The University of Arkansas System's Agriculture Division says it will have "extremely limited options" for helping pay for a new rice research center near Jonesboro if the pending sale to a private entity of 6,300 acres from another research station collapses.
The Arkansas Rice Research and Promotion Board has voted to provide $21.4 million for the future Northeast Rice Research and Extension Center, including an initial $4 million grant to buy the 614-acre site in Poinsett County, about 5 miles south of Jonesboro on Arkansas 1.
The board, a quasi-public entity whose nine members are appointed by the governor but receives no general funding from the state, also has established a $5 million endowment for the operations of the center, the UA System's first since 1957.
The UA Agriculture Division said the sale of the 6,300 acres from its Pine Tree Research Station in St. Francis County is central to matching the rice board's $5 million endowment.
"Progress and scope of the project will be directly impacted by the sale of Pine Tree," Mary Hightower, a division spokeswoman, said this week in response to a series of questions related to both projects. "If the sale does not proceed with the current executed contract ... we have extremely limited options."
As for other costs associated with the center's construction and operations, the division will seek grants and endowments from private entities and state funds through the Arkansas General Assembly.
"We are also pursuing noncash gifts to equip our research," Hightower said. "Through our development work, we would need to raise $4 million to $6 million, in addition to the endowment; hence the significance of the Pine Tree sale."
Selling 6,300 wet and heavily forested acres of the Pine Tree station was "the most viable option" to help pay for the new research center, Hightower said, because the acreage isn't conducive to the row-crop research conducted elsewhere at the station.
While the sale was approved March 11 by the UA System board of trustees, it also is contingent on the approval of Congress. That's because UA in 1960 had obtained some 11,800 acres from the U.S. Forest Service for what would become the Pine Tree station. UA paid $560,600, making the final payment in 1978. The deed specified that the acreage be returned to the Forest Service should it ever cease being public land -- a stipulation that requires the congressional waiver, according to the Agriculture Division.
Lobo Farms LLC of the Fisher community in Poinsett County made the only offer for the 6,300 acres. The sale price was $17.6 million, plus a $1 million gift to a wetlands and waterfowl conservation endowment.
PUBLIC ATTRACTION
The proposed sale to a private entity caught the attention -- and opposition on social media -- of hunters and anglers who've used the 6,300 acres for decades under a cooperative agreement between the Agriculture Division and the state Game and Fish Commission.
While that agreement expired in 2005, the land has remained open for hunting, fishing and other outdoor activities (but not camping), and the Game and Fish Commission continues to manage the property as a wildlife demonstration area.
The Agriculture Division said efforts to sell the land to state agencies, including the Game and Fish Commission, and conservation groups failed. Some state lawmakers have said the General Assembly could pass legislation next year to buy the land and keep it in public hands.
"We have full faith and confidence in the University of Arkansas coming up with the match," Roger Pohlner, chairman of the rice promotion board, said Friday.
Pohlner said he believed the Agriculture Division did everything it could to keep the Pine Tree acreage in public hands. "I know the university explored a lot of options but just kept coming up empty," Pohlner said. "The sale, if it goes through, helps not just this [Jonesboro] station but all the other farms and stations where the university is researching row crops, vegetables, cattle and forests."
Pohlner said the division went several years without an increase in state general funding. "It's funny, now that the agriculture people have found a way to get new funding, some lawmakers are telling them to go back to the drawing board," he said.
Tying the acreage at the Pine Tree station to paying for the new research station was a response to a board of trustees' directive to inventory underutilized properties for possible sale or link to other "public-private partnerships," the Agriculture Division has said.
"At a time when funding is hard to come by and the research and education needs of our organization are constant, the proceeds from this sale are vitally important," the division said.
There apparently is no timeline for such a vote in Congress. The contract with Lobo Farms expires at the end of the year but can be renewed by mutual agreement, the Agriculture Division has said.
The registered agent for Lobo Farms is Mark "Field" Norris Jr., a financial adviser with Raymond James & Associates in Memphis. Norris, the son of a federal judge in Tennessee appointed two years ago by President Donald Trump, has declined through an attorney for the group to identify other investors in Lobo Farms. No law requires such identification.
