A funny thing happened to me on the way to the 1976 Centennial from Enjoy Colorado. I found gold. And then lost a million dollars.
Of course Enjoy Colorado had gotten into the radical business of providing 'access to Colorado experiences' by individually tailored 'information' about a wide variety of activities. Starting in early 1976 we started getting lots of requests for where and how to pan for gold in Colorado. Part of what was driving that was that the US came off the gold standard - with its fixed price of $35 an ounce - by 1974. And President Gerald Ford had signed a bill permitting individuals to own and trade gold.
So we reproduced maps of known gold bearing rivers, streams and districts in Colorado,. with access information for a variety of ways of getting there. We even sold gold pans to the traveller. Gold was so much publically discussed that we got a round horse water trough, filled it with water and sand and 'salted it' with almost an ounce of gold - worth about $45 then, in the form of flakes and grains. We put it outside on the corner of the Enjoy Colorado building on West Bijou street and let anyone pan for gold.
Some women showed up and spent, on their knees, up to 2 and 3 hours at a time, washing out the flakes they could put into a small glass bottle. Gold Fever was catching.
Gold Hill Mesa
Now I already knew that there was a great eroded pile of gold ore tailings on the original Golden Cycle Mill site south of the Midland Expressway - US 24 - which Mill shut down in 1949. Nothing was built upon its sandy and eroded slopes. There was a small housing development - Villa de Mesa sitting on solid ground off the south edge of what had been the mill operations and tailings ground. A real estate wheeler and dealer named Bill Wiley lived in Villa de Mesa.
He noticed the publicity we got on our 'free gold panning' promotion and contacted me.
He told me there was still gold in that big - 14,000,000 ton - tailings pile that was built up from 1908 to 1949 from Cripple Creek gold ore that came down the mountain via the Midland Raiload ore cars and was processed, then disposed, there. Wiley said that as the price of gold rose it would be possible to re-process the tailings and extract gold - and silver. He had talked to several prospecting and gold mining operators.
I really doubted the idea. So one Saturday I drove over to the base of the tailings pile on the other side of Fountain Creek with a small chemistry set, and dropped some of the sandy tailings into a test tube with water, added a chemical and the whole thing turned a deep purple - a sign of the presence of Au - gold!
I was surprised. But what would it take to extract any residual gold from such a huge and once-processed tailings pile?
I decided to consult other experts. I flew to Las Vegas to the large US Mining Convention that was taking place, on my own nickle, asked around and found myself in a room with two Pakistani Gold Engineers.
They made a presentation about what it takes to recycle Gold ore tailings to extract, profitably, the gold left behind after years of milling gold ore using the less efficient means of getting the gold from the ore in earlier times. I knew that a tailings pile north of Denver, near "Globeville' had been reprocessed some time ago.
Their Pakistani model was for 10,000,000 tons of tailings, which assayed at least .04 ounces of gold per ton. By using cyanide, sufficient water, and the carbon-in-pulp process, on large enough scale, they calculated a company could profitably recycle such a pile if gold were $100 an ounce or higher.
Gold Hill Mesa contained 14,000.000 tons, and Wiley who had assays of samples made, found that the hill may average over .045 ounces per ton. Thats over 630,000 ounces of gold STILL in that pile of sand! And the price of gold already had passed $100 per ounce! That's over $60 million gold!
Now I got interested. And started to do my homework.. Wiley helped because he knew descendents from A. E. Carlton who mined in Cripple Creek.
Why was so much left? Who has the mineral rights? What is 'carbon in pulp?'
Answer 1 - for 40 years the Golden Cycle Mill processed that 14 million tons of ore (at over 1,000 tons a day) crushing, roasting the ore then putting it in vats with a solution of cyanide. Cyanide was so much more efficient than mercury, or chlorine which the other 3 Colorado City mills used, that it put them all out of business.
But once the gold and silver are dissolved in solution, they have to get it out as metallic gold. There were only two known ways to do that in in the early 1900s. Use Zinc precipitate, or activated charcoal - carbon. Zinc powder got 93% of the gold out of solution. Carbon could get 97% out of solution, BUT the problem was that there was not a supply of hard-enough charcoal in the US to withstand the stirring in the vats, so the loss in charcoal - the 'carbon in pulp' and the gold in it made zinc the most profitable best choice. So for 40 years 7% of the gold was left behind in the sandy tailings of Gold Hill Mesa!
