HomeMy WebLinkAbout20083400.tiff MINUTES OF THE WELD COUNTY BOARD OF ADJUSTMENT MEETING
Tuesday, December 16, 2008
A regular meeting of the Weld County Board of Adjustment was held on Tuesday, December 16, 2008, in the
Hearing Room of the Department of Planning Services, 4209 CR 25.5, Longmont, Colorado. The meeting
was called to order by Chair Bruce Fitzgerald at 11:15 a.m.
ROLL CALL ABSENT
Bruce Fitzgerald -Chair
Bryant Gimlin—Vice Chair
William Hansen
Erich Ehrlich
Anita Owens
Bill Hall
Benjamin Hansford
Jerry Neff
Bruce Fitzgerald wished to make a change to the November 18, 2008 minutes. He wished to add that
"Officers were elected by acclamation" after the nominations.
Benjamin Hansford motioned to approve the'amended minutes of the last regular meeting of the Weld County
Board of Adjustment held on November 18, 2008, seconded by Bryant Gimlin. Motion carried.
Also Present: Tom Honn,Weld County Department of Planning; Bruce Barker, County Attorney;and Kristine
Ranslem, Secretary.
CASE NUMBER: BOA-1054
PLANNER: Tom Honn
APPLICANT: Roger Kenney
LEGAL DESCRIPTION: Lot D RE-3983 located in the NW4 Section 5, T4N, R68W of the 6t" P.M., Weld
County, Colorado.
REQUEST: An Appeal of a determination of the Weld County Planning Department as written in
a letter dated Oct. 1, 2008, by Thomas E. Honn, Planning Director. The appeal
seeks to overturn a determination that permits use of a water tap on the property for
exclusive use of Mr.Warner and Magpie Operating, Inc.because the use is for Oil
and Gas Support Service uses and should be only allowed as a Use by Special
Review.
LOCATION: South of and adjacent to State Highway 60 and east of CR 3.
Tom Honn, Planning Services, asked Bruce Barker, County Attorney, to clarify an item of confusion. In Mr.
Honn's staff report it indicates that it takes six(6)members of the Board of Adjustment to uphold an appellants
request to overturn an administrative decision. In the charter there was an amendment which had not been
codified yet in the code book. He deferred to Mr. Barker to explain what those changes are.
Bruce Barker, County Attorney, stated that three(3)years ago there was a change to the Weld County Home
Rule Charter that took the number of Board of Adjustment members from nine(9)down to five (5)detailing
how those members are appointed. It also states that with five members on the Board a quorum consists of
four(4); but for an appeal of an administrative decision, which is this case, you need the concurring vote of
four of those five members.
Mr. Honn stated that staff received a request from Mr. Warner to utilize the commercial water tap on this
particular property at some point after the date that the Board of County Commissioners did deny a Use by
Special Review for this site.
Staff had evaluated Mr. Warner's request of allowing the use of the commercial well but limiting it to his use
and his company(Magpie). Mr.Warner's request was that only his and his company's vehicles would be used
strictly for their wells. Staff felt that it was an allowed use within the Agricultural Zone District because oil and
gas activities are a use by right. He added that as long as it was limited to Mr.Warner and Magpie's use from
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this property that it would be an allowed use within the agricultural zone district.
Staff then received a letter from Mr. Kenney,an adjacent land owner, requesting that the decision be taken to
the Board of Adjustment because he felt that it was still a commercial use under the code and that staff's
interpretation was not correct.
The basis of the appeal is made against the findings of staff that determined the oil and gas uses are allowed
by right and the water tap is located on the property of the owner. As long as it was operated under that
restricted condition, it was appropriate.
Mr. Honn stated that there are several comments in the packet which the board has received from Mr.
Kenney. They indicate that there are a variety of conditions which may well exceed what the normal
agricultural use on the property is, such as the business could potentially change hands or the business could
grow substantially and therefore the character of how the use would operate on the property would become
like a commercial operation that was ultimately denied by the Board of County Commissioners.
