U.S. Sens. Michael Bennet and John Hickenlooper, both Colorado Democrats, introduced a bill to give Crystal Lake, a federal reservoir, to the city of Ouray.
In 2024, the U.S. Forest Service, the current owner, drained the lake after inspections raised concerns about a crack and seepage at its aging dam, which sits upstream of Ouray. The dam has been rated as a high-hazard dam, which means the agency determined there would be a probable loss of life if it failed or malfunctioned.
But the decision to drain the reservoir left some locals baffled. The city of Ouray had an agreement with the Forest Service to store water in the reservoir, a water supply that is key for local economic engines, like the Ouray Hot Springs. The reservoir, located in southwestern Colorado, is a major draw for tourists, who come to fish, get married there or see the fall colors.
“Crystal reservoir is deeply missed by all who knew her, and we want her back,” Ouray Mayor Ethan Funk said in a news release Wednesday.
The bill would convey about 45 acres of federal land, including the Crystal Reservoir, Full Moon Dam and Full Moon Ditch, at no cost to Ouray. In exchange, Ouray would assume responsibility for the operations, maintenance and repairs of the Full Moon Dam and Full Moon Ditch.
Ouray said it was doing 2026 budget reviews, which will include preliminary funding for the engineering analysis on the dam. The city expects to have cost estimates for work at Crystal Lake by the time the property transfer is complete, city officials said in an email to The Colorado Sun.
The Forest Service did not respond with its cost estimate for repair work Wednesday.
The move would prohibit development on the property and would require compliance with Colorado water law, according to the news release Wednesday.
“The City’s water supply and hot springs depend on Crystal Reservoir,” Bennet said in the news release. “This common-sense legislation will refill and reopen the Reservoir, protecting its recreational and environmental benefits for future generations.”
Crystal Lake also plays a vital role in wildfire response, a role that became all too clear during the recent Snowshed fire, Ouray County Sheriff Justin Perry said.
The fire, in the Ironton-Red Mountain area along U.S. 550, sparked in June and burned about 3 acres, according to the Forest Service.
“Thankfully, the fire didn’t grow larger, but had it spread even slightly, we would have faced serious challenges in securing water from alternate sources for aerial support and water drops,” Perry said in the news release. “To ensure we’re prepared for future emergencies, it’s imperative that we refill this reservoir and make it a key asset in our wildfire response strategy.”
A disappearing lake
Crystal Lake’s history goes back about 90 years. But since it drained, its future has been unclear.
Each spring, snowmelt has filled the lake, which sits at about 9,600 feet in elevation in Ouray County and releases water into Red Mountain Creek. The water from the reservoir flows northward — far below the cliff-hugging road of Red Mountain Pass — for about 5 miles before it eventually reaches Ouray.
It’s a popular spot for photographers, hikers, tourists and anglers. Families go there for after-school walks. Marriage ceremonies have taken place on its banks. One person said they spread a friend’s ashes there.
But in May 2023, Forest Service staff saw a thin, 46-foot crack running along the surface of the earthen embankment. The Forest Service said the crack was even longer a year later in 2024, although it wasn’t visible in June 2024 during a visit with the Bureau of Reclamation
A Forest Service hazard assessment found that, if the dam failed, the resulting flooding in Ouray could impact about 35 structures and potentially be fatal.
The city plans to make sure the dam is safe by repairing it, refilling the reservoir and making sure it is maintained, Tamara Gulde, a city council member, said.
In early spring 2024, the Forest Service met with local officials to update them on the hazard rating and the reservoir drawdown planned for April. By May, the only water left was too low to flow through the drain.
That was a problem for the city of Ouray in 2024. The city has been looking for more water supplies to provide for future population growth and to secure water for the city’s hot springs.
Upriver water demands can cut off the hot springs’ water supply early, which can lead to closures, cut hours and lost revenue. Acquiring more water would help stabilize water sources for the springs and another attraction, the Ouray ice-climbing park.
The drained lake also raised environmental concerns.
The drawdown exposed peat on the lake’s bottom, and damaged peatlands are a major source of greenhouse gas emissions. It also changed the flow of water in the area, increasing erosion in fens that have been in the area for millenia, according to Tanya Ishikawa, executive director of the Uncompahgre Watershed Partnership.
A refilled Crystal Reservoir will boost outdoor recreation and provide much-needed water storage to fight extreme drought and manage wildfires, Hickenlooper said in the news release.
Over 20 organizations voiced support for the bill, including town governments, counties, emergency managers, environmental groups, historical societies and chambers of commerce.
Locals called the lake a “national treasure” that anchors a fragile ecosystem. The mountain views, and their crystalline reflection on the lake, were “world-class” attractions that drew people from across the country, according to the news release. That’s in addition to the critical water supply it provided.
“For over 90 years, Crystal Reservoir has been a part of a colorful history, and a favorite recreation location in the San Juan mountains of Colorado,” Funk said. “We will return the love she has given us, by restoring her to her home in the Ironton Valley.”