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Home My WebLink About20160231.tiff m" IInfrostructure MaIntena one Centel (r.traotructure Depeit:ent 12408 Warrhoeten Street 72G-977-6600 Thornton. CO 80241-2405 FAX 720-977-6202 www.cityortnornton-net December 28, 2015 Ms. Jenny Fuller, Office Manager Office of Board of County of Commissioners Weld County 1150 O Street RECEIVED P.O. Box 758 Greeley, CO 80631 JAN 0 0 2016 ELD RE: City of Thornton Farm Property Management Update 1 MMI IGN R C®fiAMISSCOMMISSIONERS Dear Ms. Fuller: Attached for the Weld County Board of County Commissioners' review is the city of Thornton's 2015 Annual Farm Management Operations Report, which summarizes certain land management activities on Thornton's Weld County farm properties during 2015. Thornton representatives will be available to meet with the Commissioners in 2016 during the month of March to address questions from the report, or other issues of interest. I will contact you after the first of the year to set a date for this meeting and to establish an agenda. Thornton is pleased to continue open communication with the Commissioners and County staff throughout the year. Please feel free to contact me with any questions or concerns at 720-977-6504. Sincerely, Emily Hunt Water Resources Manager EH/dm cc: Bud Elliot, Deputy City Manager- Infrastructure Mark Koleber, Water Project Director Brian Foss, Farm Operations Administrator MLCR 2016-0231 orivrviAnitevgwri.6 -013 - at/ CC: Ca,, 60;PODt �'t ,wc Annual Farm Management Operations Report Prepared for the Weld County Board of County Commissioners December 15, 2015 Executive Summary • Thornton acquired farm land and water rights in Weld and Larimer Counties in 1985 and 1986 as part of a water supply project. • Since 1986, Thornton has contributed over $12.4 million to the local Weld and Larimer County economies through its Farm Management operations, including Voluntary Payments in Lieu of Taxes to Weld and Larimer County agencies, and the use of local vendors on Thornton's projects and operations. • Thornton owns 104 farms on approximately 17,161 acres in Weld County. • In 2015, there were 6,941 acres included in Thornton's Revegetation Program in Weld County. To date, 6,033 acres have been approved as established native grasslands by the Natural Resources Conservation Service. Thornton's 2015 Revegetation Program successfully maintained these native grasses with weed management and mowing. • The remainder of the farms in Weld County will stay in irrigated agriculture until the water is needed for municipal use in Thornton. It is currently estimated that additional conversions from irrigated agriculture to native grasses will not be needed until approximately 2030. • Thornton currently owns 62 farm houses in Weld County, 57 of which were leased to Weld County residents in 2015. Thornton is in the process of selling its farm houses. To date, 14 houses have been sold (seven in 2014 and seven in 2015). • Thornton's Farm House Repair Program addresses repair needs on Thornton- owned houses. Thornton uses local contractors and vendors for this program. 2 Introduction In 1985 and 1986, Thornton purchased over 20,000 acres of farms and associated water rights in Weld and Larimer Counties. Thornton purchased the assets for a water supply project. Since Thornton's acquisitions of farms and water, Thornton has operated under a good neighbor policy of working with farmers, residents, businesses, and governmental entities to effectively manage its properties and provide benefits to the Weld and Larimer County communities. This annual report provides a summary of Thornton's 2015 operations and activities in Weld County. Since 1986, Thornton has operated a local Farm Management Office in Ault, and more recently, Eaton. The function of the Farm Management Office is to oversee the operation, leasing, management, and maintenance of Thornton's properties in Weld and Larimer Counties. Thornton cash-leases many of its farms to local farmers, and several farmers who originally sold farms to Thornton continue to lease farms from the city. Other Thornton farms have been removed from irrigated agriculture, and Thornton has converted, or is in the process