Bryant Gimlin asked if staff's decision would have been different if they knew that the water was going to be
used for more of a commercial use. Mr. Honn stated that staff concluded that it would not be allowed which
was a basis for going through the process of the Use by Special Review and was denied by the Board of
County Commissioners. He added that Mr.Warner's request came in subsequent to the denial of the Use by
Special Review and was based on a limited use. Staff evaluated his request and felt that it was appropriate
within the district.
Mr. Honn commented that there was recently a case on this particular property that although it was stated for
the use of the property owner he did contract with a commercial carrier to come in and take the water from the
site out to the oilfield. He added that Mr.Warner indicated that there would be fewer trips with larger vehicles
rather than many trips with his smaller vehicles that he owned. Mr. Honn said that staff responded to him that
it would not be acceptable under their interpretation and it was limited to their own equipment.
Mr. Gimlin asked that if indeed it was being used strictly for their own usage would intensity matter. Mr. Honn
said that staff's interpretation did not specify a limited number of vehicles owned by Mr. Warner.
Jerry Neff asked what the approximate difference in the volume of water with the Magpie trucks is versus the
semis. Mr. Gimlin clarified that according to information in their packets, Magpie's vacuum trucks hold about
70 barrels or approximately 2500 gallons and the semis hold approximately 8,000 gallons.
Mr. Neff asked where the source of the water comes from. Mr. Honn replied that it is supplied from the Little
Thompson Water District.
The Chair asked the applicant to give his comments.
Stewart Olive, 110 E Oak St., Ft. Collins CO. He commented that he is representing Roger Kenney and has
also been authorized to speak on behalf of Arthur Elmquist and Ted Schrage. Mr. Olive wished to provide a
little history of this site because the decision made today on this appeal will affect properties throughout Weld
County.
Mr. Olive indicated that Mr. Kenney's property is directly across from this site on County Road 3. The uses in
the past had created several problems. Mr. Olive entered into exhibits pictures of the property. He indicated
that large trucks owned by A&W Water Company accessed the property prior to any decisions whether this
use was even allowed. He reminded the Board that this property is zoned agricultural.
On April 11, 2007 this activity operated without a permit. The photo which he presented indicated the intensity
of the use when they were operating with semi trucks.
Mr. Olive showed in a photo the safety issues of the trucks entering State Highway 60 from County Road 3.
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After April 11, 2007 upon receiving several complaints,the Planning Department said that Mr.Warner needed
to go through the Use by Special Review process. Mr. Olive stated that the water from this site was used for
oil and gas support services. He added that there is a 4 inch commercial water tap served by a 10 inch line
and will fill a semi truck in 20 minutes.
Mr. Olive stated that Mr.Warner filed a Use by Special Review application which requested to allow the use of
the commercial water tap to support off-site oil and gas facilities in an agricultural zoned district. He added
that there were many conditions which were attached with staff approval. It went before the Planning
Commission approximately one year ago and was voted down 6-1 for being incompatible with the surrounding
uses. He indicated that residential uses surround the property. The decision was then appealed to the Board
of County Commissioners. Staff had requested limits on the use to 10 trips per day as well as other attached
conditions.The Board of County Commissioners unanimously denied the application for failure to comply with
Section 23-2-230.B of the Weld County Code.
On May 6,2008 Mr.Warner requested by letter that the Planning Department allow the use of the commercial
water tap for an offsite oil and gas operations belonging to Magpie. There was a violation hearing scheduled
for June 17,2008 which was pulled by planning staff on May 30, 2008. At that time planning staff sent a letter
to Mr.Warner stating that it was determined that since Magpie owned the water tap that it had the allowed use
by right to use the water tap for support of its off-site oil and gas operations. The violation hearing was
cancelled and the case was closed.
On July 15, 2008, Mr. Olive sent a letter to the Planning Department which states that this is a problem and
wished to have this addressed. On October 1, 2008 he received the final letter stating that this use was
allowed in the agricultural zone. At that time they proceeded to appeal the Planning Department's decision.
