Editor’s Note: Part two of a two-part investigation. Read part one here.

V

When Aurora Water, the city utility, inked its initial deal in January 2018 to pay $31.1 million for water that emanates from the historic London Mine, it was for 1,411 acre-feet annually.

But of that total volume, 370 acre-feet was still classified as “conditional” water by a Colorado water court, according to copies of the purchase agreements and copies of the water court decisions that established the amounts. Technically that meant Aurora didn’t have to put it to an immediate beneficial use, though it does.

The rest of what Aurora initially bought — 1,041 acre-feet of water — was “absolute” water, meaning it was already put to beneficial use and accessible to the city’s taps.

There was an additional 100 acre-feet of absolute water right that was first to be provided to a local sand and gravel company for the benefit of a fishing club before Aurora could get any of its water from the mine, records show. The fishing club’s water right remains today.

An acre-foot is the amount of water that covers an acre of land one-foot deep, or about 326,000 gallons. In all, 1,511 acre-feet of water was the minimum amount that needed to come from the London Mine each year to fulfill Aurora’s initial purchase.

That contract, at the time lauded as the first of its kind nationally for a municipality to purchase water from a historically polluted gold mine, was the start of years of deal-making between one of the Front Range’s thirstiest communities and the mine’s ownership.

Deals that have seen little more than a marginal increase in the amount of water the city was promised at a cost of millions of ratepayer dollars were done quickly and quietly. The potential cost to the city could easily top $100 million over the next several years.

The initial deal, however, was a complex array of payments and promises that put more money into the pockets of the players than had previously been known publicly, a five-month Denver Gazette investigation found.

And a lot of the money wasn’t even tied to actually getting any more water, but, rather, as a means to ensure the mine owner wouldn’t fold, potentially leaving Aurora with a massive environmental headache that could conceivably cost it many millions of dollars more.

Even though some of Aurora’s purchase was conditional water, the city nevertheless agreed to pay the sellers, No Name Investors — an entity that came into existence only a month or so earlier for the very purpose of selling the water — the absolute water price of $22,000 per acre-foot for all 1,411 acre-feet.

There was one key condition: The sellers of the water had to petition a state water court within four years to get the 370 acre-feet of conditional water decreed as absolute. Either that or refund the city the $8.14 million it had paid for it, according to the contract.

To guarantee that obligation, London Mine owner Joe Harrington signed a promissory note and put up nearly all the land at the London Mine as collateral — the same land Aurora had earlier paid Harrington $1 million to place into a conservation easement to protect the water from potential contamination.

The city agreed that land would cover the whole of the $8.14 million tab, records show. Aurora could not provide any appraisal records to back up that evaluation.

There was more.

The various water decrees at the London Mine showed conditional water rights there exceeded 4,200 acre-feet, none of which was yet developed and all of which No Name Investors owned.

Apart from the 1,411 acre-feet of water Aurora purchased, its water utility handed over millions of dollars more for a variety of water-related line items tied to the mine.

Uncharted waters: Aurora’s unique bid for gold mine water hits head waves

Because it wanted to lock in a future price of $21,500 per acre-foot for any additional water it might buy, Aurora paid No Name another $2 million for an option to buy at that price any water that was eventually developed. In a separate agreement between No Name Investors and MineWater — both of them founded by Harrington of Greenwood Village — Aurora’s $2 million went to MineWater, according to copies of that agreement obtained by The Denver Gazette.

But before Aurora would exercise its option to buy, the city agreed to pay No Name a water lease fee of an additional $290 per acre-foot for any water it got that exceeded the 1,411 acre-feet Aurora owned and the 100 acre-feet the fishing club owned, records show. That payment happened only once, between September 2019 and 2020 when Aurora got an extra 104 acre-feet of water and the city paid No Name more than $30,000, according to a copy of the invoice obtained by The Denver Gazette as part of an open records request.

In addition to the $290 lease fee, the city agreed to pay MineWater an extra access fee of $7,000 per acre-foot, records show. In November 2022, that cost Aurora another $368,000, records show.

In the years before that, Aurora did not come close to getting the 1,411 acre-feet of water it had purchased, records show, with flow totals barely reaching 1,300 acre-feet of water just once, according to state water data. The city received no refund.