of converting, these farms to native grass vegetation. This conversion of farms from irrigated agriculture to a non-irrigated use is required by Thornton's Water Court Decree, and must be satisfactorily accomplished before Thornton can deliver water to Thornton customers. The Thornton Farm Management Office pro-actively manages Thornton's properties and tenants, and responds to issues and concerns when they arise. Since 1986, Thornton has spent over $12.4 million on its Farm Management operations, which include activities ranging from tree trimming, to plumbing and electrical repairs, to culvert replacements. In addition, since 1987, Thornton has made voluntary payments in lieu of taxes to Weld and Larimer Counties. Since 2010, Thornton has adjusted its voluntary payments to the counties to reflect changes in property values and the local tax schedule. The 2015 voluntary payment to Weld County taxing authorities was $237,885. Since 1987, approximately $4,607,518.20 has been paid to Weld County taxing authorities. Over the years, Thornton has partnered with local governmental entities and businesses to enhance their operations. For example, Thornton sold land and the associated mineral rights to the Weld County RE-9 School District for expansion of the school campus in Ault and construction of a new station for the Ault/Pierce Fire District. The city has also worked with local agricultural producers to acquire land to improve their operations. Fagerberg Produce expanded their onion processing facility onto land acquired from Thornton and Longs Peak Dairy has acquired three Thornton farms to improve their operation. 3 Since 2003, Thornton has leased approximately 57,846 acre feet of water to the Central Colorado Water Conservancy District (Groundwater Management Sub-district and Well Augmentation Sub-district) for operation of an augmentation plan for irrigation wells in Weld County. Thornton looks forward to its continued contribution to and cooperation with the Weld County community. Thornton's 2015 Farm Management Operations Revegetation Project Thornton currently owns 104 farms on approximately 17,161 acres in Weld County. To date, a total of 6,941 acres in Weld County have been taken out of irrigated agricultural production and have been or are in the process of being revegetated to native grasses. In 2015, an additional 300 acres in Weld County were approved as revegetated by the Natural Resources Conservation Service (NRCS), bringing the total approved revegetated acres to 6,033. An additional 788 acres of land in Larimer County are currently in Thornton's revegetation program. Thornton implements its revegetation program in Weld and Larimer Counties with contractors and vendors that are selected through a bid process that is advertised locally. Since 2006, all revegetation contractors and vendors have been from the local Weld and Larimer County communities. Since 2006, Thornton has spent over $1.8 million with these local vendors on its revegetation project. Attached is a current map of the Thornton properties located in Weld County. There is currently one grazing lease in place on the city's revegetated farms in Weld County. This tenant works with Thornton to manage his cattle appropriately to maintain the health of the pasture grass on the farm. Thornton does not allow horse grazing on its properties, as in the past this activity led to erosion problems. The pasture grass on the other farms that have been revegetated is cut and baled by Thornton vendors when adequate natural moisture has been available to produce a harvestable stand of grass. This procedure maintains the health of the pasture grass, and avoids potential damage from overgrazing. Adequate moisture in 2015 allowed for grass production on some Thornton land. Just over 3,022 bales from Thornton's Weld County farms were sold to local area cattle producers. Other farms that did not receive adequate moisture were monitored to control weeds and pests. Thornton's current plans are to complete revegetation and obtain NRCS approval on a total of 6,941 acres in Weld County by 2020. The remainder of the farms in Weld County will stay in irrigated agriculture until the water is needed for municipal use in Thornton. It is currently estimated that additional conversions from irrigated agriculture to native grasses will not be needed until approximately 2030. This timeline is a planning estimate and is subject to change to meet Thornton's water supply needs. 