Despite objections from University of Arkansas System President Donald Bobbitt, lawmakers on the Joint Budget Committee approved a bill Tuesday prohibiting the sale of a portion of a university research farm to a private entity.
While Senate Bill 447 is an appropriations bill for the UA System's Agriculture Division, an amendment includes special language specifically prohibiting the proposed sale of 6,300 acres of the Pine Tree Research Station in St. Francis County. Lobo Farms LLC, based in nearby Poinsett County, has a contract to buy the land for $17.6 million, plus a $1 million endowment in wetlands conservation.
Bobbitt said Lobo Farms and the Agriculture Division agreed late last year to delay closing on the sale until the General Assembly could decide this legislative session whether to find $20 million to buy the 6,300 acres.
While the "good faith" offer to find the money failed, the Agriculture Division is now being met with "several pieces of legislation that attempt to interfere with our existing contract on the property," Bobbitt, the UA System's president since late 2011, said. On Monday, the state House of Representatives passed House Bill 1694, which also prohibits the sale. Both SB447 and HB1694 are now in the Senate.
"Effectively, we are being asked to give up a good-faith offer on this land in return for a promise and the threat of legislation like SB447," Bobbitt said. "We face a difficult choice. If we were to walk away from our current pending contract, we may face litigation from our buyers for breach of contract."
Bobbitt also said UA agriculture officials, in coming up with the proposed sale, had sought to comply with legislators' directives two years ago to find revenue sources beyond state general revenue. He said UA agriculture officials also were complying with a UA System board of trustees' directive to identify, and sell, unused property.
Sen. Ron Caldwell, R-Wynne, has led the legislative effort to halt the sale. Caldwell, who offered the special-language amendment to SB447 prohibiting the Pine Tree sale, said Tuesday the state had an obligation to keep the acreage as public lands and not sell it to a "hunting group."
Critics of the sale also have said that, while Lobo Farms is based in the Poinsett County community of Fisher, it is headed by an investment banker in Memphis. No law requires an LLC such as Lobo Farms to identify its investors or other backers.
Justin Allen, a Little Rock attorney for Lobo Farms, said recently that he doesn't believe the General Assembly can legally put a stop, retroactively, to a legally executed contract.
The 6,300 acres is wet, wooded and not conducive to row-crop research conducted elsewhere on the station's other 5,000 acres but has been open to the public for hunting, fishing, hiking and other activities for decades.
Efforts to sell the land to the state Game and Fish Commission or to nonprofit organizations failed, leading to the proposed sale to Lobo Farms, Bobbitt said. Some $5 million of the sale's proceeds would match a $5 million grant from the Arkansas Rice Research and Promotion Board for construction of the proposed Northeast Rice Research and Extension Center near Jonesboro, Bobbitt said.
Even if the General Assembly this session approves a $16.5 million appropriation elsewhere in SB447 for the research center, the appropriation is unlikely to be funded under the budgeting process known as the Revenue Stabilization Act, Bobbitt said.
Mark Cochran, UA's vice president for agriculture, joined Bobbitt in arguing for the sale.
Besides the $5 million for the new rice research center, $6 million would be invested in precision agriculture and smart farming programs, Cochran said.
Cochran said other investments would be made in infrastructure needs across the Agriculture Division's land holdings, in water and habitat conservation, and in the state's premier forestry programs at the University of Arkansas at Monticello.
Two Arkansans who live near the Pine Tree station, Josh Long and Charles Gaines, testified against the sale, saying the Pine Tree acreage is important as an area open and affordable to the public.
As a scoutmaster for 29 years, Gaines said he has taken his Boy Scout troop to the area for Eagle Scout projects that included improvements to a duck habitat and the reclamation of a long-forgotten cemetery. "There's a lot to be said for the educational projects that are out there," Gaines said.
Cochran and Bobbitt said they sympathized with residents who use the Pine Tree acreage for hunting, fishing and other outdoors activities but noted the Agriculture Division's public mission is to serve as a research and education institution, not a wildlife agency.
The sale requires approval of the U.S. Congress because of deed restrictions placed on the UA's purchase of the land in 1960 from the U.S. Forest Service. The deed requires a continued "public purpose" for the land.
In response to questions as to why the UA is trying to sell the land and then seek Congress' approval rather than seek Congress' approval before a sale, Bobbitt said he was informed that the Senate Committee on Agriculture, Nutrition and Forestry prefers to know the identity of a prospective buyer and its intentions prior to a sale taking place.
In a letter to UA officials in February, Lobo Farms said it will resume the effort to close on its purchase if the General Assembly doesn't pass legislation to buy the property.
Lobo Farms also said in the letter that it plans to spend $5 million in various improvements, such as to infrastructure and in wetlands restoration and habitat development.
Seasonal public use also would be possible, such as for summer fishing and bird-watching from towers erected on the property, Lobo Farms wrote. Hunting by members of the general public was not mentioned as an activity that would be allowed.
Lobo also said cabins and other facilities on a 22-acre parcel inside the Pine Tree property that were part of a state juvenile rehabilitation program could be renovated and put aside for public use.