interests of

would be developers in some manner. See Tri-State Gener-

ation & Transmission Ass‘n v. Board of County Commission-

ers, 42 Colo. App. 479, 600 P.2d 103 (1979). The existence

of previously decreed water rights does not provide an

exemption for the developer from regulation under the

Land Use Act; so long as the regulations do not serve to

undermine these established water rights, they are a valid

exercise of authority. City & County of Denver v. Board of

County Commissioners, supra.

21a

As discussed, the trial court correctly concluded that

the regulations pertaining to wetlands protection and

nuisance factors were a proper exercise of authority to

enact more stringent guidelines than those embodied by

the Land Use Act. See §24-65.1-402(3).

At the insistence of the cities, the Board limited its

consideration to the water project as proposed, and did

not consider whether any alternative configurations

could be designed which would meet the regulatory crite-

ria. Although the permits for the project were denied, the

cities are not prohibited from resubmitting the proposed

project with changes or from submitting a different pro-

posal. The cities have not demonstrated that such alterna-

tives are unfeasible.

The cities’ entitlement to take the water from the

Eagle River basin, while a valid property right, should

not be understood to carry with it absolute rights to build

and operate any particular water diversion project. See

City & County of Denver v. Bergland, supra. We do not

perceive any undue interference with the exercise of the

cities’ established water rights.

IV.

The cities also argue that, even if the Board has the

power to regulate the proposed project under the Land

Use Act, its regulations concerning wetlands protection

and nuisance abatement bear no reasonable relationship

to valid county concerns. We disagree.

To the contrary, the General Assembly has explicitly

endorsed environmental concerns as a legitimate concern

22a

in land use planning by local governments. As used in

the Local Government Land Use Control Act, “local gov-

ernment” includes counties. See §29-20-103, C.R.S. (1986

Repl. Vol. 12A).

Section 29-20-102, C.R.S. (1986 Repl. Vol. 12A)

declares that: “[I]n order to provide for planned and

orderly development within Colorado and a balancing of

basic human needs of a changing population with legiti-

mate environmental concerns, the policy of this state is to

clarify and provide broad authority to local governments

to plan for and regulate the use of land within their

respective jurisdictions.”

Section 29-20-104(1)(h), C.R.S. (1986 Repl. Vol. 12A)

further provides that each local government has the

authority to plan for and regulate land use within its

jurisdiction “so as to provide planned and orderly use of

land and protection of the environment in a manner

consistent with constitutional rights.”

We therefore reject the cities’ contention that the

Eagle County regulations are unrelated to any valid

county concern.

The cities next argue that, even if the Board may

impose reasonable regulations upon the water diversion

project and reasonable conditions upon project design

and construction, it lacks statutory authority to deny the

permits here. We disagree.

23a

Contrary to the cities’ contention, the denial of the

permit applications was not an illegal abrogation of the

cities’ home rule powers.

As determined by the supreme court, the Land Use

Act gives the Board the power to regulate, but not to

prohibit, the operation of extraterritorial .water projects.

City & County of Denver v. Board of County Commissioners,

supra. The Land Use Acct itself specifically provides that,

pursuant to regulations adopted by the county, a permit

may be granted or denied after hearing on the matter. See

§24-65.1-501.

Here, the cities’ contentions notwithstanding, no out-

right abrogation of the cities’ home rule powers to con-

struct, condemn, purchase, acquire, lease, add to,

maintain, conduct, and operate extraterritorial water

works under Colo. Const. art. XX, §1, occurred. There-

fore, City of Thornton v. Farmers Reservoir & Irrigation Co.,

194 Colo. 526, 575 P.2d 382 (1978), relied upon by the

cities, is inapplicable.

As determined by City & County of Denver v. Board of

County Commissioners, supra, construction of water diver-

sion projects is a matter of mixed local and state concern

and home rule cities must submit to the permit process.

The cities have not been prohibited from submitting a

substitute proposal. The denial of their permit applica-

tions affects this particular project only and not their

right to construct and maintain extraterritorial water

works.

24a

The cities next argue that the ability of the Board to

deny their permit applications was circumscribed by

§24-65.1-105(1), C.R.S. (1988 Repl. Vol. 10B). Again, we

reject their analysis.

Section 24-65.1-105(1), provides that, with regard to

public utilities: “[NJothing in this article shall be con-

strued as enhancing or diminishing the power and

authority of municipalities, counties, or the public util-

ities commission” and “[t]he public utilities commission

and public utilities shall take into consideration and,

when feasible, foster compliance with adopted land use

master plans of local governments... . ”

According to the cities, all that was required of them

pursuant to §24-65.1-105(1), was to “take into consider-

ation” and “foster compliance” with Eagle County’s con-

cerns. They contend that this requirement was served by

the public hearing process during which Eagle county

was “able to assess the project proposal and place its

concerns on the record.” The cities claim that despite this

voluntary “accommodation” of Eagle County’s concerns,

the Board attempted to “veto” the project by denying the

permits. We reject the cities’ contention on several

grounds.

First, the cities’ contention that §24-65.1-105(1)

exempts a municipally operated utility from the permit

process under the Land Use Act was rejected in City &

County of Denver v. Board of County Commissioners, supra.

Although the supreme court stated in that case that

§24-65.1-105(1) “may provide the courts with a basis for

invalidating particular local regulations,” it nevertheless

25a

found that the subsection does not “exempt [municipal]

water projects from every conceivable regulatory

scheme.” City & County of Denver v. Board of County

Commissioners, supra, 782 P.2d at 764. The cities’ argument

here is no different from the general attack upon the

validity of the permit process rejected in that case, and

we view that ruling as controlling.

