San Miguel commissioners and planners spar over policy for substandard lots; staff seeks code fix

A San Miguel County joint work session on March 4 laid bare a long-running mismatch between the county’s written land‑use rules and how staff and applicants have actually operated for decades.

Planning staff told commissioners and the county planning commission that the land‑use code contains conflicting provisions about “substandard” parcels — lots created before the state’s 1972 subdivision law or otherwise smaller than the county’s 35‑acre minimum. In practice, staff said, many projects that would be allowed by right or under administrative review have been treated as permissible on substandard parcels; more intensive commercial or industrial activities have sometimes been handled as special‑use permits (SUPs). That history, residents and officials said, has left property owners, neighbors and staff operating under ambiguity.

“K has a careful run‑through of the code and it shows the conflict,” Planning Department staff said, urging the board to authorize a targeted code amendment that would clarify what uses may be approved on legally nonconforming lots and how the SUP process should apply. The department presented three options: keep the code as written (which, strictly read, would limit many activities on sub‑35‑acre parcels to a single residential use); amend the code so that by‑right and administrative‑review uses are explicitly allowed on substandard lots; or allow one‑ or two‑step planning commission/BOCC review for more intensive uses on substandard parcels and add guardrails.

Residents who own substandard lots and work or run small businesses on them urged the board to preserve pathways that allow local, modest enterprise and to avoid retroactively stripping lawful expectations. “We were repeatedly told the county that tree farms and nurseries were allowed,” a property owner said, describing years of permitted use and subsequent disagreement about when an SUP was required. Applicants and their attorneys described large expenditures assembling environmental analyses, water and stormwater plans, and wildlife studies for SUP packages — work that became uncertain when staff and attorneys re‑read the code late last year.

Neighbors and public commenters pressed the opposite concern: allowing industrial or staging operations on many small lots risks fragmenting the landscape, adding noise, dust and traffic, and straining limited water and road infrastructure on the Rights Mesa. “Before expanding potential for additional principal uses on smaller parcels — especially industrial activity — the county should first run cumulative water‑and‑infrastructure analyses and coordinate with Norwood,” the town’s mayor said.

Commissioners signaled they were not ready to endorse a single approach that night. Several said they favored a middle course that would preserve by‑right owner‑scale uses such as agriculture and home occupations yet clarify the SUP process and add protections where neighbor impacts are likely. They asked staff and the planning commission to draft language that reconciles the conflicting sections of the code and proposes clear thresholds, conditions and mitigation requirements for uses on substandard lots.

Alongside the planning code debate, the board took a number of routine and substantive actions on March 4.

• The board unanimously adopted Resolution 2026‑10, a unified cash‑transaction rounding policy to govern cash sales if pennies stop circulating (staff recommended an April 1 implementation date for cash transactions only). “Rest in peace, pennies,” a commissioner quipped after the unanimous vote.

• Public health staff won unanimous approval for Resolution 2026‑11, a flat $75 temporary‑event fee for unlicensed or out‑of‑state food vendors at special events; event organizers will be expected to collect vendor food‑safety documentation to reduce county administrative burden.

• The board authorized the chair to sign the first amendment to the Subdivision Improvements Agreement for Mill Creek Ranch (the applicant is Tom Kennedy). The amendment updates cost estimates (with a 25% contingency); provides for partial rock‑fence installation; defers some paving; requires conduit for shallow utilities; and secures a developer commitment/guarantee just under $1.1 million. The applicant offered a development credit of roughly $450,000 to the county in exchange for reallocating some work. Planning staff and the applicant said construction would begin this year with much of the Mil Creek work planned for 2026–2027; the amendment adds a 36‑month completion schedule tied to the amendment.

• Following an executive session about Paradox Midstream’s bankruptcy, the board approved a staff recommendation to refund two tax‑lien certificate endorsements purchased by an investor (FIG20 LLC) that had been affected by the bankruptcy sale. Staff and outside bankruptcy counsel recommended the approximately $26,775 refund (including accrued interest) to avoid prolonged litigation and because the liens had been stripped from the property by the bankruptcy sale and attached to the sale proceeds.

What’s next: staff will draft one or more proposed code amendments and return them to the planning commission as formal ordinance language. Commissioners asked staff to scope a fix that (a) reconciles the conflicting code sections, (b) preserves predictable rights for long‑standing, small‑scale owner uses, (c) tightens thresholds and mitigation for activities likely to produce traffic, dust, noise or heavy water use, and (d) identifies a clear approach to legacy SUPs so property buyers and neighbors can see recorded outcomes. The planning commission and the public will have additional hearings before any code change is adopted.

Quotes from the meeting

• “Barbara, you may be the best part of our meeting today,” a commissioner told newly appointed historical commission member Barbara Youngla after her introduction.

• On the Mil Creek amendment, applicant Tom Kennedy said staff and the developer “figured out what the cost was going to be and suggested, hey, if you want us to give you a credit for that since we’re not doing it, that we’re happy to do that.”

• Public health director Grace Franklin said measles and other communicable diseases remain a focus: “This is going to continue to be a conversation. Our community, our medical providers and school nurses are really dialed into this.”

• On the planning code question, one resident said: “We were repeatedly told by the county that tree farms and nurseries were allowed.”

Next step: Planning staff will draft code amendment language and bring it to the planning commission; commissioners asked for an approach that narrows the ambiguity without removing predictable owner rights for small, low‑impact uses. Written proposals will be subject to public hearings and formal votes before any change takes effect.

Correction note: the transcript uses shorthand speaker cues (e.g., “K”) in multiple places; article attributions use the names given on the record (e.g., Tom Kennedy, Grace Franklin, Melissa Merrill, Barbara Youngla) and role labels (e.g., “planning staff”) where speakers used initials or were not fully identified on the record.

Ending

The work session underscored a practical problem of policy outpacing on‑the‑ground practice: county staff and applicants have long treated many small parcels as workable for modest enterprise, but the code’s literal wording dates to a different era. Commissioners directed staff to return with draft ordinance language that reconciles the difference while protecting water, roads and neighborhood character — and to present a way to document legacy SUP decisions so buyers and neighbors know where they stand.