Now if you click on the Project URL below (It is a Power Point presentation I made numerous time converted into a Web accessible one) you will get the whole story of the history of both the Gold Mills of Colorado City and the ill-fated Gold Hill Recyle Project. Had that project gone forward, as a junior partner in the venture, I would have, over 6 years, when Gold was $100 an ounce, made $1 million dollars. And if I was paid in bullion we produced, I would not have paid any taxes on that million, until and unless I sold the gold bullion for cash. For Gold is a "commodity" and its 'producers' do not pay taxes on the 'product' until they sell it!
In 2008 the Colorado City Independent published a long story on the Gold Hill Mesa Project. It was pretty accurate about the whole affair.
Note - as of now (2014) the 638400 Ounces are still there, in the 14 million tons of tailings on top of the ground, just waiting for the right alignment of the stars to empower someone to get that Golden Reward.
It's easy, in a situation like this, to imagine yourself the sidekick of a movie-star action hero albeit a somewhat suburbanized one. Development manager Barry Brinton, a tough, middle-aged man with a healthy tan and a head of thick blond hair, jabbers on about the landscape between gulps out of a can of Myoplex Lite. Meanwhile, he muscles his big GMC Denali at what seems a terrifying speed along the big orange dunes, barely noticing the steep cliffs and rocks that rattle the SUV.
Back when he was a kid, he's saying, this used to be a party spot.
"They called it "The Ruins' back then," he says. The teens littered it with trash and beer bottles, and they sprayed graffiti on decaying (and now buried) foundations on the property. "It was almost like a dump, an illegal dump."
Brinton drives past a towering smokestack, where a vandal of yore has written "BEER" in big white letters. A short distance to the north, he parks along the edge of the sand pile. The view here is phenomenal. Downtown Colorado Springs stretches out one way, and behind, the tangerine waves, hardened by evaporating water, contrast with the bright blue sky.
But the dunes aren't sand. They are the leftovers of great fortunes million of tons of tailings from an old mill that processed gold and silver ore mined in Cripple Creek back in the early 20th century.
For decades, these hills have inspired dreams, from those who wanted to plunder them for the gold still left in their fine grains, to those who wanted to build neighborhoods and businesses in the prime location, just west of downtown.
Development won out. Brinton's boss, developer Bob Willard, dubbed the area Gold Hill Mesa.
Willard, a vigorous 61-year-old man, spent most of his career as a financial adviser. You'll still catch him from time to time hunched over in his seat, working a calculator like a 9-year-old with a Game Boy. But to hear him talk about Gold Hill, you'd never guess his number-crunching past. He's turned visionary.
He plans a community of the future, connected with fiber optic cables, that looks and feels like the historic west side. The development which stretches from Eighth to 21st streets south of U.S. Highway 24 is to include 143 acres of homes and 67 acres of commercial. The homes and businesses will nestle around the historic smokestack, which will serve as a permanent tribute to the area's past. The project already has 50 completed homes sitting atop the dunes.
Willard fully expects to earn a Phoenix Award for excellence in redevelopment and, eventually, appreciation from west-siders.
"A rising tide carries all ships," he says. "It's good for the west side."
But Willard's plan hasn't been simple, nor has it been well-received by everyone. The tailings upon which Willard is building contain traces of arsenic, lead and other heavy metals and contaminants. Pools of cyanide, used to process the ore, once called the mesa home as well.
Because of the nature of the land, Willard has spent over a decade planning the development, and ensuring it meets environmental standards. Now, Willard says, he's trying to overcome a sour economy, difficult lenders, the housing slump and backlash from those who believe the mesa will never be a safe place to live. Many repeat untrue rumors. (For example: Breathing the dust even briefly will give you cancer.) Or they rely on old information. (At one point, Gold Hill wasn't going to allow vegetable gardens, but testing now shows they're safe.)
"We have become the whipping boy for various reasons which we don't really understand," Willard says.
His plan will improve the property's environmental condition assuming he can pull it off.