In a closely related argument, the cities characterize

“cooperation with the permit process” as equivalent to

“consideration of and fostering compliance with” the

adopted land use master plans of Eagle County. In other

words, because they voluntarily followed the permit pro-

cess and submitted a proposal, the cities suppose that

they have demonstrated a willingness to cooperate with

Eagle County’s land use plans. Even if that were all that

was required of them, the record does not support this

contention.

The regulations utilized by the Board in evaluating

the cities’ applications are specific regulations adopted to

control the construction and operation of domestic water

supply projects and municipal water projects. Although

they may be related to the Eagle County land use master

plan, they are enacted for a more specific purpose. Con-

sideration of, and fostering compliance with, the Eagle

County land use master plan perhaps fulfills a particular

requirement of §24-65.1-105(1), but such does not begin to

fulfill the extensive permitting process envisioned by the

remainder of the Land Use Act.

Moreover, the record reveals no indication that the

cities were willing to alter any aspect of the project. To

26a

the contrary, the cities have argued that they may disre-

gard Eagle County concerns because Eagle County lacks

any regulatory authority over the project.

Further, insofar as the cities contend that a munici-

pally owned utility is only required to consider and,

when feasible, foster compliance with local government

land use master plans, such an interpretation would ren-

der the rest of the Land Use Act irrelevant to public

utilities. The supreme court rejected this result in City &

County of Denver v. Board of County Commissioners, supra.

‘

The cities next contend that the Board’s power to

deny the permits is circumscribed by §30-28-110, C.R.S.

(1986 Repl. Vol. 12A). The cities maintain that this provi-

sion supersedes the permitting process prescribed by the

Land Use Act and thus precludes denial of their permits.

Again, we do not agree.

Section 30-28-110(1)(c), C.R.S. (1986 Repl. Vol. 12A)

provides, inter alia, that although counties may regulate

the construction by utilities, if the particular project “is

one the authorization or financing of which does not,

under the law governing the same, fall within the prov-

ince of the board of county commissioners or other

county officials or board, the submission to the [county

planning commission] shall be by the body having such

Re RN LY

;

Pe -

q e-

27a

jurisdiction, and commission’s disapproval may be over-

ruled by said body by a vote of not less than a majority of

its entire membership or by said official.”

Again, the cities’ contention that §30-28-110 exempts

municipal utilities from local government regulation of

extraterritorial water projects was raised and rejected in

City & County of Denver v. Board of County Commissioners,

supra. The court found that §30-28-110 was not facially

inconsistent with the Land Use Act and that any arguable

power of a municipality to “overrule planning commis-

sion disapproval of a project does not give [the munici-

pality] the unrestricted authority to ignore regulations

adopted pursuant to the Land Use Act.” City & County of

Denver v. Board of County Commissioners, supra, 782 P.2d at

766. Therefore, that case is controlling here.

The cities argue, however, because §30-28-110 was

adopted later in time than the Land Use Act, §30-28-110

controls. They contend that, in order to read the statutes

harmoniously and avoid inconsistency, we must assume

that the General Assembly knew that the later statute

would deprive local governments of the power to deny a

permit to a municipal utility and thus intended to rele-

gate local governments to a purely advisory role. We do

not agree.

Section 24-65.1-501(4) provides specific authority for

a local government to approve or deny a permit to con-

duct activities of state interest. The cities argue that, in

order to harmonize the two statutory sections, we must

read the provision of §30-28-110(1)(c), allowing municipal

28a

utility override of a county planning commission disap-

proval of a project, as a modification of §24-65.1-501(4).

Although the cities maintain that this does not

amount to a revocation of §24-65:1-501(4), we are at a loss

to ascertain what else it could be. If §30-28-110(1)(c) pre-

vails, then §24-65.1-501(4) is nullified.

Statutes upon the same subject must be construed

together and any conflicts reconciled if possible to give

effect to the legislative purposes behind each section;

particular statutes will prevail over general, and later

provisions over former. State v. Borquez, 751 P.2d 639, 643

(Colo. 1988). If the statutory sections are irreconcilable,

“the statute prevails which is latest in its effective date.”

Section 2-4-206, C.R.S. (1980 Repl. Vol. 1B).

Nonetheless, before a later statute of general terms is

deemed to revoke an existing provision of a statute which

is specific in its terms, there must be a clear and unmis-

takable intent to do so. See Smith v. Zufelt, __ P.2d ___

___ (Colo. No. 925C845, September 12, 1994) (“[T]he ‘last-

in-time’ approach is inapposite where one statute more

specifically addresses the situation at issue.”); People in

Interest of E.Z.L., 815 P.2d 987 (Colo. App. 1991); §2-4-205,

C.R.S. (1980 Repl. Vol. 1B).

To the extent there is conflict, the Land Use Act

specifically addresses the situation at issue - water pro-

jects designated as activities of state interest by the

appropriate unit of local government. Therefore, we con-

clude that the General Assembly intended the permitting

process of §24-65.1-501 to apply to utility projects which

involve designated activities of state interest and

§30-28-110(1)(c) to apply to any other utility project.

29a

Thus, §24-65.1-501(4) prevails as it is a specific exception

to §30-28-110(1)(c), a statute of broader scope. See Husson

v. Meeker, 813 P.2d 731 (Colo. App. 1991).

Finally, the cities argue that the trial court erred in

determining that they lacked standing to pursue Four-

teenth Amendment based substantive due process and

regulatory taking claims against the Board. We disagree.

A municipality lacks standing to assert a substantive

due process claim because it is but a creature of the state

and cannot invoke the provision of the Fourteenth

Amendment in opposition to the will of the state and

because the Fourteenth Amendment does not impose

restrictions upon the relationships between one political

subdivision of a state and another. See Town of Orchard

City v. Board of Delta County Commissioners, 751 P.2d 1003

(Colo. 1988); see also Coleman v. Miller, 307 U.S. 433, 59

S.Ct. 972, 83 L.Ed. 1385 (1939); South Macomb Disposal

Authority v. Township of Washington, 790 F.2d 500 (6th Cir.

