To: Honorable Mayor and Members of Town Council
Through: David L. Corliss, Town Manager
From: Jeff Brauer, Director of Parks and Recreation
Title
Resolution Approving the Purchase, Sale, and Management Agreement between the Conservation Fund and the Town of Castle Rock for Lost Canyon Ranch [Location: 6581 Lost Canyon Ranch Road]
Body
________________________________________________________________________________
Executive Summary
Castle Rock Parks and Recreation is seeking Town Council approval of a Purchase and Sale Agreement with The Conservation Fund for the acquisition of Lost Canyon Ranch.
Background
An essential priority identified in the 2023 Community Survey is the preservation of open space. Lost Canyon Ranch is one of the last, large-acreage properties yet to be developed near Castle Rock. Its outstanding scenic resources, cultural resources and potential recreational opportunities are unparalleled. For this reason, the Town of Castle Rock, The Conservation Fund, Great Outdoors Colorado (GOCO) and Douglas County have partnered to acquire this 681-acre property, representing the largest acquisition and protection of open space in Town history.
The property lies within unincorporated Douglas County at 6581 Lost Canyon Ranch Road in the southeast corner of Castle Rock. It’s surrounded on the north and west by residential neighborhoods, large-acreage estate lots on the south, and shares a ¾ mile boundary with Castlewood Canyon State Park on the northeast side. Its location presents a wealth of potential trail connections to the surrounding metro-district green spaces and the adjacent state park.
Lost Canyon Ranch includes a variety of habitat types including riparian, ponderosa forest and open grasslands, cliff outcroppings, Willow Creek, and a culturally-significant prehistoric archaeological site in the Franktown Cave dating back over 8,000 years ago. The property provides habitat for many wildlife species including mountain lion, bobcat, bear, mule deer, coyote, fox, golden eagles, owls and other raptors, wild turkeys, migratory songbirds, prairie dogs, porcupine, elk and others. The ranch includes two older houses, a horse arena, and small outbuildings. The primary goal of this acquisition is the permanent protection of the habitat, cultural resources, and future passive recreation opportunities as open space.
Acquisition of this parcel represents the Town’s efforts to respond to ongoing growth by expanding the network of protected open spaces, which is a primary objective in the Council-approved Castle Rock Parks and Recreation Master Plan. Castle Rock’s population has increased rapidly and now sits at over 80,000, with an annual population growth of about six percent per year, earning Castle Rock the distinction as the 7th fastest growing city in America in 2018. Bi-annual community surveys have consistently shown a value for additional trails and open spaces, ranking new trail development as the second-highest priority behind purchasing land to preserve open space. This preference relates to a consistent open-ended survey response that growth is the single most important issue facing Castle Rock.
Protection of Lost Canyon Ranch as permanent open space would provide a buffer for the northwest section of Castlewood Canyon State Park from increasing development activity in Castle Rock and unincorporated areas of Franktown surrounding the park as both municipalities continue to expand their boundaries. Conservation will also open up the potential for numerous trail connections to the surrounding neighborhoods and provide the platform for families and children to connect and interact with nature on a much larger scale than currently exists in the community.
Lost Canyon Ranch is currently under one ownership, which is the estate of the previous property owner who passed away several years ago. The estate beneficiaries do not live in Colorado and have expressed intent to liquidate their out-of-state property holdings. There have been offers by private developers, churches, and even a movie studio. Any of those options could compromise the conservation values, wildlife habitat and corridors as well as public benefits by changing the land use of the property. The sale of this large contiguous parcel to a developer could result in dividing the parcel into at least 19 individual 35-acre residential-estate lots with individual water wells and leach fields, thus fragmenting wildlife habitat and restricting public access to the historic cave.
The Town has partnered with The Conservation Fund, a non-profit corporation dedicated to the preservation of this country’s most critical lands and waters, to assist in property acquisition. The Conservation Fund has led negotiations with the current owner on behalf of Castle Rock and Douglas County. TCF contracted an appraisal of the property in August 2023 and coordinated efforts with the Town to submit an application to the Great Outdoors Colorado Centennial Grant Program. In September 2023, Town Council approved a resolution supporting the submission, and Castle Rock has since received a $3 million award, marking the largest funding amount from GOCO for any parks and recreation project in Town history. TCF has also coordinated with Douglas Land Conservancy for the placement of a conservation easement on the parcel for the ongoing protection of the ranch as open space, and through private fundraising, TCF will contribute $200,000 towards the purchase as well.
On April 9, 2024, the Douglas County Board of County Commissioners approved an Intergovernmental Agreement with the Town to provide a financial contribution of $5.5 million for the acquisition of Lost Canyon Ranch.
On April 16, 2024 staff will seek Town Council approval of both the IGA with Douglas County and a Sale and Purchase Agreement with The Conservation Fund to secure the necessary funding and legal documents required for acquisition.
The parties anticipate closing in late April 2024, and TCF is prepared to buy and hold the property if necessary. Once TCF closes on property, it will place a conservation easement on the property to Douglas Land Conservancy, and then sell the property and associated groundwater rights to the Town.
Budget Impact
The Town will purchase the property from The Conservation Fund in the amount of $14,126,021, plus a professional services fee of $501,411 for a total contract price of $14,627,432. The agreement includes a reduction of $200,000 from the property’s purchase price of $14,326,021 since TCF donated $200,000 from private fundraising to the Town for the acquisition. The purchase includes total compensation for all interests in the property, including groundwater and all improvements.
Fees outside of the contract will include due diligence in the amount of $162,000 and the Town will pay the Douglas Land Conservancy (DLC) a $15,000 endowment fee and associated legal review fees of $5,000 ($20,000 total) for the conservation easement.
This purchase will be funded from a variety of sources, including:
|
Fund Source |
Amount |
|
Douglas County |
$5,500,000 |
|
Great Outdoors Colorado |
$3,000,000 |
|
The Conservation Fund Donation |
$200,000 |
|
General Fund |
$4,750,000 |
|
Castle Rock Water Dept. Purchase of Water Rights |
$1,300,000 |
|
Cash-in-Lieu Parks Development Exaction |
$259,432 |
|
Total |
$15,009,432 |
|
Expenditures |
Amount |
|
Purchase Price (not including $200k TCF contribution) |
$14,326,021 |
|
Due Diligence Costs |
$162,000 |
|
TCF Service Fee |
$501,411 |
|
DLC (endowment and legal fees) |
$20,000 |
|
Total |
$15,009,432 |
Staff Recommendation
Staff recommends approval of the Resolution.
Proposed Motion
“I move to approve the Resolution as introduced by title.”
Alternative Motions
“I move to approve the Resolution as introduced by title, with the following conditions: (list conditions).”
“I move to continue this item to the Town Council meeting on ___date to allow additional time to (list information needed).”
Attachments
Resolution
Agreement
Map
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