Gold Hill Mesa is a by-product of the gold rush that made Cripple Creek famous and Colorado Springs rich. In the 1800s, miners began plundering gold and silver ore from the mountains, but the precious metals didn't come out in cartoon-like chunks. Instead, they were mixed in with rock. Mills were responsible for extracting the good stuff and tossing the rest.
The mills generally crushed the ore, roasted it, dissolved it in a chemical solution, then used other substances to make the metals sink to the bottom. Many mills were located near the mines in Cripple Creek and Victor, but in the late 1800s and early 1900s, four mills popped up along Colorado Springs' west side: the Portland, the Standard, the Colorado-Philadelphia and the Telluride.
They wouldn't last long. When the Golden Cycle Mill began continuous operations near the Telluride in 1908, it gradually drove its competitors out of business. The Golden Cycle was huge, and its method of dissolving the ore using cyanide instead of chlorine was more efficient. It was also conveniently located between the gold mines to the west and the coal mines (which provided fuel to heat the ore) in what is now northern Colorado Springs.
In 1948, Merrill E. Shoup, president of the Golden Cycle Corp., told the Gazette-Telegraph "it was estimated that 14,500,000 tons of ore had gone through the mill in the almost 50 years that it has been in operation."
Dave Hughes, treasurer of the Old Colorado City Historical Society (and a man with a personal interest in the dunes), says the mill extracted more than 8 million ounces of gold before succumbing to worldly circumstance.
"They could have continued on," he says. "But World War II really screwed everything up."
When war hit, Hughes explains, the mill's equipment and workers were diverted to purposes that helped the war effort; a report from the Environmental Protection Agency notes that the mill processed zinc-lead ores during that time. When the war ended, Hughes says, profits at the Golden Cycle were marginal. It closed in 1949 and transferred its operations to a new mill in Cripple Creek.
After closing, the Golden Cycle Corp. covered its tailings with a layer of dirt to prevent blowing sands, planted native grasses and waited. The hope was that one day, the price of gold would rise high enough to justify reprocessing the tailings using a more efficient extraction technique.
Even at the time, when gold was $35 an ounce, it was estimated $10 million in gold remained in the sands. But reprocessing was expensive. Too expensive.
As the price of gold rose, people like Hughes saw dollar signs. Now 80, Hughes is a cowboy-hat-wearing, straight-talking west sider who's still a tad bitter that Gold Hill didn't make him rich 30 years ago. Back then, Hughes stood to get a cut of the profits from a scheme to rework tailings that was hatched by partners Bill Wiley and Richard Hadley. The plan was to get the gold, then develop the land. Even the old iconic smokestack would've been turned into a high-class observatory.
"I never got my million dollars in 1976," Hughes says, lamenting.
After several years of planning, financial bickering and backstabbing put an end to the project.
The saga continued. By the '80s, the mill's foundation had become a playground for drunken teens, and city officials worried someone would be hurt, especially because large pits still existed on the property.
"Another police concern is that satanic symbols and dead animals found at the Ruins may indicate a rise in devil worship among area teens," stated a 1988 Gazette-Telegraph article.
In 1989, an Australian firm bought the land with plans to get rich off the gold. But the firm ended up defaulting on its loan to buy the property, and it came back into Hadley's possession in 1993.
Willard, well-schooled in the history of Gold Hill, says Hadley then used the land as collateral and defaulted on his loan. The bank, though, never foreclosed, and the land sat in limbo. Nobody was claiming it, Willard says, because nobody wanted it.
The old dirt "cap" that had been put on the property in the '50s was eroding away, exposing the tailings. The EPA began investigating the grounds to determine if the tailings posed a serious enough risk to human health to deem the area a Superfund site with enough toxic waste to be considered a high priority for cleanup by the federal government.
It never became one, but the EPA did find potentially hazardous contaminants. So Gold Hill was labeled a "brownfield" with real or perceived problems that needed addressing. That was enough to scare off most developers.
"The EPA had said, once you take control of it, you're liable for it," Willard explains.
Yet, in 1996, Willard began investing in Gold Hill. He had his reasoning. For one thing, in 1994, Colorado developed a Voluntary Cleanup and Redevelopment Program (VCUP) for brownfields. Cooperating with VCUP meant the EPA would release developers from liability if the site ever became a Superfund.