1986).

In contrast, municipal corporations are not barred

from asserting procedural due process claims. See City &

County of Denver v. Eggert, 647 P.2d 216 (Colo. 1982).

Procedural due process, however, was not the basis for

the cities’ sixth and twelfth claims.

30a

Similarly, because the cities failed to establish stand-

ing to assert these claims, they also were not entitled to

invoke the Civil Rights Act, 42 U.S.C. §1983 (1988). That

legislation does not create any substantive federal rights

but merely provides a remedy for violations of other

federal statutory or constitutional rights. See Tafova v.

Adams, 816 F.2d 555 (10th Cir. 1987); South Macomb Dis-

posal Authority v. Township of Washington, supra. Further-

more, governmental entities are not protected “persons”

under §1983. Commonwealth of Pennsylvania v. Porter, 659

F.2d 306 (1981).

Neither does the cities’ home rule status, derived

from Colo. Const. art. XX, confer standing upon them to

invoke the Fourteenth Amendment. Municipalities and

counties exist for the convenient administration of gov-

ernment and are instruments to carry out the will of the

state; whether statutory or created under the constitution,

municipalities have no privileges or immunities under

the state constitution. Enger v. Walker Field, 181 Colo. 253,

508 P.2d 1245 (1973); Board of County Commissioners v.

E-470 Public Highway Authority, __ P.2d __ (Colo. App.

No. 93CA1292, March 24, 1994) (cert. granted October 11,

1994).

The state thus retains a measure of control over its

home-rule municipalities. See Voss v. Lundvail Brothers,

Inc., 830 P.2d 1061 (Colo. 1992) (in matters of mixed local

and statewide concern, a home-rule municipal ordinance

3la

may not coexist with a conflicting state statute, the ordi-

nance is superseded); Vick v. People, 166 Colo. 565, 445

P.2d 220 (1968) (a home rule city has authority which

allows its ordinances to coexist with state ordinances

concerning the same matters only insofar as they are not

in conflict); cf. Village of Arlington Heights v. Regional

Transportation Authority, 653 F.2d 1149 (7th Cir. 1981)

(although Illinois home rule provisions changed the rela-

tionship of the State to the home rule municipalities in

some respects, the State retained a general power of

control over its political subdivisions and the Fourteenth

Amendment restraints against state action do not apply

against the State in favor of its home rule municipalities).

That the cities are operating their water systems in a

proprietary rather than governmental capacity also does

not provide them with standing to invoke the Fourteenth

Amendment.

The governmental/proprietary function distinction is

subject to criticism and has been limited in its applica-

tion. See Colowyo Coal Co. v. City of Colorado Springs, 879

P.2d 438 (Colo. App. 1994); see also City & County of

Denver v. Mountain States Telephone & Telegraph Co., 754

P.2d 1172 (Colo. 1988). Even if the distinction is viable,

however, it has not been considered a sufficient basis for

allowing municipalities to invoke the Fourteenth Amend-

ment. See City of Trenton v. State of New Jersey, 262 U.S.

182; 43 S.Ct. 534, 67 L.Ed. 937 (1923) (because govern-

mental and proprietary distinction is a court developed

doctrine based on vague distinctions used primarily as a

32a

method of escaping difficulties in the application of tort

liability, the Court rejected argument that it provided an

analytical framework upon which a municipality could

invoke federal constitutional provisions against the state).

Finally, we reject the cities’ contention that Town of

Orchard City v. Delta County Commissioners, supra, has

been eroded by City of Montrose v. Public Utilities Commis-

sion, 629 P.2d 619 (Colo. 1981) (court rejected a munici-

pality’s Fourteenth Amendment argument on the merits

without addressing standing issue). Therefore, we con-

clude that the trial court did not err by dismissing the

cities’ sixth and twelfth claims and by denying leave to

amend the complaint to add a fifteenth claim.

VI.

In sum, the record of the proceedings before the

Board contains competent evidence to support its deter-

mination that all of the applicable criteria had not been

satisfied. We further conclude that the Eagle County reg-

ulations are within the authority granted in connection

with the administration of activities of state interest and

are not violative of any constitutional provisions. Thus,

the decision of the Board must be reinstated. See Ross v.

Fire & Police Pension Ass'n, supra.

Accordingly, the judgment of the trial court vacating

the Board’s order is reversed, and the cause is remanded

to the trial court with instructions to reinstate the deci-

sion of the Board. The judgment dismissing the cities’

EPL te GEE

33a

sixth and twelfth claims and denying leave to amend the

complaint to add a fifteenth claim is affirmed.

JUDGE JONES and JUDGE ROTHENBERG concur.

34a

APPENDIX B

Record of Decision

for

HOMESTAKE PHASE II PROJECT

Final Environmental Impact Statement

Rocky Mountain Region

White River National Forest

USDA Forest Service

Eagle County, Colorado

I. INTRODUCTION

This Record of Decision documents the decisions reached

by the Forest Service regarding the application for land

use made by the Cities of Colorado Springs and Aurora

concerning the Homestake Phase II Project. The regula-

tions implementing the National Environmental Policy

Act (40 CFR 1500-1508) require that each Federal agency,

having a decision to make, prepare a concise public

Record of Decision at the time of the decision. This is that

required Record and it is limited to the authority and

jurisdiction of the Forest Service and, therefore, applies

only to activities on National Forest System lands (FEIS

Section 1.2, pages 1-4 to 1-8). It also describes the alterna-

tives considered, documents the conditions and stipula-

tions that are associated with the decisions, summarizes

the coordination with other governmental agencies, and

describes public involvement that took place.

