1041 Regulations – October 2022 Update

On November 15, the Fort Collins City Council is scheduled to consider adoption of policies that define the regulatory authority the City has assumed over activities of statewide interest.  Known by the State Statute that grants local governments this authority, 1041 Regulations allow the City to subject certain projects to a local evaluation and approval process that would otherwise be considered by other governmental or quasi-governmental entities.  Among those areas identified within the 1041 Statute, Council has narrowed its purview to activities that encompass domestic water, wastewater, and transportation.  Think pipelines, treatment plants, storage, and highways.

Although it was widely understood at the time these powers were adopted by Council in October 2021 that 1041 Regulations would apply only to projects that encroach upon natural areas, open space, and parks within the city, that interpretation has apparently expanded to include any water or transportation project within the jurisdictional boundary of the City.  This perspective is reflected in the draft policies that will be considered in November.

On the surface, this issue may not appear to have a direct impact to business and the economic wellbeing of our community.  However, as currently drafted, proposed regulations will extend well beyond activities of statewide interest to developments that serve a local or regional purpose.  As one example, a large swath of the Fort Collins GMA is served by North Weld and East Larimer County Water Districts.  Together, these two entities are in process of pursuing a water pipeline that will expand and extend capacity to meet growing demand for domestic water within the immediate region.  By necessity, the pipeline transits through Fort Collins though would not encroach upon sensitive spaces.

As drafted, 1041 Regulations would grant the City the authority to approve or deny this project even though it does not rise to the level of statewide importance.  Not only would this duplicate a similar process required by Larimer County, but the City’s involvement will introduce greater uncertainty and cost to this vital project while potentially rendering it infeasible through added requirements that are customary of our self-ascribed World Class standards.  There is genuine concern the proposed regulations will imperil the ability of the Districts to serve residents and businesses within Fort Collins and surrounding communities.  Effectively, the City is proposing to extend its functional jurisdiction beyond its established boundary.

Though members of Council have portrayed this authority as necessary to limit the ability of “developers” to pursue projects that are not in the best interests of the community, it is important to note that private sector developers do not build water pipelines, storage reservoirs, or highways.  Such activities are sponsored, funded, and managed by public sector partners.  The Colorado Department of Transportation has an inherent mandate to work with the City in aligning and designing highway interchanges and other features.  Northern Water not only delivers half of the raw water supply of Fort Collins Water Utility but has a vested interest in amicable cooperation with the City in executing its mission.  Water districts have no incentive to circumvent the best interests of the city as they exist and thrive upon the economic vitality of the community.

Moreover, ambiguity within the regulations may subject the City Water Utility itself to these elevated standards that, at minimum, will artificially raise costs and slow upgrades to critical infrastructure.

The Fort Collins Area Chamber of Commerce is urging Council to reconsider the necessity of 1041 Regulations and rescind its enabling ordinance.  Recognizing the futility of such request, the Council must scale back the triggers that invoke 1041 Regulations to include only those proposals that truly represent activities of statewide importance and only where such projects encroach on public open space, natural areas and parks as originally intended.

Chamber members are invited and encourage to share their perspective on this important regional issue.  Reach out to your City Council today to let them know how impactful 1041 Regulations will be to the vitality of the region.

Source: Fort Collins Area Chamber of Commerce
October 10, 2022