Additionally, Willard never expected to be very involved with Gold Hill; he was a financial adviser, not a developer. He simply gave a loan to Richard Hadley, allowing him to repossess his land and take another stab at his dream. But an attempt at finding an economical way to reprocess the tailings turned into little more than a money pit, and Willard became more and more financially involved.
Richard Hadley died in 2002, and his son, Robert, took over his interests. Today, Willard, the younger Hadley and their investors (called Gold Hill Mesa Partners, LLC) own Gold Hill. They've long since abandoned the idea of recovering the gold, now worth more than $300 million.
"I have had people cry, literally," Willard says. "Miners say, "You cannot do that.'
"I made the decision that the gold would be what's on the hill, not what's under it."
Not so fast
Gold Hill Mesa isn't the only mining scar in Colorado Springs. Coal mines in the Rockrimmon area, capable of swallowing homes in sinkholes, still snake underground. The Standard and Colorado-Philadelphia mill sites are on the east side of the Red Rock Canyon area. The Portland mill site became a landfill for a time, and is now occupied by the Norris-Penrose Events Center. It was never cleaned, though tests have revealed no health threats.
Villa de Mesa even sits on the same tailings as Gold Hill Mesa. This 25-house development was built directly on the mill's leftovers, without any mitigation. Lana Wright, president of Villa de Mesa Homeowners Association, says many residents at the Villa have lived there for decades, including one lady who moved in when her home was built in the late '70s. She's now 99 years old.
"How's that for longevity?" she quips. "She has no health problems."
Carol Foltz, 72, says she's also quite healthy despite living near the dunes for much of her life and using their warm sands as a sunbathing destination in the late '40s and early '50s. She's kept in touch with six of her beach-bum pals; none has cancer.
"It was very common for kids in that area to play," she says. "It was right across the street."
The boys were even more reckless. That's according to her husband, Ted, 75, a legend of the Pikes Peak Hill Climb and longtime west sider. Back in the late '40s, when the mill was still running, he and his buddies used to slide down the hill, using the wet mud that poured from the cyanide pool as a Slip 'n Slide.
"We'd go to the creek and scrub up," Foltz says. "We were a mess, too!"
He wouldn't have done it if he'd known what was in the mud, he says, but he and his friends are fine today.
Stories like this serve to embitter Willard and his crew, who have endured public outcry over the Gold Hill project. Willard, after all, has been working on a plan to make Gold Hill environmentally sound for over a decade now, and invested millions. Under current requirements, Willard has worked with the state's VCUP program to test the site and set up a plan for mitigation.
VCUPs are common throughout the nation, says Mark Walker, project manager for Gold Hill Mesa VCUP. They were created to make brownfields more attractive to developers by shielding them from suits by the EPA, providing guidance and offering grants and low-interest loans for cleanups.
Sites are dubbed "brownfields" for many reasons. Maybe a site has chemical contamination from an old jewelry manufacturer or a dry cleaner. Maybe it was a coal plant. Maybe it's not contaminated, but is viewed so negatively by the public that no developer wants it. Whatever the case, Walker says, brownfields were once viewed as untouchables by the private sector, and low priorities for cleanup by the EPA, which focuses on Superfund sites like Rocky Flats, a nuclear site in Jefferson County.
Willard has tested Gold Hill over the years, and he's not afraid to answer questions about those tests. In fact, he seems to relish doing so, particularly if he can direct you to his monstrous book compiling the research.
click to enlarge Bob Willard has spent more than a decade turning his - dream into reality.
"We know what's in our soil," he says slyly. "Do you know what's in yours?"
In 1994, the EPA found Gold Hill tailings contained cyanide, arsenic, copper, lead, mercury, silver and other heavy metals in elevated concentrations. It also found that since the cap on the tailings had partially eroded, tailings were blowing into a nearby mobile home park. Sediment samples collected from Fountain Creek, where it borders the property, also contained relatively elevated levels of heavy metals and cyanide, though the concentrations reduced substantially as the water flowed downstream.
Not great, but VCUP's Walker says there was no need to panic.
"The amount of time for someone to be exposed, it varies with the individual," he says of the potential for side-effects. "[But] you need to be exposed for, we've said, decades."