On June 19, 1981, a revised Environmental Impact Report

was submitted by the Cities to the White River National

Forest with preliminary plans to apply for an easement to

construct the second phase of a water collection system

on National Forest System (NFS) land. The plans pro-

posed developments which were substantially different

EBON RT Lee athe aie i mnie

35a

from the system outlined in the 1960 easement granted by

the Bureau of Land Management (BLM) and assigned to

the Cities of Aurora and Colorado Springs on July 31,

1962. The Forest Service subsequently informed the Cities

that the proposal could not be approved until an Environ-

mental Assessment was completed (FEIS Section 1.1, page

1-4). Subsequently, on August 18, 1981, the Forest Service

and the Cities signed a Memorandum of Understanding

to study the proposal. On December 30, 1981, the Forest

Service filed a Notice of Intent to Prepare an Environmen-

tal Impact Statement (EIS). The Notice was published in

the Federal Register on January 7, 1982 (FEIS Section

6.1.6, pages 6-1 to 6-5).

The Forest Service, as lead agency, has the primary

responsibility for preparing the Environmental Impact

Statement (EIS). The cooperating agencies listed in

Exhibit 1 and other Federal, State, and local agencies,

organizations, and individuals contributed to the Final

Environmental Impact Statement (FEIS). The FEIS is a

document disclosing the environmental consequences of

implementation of the proposed action and alternatives

to the proposed action. It is an important document for

Federal, State, and local governments to use in arriving at

their individual decisions regarding the proposed action

and the alternatives to it (FEIS Section 1.2, page 1-7).

The Forest Service has identified ten approvals or deci-

sions which may be needed from the Forest Service,

cooperating agencies, and other Federal, State, and local

agencies. Only one authorization is required from the

Forest Service. In addition, the Forest Service and the

Corps of Engineers has consulted with the U.S. Depart-

ment of the Interior to determine the effects of the project

36a

on threatened and endangered species. The remaining

actions are the responsibility of other Federal, State, or

local agencies. These are listed in Exhibit 1, attached

(FEIS Section 1.6.2, pages 1-18 and 1-19).

II. ISSUES AND CONCERNS

Water development proposals such as the Homestake

Project bring many issues and concerns to the surface.

The public comments on the DEIS, the many letters

received since the comment period ended, the hearing

conducted by the House Subcommittee on Public Lands

and National Parks, and the news and feature articles in

newspapers and on television all indicate that water

diversion proposals generate a wide variety of responses,

including some that are intensely personal and emo-

tional. The facts of Colorado’s climate, topography, and

social development intensify and polarize the water

issue. The State is divided by the Continental Divide into

east and west slope interests. The major population cen-

ters are on the eastern slope, where there is a shortage of

water; the lack of water on the eastern slope results in an

east-west and a growth-no growth conflict. This is unfor-

tunate but understandable since water is a necessary

ingredient for economic growth and development, the

continuation of preferred lifestyles, and for an enjoyable

and healthful environment (FEIS Section 1.4, pages 1-11

to 1-16).

Several public issues can be identified as underlying the

concern over transporting water from western Colorado

across the Continental Divide to Colorado’s Front Range

37a

communities. One is the desire of western Colorado inter-

ests to retain water which may be needed to serve future

needs such as recreation ~nd industrial growth. A second

is whether growth along ine Front Range is fostered by

water development and, if so, whether growth should be

controlled by limiting water availability. A third is

whether current agricultural uses along the Front Range

should be reduced or eliminated so that agricultural

water could be used as municipal supplies in lieu of

additional west slope diversion. These are serious and

troublesome problems. They are, however, by and large

institutional rather than technical problems. A “water

crisis” aura has been created by conflicting laws and

regulations, political motives, agency missions, social

customs, the seeming inability of west slope water users

to fund water developments, and an outdated belief that

water is “free for the taking.” These conflicts are not

being resolved and it appears that our institutional sys-

tems are floundering at an elementary level.

The Forest Service recognizes this situation. Because of

our responsibility to manage the Federal lands where

many water developments occur, we are involved in con-

troversies. For example, in the last five years, two of

Denver’s water projects, Foothills and Williams Fork,

resulted in extensive litigation and the Cheyenne, Wyo-

ming transmountain diversion is under litigation now.

This will not change in the future.

In addition to the broad public issues, the Forest Service

identified five specific issues that provided the focus of

the Homestake Phase II Project (FEIS Sections 1.5.2 and

1.5.3, pages 1-16 to 1-18). These are:

38a

A. Effects of the proposal on the Holy Cross Wilder-

ness values.

In my judgment this is the most important issue

to many of the individuals who commented on

the Draft EIS (DEIS). There is severe criticism of

the project on the basis that it is in conflict with

the intent and purpose of wilderness as defined

by the Wilderness Act of 1964. While I agree that

the project is contrary to the concept and philos-

ophy of wilderness, it is specifically provided in

the law establishing the Holy Cross Wilderness

that the creation of the Wilderness will not be

considered in determining whether or not to

permit the use of National Forest System lands

for the Homestake Project purposes. (See Sec-

tion V.D. of this document and FEIS Sections 1.4,

pages 1-11, 1-12; 3.1.6, pages 3-14 to 3-16; 4.1.6,

pages 4-36 to 4-39.)

B. Effects of the project on wetlands.

The contention that wetlands will not be signifi-

cantly affected by the project has been ques-

tioned by some of the DEIS commentors. The

Forest Service conducted detailed studies of the

Cross and Fall Creek wetlands. The Forest Ser-

vice was assisted by the Fish and Wildlife Ser-

vice, Colorado Division of Wildlife, and the

Army Corps of Engineers in the study. It was

found that these wetlands developed in basins

and hollows scoured cut of the bedrock by gla-

cial action. Depositional material subsequently

deposited in these scoured areas acts as a

groundwater reservoir. The saturated conditions

necessary for wetland vegetation is provided by

precipitation falling directly upon the wetlands

39a

themselves. In addition, the hillsides adjacent to

the wetlands provide a considerable amount of

water through surface and subsurface runoff.

