As the West's economy shifts from traditional extractive industries to real estate and recreation, the region's largest landowner is proving to be a big-time sucker.
For decades the Forest Service has lost money on timber sales, and has leased valuable oil and gas reserves virtually for free. So it's no surprise that the agency is equally irresponsible in the world of real estate.
But it is troubling to see the Forest Service cave in to a speculator as blatant as Colorado developer Tom Chapman. On April 15, Forest Service Chief Jack Ward Thomas granted final approval of a land trade that would dupe the federal taxpayers and make Chapman a millionaire. In doing so, the agency looked away from possible illegal activity by Chapman and refused to participate in a Justice Department investigation.
Forest Service officials also ignored an angry public in western Colorado, and, most surprisingly, spurned an offer by Sen. Ben Nighthorse Campbell, D-Colo., to take Chapman to the mat.
Chapman's strategy is by now well documented. He purchases private land within or adjacent to major national resources; then he threatens to develop it unless the federal government promises to buy him out at vastly inflated prices. It worked before in the Black Canyon of the Gunnison National Monument, and Chapman used the same gambit briefly in the Bureau of Land Management's Gunnison Gorge recreation area.
Then, in 1989, Chapman and an investor named Bob Mine-rich picked up a 240-acre inholding in the West Elk Wilderness near Paonia, Colo., for $240,000, or $1,000 an acre. Chapman spent two years threatening to build a cabin and sue for road access into the wilderness unless the Forest Service bought them out for $5,500 an acre.
The agency held firm and Minerich balked at further action. Chapman found a couple of other investors and bought the land himself as the principal owner of the West Elk Development Corp. Chapman says he paid $960,000 - or $4,000 an acre - but the price included only $300,000 in cash and a $660,000 loan from Minerich.
Soon after, Chapman and his new partners started flying in logs for a $1 million cabin in the heart of the wilderness. That outraged everyone, from diehard backpackers to the head of the local Republican Party, and prompted formal protests from then Sen. Tim Wirth and Campbell, then a congressman.
But instead of protecting its turf, the Forest Service collapsed. Officials from the agency's Denver and Washington offices - who a year earlier declined to even meet with Chapman - suddenly agreed to a land exchange and offered him 105 acres adjacent to the Telluride Ski Area. The agency's appraisers drafted a new study that valued both parcels at $640,000.
While the Forest Service insists the land trade is of equal value, similar parcels in Telluride are selling for $2 million to $3 million. Inexplicably, the Forest Service has not only stuck with the deal; it continues to defend it in the face of increasing opposition.
In western Colorado, local governments, the San Miguel County Board of Realtors and environmental groups have appealed the Forest Service proposal. The appellants provided the agency with a hefty portfolio showing the Telluride parcel is worth several million dollars. The Forest Service rejected their case.
Sen. Campbell vowed to introduce legislation in Congress to condemn Chapman's inholdings if the Forest Service would deny the land trade. The agency never responded.
Finally, a former business partner of Chapman's came foward to testify that not only was the Forest Service set up from the begining, but that Chapman himself estimates the value of the Telluride lands at almost four times the official Forest Service appraisal. That was enough to trigger an inquiry by the U.S. Attorney's Office in Denver (HCN, 4/18/94). But again, the Forest Service declined to investigate or even cooperate with the Department of Justice. Sources there say that without a plaintiff, the case stands little chance.
It's a slim reed, but those who object to Chapman's manipulation of a federal agency now have only the Congress to turn to. It has the power to condemn Chapman's private inholding in the West Elk Wilderness. Doing so would be a timely warning to all wilderness profiteers.
Steve Hinchman is a staff reporter for High Country News.
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