If all had gone according to plan, the Land Trust for Santa Barbara County should have closed escrow last week on the McCaslin family’s 462-acre Hot Springs Canyon property, a critical first step in permanently protecting the mostly unbuilt land — home to some of Montecito’s most popular hiking trails — and eventually turning it over to the United States Forest Service for safekeeping. However, thanks to an as-yet-untapped groundwater well located on the parcel but owned by the Montecito Water District, the deal has hit a snag. Calling the situation a “serious impediment,” the Land Trust’s Executive Director Michael Feeney summed up the problem this week. “Basically, [the Forest Service] won’t accept a property if the groundwater rights are held by somebody else,” he said.

The Land Trust went public with its efforts to “Save Hot Springs Canyon” this spring, announcing it already had $6.6 million toward a negotiated purchase price of $8.5 million for the property. The trust also explained it would quickly turn the land over to the Forest Service. In the half year since, thanks to more than 220 donations, the trust has all but $20,000 of the necessary dough to close the deal and were poised to sign the final paper work last week. That is until the issue of the well bubbled up during due diligence work.

As it turns out, the Montecito Water District acquired the rights to a water source — located some 300 feet beneath the property — 16 years ago as an insurance policy of sorts for its customers in time of drought, and has since built a well to access it, though the district has not ever had to do that. With this discovery, the Forest Service has since balked at taking over the land without having full control of the water. (It also should be noted that the current plan would see 50 percent of the artesian spring water on the property, which is separate from the well water, fall under Forest Service control, the other half remaining with the Montecito Creek Water Company.)

Feeney remained optimistic this week that the deal will still happen, just that it would take a certain amount of “time, lawyering, and negotiations” between all parties involved to find a work-around before the new escrow deadline of February 22, 2012. To that end, the Water District’s Board of Directors on Tuesday afternoon were, at best, lukewarm when formally approached by Feeney and company about any such compromise, be it a special use permit or a long-term easement of sorts that would ensure the district’s future access to the water while also allowing the feds to technically own it. In short, though they all seemed supportive of the preservation play, the water district’s directors were not eager to jeopardize their future water holdings. The district will further discuss the topic at a committee level meeting early next year.


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