Nevertheless, Walker told Willard to either relocate the tailings or cap them with fresh dirt. Both knew relocating millions of tons of material from an inner-city location was impractical. So Willard hired private companies to help him figure out whether capping the tailings was worthwhile.
Casey Resources, Inc., of Wheat Ridge, did much testing. It showed Gold Hill's ground water was not contaminating Fountain Creek, though run-off was a problem; that Gold Hill workers need not wear respirators; and even that an apple from a tree in the tailings didn't have high levels of lead or arsenic.
The testing company's president and principal engineer, Paul Casey, says the type of tailings here doesn't leach as much as ores in many other Colorado piles. And cyanide tends to breaks down into carbon and nitrogen as it's exposed to UV rays.
So the company recommended a 30-inch cap, with the top 12 inches consisting of tailing-free native soil. Willard, for safety and simplicity, upped that to 4 feet 2 feet of mixed tailings and soil, followed by 2 feet of fresh soil to be distributed as the development expanded.
That's enough to allow residents to plant and eat most garden crops, with the exception of root vegetables, says soil scientist Jim Ippolito, hired by Casey to examine the data.
"I came to the conclusion that [arsenic] should be of low concern at the Gold Hill Mesa site," he wrote in an e-mail to the Indy. "Arsenic uptake by most garden crops should not be an issue."
The battery of tests behind Gold Hill's design seem to have satisfied residents. Homeowner Steve Crochet says he's not concerned, though he has two young daughters.
"It was a concern to hear about it," he says. "But I'm a geek, so I did as much research as I could."
Neighbor Jeff Allums says Gold Hill took the right precautions. He has no regrets about buying his home. Residents Mary Alice and Ronald Hill look almost annoyed about being asked about the tailings.
click to enlarge Gold Hill Mesas long history of gold-processing mills - that later became ruins has now given way to an - ambitious housing development, spearheaded by - developer Bob Willard, who has battled through all kinds - of obstacles including the economic downturn that has - slowed the local market. - L'AURA MONTGOMERY
Gold Hill Mesas long history of gold-processing mills that later became ruins has now given way to an ambitious housing development, spearheaded by developer Bob Willard, who has battled through all kinds of obstacles including the economic downturn that has slowed the local market.
Walker says they have no reason to worry.
"The cap prevents stuff from washing into the river; a cap prevents people from getting the stuff on their hands and ingesting it; a cap prevents it from blowing in the wind," he says. "If the entire 200 acres are built out like it's proposed, there won't be any health risks."
About that ...
Willard is the first to concede his timing with Gold Hill Mesa wasn't perfect. It's a hard time to be selling houses, and the project is moving slowly. John Laing Homes has been building the first installment 70 townhouses and 114 single-family houses as homes have pre-sold. Seventeen townhouses and 37 houses have sold as of May 26, with 14 townhouses and 36 houses built, including models. More are under construction.
New homes counselor Fred Heedt says buyers usually have to sell their homes before they can buy, and that's been tough.
"It's kind of a Catch-22," he says.
Recently, John Laing merged its Denver and Colorado Springs administrative offices and cut workers to save money during the slump. Despite the shake-up, John Bissett, new president and senior vice president for Denver and Colorado Springs, says the company remains committed to Gold Hill.
Development's slow pace has had other effects. In November, the lender financing the development defaulted on its loan to Gold Hill. The lender's main capital provider continued the loan until February, but after that, Gold Hill was left penniless. Willard says he laid off employees while he looked at other funding options, and the project came to a halt. There wasn't even money to fund water trucks that had been soaking exposed tailings daily to keep the fine sands from going airborne.
On Feb. 24, a dust storm kicked up the exposed dry tailings, creating an orange cloud that encompassed downtown. It was a public-relations disaster.
"We were cringing, just like everyone else that week," Willard says.
It won't happen again, he says, even though he hasn't worked out all the kinks with his lender, who will only finance lienable assets. He's currently trying to buy out the loan with help from investors.
For now, Brinton had crews lay down a mix of clay and hay on the top of the mesa and plant grass to prevent the tailings from blowing. He's currently exploring options to control blowing sediment along the steep sides of the property that face U.S. Highway 24.
"I think because I hadn't done a development before, I didn't have a good grasp of the problems I'd be facing," Willard says.
