@SFWMD, though short on cash, renews farmer leases without competitive bidding
Palm Beach Post Staff Writer
Posted: 8:03 p.m. Tuesday, Nov. 8, 2011
For five years the Pearce family of Okeechobee waited for the lease to expire on 4,700 acres of public ranchland, so they could bid on the lease and return their cattle to land that, until 2006, was in the family for five generations.
But about 7:30 a.m. on Oct. 13, Patricia Pearce learned that, later that morning, the governing board of the South Florida Water Management District would be asked to renew the 5-year lease of the current tenants, the Old River Cattle Company. The renewal was scheduled even though the lease was not up until March 2012, no notice of the land's availability was published in a local newspaper and the Pearces were willing to pay more.
"We have been waiting patiently for five years," Patricia Pearce told the board after making the 85-mile drive to the district headquarters in West Palm Beach. "We were told it would be put up for public bid. I'd like to know what the policy is."
So would many others, including members of the governing board and ranchers and farmers who lease more than 129,000 acres of public land controlled by the district, which spans 16 counties.
"What is the thinking, that we didn't want to give the Pearce family an opportunity to compete for this land?" asked board member Glenn Waldman during the Oct. 13 meeting. "Is it just because it's easier to re-lease?
Last year the district collected more than $4.2 million in rent and saved countless more in taxes and land management costs by leasing land for agricultural uses, from grazing to farming. But at a time when the district's budget has been slashed, more than 300 workers cut and Everglades restoration projects delayed for want of money, the board's renewal of the Old River Cattle Company lease and eight others without seeking competitive bids to ensure top dollar has sparked a review and proposed overhaul of the district's controversial and confusing lease policies.
Bob Brown, the district's recently appointed assistant executive director, acknowledged that "some legitimate points have been raised." Brown will unveil the proposed changes at a meeting of the Projects and Lands Committee meeting today.
This is not the first time the district's lease policy has come under fire. A critical, internal audit in 2002 uncovered a lease for as little as $1 per acre -- far below the market value of a lease for pasture land. Other leases were renewed without competitive bids which appeared to "bypass the tenets of fair and open competition," according to the audit.
The auditor strongly recommended that the district adopt a policy of public notice and open bidding for all leases: "Competition will determine market value and therefore the leases should be competed."
That did not happen. Although the district did adopt its first agricultural lease policy in November 2003, revisions made in 2005, 2006, 2010 and earlier this year diluted oversight and eventually gave the executive director the authority to approve lease renewals.
As the policy evolved, the leases of ranchers and farmers who leased back the land that they had sold to the district were routinely renewed without allowing others the opportunity to bid. And despite a Florida law that requires the district to publish notice -- weekly for three weeks -- of its intention to lease any land, the district enacted its own policy that "allows the district to renew existing leases without competition if, among other things, the lessee is in good standing," the district said Tuesday in response to questions from The Palm Beach Post.
In defense of those policies, Ruth Clements, the district's chief real estate specialist, explained that renewing the leases of good tenants -- those who paid their rent on time, paid taxes, maintained fences and were good stewards of the land -- made good sense. That was the case of the nine lease renewals presented to the board last month.
All nine of the tenants needed lease renewals to qualify for a federal agricultural matching grant that would allow them to make environmental improvements to the land, according to a spokesman for the grant program. Unless they could prove they would be on the land for at least another five years, their applications would be denied, he said. The application deadline for the grant was Oct. 31.
"Here's my thought on this," said Ric Hartman, a partner in the Old River Cattle Company. "I'm a businessman and I have a tenant who is paying his rent on time, paying his taxes and done everything I have asked him to do, why would I want to go look for someone else?"
Even though the board approved his lease renewal last month, the documents have not been signed, Hartman said. Now he is concerned that the board may reconsider its vote.
"We played the game the way we were supposed to," Hartman said. "I'm not threatening and I'm not going to sue but I would be really disappointed if they did that.
