Fourth-generation dairyman Rob Graves looking for a solution to the smelly problem of Noosa's success

As a fourth-generation Colorado rancher and farmer, Rob Graves is part of a continuing tradition. His great grandfather, William Charles and his wife Arista, came from Illinois in 1894 and settled on fertile land near the mouth of the Poudre River near Bellvue, a few miles northwest of Fort Collins.

In the early days, the Graves sold their excess milk to a few neighbors. Over time they increased their holdings until today, as owners of 7,000 acres, they are one of the largest landowners in the area. They also own perpetual water rights and grazing permits on national forest land.

W.C’s only son, Charley, attended tiny Pleasant Valley School, a one-room stone building that still stands on the Graves’ property. At Colorado A&M he met Helen Whiting and they had two children, Millah and Robert. In 1930, to meet medical expenses incurred by complications at Robert’s birth, the Graveses stepped up their dairy business, introducing modern techniques and acquiring additional land.

Robert grew up to earn a degree in veterinary medicine from Colorado State University and was active in the dairy business until his death in 1997. A well-known member of the community, he is remembered for establishing the National Marrow Donor Program, resulting from his struggle to find a cure for his daughter Laura’s leukemia. His only son, Rob, took over the business in 1991 and renamed it Morning Fresh Dairy.

After graduating from CSU and a year spent working at the Chicago Board of Trade, Rob reverted to his roots and came home to farm and run the dairy. Following in his grandfather’s footsteps, he met his wife, Lori while in college at CSU and together they operate Morning Fresh. Rob oversees many operations, dividing his time with Noosa, their yogurt business, and Lori runs the back office. She recently opened Howling Cow, a coffee shop that caters to employees, local residents and road bikers who often make the shop their destination. Their son Bryan works as an engineer at Noosa and three younger children are in college. Daughter Kelsey died at age 13, electrocuted while cleaning a filter on an irrigation pivot clogged with debris from a severe forest fire in 2012.

Morning Fresh delivers milk free of pesticides, preservatives and hormones, in reusable glass bottles, to the doorsteps of loyal individual customers and to Whole Foods and other grocery stores. And along with their milk, customers can purchase Noosa Yoghurt, produced on what has become the Morning Fresh/Noosa campus, made from Morning Fresh milk and an Australian yogurt culture.

Lori and Rob were happily milking their 400 cows and not looking to expand in 2009 when Koel Thomae approached them with a taste of some special yogurt and an idea. “I didn’t even eat yogurt at the time,” Rob said.

But Thomae, who lived in Boulder, insisted. An Australian ex-pat, she had recently returned from seeing her parents bearing a license to produce Queensland Yoghurt (They spell it with an “h” in Australia.) in her adopted country. She had discovered what she called “the best food I’ve ever eaten” during her visit home and was determined to find a way to make it in the U.S. She tracked down the Mathewson family who made the yogurt and persuaded them to go international. They came to their agreement in a town called Noosa.

Thomae’s next step was to find a dairy to provide the milk and make the yogurt. By chance, she saw a flyer about Morning Fresh Dairy, contacted the Graveses and the rest is history. They formed a partnership. Paul and Grant Mathewson came to the U.S. to share the secrets of their yogurt and in 2010 Morning Fresh began production.

“We made it in 5-pound buckets and delivered it to our first customer, Whole Foods, in 2010,” Lori said. “We also sold it at the Boulder Farmers Market.” The first flavors were blueberry, honey, raspberry and mango.

“We figured on making a couple hundred pounds a week, no more than that,” Rob added. Today 20 percent of Morning Fresh’s milk gets piped into the adjacent yogurt manufacturing plant that runs 24 hours a day, seven days a week. Four flavors have become 18, now sold in 25,000 stores across the country.

In six years, Noosa has become the number-one selling yogurt in Colorado, with total current sales of $100 million. The company employs 150 people. This summer three new spicy flavors, mango sweet chili, pineapple jalapeno and raspberry habanero will hit the shelves.

By 2014 Noosa had become so successful that private equity firm Advent International based in Boston acquired the company making further expansion possible. A new 35,00 square-foot warehouse and a 6,000 square-foot administration building have recently been completed at world headquarters adjacent to Morning Fresh in Bellvue.

The growth of Noosa and Morning Fresh has been so startlingly rapid that the Graves have been playing catch-up for several years. They’ve built new buildings, hired more employees, increased their herd to 850 cows and opened Howling Cow Café on the Morning Fresh property. Managing the growth and change is a continuing challenge and has meant long hours and hard work for both of them.