Although Aurora owned some of the mine’s water rights, it still needed to actually get the water. The city agreed to pay MineWater another $35 per acre-foot to bring the water to the surface, a monthly total that averages about $3,500. The initial payment in November 2019 included a one-time $200,000 payment for additional MineWater expenses, records show.

Colorado water rights: A complex system and pricey process

That agreement remains in place today, although Aurora now pays MineWater $37.14 per acre-foot to pump its water.

Aurora also agreed to pay MineWater’s electricity bill to run the pumps that pull up the water at a cost of about $15,000 each month, records show.

And Aurora agreed to pay the costs of any equipment MineWater needed to replace, and Harrington’s firm retained the ownership of it, according to the contract.

All tolled, Harrington and MineWater have gotten at least $15 million of the more than $50 million Aurora has paid into the London Mine venture — with a total outlay likely to exceed $110 million based on the city’s current agreements.

But even with the millions spent and the compromises reached in the early phases of the deal, the complexities and costs the city would incur were just getting underway.

VI

By the end of 2021, nearly four years after Aurora purchased water rights at the London Mine, it became clear that No Name’s obligation to go to water court to convert the 370 acre-feet of conditional water to absolute water by November 2021 would fail.

“The parties believed that within three years, (MineWater’s) mining-related activities, including work to prevent the formation of acid mine drainage, would also result in the production of more non-tributary water,” Aurora Water Assistant General Manager Alexandra Davis wrote the City Council for its May 23, 2022 meeting.

MineWater “has encountered several technical problems and the amount of additional water developed by (MineWater’s) activities was not sufficient to warrant going to water court as of November 2021.”

Harrington explained that his approaches to finding more water weren’t working and his No Name partners weren’t happy about it.

“I went to the city and said I needed more time and wanted another extension,” Harrington said to The Denver Gazette. “No Name was unwilling to take on the obligation.”

Aurora’s London Mine gambit was beginning to wobble and Harrington’s No Name partners wanted out.

“We discovered that when we did drilling it didn’t work,” Harrington said about the city giving him more time. “We did all sorts of things and we had slow success at it, and I said to the city I don’t know when it’s going to work out.”

By November 2021, state records show MineWater hadn’t developed any new water and that it was headed for a yearly total of 1,343 acre-feet, short of the 1,411 acre-feet that Aurora had purchased.

Aurora officials explained that allowing any other entity to purchase No Name’s remaining water rights, should it sell them, could make for a difficult partnership, especially if any of the additional water was ever developed.

“The city said they’ll just take No Name out of the equation,” Harrington said.

The timing was right. No Name hadn’t gone to water court as it promised and there was no new water.

But rather than simply foreclose on No Name as the initial contract allowed and require the investors to refund the $8.14 million Aurora had paid for the 370 acre-feet of conditional water — the city had paid the absolute water price of $22,000 per acre-foot while the conditional water price was only $10 per acre-foot — Aurora took a different approach.

Aurora Water, No Name Investors and MineWater negotiated a new deal. Its critical components:

• Aurora chose not to exercise its right to purchase all of the remaining water rights for $10 an acre-foot, or roughly $50,000.

• Aurora paid $1 million for the entirety of the London Mine conditional water rights that No Name still owned, or about 4,200 acre-feet.

• No Name kept the $8.14 million it was to have refunded Aurora, though Harrington’s promissory note for it remained.

• Aurora agreed to honor a deal MineWater signed in 2016 with THF, the previous owner of the London Mine water rights, in which MineWater would be paid for any water it developed beyond the initial 1,511 acre-feet at $21,500 per acre-foot. That deal extended to No Name when it purchased THF’s water rights.

In her public explanation to the City Council, Aurora Water’s Davis described the deal generally and said it was giving Harrington more time to get to the water: “Aurora agrees to honor the previously agreed-upon allocation of purchase money revenue between (MineWater Finance) and No Name, and the timing of any water court applications is delayed, increasing the potential for (MineWater Finance’s) mining-related activities to deliver ancillary benefits in the form of increased water production.”

