October 3, 2013 BOARD MATTER D - 1 ACTION: AUTHORITY: Consider Moriah Ranch Lease Proposal W. S. 36-5-114; Board of Land Commissioners Rules and Regulations, Chapter 5 ALTERNATIVES: Approve the Selected Proposal and Authorize the Director to Negotiate and Execute a Farm and Ranch Management Lease with Hunter Cattle Company, LLC Deny the Selected Proposal and Reinitiate Request for Proposal Process BACKGROUND: On August 11, 2005, the Wyoming Board of Land Commissioners (Board) adopted the following Trust Land Management Objectives to guide the sale, acquisition or exchange of State Trust Lands: 1. Better meet the beneficiaries short and/or long-term objectives through: (a) improved income generating potential, (b) improved investment return, (c) improved portfolio diversification, (d) improved appreciation potential, and/or (e) improved intrinsic natural resource values; 2. Improve the manageability of the land asset through: (a) consolidated ownership patterns, and/or (b) improved ability to leverage the management resources of other agencies/entities; and 3. Meet a specific school and/or community need through: (a) economic stability, (b) economic growth opportunity, and/or (c) improved access/recreational opportunity. Applying these objectives and critical analysis outlined in the Detailed Analysis of the purchase of the Moriah Ranch (Ranch), the Board concluded that the Ranch satisfied not just one (1) but, to some degree, each of the adopted objectives. The Board purchased the Ranch on April 12, 2012. A copy of the Detailed Analysis prepared for the purchase of the Ranch can be downloaded from the Office of State Lands and Investments (OSLI) website at: http://slf-web.state.wy.us/surface/landtransactions/2011/moriah/damoriah.pdf As prescribed by the Wyoming Constitution and State Statute, the Ranch is managed as State Trust Land for the exclusive benefit of Wyoming s public schools. Since the purchase date in April 2012, OSLI has managed the Ranch pursuant to interim management recommendations approved by the Board in June of 2012, subject to the development and implementation of a permanent management plan. The Board approved a Temporary Use Permit to guide Ranch operations in the interim, which expired on October 1, 2013. A Request for Proposal for a Farm and Ranch Management Lease (RFP) was advertised in July, 2013 in two (2) statewide publications, the Casper Star-Tribune and the Wyoming Livestock Roundup, and was posted on the OSLI website (see attached RFP). OSLI received inquiries and interest from individuals and corporations across Wyoming, as well as interest from parties in Nebraska and New Mexico. OSLI provided tours of the Ranch to twelve (12) interested parties. Page 1 of 2
ANALYSIS: OSLI received seven (7) applications as a result of the RFP. Each proposal met the established minimum criteria. Rental offers ranged from $20,000 to $73,300 per year. Each proposal was reviewed and prioritized by the Review Committee (Committee) utilizing the Board s Trust Land Management Objectives and management goals, as stated in the RFP. The Committee consisted of: Jason Fearneyhough, Director, Wyoming Department of Agriculture; Tony Hoch, Director, Laramie Rivers Conservation District; Roger Coupal, Department Head, Department of Agricultural and Applied Economics, University of Wyoming; David Whitman, Rancher, Albany County; and Cole Lambert, Natural Resource Specialist, OSLI. As a result of its review and deliberations, the Committee unanimously recommended that the Director forward the proposal and annual rental offer of $47,025 submitted by Hunter Cattle Company, LLC (HCC) to the Board for its consideration. While HCC s rental offer was not the highest received, the Committee