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Tarkana Well project cleared biologically but faces funding uncertainty; council asked to consider CIB application
Summary
Staff reported the Tarkana Well corridor has cleared biological (USFWS) and cultural (SHPO) reviews, but federal community project funding remains uncertain; staff proposed applying to the Colorado Water Resources and Power Development Authority (CIB) for $5 million and keeping USDA as a funding partner for the remainder.
City staff updated the Gunnison City Council on Sept. 3 on the Tarkana Well project’s environmental clearances and the project's funding options, and recommended the council consider a Colorado Infrastructure Bank (CIB) application if federal earmarked community project funding does not materialize.
Staff said surveys conducted for the U.S. Fish and Wildlife Service identified evidence of old prairie dog colonies but no recent colonies that would trigger additional restrictions; staff reported that USFWS issued a "no impact" finding for the species surveyed, and that cultural resources work had previously been cleared by the State Historic Preservation Office (SHPO). Staff also reported that surveys for monarch butterfly habitat and milkweed found no suitable milkweed habitat in the corridor.
On funding, staff described three funding "pots" previously considered for the project: a state Department of Facilities Construction and Management (DFCM) award of about $5.5 million that remains available, a congressional community project funding earmark that was not ultimately funded by the congressional bill, and a planned USDA loan to cover remaining costs. Because the community project funding remains uncertain, staff proposed applying to CIB for $5 million to cover roughly one third of project costs and to keep USDA for the balance.
Staff explained the CIB timetable: applications are due for the next cycle by Oct. 1, awards are decided in a board meeting that staff expects could be held on a first Thursday of an upcoming month, and funding becomes official in February 2026. Staff said CIB generally evaluates projects with a financial tool that estimates grant/loan splits and that presenting the USDA loan obligation could improve the project’s profile.
Staff noted that CIB requires a public hearing as part of the application process and recommended the council prepare project numbers and a public hearing schedule quickly. No formal application or vote was taken at the council meeting; staff asked whether they could present numbers within about two weeks to support an application.
Staff cautioned that community project funding could reopen later, but there is no guarantee and staff said waiting indefinitely could delay the project. Options discussed included trimming project scope, seeking a smaller USDA loan, or pursuing an application to CIB with a combination of grant and loan requests.
The council requested return of precise cost and financing numbers and reiterated that a public hearing will be required before any CIB application is submitted.
