Summit County history: How Dillon residents moved an entire town before filling the reservoir

Former Summit Historical Society president and local author Sandra Mather walks out of a homestead building, built in the 19th century, during a weekly tour for guests on Aug. 8, 2017 in Dillon.
Hugh Carey /

This story has been updated to correct dates, dollar amounts and other specifics about how the town was moved.

The little town known today as Dillon has a particularly peculiar history. The town — which could be called New Dillon if you want to get technical, New New New Dillon if you want to get pedantic — is the fourth iteration of the original town established in 1881.

The town’s turbulent history mirrors the fortunes and evolution of Summit County as a whole. Sandra Mather, former president of the Summit Historical Society and an author of 20 books on Summit County history, gave a lunchtime lecture to locals in Frisco on July 10 about the Dillon Reservoir and the town it replaced.

Before the first town named Dillon came to be, the valley and entire region surrounding it had been the homeland of the Ute Native American tribe for thousands of years, since they scaled Vail Pass from the West around 4,800 B.C. The Utes slowly lost the land to white settlers and the United States when the gold rush came to the Colorado Rockies in the 1850s.

After a series of broken promises led to escalating tensions and an all-out war, the Utes were forcibly removed by the United States militia to reservations in eastern Utah. The last of the Utes left in a caravan from Summit in 1881, the same year the original town of Dillon was born. The state of Utah was named after the tribe.

On July 26, 1881, the Dillon Mining Company — an organization with a misleading name as it was run by real estate and railroad men — established a 320-acre residential town on the Snake River in the Snake River Valley.

The town was meant to be a trading and railroad hub for trains traveling from the Front Range over the Continental Divide and down to Leadville. The only thing missing was the railroad.

Mather explained that the name of the town — Dillon — was not named after a prospector named Tom Dillon who got lost in the woods, as has been a common oral tradition. Rather, the town was named after Sidney Dillon, a powerful railroad executive who became president of the Union Pacific railroad four months before the town was established. The entire point of naming the town Dillon was to somehow appeal to Sidney Dillon’s vanity and persuade him to build a railroad through the town.

But as it turned out, the railroad didn’t wind up going through Dillon or winding along the Snake River. Instead, it went through Tenmile Canyon and the town of Frisco — also named to flatter a railroad company, the St. Louis–San Francisco Railway Co., in a bid to get them to build their next line through town.

Seeing that Dillon’s purpose would be nullified without a railroad, its founders decided to move it close to the one that was being made. Just 17 months after it was first established, the town of Dillon was moved for the first time to a location between the Blue River and Ten Mile Creek.

A month later, the founders realized another railroad was being built by the Denver, South Park and Pacific Railroad that would go through Breckenridge and east toward Keystone and Montezuma. It was decided that the town should have both railroads traveling through it.

So the town of Dillon moved for the second time to a third location, where it stayed well into the 20th century. That location is now underwater, where the Dillon Reservoir stands today.

After its second move, Dillon became more of a ranching and agricultural community, a watering hole for cowboys with food, drink and wide-open spaces. In 1855, the town’s population was 99 — 66 men and 33 women.

“Pretty good odds if you’re looking for a husband,” Mather said.

Dillon remained more or less the same for the next few decades. Things started to change in the 1910s, when Denver started sniffing around for water. By the 1950s, Denver Water had secured nearly all the water rights it needed to create a reservoir. The town of Dillon, population of about 1,000, was the only thing in the way. The writing was on the wall.

After avoiding a formal meeting over the inevitable for many years, Denver Water met with town officials on Nov. 3, 1955, to negotiate the moving of Dillon. In its place, Denver Water said, would be a permanent recreation site that would impound 52,000 acre-feet of water. The reservoir they eventually built holds five times that amount.

For the most part, the town’s residents eventually accepted Denver Water’s offer. The town’s buildings would be destroyed or moved to a new location, and in its place Denver Water would build the reservoir, a recreational site that would bring a huge economic boom to the county. Old Dillon residents would be first in line to buy or trade their land for parcels on the newly marketable property.

Denver Water would also give the new town $450,000 to build up infrastructure and public works. It was not a gift nor a loan, Mather explained, with the entirety of the money paid back with service fees and land sales.

While this offer may have been well and good for many, there were questions that came with trying to physically move a community.

What about senior citizens and others who had no means of moving a house or buying new land? What about families who had lived there for generations and had sentimental attachment to the land? What if they disagreed with the amount Denver Water offered for their land?

There also were issues with managing the needs of a growing community. How would Summit County make up the money it would lose from tax rolls when that property disappears? How can they pay for the schooling for all the kids, who were already packed dozens to a classroom?

The community and Denver Water worked to address some of these concerns. An elderly widow who could not afford to move had her house moved uphill to the new town, where a portion of it can be seen today.

The town’s schoolhouse/church building built in 1883 also was moved up a steep hill and across a road, where a bulldozer dug up a few feet of ground to allow the building to get under overhanging wires.

Some other buildings were moved up the hill for more practical reasons. The Arapahoe Café — a restaurant still open today in downtown Dillon — as well as the Elk’s Lodge in Silverthorne, were among the only places serving food to workers while they were building the dam, so they were among the last to be moved.

All of the remaining disputes and arguments were ultimately settled, mostly through Denver Water purchasing enough land and water rights in the area to make arguing or living there pointless. One resident managed to bargain until the last minute to get a much better price on his land. Another stayed around until the water started rising to his ankles.

By April 1, 1961, every resident from the old town of Dillon was required to be gone. Any buildings not moved or dismantled were burned to the ground, with everything removed and submerged. Contrary to local myths, Mather said, there are no buildings lurking under the depths of the reservoir. There may be foundations and roads but nothing else.

The residents of the new town of Dillon, or Dillon 4.0, watched from the hill above throughout the next two years as their whole way of life disappeared under water. Old Dillon — which still held fast in the ’50s as one of the last living relics of the Old West, complete with cowboys and ranches and prairies — was gone forever.

“You can’t have two more different towns than Dillon three and Dillon four,” Mather said. “Old Dillon was a Western town. New Dillon is a resort town. Old Dillon had wide-open spaces. New Dillon is clustered development.”

“The expected lifetime of the dam was 50 years,” Mather added, nodding to the fact that the dams’ 50th anniversary passed in 2011. “That tells you that, however you feel about Denver Water, they did a pretty good job taking care of that dam.”

Mather was referring to ample “dead space” in front of the dam. When constructed, dams leave a certain amount of “dead space” at the bottom and front of the dam, giving room between the dam’s outlet and the bottom of the reservoir.  

The space is meant for sedimentation that, over time, collects at the bottom of the dam, raising the floor in front of it. When the floor rises far enough, it starts blocking the outlet and free flow of water out of the dam. When that happens, the dam’s effective service life is over. In the case of the Dillon Reservoir, that was conservatively estimated to be 50 years.

Mather explained that the dead space at the bottom of Dillon Reservoir’s dam is not even close to being filled.

“So the next time you go across the dam road, take comfort in the fact that it’ll be there for at least another 50 years,” Mather said.

This is the second part of two-part series on the history of Dillon Reservoir and the town of Dillon. Read part one here.

Support Local Journalism

Support Local Journalism

As a Summit Daily News reader, you make our work possible.

Summit Daily is embarking on a multiyear project to digitize its archives going back to 1989 and make them available to the public in partnership with the Colorado Historic Newspapers Collection. The full project is expected to cost about $165,000. All donations made in 2023 will go directly toward this project.

Every contribution, no matter the size, will make a difference.