Travis County Commssioners Court
May 27, 2003
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Item 32
32 is to receive report of monitoring visit to Travis County school lands located in throckmorton county and take appropriate action.
>> that's a nice surprise, going to be here a little longer. Well, I think most of you are familiar with -- with the ranch in throckmorton, what started that whole thing back in 1839 had those -- that land was given to counties to support their county school systems, we've had other ranch in throckmorton county actually in 1856, Travis County has. Basically for about 100 years. The ranch was -- was leased every 10 years a high bid are kind of a situation where it was just let out for open bid and leased or awarded to the high bidder. And 1993, 1983, I'm sorry, spade ranch, current lessor -- leaseor won the current grazing lease and has had it since that time. We've had a relationship with spade ranches for the past 20 years. Spade ranch is a large, very large operation running 350 or so thousand acres, running cattle on 350,000-acres or so across west Texas and new mexico for I guess since 1967 or 8. Doug walldrep has been the c.e.o. You all had the opportunity to meet him last year. He came to Commissioners court one day. He's been working in that position for almost 30 years as a c.e.o. He's a ph.d. In range management from Texas a&m and has -- has a long hiss in ranching. We have an agreement with them, the current agreement started in 1993, and it's -- it's an agreement for $5 per year for grazing, the ranch is 18,820 acres, so it's about 94,100 per year that comes into the county to be allocated to the school systems or school districts across the county. In addition to that income, the ranch is also leased for hunting and recreation, that's something that this Commissioners court did about 10 years ago. They set up a system called conservation fund where 06% of the income from the hunting and recreation that spade receives goes into a conservation fund and is reduced strictly for improvements on the ranch, whether it be fencing, wildlife habitat improvement, brush management, whatever the ranch needs to keep it up and to keep it in good shape. That's been probably the -- the wisest move that I have ever seen a leasor make in terms of being able to keep a property in good working condition, it been really, really good that we were able to do that. On March the 4th, I went and did had he independent monitor visit at the ranch because this is a year that the lease is going to be up for renewal. I took with me a team of experts, I took j.f. Containhead, a range specialist from vernon. [indiscernible] two wildlife specialists, one from vernon, from san angelo with me, just to take a look at the ranch. Then cork key the local extension agent went with us jurks to get some opinion -- just to get some opinions on the ranch, how it's being managed, the kind of conditions that it's in as to how it relates to wildlife and to the livestock. As we know, in Texas running cattle or livestock on a ranching operation doesn't equate to profitability. There's more people really interested in the wildlife aspects at times than there are in livestock, so it's very important that the ranch be managed to benefit both wildlife and livestock. So I took them to get their opinions on how the ranch was being managed as well. I think the ranch certainly benefited from a tremendous winter. A lot of rain on the ranch. This was my third visit to the ranch, it doesn't look like the same property. Tremendous shape, grass, waste high in places, I mean it's thick, really covered well. The brush control that has taken place over the last 10 to 12 years on the ranch are really evident now. The benefits from that are really evident as we can see the grass cover. So the ranch was in very, very good shape and I was certainly impressed with being able to see that. I asked the team to look at the ranch from three different perspectives, you know, the overall condition of the ranch for wildlife, the overall condition of the ranch for live stop and then their overall impression of what the past or present management decisions have had on the ranch. I asked them as they looked at the ranch, you all have in front of you, responses, but basically the grazing plants. Rotationnal grazing plant, where each pasture is rested for a prescribed period of time every year so it what time to recover from grazing. They felt like that draizing plan provided really good cover for quail and in the rolling plains of Texas, that's one of the few places in Texas where we still have fairly high populations of native quail. That's very important that we maintain quail habitat, food sources, nesting. We have done a very good job with that. They felt that most of the ranch, while we have done a really good job of controlling brush for the last 10 years on that ranch, most of the ranch still has men too far of -- plenty of woody cover for deer. We have done a lot of work. The ranch has done a lot of work in brush control, but in 10 years you don't fix what 100 years of overgrazing and brush