While the appeal was pending, there were numerous A&W Water trucks who were utilizing the water tap.
Mr. Olive indicated that the water was being used for an oil and gas well fairly close by. He added that Mr.
Kenney followed one of the A&W trucks through Johnstown. From that point he stopped following the truck,
therefore they do not know where the truck was going. Again, during this appeal they were having the same
safety issues as before which were dust and noise. He indicated that the water was not being used for
agricultural purposes.
Mr.Olive reiterated that Section 23-3-20 states that it does not allow oil and gas support services as a use by
right in an agricultural zoned district. It was then approved by staff that there would be two small trucks coming
in and out and the next thing we know it is back to the numerous semis again. Mr.Olive expressed that this is
in direct violation of the wording in the county code itself.
Mr. Olive stated that they are asking members of the Board of Adjustment to require the Planning Department
to enforce the code rather than creating new rights under code.
Mr. Fitzgerald asked if County Road 18 is in Larimer County. Mr. Olive clarified that it is in Larimer County.
The Chair asked if there was anyone in the audience who wished to speak for or against this application.
Richard Olona, outside council to Magpie Operating,James and Ryan Warner. He commented that he also
represents Magpie and James Warner in a lawsuit brought by Mr. Kenney.
Mr. Olona stated that upon denial of Magpie's application for the commercial water tap, Magpie completely
ceased the sale of water at that site. The initial ruling from the Planning Department limited the use of the
water to Magpie's own operations and they have complied with that at all times. He added that his client was
not aware of a letter sent by Mr. Honn to Mr.Olive which stated that it was also limited to Magpies'own trucks.
His client understood that it was for his own operations.
Mr. Olona said that he advised Mr. Olive that Magpie foresaw that there was a possibility that they would be
doing some limited drilling and/or fracking and that there might be a need for more barrels of water than can
be handled by the smaller trucks. He added that Magpie also contacted Bethany Salzman, Zoning
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Compliance Officer, and gave her advance notice of bigger trucks coming in for a track job a mile away from
the site. He advised Mr.Olive of the same situation. Mr. Olona stated that during this same time Magpie had
planned to drill its first well and a rig opened up and Magpie wished to jump on the availability. This drill was at
a property around Johnstown and he again advised Mr. Olive of this case. Mr.Olona stated that Magpie's use
for its own purposes and its operation was reasonable. He commented that it made good business sense to
use a larger truck and eliminate the number of trips necessary. There has been no sale of water and it has
been for Magpie's own purposes.
Mr. Olona commented that Mr. Kenney has the ability to pursue his claims as he is doing in Weld County
District Court and asked the Board of Adjustment to deny his application.
Mr. Fitzgerald asked how many wells Magpie operates. Mr. Olona said that they operate approximately 80
wells.
Mr. Fitzgerald asked if Magpie would be classified as an exploratory company. Mr.Olona replied that they are
an operating company.
Mr. Neff asked what the alternate source of water would have been had this tap not been available. Mr.Olona
commented that they would have had to purchase the water from A&W or another operator. He added that
Magpie does not have another water source available to them.
Mr. Gimlin clarified if this was a one time deal during the drilling of this one well. Mr. Olona replied yes.
Roger Kenney, 23955 CR 3. Mr. Kenney stated that he does have a pending lawsuit against Magpie and Mr.
Warner. He said that he has spent about two years trying to get the County to do something about this
problem and they were unwilling to do it.
Mr. Kenney purchased his property 16 years ago and at that time this water tap did not exist. Five years later
a large pile of dirt shows up with a water tap and then subsequently a parade of semi trucks are coming up
and down County Road 3 right next to his front door disturbing his quality of life.
Mr. Kenney expressed that he felt it had gone as far as it could go with the County Commissioners denying
Mr. Warner's application. He added that Mr. Warner could easily move this to another location.
Mr. Kenney commented that if the Board agrees with Mr. Honn this has far reaching consequences.
