An Eagle County District Court has rejected the Town of Gypsum’s condemnation of land next to the Eagle River owned by a biomass plant operator, saying the town failed to follow its own rules for publicly announcing its eminent domain plans.
Judge Frederick Gannett said Gypsum’s town council “acted arbitrarily and took actions beyond its authority” when it approved an ordinance allowing the town to launch eminent domain proceedings against the landowner.
Clearwater Ventures, which owns 106 acres along the Eagle River, including the land beneath the Eagle Valley Clean Energy biomass plant, sued the town last fall, arguing Gypsum failed to properly notify the public of its plans to force the company to sell 69 acres of riverfront. Gypsum wants the land for open space, recreation, wetlands protection and water storage.
The town offered $800,000 for the land, but Clearwater argued the land was worth twice that. The company early last year paid Gypsum a public land dedication fee equivalent to 5 percent of its 106 acres — valued at $22,500 an acre — as part of a 2012 annexation agreement.
The town’s council in July approved an ordinance to condemn the property, hoping to compel Clearwater to sell. Clearwater leases 18 acres to the operators of the $60 million biomass plant that burns beetle-kill trees and forest waste to generate enough electricity to power 10,000 homes. The plant needs the acreage to access water for its operations.
Judge Gannett agreed with Clearwater that Gypsum’s public notification of the condemnation ordinance was “misleading” by implying in a newspaper announcement that the action had already been approved and was simply scheduled for adoption.
“This is in dereliction of the Gypsum’s charter mandate and easily gives the false impression that the ‘approved’ ordinance had already been enacted, without any opportunity for a public hearing or public address,” Gannett ruled. “This completely violated the words and spirits of the charter.”
Dean Rostrom, a principal at Clearwater Ventures who also manages the biomass plant, said condemning the property would have injured plant operations.
“Gypsum’s government shouldn’t take private property rights so lightly and without even following its own rules,” he said in an e-mail. “We hope that in the future the Town will better listen to the people and respect the private property rights of its citizens.”
Gypsum town manager Jeff Shroll said the town is “obviously disappointed.”
The council will discuss the ruling — which awards court costs to Clearwater Ventures — next week in executive session, with three potential options: refiling the condemnation with proper public notice, appealing the court’s decision or doing nothing.