In actuality, Aurora was to be paying for the same water twice — the remaining water rights themselves and then again to Harrington should any of that additional water ever be developed.

“The statement that the city could have for $10 (per acre feet) gotten the (conditional) water rights, while accurate, wouldn’t result in the city getting water and the city is focused on getting sustainable water,” Harrington explained to The Denver Gazette. “The city and I recognize throughout all of this that if they want water, the only way to get it is to keep MineWater Finance viable. That’s arrogant, but it’s the only straightforward way.”

Harrington again noted the concern regarding the city taking on any of the environmental liabilities tied to the mine site. He was already on the hook for $725,000 in unpaid fines tied to years of problems from prior ownership of the site that he agreed to take on.

“If the city would have come in and exercised the rights as it could do (to foreclose), what would have happened from that is they’d own it all and been the deep pockets liable for the problems,” he said.

Aurora Water officials agreed, saying it has had little choice than to keep MineWater afloat.

“If you own a mine and operate a mine, you have liability over that mine,” Davis said. “Aurora does not want to own a mine because of the environmental liability. So why would the city seek to put a mine owner in default when the consequence would be that Aurora ends up with the mine? It doesn’t make any sense.”

Added Aurora Water General Manager Marshall Brown: “What would the costs have been with the responsibilities and liabilities that we would have inherited with that choice?”

The EPA, which has some jurisdiction over the water coming from the mine, told The Denver Gazette that Aurora’s liability over any environmental issues at the mine is not a certainty partly because local governments that inherit properties with prior problems are likely exempt from them.

Prior water court decisions have said to get at any new water there requires bona fide mining activity.

Aurora Water officials say they see it differently and that the city’s inherited liability would be a certainty.

The Aurora city attorney’s office, Harrington, who represented MineWater, and Karl Nyquist, a well-known Colorado water broker and co-founder/manager of No Name Investors, signed a new contract to buy out No Name on March 23, 2022, records show.

The city council discussed the deal in executive session a month later on April 25, 2022 for about 40 minutes. The agenda of that meeting showed the reason for the secret discussion was for “negotiations” and “legal advice.”

The city council unanimously approved the new contract at its meeting May 23, 2022, as part of its consent agenda without any public discussion or public input, records show.

A video of the meeting shows the massive contract and seven other unrelated items on the council’s consent agenda were approved in just 45 seconds.

VII

The mining process involves a number of complex procedures, but there is a basic principle: From the many miles of adits and shafts inside a mountain must come rock.

Most mining operations generally have two types of rock that are placed into piles: Tailings and waste.

Tailings are the remnants of quarrying for the actual ore a mining operation seeks. The rocks are small in size after having been processed for gold, silver, lead or other metals. Because some of the rock still contains traces of ore, its exposure to air and water make it a contamination hazard for acid mine drainage.

The London Mine’s tailings piles had been the historic source of pollution and were part of a large reclamation project in 2013 when they were covered over with tons of dirt onto which native grasses and trees were planted, according to records of that state-led operation.

That means any efforts today to reclaim the buried rock that make up the tailings would require extensive permitting from state and federal officials.

Waste rock is another matter.

It gets its name because it is among the first chunks of mining that are expelled in the initial blasting efforts to get at a vein of ore or mineral. The rocks are generally large and, by definition, deemed worthless.

Waste rock is usually piled not far from a mine opening, out of the way and of little consideration. Tailings are typically further away because they have undergone additional processing.

At London Mine the piles of waste rock tower up to 20 feet tall and there are dozens of them strewn around the property.

Harrington explained that the piles — approximately 850,000 tons of rock — had been hand-culled by workers during World War II, mostly women who separated the ones believed to contain additional lead that could be used in the making of ammunition.

In those piles of waste rock, though, Harrington saw the potential to pull bits of ore, gold and silver, that remained decades after long-ago miners tossed the rocks away as worthless.

“The technology has advanced much farther than a miner holding a candle taking a look at a stone,” Harrington said.

The idea isn’t a new one, explained Colorado School of Mines research professor Rich Wanty, noting one company’s unsuccessful efforts “20 or 30 years ago” attempting to reprocess waste rock piles “because old mining methods of processing weren’t nearly as efficient.”