4 Thornton's revegetation program has resulted in the successful establishment of a self- sustaining, dry-land cover on the farms that have been removed from irrigated agricultural production. Each farm is unique, and the revegetation process is highly dependent on natural moisture. Thornton evaluates and adjusts its revegetation methods on a yearly and a farm-by-farm basis. The Water Supply and Storage Company (WSSC) water that was used to irrigate Thornton's revegetated farms continues to be used within the WSSC irrigation system on farms that are still in irrigated agriculture. The Farm Management Office maintains a list of interested farmers and will rent the water on a first come, first serve basis. Tenants of Thornton-owned farms have priority in renting this excess water. After those requests have been fulfilled, then any water left is rented to other farmers throughout the WSSC system. Following are some pictures of certified grass fields and the bales that were sold in 2015, as well as a map of the revegetation program. 5 •jd 1fin . _ :� '+ •.- - `4 ` - - t_ .��. .. I.. t 1 ! w• a . .1. - , .. rl,•e.. . Wee ` . - •..lw -'%..* • ti 4 " w • ,� y• .,. !bs' • f 1 Farm #11 , CR 88 east of Pierce looking southeast l �J'�_ • - T < -:*yy, -,.`. . Jam' yr �r - 7......11-....1.11. ~'. - s..�"> .• 'Ydc 1"'— I ' ..4a ^� ♦at "'•' '!.__ w� • V e • - • •�_41. `y. '-'` Hlr .'�'i yy �� Y I� 1 - �'� �� '�►�IM•1,-•�t� • , �• 4. R • M.R . r` � IL .�•.,, 4;.:- t \ 24♦,+1. str1•/L. •. ,. ...,,1 i. 'ti♦ - 4 '♦1 ; x.1 a:.L, lane T.,.p cf. 4610. .c IwS I 'r Yr 1 ,, %J ., w. Farm #30, North of Windsor, CR 78 east of Hwy 257 MAIIIIIIIIIIrnallistgailliallme -S .1 s4M- 44 • Ir I 4 » .. . .. 4 I, Farm #19, CR 88 & 37—Northeast corner of the intersection 6 _ _ dit$_. Lc) r_ it) v._ O r et N F..: S r tp N .y 1) i - • EE E v I- Z C en in •r o o Q. o Eto c gi 2 a n F- g' ps E L- � a , i ,. a .... u_ o cb ... Lt Ac O Q` t, moneill Cr + : U S• .O rn Ivomit 'a w cis Q o 1n a, 0 4. W to `f' QZF� 2 ir 3 .r. .O W 4. s « a' F?: b. A ' A i (.1) (93 _ C C 7 . t ,„ i., ,1 - E O o O .n 111 O. r3 V V a xw cu a. in :1 ;2 ..t 4, kii Q. I. el.• '••• n — Mil 7 c , e� -- 140' :l II . u W '1. . 9 - W -- W 1.-. _ Q W •,_ IIIP , g Sp l ,_WI tepIPII-'Pr • r rYr 7 m Li .D - rrP _ r- - 1 al ≤ ` ,., a ___ 2 €; f-1 a -. I. II 1 •l i v 1L b; C r _ CO I '1 Jr O I ' S t 04 L u $ r N I • _r p Jillt H CD r'6 x 1 7 I ■ / 1 ,, is IX ii: fir �1 r IAI ' ui C r , d E C1 Co Ill J W if ifs P3 el 8 CI , n ' 1 i i n Ii .. Ci LL. . C =li- I i D PIP _ 1 .. c li ._ , * 0 I i ..c , . . r i I : la,in /�%/t U a ..... C! __ I ..........,.._ 0 1 3 rgoAi 'I I II a IA — - -- — ---- - — -- - -- — -- --- o 8i 3 1'd l a y 1 N ti _1 Thornton's Irrigated Farms The Thornton farms that remain in irrigated agricultural production in Weld County are leased to local farmers on a cash-lease basis at market rates. Water from ditch company shares or wells is provided with the leases for irrigated land. Thornton generally provides three-year leases to allow farmers to adequately plan their operations. These farms had the following approximate crop distribution in 2015: Crop Percent Shell Corn (used for dairy/ cattle feed) 25% Silage Corn (used for dairy/cattle feed) 30% Wheat (used for flour) 12% Alfalfa (used for dairy/cattle feed) 22% Sugar Beets (used for sugar) 6% Onions (used for human consumption) 5% Thornton's Residential Houses In 2015, of the 62 farm houses owned by Thornton in Weld County, 57 were leased. These houses are leased on an annual basis. Rent is charged at market rates and is re-evaluated each year based on local market conditions. Thornton's houses provide affordable housing options for over 150 residents in Weld County. Thornton's house tenants take pride in their homes, and generally stay in the houses for over five years. The city has tenants who have been leasing houses from Thornton since 1986, as well as long-term tenants who have moved from one Thornton farm house to another