Water laced with cyanide was dumped into ponds during - the Golden Cycle Mills years, but that didnt stop kids from - playing in the mud and water.
He hasn't had to go it completely alone. He's received tax credits and $1.2 million in low-interest loans from VCUP. Gold Hill is also an urban renewal area, due to "blighted" conditions, and has been given tax-increment financing for some improvements. Urban renewal status means Gold Hill could keep the bulk of its property taxes for over 20 years, or until it is reimbursed up to an estimated $11.3 million.
It's a perk, though it doesn't mend the current financial situation.
"Something other than money drives this," Willard says. "The vision drives it."
And it's the vision he hopes will continue attracting homebuyers. Gold Hill Mesa comes with a lot of extras (mineral rights isn't one of them). For $80 per month, residents can hook up to a fiber-optic Internet connection, IPTV with true HDTV programming, voice-over Internet phone, and basic home security.
Homeowners association meetings are held in a common area and can be accessed online. The common area includes video conferencing rooms and will soon have a gym and restaurant. HOA dues cover snow removal, seasonal planting and lawn maintenance. And parks pop up throughout the property.
The homes aren't bad, either. Made to mirror the houses of Old Colorado City, they have charming wooden porches and appealing architectural details, like winding ornate stair bannisters. Garages open into alleyways.
Willard plans about 830 homes, including single-family houses, condos, apartments and multi-family units. There are also plans for a 67-acre commercial section, for which he could break ground in 2010.
Willard wants a variety of businesses with hidden parking structures. He says there could be a corporate headquarters, restaurants, big-box stores, a movie theater and a unique grocery store.
All that's still in the dream phase. Willard doesn't seem discouraged, but he does acknowledge these things happen slowly.
Meanwhile, Willard hopes to get more low-interest loans that would help him partner with CDOT, the Stormwater Enterprise and other entities to restore Fountain Creek where it borders the property. He's already put in sediment ponds to prevent run-off from flowing into the creek, but the plan would also create a natural park-like setting with trails and more protections to keep the creek from clogging with sediment or widening with erosion. The plan must be approved by City Council.
What no one wants to talk about is the worst-case scenario: That the lenders will bail, the housing market won't recover, and the project will never be finished.
The scenario has played out in Willard's head. He wonders if it would end up like it was before he stepped into the situation: a property in limbo with no real owner and no one taking responsibility.
But Willard says that's unlikely, even if his financing crumbles, because he believes any new owner would stick to the Gold Hill Mesa plan.
"Because our team is going on 12 years of working on this property, we are the best ones to move this project forward," he says.
A lot of people want to see Willard finish Gold Hill. There are the current residents, who want what they were promised. There's the city, which stands to rid itself of a blighted area and increase its tax base. And then there's Walker, who says the environment will be one of the biggest benefactors. If Gold Hill is left incomplete, he says, it would mean less environmental protection for the area, though he denies it would result in environmental disaster.
"I think the evidence before us is, we're fairly equivalent to where we were three of four years ago, when the site was partially capped," Walker says. "I would dare say we're better off than we were before."
"Cover material, which was placed on the tailings pile in 1949, has eroded to expose tailings material on the northeast face. Tailings from the northeast face of the tailings pile have migrated onto the A-1 Mobile Village property. Soil samples collected in May, 1994 from the millsite area, the northeast face of the tailings pile, and within the northwest portion of A-1 Mobile Village contained cyanide and numerous heavy metals, including elevated arsenic, copper, lead, mercury, silver concentrations relative to offsite background soil samples. The site is accessible and is used for recreational purposes. There are 24 trailers with a total of 69 residents present within 200 feet of the sample locations in A-1 Mobile Village. There are four elementary schools and one junior high school within one mile of the site with a combined enrollment of 1,739 students. An estimated 11,302 people reside within one mile of the site. An estimated 85,347 people within four miles of the site are potential targets of airborne releases.
Sediment samples collected from Fountain Creek adjacent to the site contained elevated levels of twelve heavy metals and cyanide. Downstream samples indicate that the levels are substantially reduced within 1/2 mile and that the nearest wetland is not impacted by site run-off."
J. ADRIAN STANLEY
End of the Centennial Gold Hill Mesa Saga - and plunging into the Techological Era Age