Growth takes root in boom-bust cycles

Filed under: News |

Houses under construction in the middle of open land in the Briargate area during September 1985.

Editor’s note: This is second in a two-story series that considers the history of growth and development in Colorado Springs. Part I focused on the years from the city’s founding in 1871 until 1950. Part II considers the years from 1950 to the present, when growth transformed a small town into a regional metropolis. We explore the underlying conditions that enabled the city to grow and prosper, and consider the questions — Will it continue? Can we continue on the same path or have the rules of the game changed?
By the late 1940s, the Colorado Springs economy was at a crossroads.
The establishment of Camp Carson had led to a brief spurt of prosperity during World War II, but much of the wartime military establishment had melted away. There were scarcely 600 soldiers stationed at Camp Carson, and local leaders feared that it might be closed.
Across town, Peterson Field was closed in all but name, and no one expected that it would revive anytime soon.
Then, on June 25, 1950, the Korean War broke out. The Cold War was suddenly a hot war — and shuttered military facilities around the country were revived.
Troops flowed into Camp Carson, and the skies over Peterson Field were filled with aircraft.
The economy stabilized, and then surged. The business leaders who had worked so hard to attract Camp Carson — Russell Law, H. Chase Stone, Thayer Tutt — were both relieved and worried, because they realized that the city’s economic base was fragile at best.


Cragmor Sanatorium, now the campus for the University of Colorado at Colorado Springs, and the surrounding area during the 1960s.