Artie Elmquist, 8724 I-25 Frontage Road East. He stated that his family owns the farm directly north of the
tank battery site. He added that their property is located in Larimer County and that they have been following
this case very closely. Mr. Elmquist is concerned about the impacts of these trucks.
Mr. Elmquist indicated that this water tap was previously installed at anther location and is interested to hear if
Mr.Olona could give them some background on that and why the decision was made to relocate the water tap
to this particular location.
Mr. Elmquist commented that he is lead plaintiff for a court case for which the royalty owners in that area had
to bring about against Magpie because they discovered they were being paid about 50%of the market price
for the natural gas being produced in that field. On December 1st they were successfully awarded the
judgment and Magpie was asked to pay $1.245 million to correct that accounting mistake in the Larimer
County District Court. He added that it is important to recognize that Magpie does have a history of doing
some things which are questionable.
Mr. Elmquist asked how the adjacent property owners were notified as he was not notified by the Weld
County. He said that they received a call from a paralegal alerting them about this hearing. He added that he
is also curious of how many trucks per day Magpie anticipates loading water from this site.
Mr. Olona referred to Mr. Elmquist's question of why Magpie would move the tap. He stated that Magpie
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purchased this property in 1998 and the tap was there. It is his understanding that the tap was in place at the
time Mr. Kenney moved in.
With regard to the lawsuit that Mr. Elmquist referred to this is a case where Magpie continued to pay royalties
to its royalty owners in the same manner that its predecessors had under a contract. There was some dispute
in this litigation as to whether that contract was still applicable. He added that the plaintiffs claims were far in
excess of what was the ultimately reached settlement. This was a dispute that has been resolved by Magpie
and to his understanding in a very agreeable way.
The Chair closed the public portion of the hearing.
Mr. Olive commented that the precedent of this is being set for the entire county. The code states that this is
only allowed by a special review and not by staff determination.
Bruce Barker,County Attorney, commented that administratively the requirement is that the appeal comes in
within 30 days of Mr. Honn's letter. Mr. Olive's letter did comply with that.
Mr. Fitzgerald referred to the comment that this would be precedent setting. Mr. Barker said that it is
precedent setting in the sense that if the same circumstances and facts arise and if you were to either uphold
or overturn Mr. Honn's decision. The next time this circumstance comes up planning staff will follow whatever
the Board decides, so in that sense it is precedent setting.
Mr. Gimlin said that it is either a use by right or its not. He added that what is not being disputed is that it is
being utilized as an oil and gas support service regardless of ownership.
Mr. Neff commented that he believes it sets a precedent. He feels that it is beyond the intention of what was
originally agreed to. Hauling water off-site does not fit and he can foresee that this can lead to abuse in the
future.
Mr. Hansford commented that for their own use and utilizing their own vehicles for a small operation he would
agree that it is a use by right. However,when the commercial carriers are hauling the water off-site for use it
muddies the water a little for him.
Mr. Hanson agreed with the members comments.
Jerry Neff moved to grant the appeal based on Paragraph E of Mr. Olive's letter which determines that the
department is erroneous and that the Warner property cannot be used for oil and gas support and that service
operations without a Special Review Permit.
Bryant Gimlin commented that he is in favor of granting the appeal; however he is not in favor of the motion as
it was made.
Jerry Neff amended his motion to grant the appeal and overturn the decision of Mr. Honn that the use does
require a Use by Special Review rather than a use by right, seconded by Bryant Gimlin.
The Chair asked the secretary to poll the members of the Board of Adjustment for their decision. Bill Hall,
absent; William Hansen, yes; Erich Ehrlich, absent; Benjamin Hansford, yes; Jerry Neff, yes; Anita Owens,
absent; Bryant Gimlin, yes; Bruce Fitzgerald, yes. Motion carried unanimously.
Meeting adjourned at 12:43 p.m.
Respectfully
full submitted,
„JAL, �'F Y�
Kristine Ranslem
Secretary
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