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Flatiron development looks to ‘horse-trade’ water for sewer

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A conceptual illustration shows an early plan for the Flatiron development. IMAGE COURTESY OF MIDDLE FORK PROPERTIES LLC

Subdivision plan will require expanded wastewater capacity

By Jack Reaney STAFF WRITER 

The Flatiron project, proposed in May 2021 by Bozeman-based Middle Fork Properties, LLC, is stuck at a chicken-and-the-egg situation, officials say. 

The Flatiron subdivision proposal spans 535 acres of lowland at the bases of Andesite and Flatiron Mountains beside Big Sky Resort. Three hundred and fifty acres belong to Gallatin County and 185 to Madison County, but 150 of the Madison County acres are located in the gap between the Big Sky County Water and Sewer District boundaries. Developers identified drinking water wells in that middle ground, and they hope to provide excess water to the district in exchange for the sewer hookups that would make the development viable. 

District officials sense the developers are seeking roughly 550 sewer hookups. Certain district officials say they can’t “horse-trade” Big Sky’s limited wastewater rights for drinking water, and that further research to confirm the water quality in those wells—requested by the developers—might not be necessary.  

“It is a bit of chicken-and-the-egg problem,” BSCWSD general manager Ron Edwards told EBS after the meeting, borrowing the expression used by water superintendent Jim Muscat during a public committee meeting. “Unless you know what you’re going to be negotiating for at the end of it, why do the testing?” 

The topic was discussed between Flatiron developers and the district board’s Flatiron subcommittee on March 29.  

During the meeting, Flatiron developer Chris Leonard said, “everyone knows this project will be limited by water and sewer capacity.” District board chair Brian Wheeler said traffic might be a bigger constraint.  

Edwards said the Flatiron project’s plans are ambitious in terms of build-out volume and density. The group purchased the property in January 2019, which included rights to 850 single-family equivalents (SFEs) of drinking water and wastewater service within the district boundary—rights granted in 2002 through a “horse-trade” with the Yellowstone Club but left largely untouched. 

Middle Fork Properties designed Flatiron for 1,400 total doors under the expectation that they could trade abundant drinking water for lacking sewer access, Edwards told EBS, but “[the district] can’t commit to that. We’ve been pretty clear on that point.” 

Muscat told EBS that Flatiron was “kind of optimistic” in their initial estimate of the amount of water in their wells which they brought to the district “for horse-trading purposes.” Developer Ryan Pearson told the committee that Flatiron sits on roughly double the amount of water that the subdivision would need, and that their water expert sampled “dynamite” water.  

“They didn’t understand the commitment we have, the limitations on the sewer [capacity],” Muscat said. “They thought there was going to be a bunch of capacity available, and it’s just not that simple.” 

Although Big Sky’s new Water Resource Recovery Facility will increase the community’s capacity for new sewer hookups, Edwards said the district already has commitments on paper. Town Center, Spanish Peaks and Lone Moose are accounted for in the growth—but Lone Moose (now Flatiron) remains capped below Flatiron’s proposed need.   

Edwards said the cleanest path forward is for the developers to take the 850 SFEs they’ve got and spread it over a bigger area, using the drinking water they’ve found. He believes the district board won’t support an expansion of sewer rights.  

Project developer Michael Schreiner said that if the district doesn’t budge toward expanding sewer capacity, the developers would “absolutely” consider altering the current planned design which includes more than 2,500 total units, but that adjustment is yet to be determined. Because the current plan includes 900 workforce housing beds, developers might engage the Big Sky Community Housing Trust for a partnership—the housing trust holds sewer hookups around the new WRRF to encourage developers to build workforce housing.

Much of the subcommittee discussion revolved around the quantity and quality of Flatiron’s water. Developers offered to pay for the district to hire engineers to evaluate the wells, but the district subcommittee questioned the purpose. Muscat broached the question of why water quality would matter during the meeting, invoking the chicken and the egg metaphor.  

Edwards summarized to EBS, “Why go through the additional testing, if at the end of the day you’re going to try to use that as a bargaining chip for expanded sewer capacity? The answer would be ‘no,’ so why go through the testing?” 

During the meeting, the developers repeated their belief that a win-win situation is possible. Schreiner shared his vision in a phone call with EBS. 

“[We envision] a development that makes sense for the water and sewer district to connect to,” Schreiner said. “It has to financially make sense for us [in a way] that pencils in the end. They win if they can add water volume and quality to the community. We win if we have what we would consider a viable development. We’re all in it to make money, but doing something for the community along the way is what my family has always been about.” 

He said the recent meetings with the subcommittee have been helpful for both parties to educate each other on findings and share information.  

“Every meeting kind of helps us understand each other’s positions and what we’re trying to accomplish,” Schreiner said. 

He believes that right now, an agreement is being held back by knowledge.  

“We’ve already tested the water once, our engineers were happy. We’re happy to test it again at our expense. If it comes back [high quality] we’d like to work with the community to [resolve] any shortage they may have,” Schreiner said.  

The district agreed to have its engineers evaluate the exact capacity for water, checking that wells would not deplete the water flow in the adjacent Middle Fork Gallatin River, Muscat said. The engineers would also vet water quality.  

“It’s complicated. If you’re a little confused, trust me: 25 years of confusion, and I’ve been working here the whole time,” Muscat joked to EBS, on the slow-moving and technical discussion. Pearson concluded during the meeting that he learned more about the district and its limitations. 

The next Flatiron subcommittee meeting has not been scheduled.  

Schreiner emphasized to EBS that he, attorney Becca Pape, and Leonard have been established Big Sky community members. When business talk subsided after 97 minutes, participants shared pleasantries on their way out the door. 

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