Growth has its pitfalls. Owning more cows, producing more milk and the introduction of a new product require new ways of doing things—adhering to all sorts of regulations—obtaining permits and operating according to county and state-mandated guidelines have the made the business more complex. The Graves are responding as best they can.

After several months in the design stage, construction began last September on a 6,400 square-foot water treatment plant needed to deal with the waste, called “yogurt rinse water” created by the production process. “I enjoyed the research required to build the facility,” Rob said, obviously proud of the new building which will be fully functional in the coming months.

It can’t happen soon enough to please the Graves’s neighbors. Since last November when Bellvue residents first identified a fairly constant unpleasant smell wafting on the breeze coming from Rist Canyon Reservoir, (also known as Lacy’s Pond) they have become increasingly concerned. Noosa/Morning Fresh deepened the reservoir last year, constructed a pipeline from Noosa to the reservoir and planned to store nutrient water there. Small reservoirs are often used for agricultural wastewater storage in Colorado and are sometimes called storage lagoons.

Due to delays in the construction of a state-of-the-art water treatment plant, Noosa began temporarily storing yogurt rinse water in the pond, not part of their original plan.

With the approach of warm weather, the issue of the smell has become more urgent for Bellvue residents. There are often times when the prevailing wind delivers a stench so strong that they cannot open their windows. Many do not have air conditioning. Bedrooms have become stifling making sleep difficult. There has been a single incident when a woman with respiratory issues ended up in the emergency room, probably because of the polluted air.

Responding to odor complaints, Noosa installed deodorizing equipment in the pond. When one Bellvue resident had a respiratory issue, possibly related to the deodorizers, Noosa immediately removed them.

The people of Bellvue progressed from talking among themselves to conducting several group meetings, some heated, as they worked to find a solution. With the passage of time, other concerns have surfaced. The consensus, expressed by retired CSU professor, John Calderazzo, asks three questions:

1. How long will the smell continue?
2. Will liquid from Rist Canyon Reservoir contaminate the wells on our properties? He worries that the reservoir has not been completely sealed.
3. Will some of this polluted water eventually find its way to the Poudre River?

Calderazzo points out that regulations are in place that prevent the pollution of air and water. “Ownership of surface water does not include the right to pollute the land underneath it,” he said. Neighbor Mary Lea Dodd said one neighbor has moved away, at least for the summer months, because of the smell. Calderazzo suggests that if the smell persists, it is likely to affect the resale value of homes in the area.

Another issue that worries residents long-term is the capacity of the wastewater treatment plant. Their research has indicated that the plant has a capacity of 50,000 gallons while another 10,000 gallons will also need processing by the time the plant is fully functioning. In fact, Noosa has a permit to discharge 50,000 gallons of fully treated water into the Poudre River each day. The water treatment facility will have a capacity of 80,000 gallons a day. The difference, up to 30,000 gallons of processed water , will be reused at the dairy.

The Graves have always had a good relationship with their neighbors. Lori Graves and Noosa’s public relations person, Stephanie Giard, have attended every meeting held by the neighbors and are as anxious as they are to find a permanent solution to the waste disposal issue. “We’re doing everything we can to facilitate the clean-up of the reservoir as we await the completion of the treatment plant,” Giard said. She and Lori have gone as far as spending nights in a trailer near the reservoir to monitor the aerators and make sure they are doing their job.

Dodd says that while the neighbors are certainly impatient at this point, they wish Morning Fresh and Noosa well and only want to solve these difficult issues.

Yogurt rinse water from Noosa now is trucked away from the premises to A1 Organics and processed through a biodigester. At the time of this writing, some of the cleaned pond water is being applied to agricultural land in order to test the effect of spreading this partially-processed rinse water on agricultural fields. It can provide useful moisture and a small amount of nutrients.

The state of Colorado and Larimer County are overseeing the testing will certify the safety of the process referred to as “beneficial use.” When the water treatment plant is fully functional, all yogurt rinse water will be run through the plant. Fifty-thousand gallons will be discharged the Poudre River. The processed water that remains beyond that amount will be reused for cattle operations at the dairy. Rist Canyon Reservoir will no longer be used for storage, eliminating the offensive smell.

Meanwhile, Bellvue residents welcome some alleviation of the smell as the aerators do their work. They continue to pursue their case, meeting, forming committees and contacting county and state officials and the president of Advent International in hopes of being able to breathe easier and open their windows to allow a scent-free breeze to blow through their homes sooner rather than later.