Can a city “condemn” open space to develop it? Breckenridge will answer this question

In Colorado, residents love open space and the quality of life it brings.  On the flip side there is a brewing affordability crisis throughout the Denver metro and in every resort community in Colorado.  This leads us to the question; can Breckenridge use eminent domain to “terminate” / revoke a conservation easement to develop housing?  The legal ramifications of this case will be far reaching throughout the state.

What is the dispute in Breckenridge about?

The Summit County Commissioners directed county staff to find a way to extinguish a conservation easement on the 6.13 acre “Fiester Preserve” open space that separates the County Commons from Bill’s Ranch. The parcel is being contemplated to be developed into senior and workforce housing along with an assisted living facility. The easement is held by open space conservation nonprofit Colorado Open Lands, who have declined to negotiate the terms of the easement and vowed to fight to protect it.  This land was placed in a conservation easement in 1990 to protect the property from any future development into “perpetuity”.

Why is this case so important for landowners?

The Summit County and Breckenridge commissioners are attempting to use “eminent domain” which would allow the courts to possibly “condemn” the property for a higher and better use.  This sets up a few interesting legal questions

1. Which is a higher public use, public open space or housing?
2. Can eminent domain even be used to take property that is already serving a public need?
3. Can a conservation easement that has been approved by the county that was placed into “perpetuity” be removed?
4. What happens to homeowners who bought in the neighborhood with the expectation of open space that now have a commercial use instead?
5. What is the point of a conservation easement if it can be extinguished through condemnation?

As you can see the precedent from this legal case will have far reaching ramifications for property owners and conservation easement owners throughout the state. Depending on how the courts decide this case pandoras’ box could be opened where any conservation easement throughout the state could be challenged

Will Summit county/Breckenridge win?

I think it is doubtful.  Colorado Open lands (the holder of the conservation easement) responded to the proposal: “We’ve never experienced a situation where there’s been an intention to condemn an entire easement,” Caligiuiri said. “This is a different case for us, where there is an attempt at total extinguishment. We are not aware that there’s ever been a complete extinguishment of a conservation easement in Colorado since open space preservation efforts began here.”

I think the courts in Colorado will look dimly on the proposed condemnation of open space due to the huge impact this would have on established property law regarding open space throughout the state.

Summary

Although I’m doubtful Summit county will prevail, there is always a chance for anything in litigation.  This case is one to keep an eye on if you own real estate in Colorado.  If Summit county does prevail the consequences will be far reaching not just for the easement owners but various property owners that will be impacted due to the change in use.

Resources/General information

1. https://www.summitdaily.com/news/county-presents-its-case-for-developing-fiester-preserve-as-eminent-domain-looms/

2. https://www.summitdaily.com/news/colorado-open-lands-previews-legal-argument-for-protecting-fiester-preserve/

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Written by Glen Weinberg, COO/ VP Fairview Commercial Lending.  Glen has been published as an expert in hard money lending, real estate valuation, financing, and various other real estate topics in Bloomberg, Businessweek ,the Colorado Real Estate Journal, National Association of Realtors Magazine,  The Real Deal real estate news, the CO Biz Magazine, The Denver Post, The Scotsman mortgage broker guide, Mortgage Professional America and various other national publications.

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