considered its business plan to be the most compatible, consistent, and sustainable when viewed in the context of the Board s Trust Land Management Objectives. Copies of all proposals may be viewed upon request at OSLI. HCC submitted a proposal that demonstrated an active, progressive management method, utilizing yearling cattle as its primary class of livestock. HCC also proposed to manage the Ranch as part of a larger ranching operation, consisting of seven (7) other leased properties in the area, some of which adjoin the Ranch. HCC possesses a wealth of knowledge and experience relative to the Ranch, as it has been operating on it for seven (7) years, including the interim period as OSLI s temporary use permittee, consistent with the purchase agreement between the Board and the seller of the Ranch. During the interim period, HCC has been active in attending tours and meetings that OSLI has conducted with the public and neighboring ranches. HCC has shown its dedication to the Ranch by actively adapting its management techniques and improving the property. HCC has also shown its commitment to education by supporting and attending an educational tour, held this summer at the Ranch. Additionally, Randy Hunter, owner and operator of HCC, is a practicing veterinarian who provides internship opportunities to students studying livestock and ranch management techniques. DIRECTOR S RECOMMENDATION: The Director recommends that the Board: 1) accept Hunter Cattle Company, LLC's proposal and rental offer; and 2) authorize the Director to negotiate and enter into a Farm and Ranch Management Lease with Hunter Cattle Company, LLC, with an effective date of October 1, 2013. BOARD ACTION: Page 2 of 2
Moriah Ranch Request for Proposal For Farm and Ranch Management Lease PURPOSE OF REQUEST The Office of State Lands and Investments (OSLI) is seeking a long term farm and ranch management lease on the Moriah Ranch (the Ranch). OSLI will be accepting written proposals, from all interested parties, until 5 p.m. on September 2, 2013. BACKGROUND On August 11, 2005, the Wyoming Board of Land Commissioners (Board) adopted the following set of Trust Land Management Objectives to guide the sale, acquisition or exchange of school trust lands: 1. Better meet the beneficiaries short and/or long-term objectives through: (a) improved income generating potential, (b) improved investment return, (c) improved portfolio diversification, (d) improved appreciation potential, and/or (e) improved intrinsic natural resource values; 2. Improve the manageability of the land asset through: (a) consolidated ownership patterns, and/or (b) improved ability to leverage the management resources of other agencies/entities; and 3. Meet a specific school and/or community need through: (a) economic stability, (b) economic growth opportunity, and/or (c) improved access/recreational opportunity. Applying the above objectives and critical analysis outlined in the Detailed Analysis of the purchase, the Board concluded that the Ranch satisfied not just one (1), but to some degree each of the adopted objectives. The Board purchased the Ranch on April 12, 2012. A copy of the Detailed Analysis prepared for the proposed purchase of the Ranch can be obtained from OSLI or can be downloaded from OSLI s website at: http://slf-web.state.wy.us/surface/landtransactions/2011/moriah/damoriah.pdf. Pursuant to statute, the Ranch must be managed as state trust land for the benefit of Wyoming s public schools. From the purchase date in April 2012, until October 1, 2013, OSLI has been managing the Ranch pursuant to interim management recommendations approved by the Board in June of 2012, subject to the development and implementation of a permanent management plan.