Since much of the wetland area lies outside of

the floodplain and sufficient water is available

from sources other than the streams, I conclude

that the project will not have a significant effect

on wetlands. (FEIS Sections 3.1.3, pages 3-8 to

3-10; 4.1.3, pages 4-21 to 4-30)

C. The maintenance of adequate instream flows to

protect the environment.

Several comments to the DEIS expressed con-

cern about the depletion of streamflows below

the proposed Phase II diversions. The easement

authorizing the diversion requires that environ-

mental maintenance flows be provided in all

streams affected by diversions. This means that

a set amount of water would be provided at all

times to protect fisheries, maintain channel sta-

bility and enhance visual resources. The Phase II

diversion structures will be designed to bypass

the minimum flow before diversion takes place.

The bypass flow mechanism will be nonadjust-

able and one that is permanently and unaltera-

bly fixed. (FEIS Sections 3.1.2, pages 3-3 to 3-5;

4.1.2, pages 4-3 to 4-6; Appendix E; and Ease-

ment Condition No. 23, Exhibit 4, page 8,

attached)

40a

D. The correction of impacts resulting from the

existing Homestake Phase I Project.

This issue is derived from the concerns of indi-

viduals about complete diversion and subse-

quent drying-up of streams affected by Phase I

of the project. Prior to the start of construction

on Phase II, the mitigation of impacts resulting

from Phase I must be initiated. (See Exhibit 4,

Easement Condition No. 22, attached.) A major

mitigation action will be provision of instream

flows to Sopris, Fancy, French, and East Fork

Homestake Creeks. (FEIS Sections 3.1.17, pages

3-25 to 3-27; 4.1.17, pages 4-54 to 4-58)

E. Water planning — the suggestion that the Forest

Service should conduct water planning to iden-

tify possible water traces or other water supply

options which could be alternatives to the pro-

posed projects in the upper Colorado River

Basin.

This issue was raised by some individuals com-

menting on the DEIS. Local governments also

submitted comments in this vein and it was

raised by several individuals at the House Sub-

committee hearing. The Forest Service and other

Federal agencies processing applications for

land use or other approvals must recognize that

the issues involving water development and

growth are matters of State and local land use

planning. The Forest Service has no jurisdiction

or legislative charge to resoive these questions.

The Forest Service will not, under the guise of

responding to a land use application, attempt to

use its offices to redeem State and local planning

responsibilities. A Federal environmental

4la

focus of the Homestake Project EIS is on the

application submitted by the Cities for a long

term use of National Forest System land. The

Forest Service will meet its responsibilities to

comply with the Federal laws regarding the

Cities’ application (FEIS Section 1.5.3, pages

1-17, 1-18). We will not attempt to resolve State

or local issues so sensitive that those who are

responsible appear to avoid addressing them in

the hope that, if left alone they will go away or

that Forest Service actions will remove the need

for action. Once the Federal Government begins

to take action on what is rightfully a State and

local government responsibility, then the stage

is set for continued intervention and erosion of

State’s rights. The precedent of Federal inter-

vention, once initiated, is hard to reverse. (FEIS

Section 1.4, pages 1-11 to 1-15)

III. SPECIAL USE APPLICATION PROCESS AND

ENVIRONMENTAL REVIEW

The Special Use Application submitted under the Federal

Land Policy and Management Act (FLPMA), as supple-

mented by materials obtained by the Cities during the

NEPA review (FEIS Section 6.1, page 6-1), has been exam-

ined and contains the materials required by 36 CFR

251.54(e). After the close of the public comment period on

the DEIS, a question was raised by the Vail Valley Consol-

idated Water District regarding the adequacy of the appli-

cation of the Cities under 36 CFR 251.54(e). The

application process began when the Cities submitted ini-

tial materials on June 19, 1981; the FLPMA application

42a

for an easement was submitted on January 12, 1982.

Throughout the review of the Cities application, the For-

est Service has continually requested and received addi-

tional information upon which to base a decision. A list

of the materials which have been obtained from the Cities

in order to comply with 36 CFR 251.54(e) is attached as

Exhibit 8. A complete set of these materials may be

reviewed at the White River National Forest Supervisor’s

Office. The Forest Service will continue to receive infor-

mation from the Cities on the administration and opera-

tion of the Phase II Project.

While the Cities are proceeding with their application to

the Forest Service for a right-of-way under FLPMA, the

Cities have reserved the right to seek an amendment

under 43 CFR 2802 (1979) to their unbuilt 1962 right-of-

way issued by the Department of the Interior under 16

USC 524. The Tenth Circuit U.S. Court of Appeals held in

Denver v. Berglund 695 F.2d 465, 481 (1982) that grants

issued under 16 USC 524 could be amended under the

Department of the Interior regulations for the 1905 Act

even after the effective date of FLPMA, which repealed

the 1905 Act. The Cities have written a letter to the

Bureau of Land Management (BLM) reserving the right to

request an amendment and the BLM has responded

(Exhibit 2).

I am making a decision on the Cities FLPMA application,

as it has not been withdrawn. The Cities will have sixty

days from the receipt of this easement to accept (36 CFR

251.62). As a condition of this FLPMA easement the Cities

will be required to relinquish the unbuilt 1962 easement

issued under the 1905 Act. If the Cities reject the FLPMA

43a

easement they may apply to BLM for an amendment to

their 1962 easement.

The FEIS contains revisions of the Draft Environmental

Impact Statement material. These revisions were occa-

sioned by the comments of the public, groups, and Fed-

eral, State, and local agencies on the DEIS, and the public

meetings held on the DEIS. Additional data or better

information which were obtained during the review

period have been incorporated into the FEIS (FEIS Section

6.2.1, pages 6-8 to 6-361). The Cities’ proposal for land

use has not changed; however, as required by NEPA and

in response to the public comments on the DEIS, the

alternatives have been modified and the discussion of

impacts, effects, and features of the proposed action and

the alternatives have been expanded.

