DNR lease loss may mean compensation

Senate Bill could help some farmers

— Legislation that would provide farmers more time to prepare for termination of their leases with Department of Natural Resources passed the Senate Feb. 26.

Senate Bill 5051 would extend the length of advance written notice required for non-default termination of state land leases for agriculture and grazing land to 180 days. Lessees are currently given 60 days notice by the Department of Natural Resources.

The measure awaits consideration in the House of Representatives’ Agriculture and Natural Resources Committee.

The Senate bill was drafted in response a dispute between the agency and five Benton County dry-land wheat farmers in Horse Heaven Hills.

One of the farmers — David Moon, manager of G&D Moon Partnership — said he heard a rumor of an irrigation project years before he received official word from DNR.

Last March 2016, Moon got a telephone call from the agency asking him to stop applying chemicals to all 1,200 acres of his leased land. If he agreed, it would begin the three-year process to become certifiable as organic for future production of irrigated crops.

He and the other farmers refused after multiple meetings with Natural Resources officials Moon said.

The farmers reached out to Benton County Commissioner Shon Small, who contacted Sens. Sharon Brown, R-Kennewick, and Judy Warnick, R-Moses Lake. After the farmers received their 60-day notices in August, the senators worked with them and eventually convinced the department to provide financial compensation for early termination.

Moon says his compensation will cover half his $60,000 loss.

Dry-land wheat farmer Chad Smith says he incurred losses of $300,000 and received $52,000.

Those losses are due to not being able to harvest for the last four years he will no longer spend on the land.

State agriculture and grazing leases typically run 10 years. In most cases, a flat rate based on the crops grown by the lessee goes to a school trust as rent. But the department can use a non-default termination to replace a tenant with a higher-revenue tenant.

The new bill requires Natural Resources, when terminating a lease, to give the current tenant documentation showing the land is part of a plan for “higher and better use, land exchange or sale.”

Lease terminations affect the way farmers plan harvesting schedules and resource purchases, wheat farmer Chad Smith said.

Farmers maintain their land’s productivity by cycling different crop types, as well as by allowing the land to remain unplanted for periods of time between crops. Farmers often choose to rent DNR-managed land adjacent to land they own because if they didn’t, the land they plant on would be inefficiently segmented, Smith noted.

Farmers use this knowledge to purchase necessary supplies such as seeds and harvesting machinery.

Darin Cramer, DNR Product Sales and Leasing Division Manager, says the farmers should have been notified earlier despite the official 60-day warning given.

“We screwed up,” Cramer said in an interview. “We were supposed to notify these lessees of termination plans well in advance of spring. Our intent was to provide them a crop-year’s time to finish regardless of what the lease said.”

The leases previously held separately by the five farmers go up for auction as one 3,000-acre parcel, called the “Paterson Project,” April 6. The land, previously used for dry land wheat, will be irrigated from the Columbia River to grow crops that require more water than dry-land wheat, according to the DNR.

While we have a good plan to turn this into irrigated land, it may not pan out,” Cramer said. “But it’s our job to take informed risk and attempt to produce as much revenue as possible.”

Smith says he lost about 1,200 acres of land his family has rented for years. “My grandfather broke it out of sagebrush in 1949 when he rented it from the state,” he said.

Cramer believes that the legislation is reasonable and won’t be difficult for DNR to implement.

“I’m thankful DNR admitted that,” Senator Brown said. “Unfortunately, it doesn’t help the guys who lost their leases.”


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