Another Legal Blow for Alpenhof
by Samantha Wright
Jan 24, 2013 | 934 views | 0 0 comments | 5 5 recommendations | email to a friend | print

Judge Applauds City’s Concerns About Public Safety

OURAY – In the latest dispatch from the battlefield, the City of Ouray has been vindicated by the Colorado Court of Appeals in its decision to deny a development application for Alpenhof LLC’s problematic “Parcel C” in the Ouray Vista subdivision. 

The City received word late last week that the Colorado Court of Appeals affirmed an earlier trial court decision that dismissed the so-called Rule 106 claim brought by Alpenhof in which the plaintiff argued that the city’s action in denying its development proposal constituted a legal taking of its property and an “arbitrary and capricious exercise of authority.”

“It was something we had expected,” said Ouray Mayor Bob Risch. “We thought we had been doing everything well and correctly; it was a good confirmation.”

However, Risch warned, it’s not over yet. “Alpenhof still has an opportunity to contest the judgment,” he said. 

The property in question, which Alpenhof owners Galen and Rod Rasmussen want to develop, lies in the flood path of the City of Ouray’s Skyrocket Diversion (an historic man-made channel which diverts Skyrocket Creek away from the Hot Springs Pool), and  is protected by an earthen berm. 

Citing public safety risks, the Ouray City Council refused to give its approval to the development project in 2011, going against the recommendation of its own planning commission, which after an extensive process had recommended conditional approval, provided that Alpenhof did floodwork mitigation in the area.  

Alpenhof, in turn, brought a lawsuit against the city, asserting that the city had “exceeded its jurisdiction and abused its discretion in denying the application” and arguing that the flooding risk was the result of the city’s man-made diversion and was therefore not a natural hazard or geologic condition, but something for which the city must take responsibility. 

The case was originally heard in district court, with Judge Steven Patrick ruling in the city’s favor. Alpenhof appealed, and the parties entered into court-ordered mediation earlier this year, which resulted in the Ouray City Council’s refusal in November 2012 to enter into a settlement agreement which would have allowed Alpenhof to pursue its development with many conditions that were favorable to the city. Council again cited concerns about public safety, with the majority stating that they still weren’t convinced that it was safe for Alpenhof to develop its property. 

Hon. Judge John R. Webb of the Colorado Court of Appeals, in reviewing the case, found that the city properly denied Alpenhof’s application, and did not buy into Alpenhof’s attempts to distinguish between manmade and natural hazards in regard to the property.  

“The city did not cause the creek’s rapid descent from its headwaters or the debris arising from the resulting erosion,” he wrote in his decision. “These features reflect the area’s ‘geologic conditions’. Thus, the hazard to Parcel C is necessarily intertwined with the natural features and geologic conditions of the area.” 

Nor was Webb convinced by Alpenhof’s argument that the city council had “exceeded its jurisdiction” in denying the subdivision application. Rather, citing case law, Webb championed the “broad authority granted to local governments to plan for and regulate the use of land within their respective jurisdictions.”

Webb affirmed that the city council was correct denying Alpenhof’s application based on the public safety risks associated with building on Parcel C.

“Alpenhof’s interpretation would leave the city powerless to protect the public health, safety and welfare from a flooding hazard partially resulting from human activity,” Webb wrote. “This would be an absurd result.” 

Moreover, Webb pointed out that “the flooding hazard to Parcel C arises from exceptional rainfall and unusually rapid spring runoff. These are ‘natural hazards’ in a mountain environment, which the city does not cause.”

Interestingly, Webb cited case law on this point, regarding the flooding in New Orleans after Hurricane Katrina, which, the court determined, was “caused by Hurricane Katrina, not by man. The levees did not cause the flood, they, whether through faulty design, faulty construction, or some other reason, failed to prevent the flood.”

Among the components of the lawsuit which Alpenhof brought against the city was an assertion that the city was displaying an arbitrary and capricious exercise of authority.

Many pieces of evidence provided by the city persuaded Judge Webb otherwise, including a 2005 report prepared for the city estimating that a “100-year mudflow event would significantly inundate Parcel C.”

This and other evidence was substantive enough for Webb to dismiss Alpenhof’s assertion that the city was exercising “an arbitrary and capricious exercise of authority.”

He noted that the original subdivision plat for the Ouray Vista Subdivision marked Parcel C with a note that said it “may not be developed in any fashion until further approval” from the city. 

At deadline, Alpenhof principal Gaylen Rasmusson had not responded to The Watch’s request for comments. 

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