HomeMy WebLinkAbout035 - 04/04/2023 - AUTHORIZING THE CITY MANAGER TO EXECUTE AGREEMENTS, CONVEYANCES, AND OTHER DOCUMENTS TO INCORPORATEORDINANCE NO.035,2023
OF THE COUNCIL OF THE CITY OF FORT COLI.JNS
AUTHORIZING THE CITY MANAGER TO EXECUTE AGREEMENTS,
CONVEYANCES,AND OTHER DOCUMENTS TO INCORPORATE
THE SPRING CARON WASTE WAY DITCH
WHEREAS,the Spring Cañon Waste Way Ditch,a.k.a.Spring Cañon Waste Way Ditch
(“Ditch”)is located in southeast Fort Collins,diverting water from a draw in the NEI 4 of Section
I,Township 6 North,Range 68 West of the 6th P.M.,just south of Zach Elementary School,and
continuing in a southeasterly direction;and
WHEREAS,a water right with an appropriation date of July 22,1875,was decreed to the
Ditch by the Larimer County District Court in Civil Action 2031 in the decree dated April 22,1922
(“Water Right”);and
WHEREAS,the Ditch,Water Right,and associated structures and property and other legal
rights,including easements (together,“Ditch Rights”)have historically been owned by various
persons and entities as fractional interests,without these Ditch Rights being held by a mutual ditch
company,which is a more common ownership model in this region;and
WHEREAS,as part of the City’s 2002 acquisition of the land and other property that
became Eagle View Natural Area,the City acquired a 2 12th interest in the Ditch Rights;and
WHEREAS,the City currently uses the Water Right and water from the Ditch to irrigate
Eagle View Natural Area;and
WHEREAS,the City’s portion of the Ditch Rights are not associated with the City’s water
utility;and
WHEREAS,the City and the other fractional owners of the Ditch Rights (“Co-Owners”)
periodically need to coordinate with respect to internal and external matters,including:
maintenance of the Ditch,including paying for such maintenance;actions to protect the Ditch and
Water Right;and consideration and execution of potential arrangements related to the Ditch and
Water Right;and
WHEREAS,the historical and current fractional ownership model for the Ditch Rights
makes this internal and external coordination among the City and the Co-Owners difficult for
various reasons,including a lack of structure for decision making;and a lack of established
principles related to ditch matters;and
WHEREAS,changing the ownership structure of the Ditch Rights from the historical and
current fractional ownership model to a mutual ditch company model would benefit the City and
the Co-Owners in various ways,including:providing internal organization among the City and the
Co-Owners;a financial structure for maintenance and other costs;an established body of law (see,
e.g.,Colorado Revised Statute Section 7-42-101 et seq.;Jacobucci v.Dist.Court,541 P.2d 667,
189 Cob.380 (1975)(summarizing mutual ditch company law));and a single point of contact for
external matters;and
WHEREAS,the City and the Co-Owners desire to pursue the creation of a mutual ditch
company to hold title to the Ditch Rights,which would require the City and the Co-Owners to
execute agreements and other documents to establish the company and conveyances and associated
agreements to convey their ownership interests in the Ditch Rights to the newly-formed mutual
ditch company in exchange for shares of stock in the company that represent the City’s and the
Co-Owners’current proportional ownership interest in the Ditch Rights
(“Incorporation Documents”);and
WHEREAS,Section 23-111(a)of the City Code authorizes City Council to sell,convey,
or otherwise dispose of any interest in real property owned by the City,provided that City Council
first finds,by ordinance,that such sale or other disposition is in the best interests of the City;and
WHEREAS,the execution of Incorporation Documents is in the best interest of the City
because of the benefits described above;and
WHEREAS,the execution of Incorporation Documents will result in the City receiving a
value in an amount equal to or greater than the fair market value of the Ditch Rights because the
City will retain the same proportional ownership of the Ditch Rights,with the added benefits
described above.
NOW,THEREFORE,BE IT ORDAINED BY THE COUNCIL OF THE CITY OF FORT
COLLINS as follows:
Section 1.That City Council hereby makes and adopts the determinations and findings
contained in the recitals set forth above.
Section 2.That City Council finds,pursuant to Section 23-111(a)of the City Code,
that the execution of Incorporation Documents and conveyance of the City’s interest in the Ditch
Rights to a newly-formed mutual ditch company to hold title to the Ditch Rights is in the best
interests of the City.
Section 3.That City Council finds,pursuant to Section 23-114 of the City Code,that
the execution of Incorporation Documents will result in the City receiving stock of equal or greater
value than the fair market value of the property interests conveyed.
Section 4.That City Council authorizes the City Manager to execute Incorporation
Documents as described in this Ordinance and such other documents as may be necessary to carry
out the transactions contemplated by this Ordinance,on terms and conditions consistent with this
Ordinance,together with such additional terms and conditions as the City Manager,in consultation
with the City Attorney,determines are necessary or appropriate to protect the interests of the City.
Introduced,considered favora •y on irs rea
March,2023 and to be presented for final passage on
ing,and ordered published this 7th day of
the4t aa~oM~r~y 023.
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ATTEST:
,t’
City Clerk
Passed and adopted on final reading on this
A’fl’EST:
4th da of April,cr2t≤;~
City Clerk /