The current X-ray method, known as X-ray flourescents, to find traces of ore in the waste rock “seems to work well,” Wanty said.

Any of the ore that remained in waste rock couldn’t be processed profitably back when the mine was operating, but at nearly $2,400 an ounce today, the returns could be substantial.

Harrington believes there’s about 70,000 ounces of gold still in the waste rock, according to investor proposal documents obtained by The Denver Gazette. If that number were correct, the ore residing in those waste rock piles would be worth about $168 million at today’s prices. It’s unclear how much ore Harrington’s company has extracted to date.

Harrington said he also saw the X-ray operation as helping water quality on the property by removing potential contamination and, basically, tidying up the site.

In this process, the rock is analyzed and separated. The rock the X-ray machine identifies as having mineral content is sent to a pile that’s about, from visual appearances at the site, 1/10th the size of the pile that has nothing. Then the smaller pile is sent for further processing at a different location in Gunnison that another Harrington company owns.

Around February 2023, an Australian company, Dateline Resources, announced it was looking to get into a partnership deal for its Gold Links Gold Mine and Lucky Strike Processing Plant near Gunnison with MineWater Sorter, a Harrington company that owns the X-ray machine. The idea was to combine rock processed by the X-ray machine from those gold mines with that of the London Mine and another Harrington owned mine, the Hock Hocking, just downstream from London Mine.

The partnership would create a new company that was 50% owned by Dateline and 40% by MineWater, with a private Australian investor owning the remainder, according to a press release Dateline issued at the time in Australia.

Months later, in June 2023, Dateline announced it had instead sold all its interests in those properties to MineWater Sorter in a deal worth up to about $19 million — $3.4 million of it in cash to be paid out by MineWater through February 2024, according to company press releases.

Harrington promised Dateline Resources another $5.5 million in payments as gold ore was processed from the X-ray sorter, and agreed to take on about $12 million in debts the Australian company had in those operations, the press releases announced.

But the financing Harrington said he had relied on from the U.S. Small Business Administration to cover his side of the deal fell through, so he turned — again — to Aurora Water.

“All those contaminants from the rock and the potential pollution is gone, we believe we will remove all evidence of industrial activity at London Mine within five years,” Harrington told The Denver Gazette in explaining the X-ray operation and his pitch to Aurora. “So we painted a picture to the city of putting up a loan that would help us, to help increase water production and decrease pollution going into the mines.”

When asked how moving surface rock around creates any additional water, Harrington focused on cleaning up the existing water, noting that “it’s very much beneficial to the city to have mine cleanup happening that’s not just pushing the pollution around.”

He added: “The city doesn’t want a water treatment facility, they want a water collection facility and the only way to get there is through that (X-ray) sorter.”

But before Harrington could even get the city on board, records show he was fined $1,000 by the Division of Reclamation, Mining and Safety at the Colorado Department of Natural Resources for building concrete foundations at the London Mine site for the massive rock sorter and X-ray machine without a permit.

Photos at the time show the X-ray machine sitting idly by awaiting installation.

That happened on August 14, 2023, records show. Harrington explained that it was a minor misunderstanding he had with the state and admitted his mistake.

Aurora approved the $4.2 million deal — Aurora Water Director Brown refuses to call it a loan — two weeks later.

Brown told The Denver Gazette that “we’d not really call it a loan. We see it as partial payment for the water we’ll see developed.”

Put simply, the city gave Harrington’s MineWater Finance a $4.2 million payment to lease the X-ray machine from his other company, MineWater Sorter, records show. Brown agreed that no actual water would come from the operation.

“What I told the city is that MineWater Finance has this opportunity to get this equipment and it was clear we owned it,” Harrington explained. “But the city knew it was for much more than just that machine, and they said, ‘OK fine, we’ll just put this.’ It’s not limited to the X-ray sorting equipment but it’s actually the larger facility in Gunnison.”

Aurora Water officials told the City Council in August 2023 that it wanted to prepay $4.2 million to Harrington for 595 acre-feet of conditional water that hadn’t yet been developed, but that it expected would eventually be. There is no mention of the Australian partnership in any of the city’s paperwork, records show.