end control. Has done, still a lot of brush on the ranch. It's probably more clear than most of the ranch this is that area, but still plenty of habitat, plenty of cover for deer as well. There's a very broad diversity of [indiscernible] and browse on the ranch in terms of providing food for both wildlife and livestock. Again management provided that. Kind of an overall general comment that just said this was overall one of the best wildlife ranches in throckmorton county. That was from the county extension there in the county that made that contract. The four pasture three herd grazing system has been excel leapt. Done a very good job of maintaining the quality. The ranch has been approved for production of cattle for many years. The condition of the ranch is better than many ranches that have been depop placed -- depopulated of livestock for many years. We have talked about the severity of drought in that area for the last three to five years. In throckmorton county, a lot of ranches actually depopulated. Got rid of all of the livestock, just left them empty. This ranch mained some -- maintain smd livestock. Certainly well below the carrying capacity. They have maintained some livestock, but the way they have rotated those cattle and moved them around has kept this ranch in as good or better shape in terms of grasses than those ranches that have been totally depopulated. And another comment at the end is that the managers seem to have a very good grasp of the importance of leaving brush cover for wildlife while still making improvements to benefit the livestock operation. Then the overall comments, that's very well managed, we could see some I am provement to distribute the water more. That's typical of all ranches, there's never quite enough windmills or surface ponds to water every pasture like you would like them to be. But I think in general the comments from that team were very positive. That the ranch had been managed well and that it's in very good shape. In terms of recommendations, well, let me add a couple of things, there was -- there was one letter that I received just last week from dr. Rawlings who had not responded to me sprefsly, wanted to make sure that his comments were heard, his overall comment was that this ranch is the best lease country he's ever seen anywhere any time in terms of condition. A lot of times lease ranches, you know, people lease them at a rate that's really higher than they can probably afford to pay and be able to stock it correctly. In other words they have to really stock these ranches heavily in order to be able to generate enough income to pay their lease or make any profit. A lot of the lease places that you see are overgrazed, really bad. I have worked with two or three other school lease ranches in my career and seen other school county owned ranches that are leased and they are generally overgrazed pretty badly. This one is in awfully good shape. If you wanted to make sure that we come out, one of his comments that he always likes to make, he said it looked like all concerned had been wearing their camouflage cowboy hat when's they make decision, he uses that's a met tore when they are still looking at livestock, the camouflage represents the fact that they do consider wildlife and that's had a very important impact on their decision making on the ranch. He said that he would like to see that place nominated for the Texas chapter of wildlife society's land stewardship award this year, I think he's going to see that that happens. That was just a comment that I received this week from dr. Rawlings. Terms of recommendations, I think again, the lease does come up this year, the current lease expires December 31st of this year. I would recommend that we look at renegotiating a lease with spade to extend from January 1, 2004, through December the 31st of 2013. Of course negotiated a new rate for grazing and further I would probably recommend that we reduce the contribution to the conservation fund. Currently they contribute 60% of the income from -- from the wildlife and recreation. We can probably negotiate a higher lease and reduce that contribution somewhat because the major projects in terms of brush control are probably complete. Now we are looking at maintenance, doing some of those things that we can -- we can lower that contribution just a little bit and increase the cash income from -- from a higher grazing, per acre grazing assessment on the property. I would be glad to answer any questions that you may have about the ranch or the condition or the recommendations.
>> how do we determine what a fair lease rate would be?
>> I think that we look at what others in the rolling plains are paying. $510 years -- $5 taken years ago was a fair rate. 10 years ago. It's higher than that now. They realize that. In fact the initial letter that I got from spade ranches indicated that they saw it being somewhere in the neighborhood of $7 being more the market rate. I think that it's something that we need to look into further. Look at other landowners and see what they are receiving, what their cash income is on those lease places.