They had seen Camp Carson open, expand and then almost shut down — what would happen when the war ended? Colorado Springs needed to attract some kind of industry, or government establishment, that, once here, wouldn’t leave and wouldn’t close.
They weren’t interested in manufacturing or in heavy industry — Pueblo might be prosperous, but it was a smoky, polluted little city, and, even worse, Democratic to the core. The staunch Republicans who ran the Chamber of Commerce valued the Springs for its pristine skies, healthful air and conservative politics — and they weren’t willing to give up any of the three.
The answer came in the form of a two-line story in the Gazette-Telegraph, which local restaurateur Joe Reich Sr. noticed while getting a haircut. A Congressional committee had been formed to determine whether the Air Force should have its own service academy.
Reich brought the story to the attention of his fellow members of the Chamber’s Military Affairs Committee, and they decided to pursue Colorado Springs as the location.
They were under no illusions about the difficulty of their task. This would be, as Marshall Sprague characterized it in “Newport in the Rockies,” “… the national plum of plums, a $200 million industry.”
The lobbying effort lasted years, as the project moved slowly to final authorization and then to site selection. More than 400 cities had bid for the academy, but, on June 24, 1954, the selection committee voted 4-1 in favor of Colorado Springs.
Just a month before, the Army had announced that Camp Carson would become a permanent base, and be renamed Fort Carson. The Air Force followed suit, and Peterson Field became Peterson Air Force Base. In a few short months, the foundation had been laid for the future.
In 1950, 80 years after Gen. William Palmer had driven the first stake at the corner of Cascade and Pikes Peak avenues, the city’s land area had increased by only 2,130 acres — from 3,868 to 6,000. The anemic growth rate — less than 1 percent annually — was soon to be an artifact of the past.
From 1950 to the present, the city’s land area increased from 6,030 to 123,863 acres, and the population soared from 45,472 to 376, 985.
Apart from the re-energized leadership of the business community, four factors drove the city’s growth.
n Water. Thanks to a far-sighted decision to build an extensive water collection and diversion system on the western slope, Colorado Springs was able to guarantee developers water.
n Land. Cheap, abundant land, including both forested foothills to the west and gentle, rolling plains to the east, gave developers attractive and affordable options.
n Local government. Successive generations of conservative, business-oriented elected officials promoted and enabled growth. Low taxes and simple, developer-friendly municipal ordinances smoothed the way for rapid growth.
n Location, location, location. In common with other western cities that grew rapidly during the second half of the 20th century, Colorado Springs was seen as a desirable place to live, with an agreeable climate, low crime, good schools, a reasonable cost of living and easy access to outdoor recreation.
In the decade of the 1960s, growth erupted. Driven by the construction of NORAD’s Cheyenne Mountain base, and by Vietnam-era military expansion, the city’s area quadrupled, and its population doubled. During that decade, Colorado Springs was the third fastest-growing city in the nation, behind only Phoenix and Las Vegas.
Attracted by the presence of military decision makers, national high-tech firms established operations in the city’s first industrial park along Garden of the Gods Road. Digital Equipment, Ampex, Kaman Sciences, Mostek, Litton Industries, Honeywell, and NCR all established facilities.
But growth came at a price. Just as the downtown mansions of Palmer’s time were torn down during the Cripple Creek boom, developers and speculators demolished many of the city’s crown jewels, including the Antlers Hotel and the Burns Opera House. The site of the Burns Opera House on Pikes Peak Avenue between Cascade and Tejon remains a vacant lot.
In the early 1970s, growth came to a halt when City Council announced that city utilities could no longer supply new homes with natural gas, citing a national shortage. Construction stopped overnight, thousands of jobs were lost, and business leaders, blaming “no-growthers” on council, threw their support behind pro-growth candidates.
Their efforts were successful — and for decades thereafter, a clear council majority favored and supported continued growth.
The so-called “gas moratorium,” although clumsy and ill-advised, was not solely responsible for the recession of the early 1970s. Post-Vietnam, troop levels at Fort Carson plummeted, military budgets were cut and the 1973 energy crisis helped depress the national economy.
After a pause, growth continued, led by young entrepreneurs in their 30s and 40s, who wanted to build a strong, sustainable economy better able to avoid the boom-bust cycles.
Their creation, the organization that became today’s Economic Development Corp. embodied a simple premise: one-stop shopping for economic development.
In addition, the EDC was proactive, seeking candidates for relocation. Teams of businessmen, elected officials, and retired military officers flew around the country to lobby prospects.
Growth continued through the 1970s and early 1980s. In 1988, the Bob Isaac-led City Council agreed to annex the Banning-Lewis Ranch, 38 square miles of vacant land along the city’s eastern boundary.
It was a time of unbounded optimism, often expressed by Banning-Lewis developer Frank Aries, who had paid more than $100 million for the property. According to the master plan, as many as 100,000 people would live there eventually — although it might take 20 years to build out.
Reality intervened. Two years later, Colorado Springs was in a deep recession. Aries had left town, never to return. His project, like so many others, had been financed by now-insolvent savings and loans, and had collapsed when the money spigot was turned off. The admiring articles in the national press disappeared. Colorado Springs went from “Sunbelt Boomtown” to “Foreclosure Capital of America.”
Foreclosed, Banning-Lewis eventually sold for less than $20 million — one of dozens of similar sales.
But Springs leaders had seen hard times before. Casting about for new employers, the EDC’s Alice Worrell and her husband, Allan, began to cultivate religious nonprofits. They were successful beyond expectations, and in just a few years Colorado Springs was home to dozens of religious organizations — stable, settled employers who became firmly rooted in the community. Prosperity returned, and by mid-decade, the city was booming again.
But once again, the boom-bust cycle repeated, as the combined effect of 9/11 and the end of the Internet boom triggered another economic slowdown — which, thanks to the interest-rate fueled real estate run-up, was much less severe than the recessions of the early 1970s and late 1980s.
Today, nearly 20 years after its original annexation, construction has begun on the Banning-Lewis Ranch. As active as ever, the EDC now devotes as much time to working with present employers as it does to seeking relocating businesses.
But the business community has changed. Few of our leading employers are locally owned; like Intel, they’re liable to close at a moment’s notice, depending on global business conditions. Local business owners who provide continuous, long-term leadership are vanishing, replaced by professional managers whose commitment to the Springs is limited to the term of their employment.
As the city moves farther into the 21st century, the challenges are not unlike those that faced Mayor John Robinson in 1902.
We need to secure enough water to provide for the future; we need a decent transportation network; we need to preserve the city’s beauty.
And most of all, as Robinson said so presciently 105 years ago, we need “… leaders that are practical men of business, but also men of vision.”
John.Hazlehurst@csbj.com