“The funds are necessary to facilitate further bona fide mining activities (thus legitimizing the removal of more water) and are expected to result in increased mineral production and associated water yields as mining operations continue,” records show Aurora Water told councilmembers.

Brown said he saw it as an investment in “environmental remediation with the return on investment for the water from on-site activities.”

The incentive, Brown said, was that future water was dependent on mining activity and the ore and sorter would be an incentive to that end.

“If you are going to pull additional ore and rock from that … mine operation, the X-ray machine would be a valuable asset,” Brown said. “Exploration (for ore in existing waste rock) is a bona fide mining activity.”

There was also no reference in the city’s loan paperwork that the 595 acre-feet of water still needed to be developed,  that the city already owned the rights, or that the city had earlier agreed it would also pay Harrington $21,500 per acre-foot to develop any water above the initial 1,411 acre-feet it had initially purchased.

As part of the loan, Harrington agreed to cancel the $7,000 per acre-foot access fee he charged the city for any water more than the 1,411 acre-feet his company was contracted to deliver.

The terms for the city’s $4.2 million loan to MineWater: 7 years at 4% simple interest. SBA loans at the time averaged about 11.5% interest, according to federal banking data.

Officials explained that in making the loan based on future water, Aurora wouldn’t have an ownership interest in any gold ore because of the same liability concerns it has with any potential ownership of the mine.

Around that same time, MineWater and MineWater Sorter — both Harrington companies — loaned $5 million to MineWater Finance, the holding company for all the mine operations and also a Harrington company, for a variety of functions, he told CDPHE in a quarterly report ended September 2023.

VIII

As part of their presentation supporting the loan to Harrington, Aurora Water officials repeatedly told councilmembers “the water produced (from the London Mine) is of high quality.”

State records indicate it really wasn’t.

At the time water officials made their loan pitch to the City Council in August 2023, the state’s water quality division had already issued 17 different non-compliance citations over the previous 10 months to MineWater for allowing high levels of zinc, cadmium, and silver to come from the London Mine — in water Aurora already owned, state inspection records show. Six of the citations came in the weeks preceding the meeting in which the city council was repeatedly assured the water was of “high quality.”

At its worst, levels of silver had exceeded more than 443 percent of the limit allowed under MineWater’s pumping permit in October and November 2022, records show. Cadmium levels topped 204% of the limit in May 2023, and just a week before the August 2023 loan-pitch meeting zinc exceeded the allowable limit by 235%.

Then, after the city council agreed to give MineWater the $4.2 million for that “high quality water,” MineWater was advised 13 more times over the next seven months by the state of similar water quality concerns, nearly all of it for high levels of zinc, records show.

Harrington stated emphatically that he has not violated any water permit, noting that the consent decree he signed with the state in 2016 to clean up the water was firm in noting no changes would occur with the allowable heavy metal limits.

“In no event would limits be made more stringent than the current permit,” he said.

State water officials have said new levels were put in place in 2022 and that MineWater is required to comply with them.

Echoing Harrington, Aurora Water Director Marshall Brown said the water is fine.

“Even though it has environmental issues at the mine outlet, from our perspective it is fantastic quality,” Marshall said.

Federal limits on water quality contamination were changed in 2022, Harrington said, but the state was giving him leeway to meet them by not actually enforcing any breeches.

“They acknowledged Harrington will have trouble meeting the permit and that we’ll work with him,” Harrington said of the state. “They say they won’t enforce it while we’re still making our best efforts, which they believe we have.”

State water quality officials say they continue to cite MineWater for exceeding the levels of heavy metals allowed under its permit, but that anything more stringent hasn’t been warranted.

“The division’s typical initial response to noncompliance with a discharge permit is to issue a compliance advisory, which we have done for the violations,” John Michael, spokesman for the Water Quality Control Division, told The Denver Gazette in an email. “We will continue to monitor MineWater’s compliance with its discharge permit and respond” accordingly.

Brown in an interview described the water as “high-quality water in some perspectives,” acknowledging it “does have some heavy metal challenges.”

Despite claims of “high-quality water,” Aurora in 2019 told state water officials that although it owns the water coming from the London Mine, that water — no matter how contaminated — doesn’t directly reach only Aurora Water customers.

