Photo by George Lauby
Commissioner Joe Hewgley, foreground, questions Miller.
Photo by George Lauby
NRD Manager Kent Miller
Photo by George Lauby
Dan Smith, manager of the Middle Republican NRD.
The creation of a mega-water farm in southern Lincoln County would hamper important government services -- such as roads, schools and fire departments, officials said Monday. Under a plan that is rapidly taking shape, irrigation wells on the largest farm in the area would be devoted to pumping water into two Nebraska rivers -- the Republican and the Platte.
Tax money would dry up for Lincoln County and the Wallace School District if the cropland on 20,000 acres is seeded back to grass, as expected.
Changing the big privately-owned crop farm into a government-owned water farm would sharply reduce if not eliminate the taxable value of the land.
The commissioners want the farm to continue to pay all the taxes – as though the land generated crops.
In the deal, four Natural Resource Districts are buying the farmland for $83 million.
The Twin Platte NRD, with offices in North Platte, is one of the four resource districts that have agreed to buy the land. The other three districts cover the western Republican River Valley.
Nearly 15,000 acres of that land are irrigated by 117 center pivots.
The four NRDs will equally pay for the land and the development of the wells, pumping stations and pipelines. The four NRDs will likewise share the water rights. In the Twin Platte NRD -- consisting of Lincoln, McPherson, Arthur and Keith counties -- that cost will be paid by a $4-6 tax that will be levied on each of the 350,000 irrigated acres in the district. Most of those irrigated acres are in Lincoln and Keith counties.
Kent Miller, the general manager of the Twin Platte NRD, said the purchase is necessary so Nebraska can meet federal requirements to keep water in both the rivers.
The alternative -- regulating every well -- is expensive, time consuming and highly controversial, Miller said.
"It makes more sense to affect a piece of land on the fringe of the district rather than to regulate (and restrict) every well,” he told the Bulletin when news of the deal broke -- the day before the first agreements were signed.
The deal came about in mid-October. Already, short-term bank financing is arranged. Miller said the goal is to issue long-term financial bonds.
The financial agreement must be approved by the 11-member board of directors, Miller said. That is expected to happen during a special meeting that starts at 3 p.m. Nov. 8. The meeting is public. Questions and comments will be welcome.
The meeting will be held at the TPNRD office on the second floor of the Great Western Bank building at 111 So. Dewey in North Platte.
The hastily-arranged, multi-million-dollar deal not only raised eyebrows, but also a wide range of concerns.
School and county officials see tax revenues slipping away. Lincoln County could lose $312,000, the commissioners said, just from real estate taxes. That doesn’t include money on personal property -- the five homes on the land.
“The loss of these (tax) revenues to Lincoln County would be devastating,” the commissioners wrote Oct. 30 in a letter to Miller and the Twin Platte NRD. “Not only would Lincoln County possibly suffer loss of jobs, services and safety, but the school districts included would be forced to downsize their services.”
The Wallace school district currently collects nearly $135,000 from the land, the commissioners said. Also, the community college, fire departments, cemeteries, hospitals, educational service units and the NRDs themselves rely on tax money from the property.
Miller responded Monday.
He reiterated what he’d said before -- that the NRDs don’t intend to harm schools or government agencies -- but he didn’t promise.
Miller said adding the water to the rivers would benefit a great deal of Nebraska, and there should be some way for other parts of the state to contribute to the loss of taxes.
“I believe we can figure out a way not to harm these agencies,” Miller said, “but I can’t say for sure what it will be.”
In other discussion, Miller and his counterpart Dan Smith of the Middle Republican NRD said the existing 100 or so irrigation wells on the land would probably be converted to stock wells and/or monitoring wells, and dozens of new high-capacity wells would be dug that would pump water into 20-inch mainline pipes running both north or south.
Smith said some of the water would run 7-10 miles to the Medicine Creek, and from there on into the Republican River. In the other direction, Miller said water would probably be pumped into a Nebraska Public Power District canal leading to the South Platte River.
Farmer Roric Paulman of Sutherland asked if a pending special master’s ruling on the Republican River compact would negate the need for water to go to the Republican. Smith said no, that the water will be needed in the Republican River even if the ruling is in Nebraska’s favor.
Nebraska does not have to put water in the Republican every year, Smith said. The need arises every 2-3 years.
Paulman said he had several more questions. He asked for more public information meetings.
Miller said he would set up some meetings in December or January.
Commissioner Joe Hewgley said that isn’t soon enough.
“People don’t want to learn more about it after the deal is all set,” Hewgley said. “If you really wanted to find out what people think, you could have had a meeting last week.”
Miller took the criticism.
"I accept that," he said.
Then, Hewgley specifically asked the four NRDs to adopt a binding regulation assuring all taxing entities that there would be no loss of tax revenue.
Miller made no promises.
“We’ve only known about this for a couple weeks,” said cattle rancher Dan Estermann, who lives on the Medicine Creek. “We’ve asked about the effects on the creek, but nobody can tell us much.”
Estermann said the economic impact goes far beyond loss of taxes. He said lost corn production will adversely affect three feedlots -- North Platte Feeders, a feedlot owned by Don Oppliger and Southwest Feeders -- as well as the recently-built ethanol plant near Madrid.
“It will increase the costs of corn and raising cattle,” Estermann said. “Nobody has talked about that.”
Estermann predicted that the community of southern Lincoln County will pay the price over many years.
Estermann also said he would like to see how the land purchase, the new wells, the piping and related costs (including re-seeding to grass) can be financed with a $5 per acre tax on irrigated acres.
After the meeting, Ken Anderson, who works at Lincoln Farm, said the farm:
• Generates nearly 2 million bushels a year of corn and soybeans, plus millions of pounds of potatoes -- enough potatoes to fill two warehouses before loading on rail cars for shipment out of state. A third potato warehouse is under construction just west of Dickens, he said.
• Employs 14 full time workers for corn and soybean production, most of whom live in North Platte, plus part-time workers during planting and harvest.
• Employs about 25 full- and part-workers just for potato production.
• Buys significant amounts of supplies, including new machinery and thousands of bushels of seed, from North Platte businesses.
• Contains three modular houses and two mobile homes, in addition to grain bins that can store one million bushels of crops.
“People are just starting to realize the economic impacts of putting the place out of business,” Anderson said. “This year we bought four new combines. We have to have up-to-date equipment; we trade every year.”
He said the employees haven’t been told what will happen to their jobs yet.
“We have a ways to go to finish harvest,” he said. “And, there will be 1 million bushels of crops in bins on the farm that will have to be hauled to terminals later.”
Anderson said the harvest has been good one, despite the dry summer. One center pivot of soybeans yielded a whopping 78 bushels per acre, irrigated with 10-12 inches of water.
“We had some good fields and some bad ones,” he said. “The point is we can raise crops under water (pumping) restrictions.”