Comments received during the preparation and review of

the DEIS for this proposal suggested that the Forest Ser-

vice delay its Federal decision regarding the easement

application until State water planning has been com-

pleted (FEIS Section 6.2, page 6-5). Water adjudication is a

matter of State concern and may be a means by which the

social and economic growth issues will someday be

addressed. It is my view that delay of a decision is a

variation of Alternative 1, No. Action (FEIS Section 2.2.1,

page 2-15), which denies the Cities’ application. The For-

est Service Special Use Regulations, 36 CFR 251.54(h)

provide for denial of applications when:

1. The proposed use would be inconsistent or

incompatible with the purpose(s) for which

the National Forest System lands are man-

aged, or with other uses; or

44a

2. The proposed use would not be in the public

interest; or

3. The applicant is not qualified; or

4. The use would otherwise be inconsistent

with Federal and State laws; or

5. The applicant does not or cannot demon-

strate reasonable technical or financial capa-

bility.

The Cities are entitled to a timely decision on their appli-

cation. There is no provision for delaying a decision

indefinitely. I have no indication that State water plan-

ning will be undertaken, or if undertaken, when it would

be completed.

Many commentors have criticized the lack of additional

or expanded water trade alternatives. There is an infinite

number of such alternatives which could be analyzed;

however, there are no proponents or applications for

National Forest System land use from any holder of an

adjudicated water right to implement any of the water

trade alternatives. To delay a decision and study further

such remote and speculative proposals would, in my |

judgment, be unreasonable. Further, such State-wide or

similar studies would result in the Forest Service con-

ducting State water resource planning for which there is

no authority.

The Forest Service recognizes the primacy of the State of

Colorado for administration of water rights and uses

within the State. The process of water resource planning

is quite properly a matter of State responsibility and

should be conducted and settled by the State (FEIS Sec-

tion 1.2, page 1-6). I am forced into making a decision

45a

that somewhat overlaps State jurisdiction. By approving

this specific proposal, piecemeal water development will

continue. By denying the Forest Service portion of the

proposal, the Cities’ opportunity to effectively develop

their State-decreed water rights would also be denied. |

do not know that the State will ever develop a State-wide

water plan. The Forest Service would assist and cooperate

in development of a State-wide water plan and would

gladly use such a plan if one existed (FEIS, Appendix A,

page A-16).

IV. DECISIONS

I have reviewed the Cities’ Homestake Phase II Water

Diversion Proposal, the alternatives to that proposal,

environmental consequences, and public comments.

Based on this information, my decision is as follows:

A. Issue a granting document for phased con-

struction over a five to ten year period for

Alternative 6, as described in Sections 2.2.6

(page 2-32) and 2.3 (page 2-34) of the FEIS

(also see Exhibit 3, attached). The grant is

for a 50-year period with a re-entry period

of 30 years (as provided in 36 CFR

251.56[b]) and includes stipulations to

assure fulfillment of the mitigation meas-

ures on National Forest System lands (FEIS

Section 2.4.1, pages 2-35 to 2-38 and

Exhibits 4 and 5, attached). The grant

period of 50 years is based upon the cost

recovery period of the facilities and the eco-

nomic analysis of the project (FEIS Section

4.1.16, page 4-52 and Appendix D).

46a

B. The power distribution line will be buried

in the Homestake Road (FDR 703). A permit

will be issued to the appropriate power dis-

tributor. This is discussed in FEIS Section

2.2.6, page 2-32 and 4.1.9, page 4-40.

C. All activities on National Forest System

lands will be conducted in accordance with

stipulated mitigation measures (Exhibits 4

and 5, attached). These are identical to

those disclosed in Section 2.4.1 (pages 2-35

to 2-38) of the FEIS as applicable on MFS

lands, and are incorporated into all

authorizing documents. Mitigation measures

will be enforced through the grant docu-

ment and Forest Service regulations (36

CFR 251). The Mitigation measures are the

key to the decision to grant the land use. As

discussed in the Reasons for the Decision

(Section V), the proposed land use would be

denied if the mitigation measures (Exhibit

5) were not included. Mitigation measures

for non-Federal lands will be specified by

the appropriate State or local agencies. A

list of potential measures is provided in

Section 2.4.2 (page 2-38 and 2-39) of the

FEIS.

V. REASONS FOR THE DECISIONS

The bases for my decisions are as follows:

A. The decision is consistent with the Organic

Act of 1897, the Multiple Use Sustained

Yield Act of 1960, and Title V of the Federal

Land Policy and Management Act of 1976

(FLPMA).

1. The White River National Forest was

established under the authority of the

47a

Organic Administration Act of 1897 (30

Stat. 34, supplemented and amended; 16

USC 473-478, 479-482, 551), which

states, “ . . . No national forest shall be

established, except to improve and pro-

tect the forest within the boundaries, or

for the purpose of securing favorable

conditions of water flows, ...” arid

“ ... All waters within the boundaries

of national forests may be used for

domestic, mining, milling, or irrigation

purposes, under the laws of the State

wherein such national forests are situ-

ated,...” Therefore, I conclude that the

Homestake Phase II Project is consistent

with National Forest purposes (36 CFR

251.54(h)(1).

The proposed use is in the public inter-

est. Although there will be an effect on

wilderness users and the magnitude of

the effects will vary on each wilderness

user, the Homestake Phase II project

will not significantly affect the increas-

ing wilderness use trend (FEIS Section

4.1.5, pages 4-38 and 4-39). Further, Col-

orado Springs and Aurora will be per-

mitted to develop their decreed water

rights and, therefore, meet their com-

munity goals (36 CFR 251.54[h][2]).