to meet their space needs. House Repair Program In 2009, Thornton began a comprehensive Farm House Repair Program. All of the Thornton-owned houses were inspected by a local contracting company, and an inventory of major repairs for each house was generated. The types of repairs are wide-ranging, and include foundation improvements, site drainage improvements, new roofs, exterior paint, siding, structural repairs and site grading as well as interior repairs such as painting, and repairs to sheet rock, windows, and flooring. Repairs are completed by local vendors. Sale of Thornton Houses In 2013, Thornton began the process of selling some of the houses it owns in Weld and Larimer Counties. To date, fourteen houses have been sold, seven in 2014 and seven in 2015. Two houses are currently for sale and the city is working with the County to 8 subdivide an additional five houses, which will create residential lots separate from the farms and make them eligible for sale in 2016. Oil and Gas Leasing During 2013 and 2014, Thornton experienced an increase in drilling activities for oil and gas production on various farms. Leases were signed in late 2011 and early 2012 with three different oil companies - Petroleum Development Corporation (PDC), Bayswater Exploration, and Marathon Oil. In 2013, Marathon assigned its Thornton Leases to DJ Resources. Another drilling company, Extraction Minerals, signed additional leases during 2014. Depending upon the parcel, Thornton may own all or a portion of the minerals. Marathon/DJ, and PDC have drilled 22 wells on Thornton and adjacent properties under these Leases. Additional wells may be drilled on these sites in the future. The recently drilled wells, and wells that are planned to be drilled in the near future, are all horizontal wells and have been drilled from multi-well pad sites. Some additional wells have been drilled on Thornton-owned Farms where the city doesn't own any of the minerals. Because drilling locations can impact development locations as well as building envelopes, Thornton also worked closely with the Highland School District in providing assistance in the development of the mineral assets they acquired from Thornton. In working with the various oil and gas ownerships, as well as the drilling companies, both Thornton and the School District will benefit from the oil and gas exploration taking place on these parcels just to the west of the Town of Ault. Farm Management Office The City of Thornton Farm Management Office had been renting office space from the Highland School district for the previous 5 years. Early in 2014, the Farm Management Office was notified by the District that the building that housed the office space Thornton was renting was part of a large construction project to improve and expand the District's facilities. As a result, Thornton's lease would not be renewed. The city searched the Ault community for a suitable substitute. The city also investigated the possibility of converting one of its houses into office space Neither of these options were viable, so the Farm Management Office relocated to rented office space in Eaton. With the objective of finding permanent office space for the Farm Management Office, the Highland School District and Thornton are investigating the possibility of joint venture to build a new, shared office complex on property owned by Thornton, which would include a bus barn and maintenance facility. This is located just outside of the town limits of Ault. Thornton Water Protect Thornton has been working with communities in Weld County that could be impacted by the construction of the pipeline to deliver Thornton's Water Supply and Storage Company share water to the city. Thornton has discussed possible pipeline alignments 9 with planning, engineering and other staff from Windsor, Greeley, Berthoud, Johnstown, Milliken, Mead, Firestone, Frederick and Dacono, as well as Weld County. Thornton staff has also attended the stakeholder meetings regarding possible "1041" regulations for water pipelines in Weld County. Thornton remains committed to an open, responsible, and collaborative approach to locating and constructing the pipeline needed to deliver water to Thornton. 10 Hello