It blends with every other water source in the watershed  as it cascades down the mountains. By the time the London Mine water reaches any downstream water intake, including Aurora’s, it has been diluted many times over.

“The fact sheet (from CDPHE) states ‘and this water will be used for drinking water for the City of Aurora’ incorrectly implies that the water discharged from the London Mine is diverted directly, and solely, into Aurora’s drinking water system when it is not,” the city corrected state water quality officials in July 2019 during an examination of the mine’s water permit.

The various water sources that empty into the South Platte River watershed, including water from the London Mine, “blend in … several reservoirs before they are ultimately delivered through the South Platte River system to the Front Range metro area.

“The City of Aurora is one of many entities who use water from the South Platte River watershed downstream of the London Mine as a source of drinking water,” the city wrote CDPHE. “Accordingly, Aurora Water respectfully requests the deletion of the clause … that mentions exclusively the City of Aurora as a user of drinking water downstream of the London Mine.”

IX

It wasn’t long after the city loaned Harrington the money to pursue his X-ray idea that he found himself in yet another financial jam. As before, he turned to Aurora Water for help.

In May 2019, roughly six months after Aurora purchased the first amounts of London Mine water and paid for an option to buy more if developed, entities owned by Harrington and Tim Brittan – MineWater Finance and Brittan Commodities, respectively — borrowed $3.9 million in non-recourse loans from Texas hard-money lender Oak Savanna LM.

Brittan was a member of 2016 Cascade Water Resources, a group of investors who had backed MineWater’s efforts at developing more water at the London Mine when the water rights were owned by THF, a real estate firm held by sports magnate Stan Kroenke.

Of the $3.9 million loan, Harrington got $1.5 million and Brittan the remainder, both at 18% interest, records show.

As collateral, Brittan pledged his 30% equity stake in the Cascade investment group, according to a lawsuit filed against Brittan and Brittan Commodities in Denver County Court.

The other Cascade partners, according to lawsuit documents, were unaware of Brittan’s loan nor gave their approval to use his equity share as collateral, a requirement under their rules, the lawsuit alleges. Brittan denied the assertions, court records show.

Oak Savanna’s loan came from another Texas lender, eCapital, an online business that focuses on alternative business financing. It was eCapital that sued Brittan.

eCapital said in court papers that Harrington wanted the money as an advance on the conditional water he hoped to develop and be paid for through his original agreement with THF, which No Name had agreed to honor when it bought the water rights from THF. Aurora later did the same. At the time of the Oak Savanna loan, Aurora had the option to purchase those conditional water rights if they were developed and made absolute.

A pitch book that Oak Savanna used to secure the loans for Brittan and Harrington made it sound like a low-risk investment: “Development of a known water reservoir has extremely low technical difficulty and the additional production required was minimal given the high productivity of recently drilled wells (far exceeding the volume sold to Aurora),” according to court records.

Harrington told The Denver Gazette his part of the loan money was to cover expenses from 2019 when drilling efforts at the mine went poorly. Utah company REI Drilling Inc. filed a $553,000 lien against MineWater properties at the London Mine for that unpaid work in November 2020, Park County records show.

REI representatives did not respond to efforts by The Denver Gazette to reach them.

“In 2021 we attempted to finance a new approach” to developing any new water, Harrington said, “and we told the city we’re in trouble and trying to get through this. Pretty much everything went worse than we had hoped.”

When Oak Savanna defaulted in 2021, eCapital purchased its assets in foreclosure, including the MineWater and Brittan Commodities loans, records show, and immediately moved to collect.

eCapital sued Brittan and Brittan Commodities in October 2021. The case moved to arbitration shortly afterward. The case against Brittan individually was dismissed in November 2022, but eCapital added a new set of allegations against Brittan in March 2024.

Brittan Commodities filed for bankruptcy protection in February 2024, just after an arbitrator found for eCapital and awarded it $4.6 million in the case, not including attorney fees and costs, court records show.

The Denver eCapital lawsuit and another lawsuit in Texas involving Cascade members lay out an elaborate plan by which Harrington’s MineWater then loans or gifts $1 million of the loan proceeds he received to another Cascade partner, Mark McCrary, in return for McCrary’s stake in the investment group.

