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Court tells the State Land Board to get a better appraisal

Article by Ed Quillen

Little Cochetopa School Section – June 2001 – Colorado Central Magazine

THE COLORADO STATE LAND BOARD can sell or trade the Little Cochetopa School Section — but it has to get a fair market value for the land, and the trade proposed last year did not represent a fair market value.

That was the essence of a ruling issued May 1 by Chaffee County District Court Judge Ken Plotz in a suit brought by four neighboring landowners who had formed the “Citizens to Save the Little Cochetopa School Section.”

Last summer, they sued to block a land trade proposed by Thomas and Margie Smith. The Smiths own an adjacent property, the 210-acre McNeil Ranch on the south side of the Little Cochetopa parcel.

They also own about 3,090 acres near La Jara Reservoir in Conejos County — land they offered to trade for the 640-acre Little Cochetopa School Section, which sits about ten miles southwest of Salida, along County Road 210.


It’s known as a “school section” because of its size, — it’s one-mile square — and its purpose. When Colorado became a state in 1876, the federal government gave the state two sections in every township — a township is 36 square miles — for “the support of the common schools.”

The land could be sold, but the proceeds would have to be put into a permanent fund whose interest goes to public schools. If, on the other hand, the land stayed in state hands, then the income — grazing leases, mineral and timber royalties, that sort of thing — goes to the schools.

The Colorado State Board of Land Commissioners — five part-time people with a small staff — is in charge of making the decisions about leases, sales, and trades.

The Little Cochetopa trade first appeared on the Land Board agenda last March, and the board voted to consider it, while extending the comment period beyond the usual 30 days, so that the final decision would be made in July.

In March, the Land Board had two appraisals in hand. The Smiths’ La Jara land was valued at $1.2 million, and the appraisal put the Little Cochetopa Land at $1,560 acre, or $998,400 for the section.

SO ON PAPER, it looked like a good deal for the state. The state would give up 640 acres worth $998,400 for 3,090 acres worth $1.2 million. The Little Cochetopa land brought in less than $2,000 a year in grazing and hunting leases, and the La Jara land would earn about $12,000. The Little Cochetopa land sat amid National Forest and private land, while the La Jara land bordered other state land, thereby simplifying management.

But when land near the Little Cochetopa School Section was selling for $10,000 an acre or more, why was the state selling it for $1,560 an acre?

The Little Cochetopa land is prime development property: scenic, forested land along a creek, with electric and telephone lines almost at its edge. There is a county road, and even a natural-gas pipeline. It sits only five miles from Highway 50.

But for those who protested the appraisal at only $1,560 an acre in March and April of 2000, the Land Board had an answer. Charles Bedford, then the executive director, told them that the board had “guarantees … in place to ensure that full and fair market value is received.”

EVEN SO, the Land Board got another appraisal before its July meeting, and came up with $1.35 million, or $2,110 an acre, for the Little Cochetopa Land.


At its July meeting, the Land Board approved a restructured deal with the Smiths. The two parcels — La Jara and Little Cochetopa — could still be traded. But the Smiths would get only a limited development right: one house on 35 acres. The Smiths would be paid $421,976 for the other development rights, which would be offered for sale for the next three years. If no one else bought them, then the Smiths could buy the rights then for $540,000.

However, that deal didn’t go through, even though it was approved by the State Land Board. That’s because Citizens had requested, and received, a temporary restraining order that halted the transfer until Judge Plotz could hold a full hearing.

The hearing started in August with testimony in Chaffee County District Court from a variety of people — the Smiths, the Citizens, hunters who relied on the Little Cochetopa for access to National Forest in the Cleveland Mountain area, etc. There were other hearings since then, and on May 1, Judge Plotz issued his decision.

He dismissed many of the claims brought by Citizens on various grounds, but focused on the appraisals.

THE LAND BOARD’S appraisals, he wrote, ignored the possibility of developing the Little Cochetopa School Section. And yet, the Board knew the land could be home to a residential development, since it approved one residence there and planned to sell the rest of the development rights.

“Thus, it appears to the Court,” Plotz wrote, “that the board made findings that are unsupported by and contrary to the evidence that it had before it.” And so, the Land Board and the Smiths could not consummate the agreement that the Land Board approved last July.

What happens next?

In his ruling, Plotz concluded that the “Court does not preclude the Land Board from consummating a sale or exchange to the Smiths or anyone else as long as such possible future agency action is in compliance with the State Ad min istrative Procedures Act.” That is, the Land Board has to get a more realistic appraisal if it intends to sell or trade the land in the future.

The Land Board hasn’t issued a response to the ruling, for several reasons. One is that the litigation was handled by the state attorney general’s office, and the attorney in charge of the case, Patrick Wilson, resigned in February to go into private practice.

Another is that Charles Bedford, the Land Board’s executive director, has resigned to become associate director of the Colorado chapter of The Nature Conservancy, so there’s no one at hand to speak for the board.

And, the Board hasn’t met since Plotz’s ruling arrived; its next scheduled meeting is May 31 in Steamboat Springs.

ED ROGERS, one of the neighboring landowners who formed Citizens, said he believes that the Smith trade is no longer a possibility, now that the court requires appraisals more in line with the market.

Citizens will likely pursue getting the Little Cochetopa School Section designated as part of the Land Board’s “Stewardship Trust.”

Most of the 3 million acres managed by the State Land Board can be sold or traded by a simple majority: 3 votes out of 5. But it takes 4 votes to sell or trade Stewardship Trust land, which attains that status by getting nominated and then approved by the Land Board.

The Stewardship Trust was established by Amendment 15, which passed in 1996. It required the Land Board to set aside 200,000 acres by the end of 1999, and another 100,000 acres by the end of 2000. This is land that might have scenic, wildlife, or other values, and shouldn’t necessarily be managed only to produce income for the schools.

Citizens nominated the Little Cochetopa parcel a year ago, with supporting letters from the Division of Wildlife, local governments, and all manner of other parties, but the Land Board refused to consider the nomination.

In 2001, the Land Board has met its deadlines and designated 300,000 acres, the maximum it can put in Heritage Trust. So by some arguments, 640 acres of Heritage land would have to lose that designation for the Little Cochetopa to be added — and that could mean a fight somewhere else, if there are people opposed to a parcel’s loss of Heritage designation.

There’s also the possibility of a trade with the federal government, which would make the school section part of San Isabel National Forest, while the state acquired land elsewhere.

And of course, somebody could come forward with another offer for the Little Cochetopa. And if the price is right, then it will likely change hands, unless somebody comes up with a new way for the state to manage its property.

Ed Quillen first learned of “school sections” from his mother, who pointed them out near the ranch she grew up on in Wyoming.