LOCATION and PROMINENT AGRICULTURAL RESOURCES The Moriah Ranch is located in northern Albany County (maps attached). The Ranch consists of 13,787 total acres, 12,947 acres of State Trust Land and 840 acres of BLM land. Topography is rolling to steep, with canyon lands and rocky outcrops throughout the Ranch. Soils range from loamy in the spring pastures and meadows to shallow soils in the rocky outcrops. The typical plant communities are grass, mountain brush and sagebrush mixed. There are scattered ponderosa pine, limber pine and aspen; and willows occur in the valleys and riparian areas. The rangeland is in fair condition overall, although the effects of the prolonged drought can be seen on the meadows and uplands. Noxious weeds observed on the property include Canada thistle and houndstongue. Prairie dogs are present in isolated populations in the uplands. Two small creeks, Duck Creek and Pinto Creek traverse the Ranch. These streams provide irrigation water to the hay meadows and are a source of water for livestock and wildlife. The amount of water in the creeks, especially in the late summer months can be a limiting factor for hay production. Prolonged drought has significantly reduced the amount of water in the creeks. There are eleven (11) reservoirs on the Ranch. The reservoirs provide a good source of water for livestock and wildlife in the area. Of the eleven (11), several have live water that feed them keeping them full in most years. They also receive spring run-off in most years that will fill them to capacity. There are multiple flowing springs on the Ranch, some have been developed and some have not, these springs help to provide water to the pastures. Currently, there is one (1) fully developed spring with a one (1) tire tank. The Ranch has several water rights attached to certain ranch lands. A list of the water resources tied to the Ranch is available in the Detailed Analysis located on OSLI s website. The Ranch will be open to the public for non-motorized general recreation purposes throughout the lease term. Hunting and fishing will be managed by the Wyoming Game and Fish Department through its access programs. The following criteria will be used by the screening committee to determine the most qualified applicant(s). The screening committee will include representatives from the Wyoming Department of Agriculture, Natural Resources and Conservation Service, an Agricultural Economist from the University of Wyoming, College of Agriculture, and OSLI staff. The screening committee will review all written proposals and accompanying bids to make a recommendation to the OSLI Director to be presented to the Board for final approval. Requirements to be a Qualified Lessee Lessee must be a United States citizen and a person(s) or entity(ies) authorized to conduct business in the State of Wyoming.
Lease will be for a term not to exceed 20 years. Lessee will submit a business plan to coincide with the number of years in the lease; plan will be subject to five-year review and updates. Applicant(s) must demonstrate an actual and necessary use for the land and available forage. Applicant(s) must demonstrate experience in managing a livestock operation involving native rangeland, irrigated hayland, wildlife habitat, and public access. Expectations of Selected Lessee Lessee must follow a grazing management plan developed by lessee and OSLI. Lessee will conduct vegetation monitoring on the Ranch as directed by OSLI. Lessee will assist in weed and pest control. Hired ranch hands will be permitted. Lessee will not sublease the Ranch. Lessee may take in livestock owned by a third party upon approval by the Board. Lessee will keep records of the operation (livestock, hay production, vegetation) as directed by OSLI. Lessee will have access and use of structures and buildings at the main residence (residence, Quonset, outbuildings and old garage). Excluding the Pinto Rock Cabin. Lessee will maintain all buildings and improvements on the Ranch. A percentage of the lessee's annual payment will be applied for improvements. Lessee will receive one permission slip per big game species; these permission slips will not affect the number of permission slips available to the public through the Hunter Management Area (HMA) The lessee will monitor recreation/hunting/fishing on the Ranch and will advise users of the policy/rules. The lessee will report violations of the rules to the appropriate authorities. The lessee will assist OSLI with various projects on the Ranch (tours, improvement projects, habitat treatments). The lessee will attend meetings affecting the operations of the Ranch (County Conservation District, Weed & Pest District, State Engineer s Office, Wyoming Game and Fish Department, etc.). The lessee will participate in educational presentations about the Ranch and/or the agricultural operation on location at the Ranch or at other meeting locations. The lessee will maintain signs posted on the Ranch. The lessee will not post any signs unless prior approval has been granted by OSLI. The lessee will not lock gates unless prior approval has been granted by OSLI. The lessee will maintain and protect all areas with cultural and/or archaeological significance, with the advice of the Wyoming Department of State Parks and Cultural Resources and pursuant to the direction of OSLI. What is being bid on:
A 10-20 year Farm and Ranch Management Lease averaging 2,309 Animal Unit Months (AUMs). Use of the Main buildings and residence. How to submit a proposal: Applicant(s) must submit a sealed proposal to OSLI by 5 p.m. on September 2, 2013 for consideration. Proposals must include: a cover letter explaining in detail the proposed agricultural business, a business plan consistent with the proposed term of the lease that addresses all the above criteria, history of your operation, a current financial statement, three years of federal income tax returns, and a signed authorization for release of credit information. THE BID WILL BE BASED ON THE UNIT AS A WHOLE AND NOT ON AN AUM BASIS. FOR BIDDING PURPOSES AND KNOWLEDGE OSLI HAS DETERMINED THE RANCH HAS AN AVERAGE OF 2,309 AUM s. THE STATE RESERVES THE RIGHT TO REJECT OR REFUSE ANY OR ALL PROPOSALS RECEIVED IF IT IS DEEMED NECESSARY. ADDITIONAL REQUESTS FOR PROPOSAL MAY BE OBTAINED FROM THE OFFICE OF STATE LANDS AND INVESTMENTS, 122 WEST 25TH STREET, HERSCHLER BUILDING - 3RD FLOOR WEST, CHEYENNE, WY 82002. THE REQUEST FOR PROPOSAL, ALONG WITH AN APPLICATION, CAN ALSO BE VIEWED AT http://slf-web.state.wy.us. The Ranch is open to the public on a non-motorized basis for applicant(s) to view. Attached are maps showing the fences, water developments, and buildings located on the Ranch. If anyone is interested in a personal tour of the Ranch we have set aside the week of July 23-26 and August 13-16. These will be individual one day tours of the Ranch. Please contact Cole Lambert at 307-620-5094 or email at cole.lambert@wyo.gov, or Michael Henn at 307-777- 6525 or email mike.henn@wyo.gov to schedule an appointment on one of these dates.
STATE HWY 311 STATE HWY 95 I 25 US HWY 20 Glenrock I 25 STATE HWY 93 STATE HWY 96 Douglas STATE HWY 59 US HWY 18 STATE HWY 91 COUNTY HWY 16 STATE HWY 94 COUNTY HWY 5 RIDGE RD STATE HWY 319 Glendo STATE HWY 270 Guernsey RANCHO RD US HWY 26 STATE HWY 160 STATE HWY 487 COUNTY HWY 61 STATE HWY 320 Wheatland STATE HWY 316 Medicine Bow S GAP RD Rock River STATE HWY 34 I 25 Chugwater STATE HWY 313 STATE HWY 13 I 25 US HWY 30 STATE HWY 130 STATE HWY 12 COUNTY HWY 17 Laramie I 25 US HWY 85 STATE HWY 10 COUNTY HWY 44 STATE HWY 230 US HWY 287 STATE HWY 210 STATE HWY 225 STATE HWY 211 Cheyenne DELL RANGE BLVD STATE HWY 212 COUNTY HWY 209 STATE HWY 223 Moriah Ranch 0 15 30 Miles city wyrds Moriah Deeded Property µ Date: 6/12/2013 By: Michael Henn
Moriah Ranch Fence Water Moriah Deeded Property BLM 0 0.75 1.5 Miles µ Date: 6/12/2013 By: Michael Henn
Source: Esri, DigitalGlobe, GeoEye, i-cubed, USDA, USGS, AEX, Getmapping, Aerogrid, IGN, IGP, swisstopo, and the GIS User Community Moriah Ranch Fence Water Moriah Deeded Property BLM 0 0.75 1.5 Miles µ Date: 6/12/2013 By: Michael Henn
WYOMING BOARD OF LAND COMMISSIONERS AUTHORIZATION FOR RELEASE OF CREDIT INFORMATION I (we) her eby agr ee as follows: I. This author ization and any support information is the property of the Wyoming Boar d of L and Commissioner s (Boar d). II. III. IV. The Boar d is author ized to make cr edit checks or inquiries concer ning matter s listed as assets, liabilities, and r efer ences relevant to this pr oposal, including farm or ranch operating statements or Feder al I ncome Tax r etur ns. Cr editor s and other s ar e author ized to disclose infor mation r elative to any loans, accounts, pur chases, or other financial transactions, past or current, to the Boar d. The proponent author izes the Boar d to r eview any Cour thouse files and r ecor ds as deemed necessar y. Date Proponent SSN or EID No. Date Proponent SSN or EID No. Date Proponent SSN or EID No. Date Proponent SSN or EID No.