“MineWater would use only $500,000 to invest in the capital needs of the (London Mine) project and would provide the remaining (loan money) to Mark McCrary of Cascade for seemingly no legitimate purpose,” the complaint in the Denver lawsuit alleges. The defendants have denied the allegations.

Harrington also guaranteed Brittan’s portion of the eCapital loan in return for Brittan’s stake in Cascade, according to court documents. With McCrary’s shares, it essentially gave Harrington controlling interest of Cascade.

eCapital was insistent Harrington repay the loan, according to interviews, and was threatening to foreclose on the potential water sales he had pledged as collateral.

“I’ve been reporting the threats to the city throughout the years because I had development obligations,” Harrington told The Denver Gazette. “I treat them (Aurora Water) as a partner.”

eCapital attorneys and principals did not respond to requests from The Denver Gazette for comment.

Harrington said eCapital in 2023 finally announced it had “put out a new default notice, acceleration and full note due.”

Harrington said revenues he expected to see from the X-ray machine deal, which he hoped he could rely on to repay the eCapital note, were not coming as quickly as expected “and eCapital was rattling their saber.”

“I went to the city and said the sorter project wasn’t happening as quickly as I would like,” Harrington said. “We started it too late.”

So, as with previous deals, Harrington simply asked Aurora for more time — and money.

“I asked the city for a source of capital we could look at, including sale of the rock from the sorter,” he said, referring to the piles of crushed rock separated by the X-ray machine because they had no valuable minerals. “I knew they bought rock for other projects” such as for road construction.

In April 2024, eCapital finally told Harrington it was foreclosing on him, he said.

MineWater was staring at bankruptcy, which he said he made clear to officials in the Colorado Attorney General’s office, the state Department of Public Health and Environment and Aurora Water.

“And that’s what made it urgent,” Harrington said.

X

Pennsylvania Mountain sits across from South Mosquito Creek and just south of the London Mine. Several years ago the northern face of the mountain collapsed, leaving a sizable rock slide of larger boulders mostly on land that is part of the footprint surrounding the mine.

The large rock — known as rip rap aggregate — is as much as 5 feet in diameter.

For about 10 minutes on April 8, 2024, Aurora Water officials and city officials discussed a $5.2 million deal regarding “aggregate purchase” at London Mine, city records show, citing the statutory authorization to discuss “negotiations” in closed-door executive session.

Records show many of the documents that made up the transaction were signed several days later by Harrington and attorneys for the city.

Then, on April 22, 2024, Aurora Water officially went to the City Council with an expedited no-bid urgent proposal to pre-pay MineWater for the delivery of about 100,000 tons — that’s 200 million pounds — of rip rap rock for maintenance at the city’s Spinney Reservoir and its still-to-be-constructed Wild Horse Reservoir.

Because the deal was urgent, Aurora Water officials asked the council to waive its normal process of discussing contracts several times before giving them final approval “due to the timeframe that is required to complete the transaction.”

Still calling it “high-quality water,” water officials also told the council the mine was “already producing as much as 1,584 acre-feet per year (of water) for Aurora’s use in the City,” not mentioning the first 100 acre-feet go to a fishing club.

Water officials told councilmembers in paperwork that MineWater had “identified riprap (sic) rock” while developing the London Mine site and that they wanted to purchase it at a “reduced market price.”

The $5.2 million price tag — figured at $52 per ton —  is less than other providers, Harrington said, noting that “I calculated it was saving them about $3 million.”

At the time, in April, MineWater didn’t have a state permit to move any rip rap rock, state records show. The city council unanimously and quickly passed the $5.2 million purchase agreement as part of its consent agenda without discussion or public input, records show.

Harrington’s reason for reducing the price of rip rap rock was simple: “Because the city has been good to us and they were saving us. We had rock, they had money, they need rock, and we need their money.”

There was no mention of the eCapital loan or Harrington’s financial troubles in the paperwork submitted to the Aurora City Council, though Aurora Water officials say the councilmembers were made aware of it.

The state approved MineWater’s rock removal permit July 11, records show.

Aurora Water’s London Mine gambit continues to play out.