The applicant is qualified (36 CFR

251.54[h][{3]). The Cities’ application

shows that each City has maintained a

water supply system for sometime. The

Cities have had previous projects on

national Forest System lands. As local

governmental bodies, the Cities are

48a

qualified to be holders of a right-of-way

under FLPMA.

This Project is expected to cost about

$90 million. Both Cities have completed

more costly projects successfully. The

Cities have submitted information

showing that they plan to finance the

Homestake Phase II Project with reve-

nue bonds and general obligation bonds

(FEIS Section 6.2.1, pages 6-125 and

6-133). The bonds will be retired by rev-

enues from the sale of water to present

and future users (letters of October 21,

1982, Colorado Springs, and December

13, 1981, Aurora, which are included in

the application file).

The Cities have successfully con-

structed, operated, and maintained sev-

eral similar projects including Spinney

Mountain (Aurora), Homestake Phase |

(Colorado Springs and Aurora), and

Rampart Reservoir (Colorado Springs).

There has been criticism of the Home-

stake Phase I Project. The environmen-

tal and other problems which arose

from Phase I are discussed in the FEIS .

(Section 3.1.17, pages 3-25 to 3-27). I am

requiring correction of these problems

and the Cities have shown a willingness

to cooperate. (See Exhibit 4, Easement

Condition No. 22, attached; FEIS Section

4.1.17, pages 4-54 to 4-58.)

I find that the Cities have the financial

and technical capability to conduct,

operate, maintain, and terminate the

49a

proposed land use in accord with 36

CFR 251.54(h)(5).

5. It is required by Section 505 of FLPMA,

43 USC 1765, and Forest Service Special

Use Regulations, 36 CFR 251.56(a), that

each special use authorization contain:

“

. . . (1) terms and conditions

which will (i) carry out the pur-

poses of applicable statutes and

rules and regulations issued there-

under; (ii) minimize damage to sce-

nic and esthetic values and fish and

wildlife habitat and otherwise pro-

tect the environment; (iii) require

compliance with applicable air and

water quality standards established

by or pursuant to applicable Fed-

eral or State law; and (iv) require

compliance with State standards for

public health and safety, environ-

mental protection, and siting, con-

struction, operation, and

maintenance if those standards are

more stringent than applicable Fed-

eral standards; and

(2) such terms and conditions as

the authorized officer deems neces-

sary to (i) protect Federal property

and economic interests; (ii) manage

efficiently the lands which are sub-

ject to the use or adjacent thereto;

(iii) protect other lawful users of

the lands adjacent to or occupied by

such use; (iv) protect lives and

property; (v) protect the interests of

individuals living in the general

Me Se

50a

area of the use who rely on the fish,

wildlife, and other biotic resources

of the area for subsistence pur-

poses; (vi) require siting to cause

the least damage to the environ-

ment, taking into consideration fea-

sibility and other relevant factors;

and (vii) otherwise protect the pub-

lic interest.”

The terms and conditions of this ease-

ment (Exhibit 4) were developed

through the NEPA process by refining

and adding to the initial environmental

protection plan submitted by the Cities

in their application. The DEIS included

mitigation measures for each action

alternative and a grant document for

the readers to review. The terms and

conditions required by FLPMA and

imposed in this easement are cross-ref-

erenced to the mitigation measures in

the FEIS in Exhibit 5. Exhibit 5 also

includes citations to the provisions of

Section 505 of FLPMA upon which the

conditions or stipulations in the ease-

ment are based. The request of the

Cities to use the National Forest land

without the conditions and stipulations

of the easement would violate FLPMA

and the request wouid be denied. The

compliance with Section 505 of FLPMA

satisfies the requirements of NEPA (40

CFR 1595.2[c]). This decision includes

all practicable means to avoid or mini-

mize environmental harm.

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6. The area necessary for occupancy dur-

ing and after construction will be as

shown on the Final Construction Plans

approved by the Forest Supervisor. This

area will be limited to the specific

ground necessary for operation and

administration of the project. The grant

document provides for operation and

maintenance, along with public safety.

In addition, the grant provides mitiga-

tion measures on National Forest Sys-

tem lands to assure that there will be no

unnecessary damage to the environ-

ment (FEIS Section 2.4.1, pages 2-35 to

2-38). Without these mitigation measures

the Forest Service would not be assured

of environmental protection and unnec-

essary damage to the environment

would occur. Consequently the Forest

Service would not issue the grant docu-

ment under the FLPMA regulations (43

USC 1764, Section 504[a]).

It is consistent with the requirement of the

National Environmental Policy Act of 1969,

to use all practicable means and measures

to create and maintain conditions under

which man and nature can exist in produc-

tive harmony and fulfill the social, eco-

nomic, and other requirements of present

and future generations of Americans.

Compliance with Section 7 of the Endan-

gered Species Act of 1973 (PL 93-205, as

amended) is required. A “no jeopardy opin-

ion” has been issued by the Fish and Wild-

life Service (FEIS Appendix I). The Cities

have agreed to the required action specified

52a

by the Fish and Wildlife Service (FEIS Sec-

tion 4.1.4, page 4-33; FEIS Appendix I; and

Easement Condition 27, herein.)

I have reviewed the FEIS with regard to

wetlands which would be impacted (FEIS

Sections 3.1.3, pages 3-8 to 3-10; 4.1.3, pages

4-21 to 4-30) and Executive Order 11990.

The granting of this land use is consistent

with Executive Order 11990 because the

wetlands on the project area will not be

significantly affected by the water diver-

sion. The diversion structures will be

located in the steams, temporarily disturb-

ing about six acres, of which about two

wetland acres will be lost (FEIS Section

4.1.3, page 4-29). There is no practicable

alternative to avoid the disturbance of these

six acres. Significant adverse effects will not

occur and this action minimizes the loss of

wetlands.