After questions were raised by outdoors groups, media outlets and some legislators, Norris wrote the UA division on July 31 to say no members of the buying group are current or past members of the General Assembly or the UA System trustees or hold "any elected position."
RICE RESEARCH
Arkansas is the largest U.S. rice producer, supplying about half of the nation's annual harvest. Arkansas rice growers last year harvested more than 185 million bushels from 1.1 million acres. About eight northeast Arkansas counties now grow most of the rice in the state, eclipsing production in the Grand Prairie region, the birthplace of commercial rice production, several years ago.
The Agriculture Division now conducts research on rice production in Stuttgart at the Rice Research and Extension Center and at the Northeast Research and Extension Center in Keiser.
"The soils at ... Stuttgart are not the same as the mixed soils north of I-40 and west of Crowley's Ridge; nor are they the same as the heavier clay soils closer to the Mississippi River on which we grow rice at ... Keiser," Mark Cochran, the UA System's vice president for agriculture, has said.
Some $5 million of the proceeds of the Pine Tree sale would go toward the new station, the Agriculture Division has said. Another $6 million could be invested in research into smart farming and precision agriculture. Research into wetlands and waterfowl conservation and timber and wildlife also would benefit, the division said.
Work at the Poinsett County site has proceeded during the uncertainty surrounding the state portion of its funding.
Hightower said the land has been leveled and irrigation improvements are being made. Ground has been broken for equipment storage. Construction of a shop will begin this year "to accommodate the initial research activities that will take place in 2021," she said.
Those "phase one" activities were funded by the rice promotion board's initial contribution of up to $4 million to buy the 614 acres and $496,500 for construction of irrigation systems and wells.
Some $3.6 million was used for the purchase of two contiguous tracts -- 591.53 acres, for $3.5 million, from R.B. Spencer Farms of Jonesboro, and 22.47 acres, for $150,000, from Rusty Cartillar of Wynne. The UA trustees approved the purchase in November 2017.
The rice board also has pledged $10 million for the new station's headquarters; $1.4 million for construction of a shop and equipment yard, and $529,000 to pay a multiyear portion of the salary and benefits of Tim Burcham, hired last year as the Jonesboro center's director.
Burcham previously was dean of the Arkansas State University College of Agriculture. While ASU has been cited as a partner in research at the Jonesboro center, ASU isn't contributing any money toward its operations, Hightower said.
The budget for a second phase is $3.2 million for early construction and equipment, Hightower said.
"Initial annual operating costs are roughly $200,000, including a farm supervisor and an employee," she said. "Once we reach full operation, we anticipate costs for the research portion of the center to be approximately $800,000 annually."
Construction of the headquarters is projected to cost $12 million to $14 million, Hightower said.
Pohlner, the rice board chairman, said he wants to see a headquarters "with state of the art programs that we don't have going on at any of the other research centers, one that's open to the public, open to teachers who can load their kids onto buses for a day of education on rice and agriculture that's so important to the state."
"Those are the kinds of things that will be curtailed if we can't get fully funded," he said.
Pohlner said the rice promotion board will offer other contributions as needed but also will help raise money from private entities.
Since its creation in 1985, the rice promotion board has been funded by assessments charged to rice growers and buyers, but the $21.4 million contribution to the Jonesboro center comes entirely from tariffs collected on rice imported by Colombia.
Every rice-producing state receives the tariff funds, part of a 2012 trade promotion agreement between the U.S. and Colombia that, by phases, will end in about 2032, when free trade fully opens between the two countries.
The Arkansas board has received about $40 million since the program began, said Brandy Carroll, the board's administrator. She said the Arkansas board, prior to the Jonesboro contributions, had contributed about $10 million of tariff funds to various large-scale rice research programs in the state.
The board, she said, has voted to require that every dollar collected through both the tariffs program and the grower-buyer assessments be spent on research.
In a preface to answering questions this week about the proposed center and the sale of the Pine Tree acreage, the Agriculture Division said in a statement, "We continue to be disappointed and frustrated that opposition to the sale of the land at Pine Tree has devolved into attacks on our reputation and our research, and in particular our plans for the new rice station. This center was requested by the rice farmers in northeastern Arkansas, whose need for our research is great and we need to support them."