>> a good legal question to address between now and when we take action, whether it's legally sound as oppose odd getting bids, we could pout in the proposal -- put in the proposal some of the terms and conditions regarding improving the ranch and other things that you have to do in addition to paying a fee, just one of --
>> tamara armstrong did the legal research on that, just to see what the situation was and she determined that it is legal to do -- to renegotiate surface leasing when you -- when we start looking at the oil and gas, the subsurface income from the ranch, those bid have to be let. But that we can renegotiate a lease on surface use of that property, so --
>> I haven't seen that. Would you get a copy of that to us?
>> sure, i'll do that.
>> any other questions or comments?
>> thanks, joe.
>> thank you.
>> thank you all.
>> I appreciate your -- what time table are you on? We need this in place by --
>> the lease expires December. So I guess in terms of giving them around answer, you would like to give as much time as possible. It takes time, if there's going to be a change made, it takes time to move livestock and people, those sort of things. So fall. I would think. Would be good. Late summer.
>> will there be any kind of report that somebody could look at or -- has there ever been something put together where you would compare how many people beyond the spade ranch people could this, obviously there's a number of people that do this, it would be interesting to see a comparison for a few people that are sort of in the same league, if you will, of these people, obviously these people know what they are doing and have done a great job for us. But -- but I mean for me, it would be great to see a comparison about here are five tract of land this large in -- that are managed by different people and just to kind of get some comparative -- is that something that's -- that's readily available?
>> well, it would take some time to put it together. Probably the most fair comparison there would be to look at other school-owned ranches. I know there's two in tom greene county, one in crockett county, two more in throckmorton county. Just looking at those. A lot of the counties have sold their properties down through the years. There are a dozen or more, I know of a dozen or more that are still owned by the counties and we can look at that and get a comparison as to what kind of income they are receiving, kind of a general idea of what kind of condition those ranches are?
>> that would be helpful for me.
>> two years ago, my idea was we probably could make more money for the school district if we sold it, invested the money, periodically gave them a payment. The economy was a whole lot better then --
>> right, it was a little different.
>> I do think that we ought to keep that in the back of our mind. My guess is the school districts would agree to that. It would be a whole lot less work for us and it -- if it generates revenue for them, that's the goal. One of those old laws where I guess i'd made sense back in the 1800's. Now we have to put a whole lot of effort into it. Of the proceeds a lot of them have to go back into the land to conserve it and do it right. You have to reinvest back into the land and what that means that is the school districts get less money. Right now there are, what, six or seven school district in Travis County. They all share from these proceeds, right?
>> yes. It's not a lot of moab.
>> of course maybe of -- of course many of them are considered property rich anyway, so we also would need to make sure that what we are doing is a positive thing. We wouldn't want to have money they wouldn't be able to recapture because of recapture.
>> yeah, put somebody over the top.
>> exactly. There are a lot of things to analyze.
>> tamara, do we -- did we punch the right button?
>> yes, I believe so. I said in my opinion, I concluded that you can renegotiate the lease with respect to the surface interests as opposed to the mineral interests. Newable. Inaudible]
>> okay.
>> I assume at some point we will make sure there's no oil on this land.
>> there is some production.
>> there used to be [multiple voices]
>> I remember the court going up in the mid '80's.
>> that -- affecting the proceeds from that are included in the amount that we receive annually?
>> that's not a part of the 94,100. That's separate in the neighborhood of 30,000 I guess.
>> something like that. Not nearly as much as it used to be. Less than the revenue from the land.
>> the 94,100 is simply the payment from spade ranches for the surface utilization from the property. The oil and gas is in addition. It's not a whole lot, bits 30, 40,000 a year.
>> uh-huh. But it's 30, 40,000 a year.
>> thank you very much.
>> thank you.
>> thank you.
>> thank you for not taking stephen with you on this trip. [laughter] thank you, tamara.
Last Modified: Wednesday, May 27, 2003 7:52 PM