The proposal is generally inconsistent with

the concept and philosophy of wilderness

as expressed in the Wilderness Act of 1964.

However, it is consistent with the Colorado

Wilderness Act of 1980 (PL 96-560) contain-

ing the following language concerning the

Homestake Phase II Project and the Holy

Cross Wilderness:

“ ... (5) Certain lands in the San

Isabel and White River National

Forest, Colorado, which comprise

approximately one hundred and

twenty-six thousand acres, as gen-

erally depicted on a map entitled

“Holy Cross Wilderness — Pro-

posed,” dated November, 1980, and

53a

which shall be known as the Holy

Cross Wilderness: Provided, that no

right, or claim of right, to the diver-

sion and use of existing conditional

water rights for the Homestake

Water Development project by the

cities of Aurora and Colorado

Springs shall be prejudiced,

expanded, diminished, altered, or

affected by this Act. Nothing in this

act shall be construed to expand,

abate, impair, impede, or interfere

with the construction, maintenance,

or repair of said project, nor the

operation thereof, or any exchange

or modification of the same agreed

to by the cities and the United

States acting se ail any appropri-

ate agency thereof;

The Wilderness was established recog-

nizing the Cities’ project proposal and it

applies exclusively to the Cities. Of the

twenty (20) wildernesses established by

Public Law 96-560, only the Holy Cross

Wilderness designation contained speci-

fic wording dealing with a proposed

water diversion (FEIS Sections 1.4, page

1-11; 3.1.6, pages 3-14 to 3-16; 4.1.6,

pages 4-36 to 4-39). If Congress had not

included this language recognizing and

protecting the Cities’ water rights and

the project, then Section 4(d)(4) of the

Wilderness Act (16 USC 1133[d][4])

would apply and a Presidential exemp-

tion for the project would be required.

54a

F. I do not have any information that indi-

cates there may be a technological

breakthrough negating the demand for

municipal water supplies forecast by

the Cities (FEIS Section 1.3, pages 1-8 to

1-11).

G. Although FSM 1970 requires that

. . efficiency shall be considered in

making decisions. .. . ,” (FSM 1970.3,

item 3) and a cost analysis was per-

formed (FEIS Section 4.1.16, page 4-52),

it was not very helpful in making this

decision. The alternatives are substan-

tially different in that they provide dif-

ferent quantities of water to different

users. The type of analysis described in

FSM 1970.3 does not lend itself to Fed-

eral land use authorizations, but is more

suited for Federal water resource plan-

ning.

VI. ALTERNATIVES CONSIDERED

The alternatives considered in making this decision are

described in the FEIS, Section 2.2, pages 2-1 through 2-34

and summarized in Exhibit 6.

Briefly, Alternative 1 is “No Action”; the Homestake

Phase II Proposal is not developed. Alternative 2 uses the

alignment described in Grant C-013867 which the BLM

issued in 1960. Alternative 3 is a combination of a tunnel

and pipeline gravity system into Homestake Reservoir.

Alternative 4 is establishing a new reservoir in the Upper

Valley above Red Cliff. Alternative 5 is a water trade

concept involving the Cities and Denver. Alternative 6 is

a modified version of the Cities’ proposal.

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The following discussion highlights the impacts of each

alternative and describes the features which were impor-

tant in the consideration for selection. Sections 2 and 4 of

the FEIS discuss the alternatives and the consequences of

implementation of each alternative. Exhibit 6, which is

attached hereto, is a summary of the consequences identi-

fied and discussed in the FEIS. It is noted that the Forest

Service has only one application before it at this time -

the Cities’ proposal represented by Alternative 6.

Alternative 1 — No Action

This alternative causes the least impacts to the

local biological and physical environment of the

project area and, on that basis, is the environ-

mentally preferable alternative. The “no action”

alternative would actually be a denial (see Sec-

tion II, above) and would force the Cities to

obtain the needed water from alternative

sources. The cost of water from the alternative

sources, such as the condemnation of agri-

cultural water and development of groundwater

described in the FEIS (Section 2.1.1, page 2-5),

could be higher. Furthermore, the secondary

effects on farmlands, agricultural economies,

and the holders of rights to groundwater could

be severe (FEIS Section 2.1.2, page 2-7). If the

“no action” alternative were adopted, the Cities

could likely not acquire and develop water

resources in time to meet the projected demands

for water. Finally, the Forest Service does not

have the authority to require the Cities to adopt

the non-structural alternatives described in Sec-

tion 2.1.1 of the FEIS, pages 2-1 through 2-7.

56a

Alternative 2 - 1962 Homestake Phase II Align-

ment

This alternative is based upon a land use autho-

rized by Grant C-103867 issued on December 29,

1960, and assigned to the Cities on July 31, 1962.

The Grant authorized a series of tunnels, open

canals, and conduits to divert water from nine

locations in the Holy Cross Wilderness. This

alternative results in the disturbance of 253

acres of surface area. About 30,000 acre-feet of

water could be diverted annually and seven

streams could be dried up for portions of each

year. There is no provision to require permanent

bypass flows in this alternative and as a result,

five miles of streams would have inadequate

flows to maintain fisheries and other environ-

mental benefits. The implementation of this

alternative would adversely affect 220 acres of

the Holy Cross Wilderness. About 14 Acres of

wetlands would be lost. Alternative 2 is less

environmentally preferable than Alternative 6.

Because of the adverse effects on wilderness,

streamflow, surface area disturbance, and wild-

life habitat, Alternative 2 was not selected.

Alternative 3 — Tunnel and Pipeline Systems

This alternative is a combination of tunnels and

pipelines. Diversions of water would occur in

the Holy Cross Wilderness at eight locations.

There would be one diversion outside the Wil-

derness. Two large pipelines or conduits would

be installed in the Wilderness; one 42 inches in

57a

diameter and 21,000 feet in length; the other 54

to 66 inches in diameter a

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