Developer’s Ploy: Letting Wilderness Slip Through Loopholes : Colorado builder specializes in trading his inholdings to U.S. agencies for valuable land. He now threatens to go to court to put in a road and subdivision.
Real estate developer Tom Chapman says that, contrary to local opinion, he is not holding a prized wilderness area in the nearby mountains for ransom. But you would be hard put to find anyone in this small fruit-growing and coal-mining town to defend him.
The native-born Chapman specializes in converting rural land into million-dollar wilderness hideaways. Lately, he has begun airlifting tons of materials into the West Elk Wilderness south of town for construction of an exclusive subdivision on 240 acres of private land.
The catch is that Chapman says he doesn’t want to despoil the wilderness, one of the largest and most spectacular in western Colorado. To protect the area, Chapman has offered to trade his land to the U.S. Forest Service for prime federal real estate near Aspen or Telluride, worth perhaps three or four times more than the remote inholding.
Agency officials say that’s blackmail, but the deal has put the Forest Service in a tight spot. As federally designated wilderness, the West Elks are theoretically protected from roads, permanent structures and all mechanization from cars to chain saws to bicycles. Chapman is exploiting a loophole in the 1980 act establishing the West Elks, which left a 240-acre island of private land in the heart of the 192,000-acre wilderness.
Such inholdings are not uncommon: There are over 450,000 acres of wilderness inholdings nationwide. But Chapman and his small group of investors are the first to try to put one to commercial use. Forest Service officials worry that the ploy will either destroy the pristine West Elks, or, if they act to save it, put the rest of the nation’s wilderness system at risk.
Chapman warns that the development is no bluff. After purchasing the land in July, Chapman began construction of an opulent, $800,000 log cabin, the first of six luxury homes he plans for the wilderness. For now, Chapman has ferried in materials and workers by helicopter, but he soon plans to take the Forest Service to court to win a permit to build a 5-mile road to his inholdings. “The Forest Service should rename the thing because it will no longer be a wilderness,” Chapman said. “We are perfectly willing to live with the investment we’ve made up there because we know we can build all the homes and make a profit.”
The helicopters and construction have outraged local ranchers, outfitters and vacationers. But Forest Service officials say they are helpless to prevent activity on private land.
“It’s a crying shame,” says Paonia District Ranger Steve Posey, who predicts that the development--which is visible from miles of surrounding peaks and ridge tops--will ruin the wilderness experience.
The inholding loophole is something Chapman has taken advantage of before. In 1984, acting as an agent for a rancher who owned 4,200 acres surrounded by the Black Canyon of the Gunnison National Monument, Chapman broke stalemated negotiations by taking a rented bulldozer into the park to start laying out street and water lines for a 132-home subdivision.
To preserve the monument’s spectacular view, Congress bought the land for $2.1 million, far more than the original appraisal by the National Park Service.
In 1989 Chapman repeated the ploy, closing a ranch on the lower Gunnison River to the public and blocking access to a prized fishery. That forced the Bureau of Land Management and local citizens to raise $400,000 to buy a thin strip of land along the river corridor.
Despite being lambasted in the press, and cursed in his own hometown, Chapman says his West Elk and other deals are not a case of a greedy developer but the result of arrogant bureaucrats who refuse to recognize the growing high-end market for recreation lands.
“In no case has there been a public payment that exceeded the valuations of independent appraisers, or decisions made by a federal appeals court,” Chapman argues.
Congress should have never left the inholdings in the Wilderness in the first place, he says, and now the Forest Service’s failure to meet the private market for these lands will doom not just the West Elks, but every other wilderness area with a private inholding.
The Forest Service says that Chapman is price gouging. Paul Zimmerman, head of the Forest Service Region 2 land acquisition group in Denver, says Chapman has fallen through the cracks because he wants too much money.
In 1989, Chapman served as broker to Robert Minerich, who bought the inholdings for $240,000, or $1,000 an acre. Minerich and Chapman then said they would build on the land unless the Forest Service bought it for $5,500 an acre, or traded them for land near the Aspen or Telluride ski areas worth over $1 million.
When the Forest Service refused, Chapman formed the West Elk Development Corp. and bought the land himself for $960,000. He says the agency has no choice but to meet his price or let him develop the land and build a road, as required under the “reasonable access” clause of the 1964 Wilderness Act.
Both sides agreed to a cease-fire, and the land is now under independent appraisal. Chapman says that with a third of a million in cash down and a legal note for $660,000, the appraisal must exceed his $960,000 price or there will be no deal. But Zimmerman cautions that he has never seen remote lands like Chapman’s parcel sell for much higher than the $240,000 paid for the property in 1989. That estimate is also supported by Jon Mulford, founder of the Boulder, Colo.-based Wilderness Lands Trust, a private fund-raising organization that buys wilderness inholdings and then transfers them to the federal government.
“I know of no market data that would begin to justify a $960,000 figure. That’s just absurd,” says Mulford.
Most of Colorado’s congressional delegation has roundly condemned Chapman for extortion, and warned that there will be no money from Congress this time.
“Although I am a strong defender of private property rights. . . . (I) urge you to oppose a permit to construct a road to this site under any circumstances,” Rep. Ben Nighthorse Campbell (D-Colo.) wrote in a letter to the Forest Service.
