Lincoln County irrigation well
Photo by George Lauby
Potatoes from the farm rolling into a storage bin, 2005.
As the costs continue to come into focus for a mega-water farm in southern Lincoln County, the Twin Platte and three other Natural Resource Districts will meet Tuesday to figure out how to run the place. The public meeting will be held at 10 a.m. in the Twin Platte NRD offices, on the second floor of the Great Western Bank building in downtown North Platte, 111 So. Dewey St. A governing board will be set up to manage the newly established conservation farm.
The official price tag is $83 million for 19,500 acres, an unprecedented sum for highly erodible sandy soil. Interest costs and the loss of tax revenue will push the costs higher.
The crop farm will become a conservation farm owned by a government body. It will be owned by four Natural Resource Districts that have joined to make one of the largest single farm real estate deals in the state’s history.
The four NRDs will divide the purchase cost equally.
It’s the water
If all goes as planned, the cropland will be converted to grass. The 100-plus irrigation wells will be converted to stock wells and new hi-capacity wells will be dug to pump water into two Nebraska rivers -- the Republican and the Platte. The goal is to meet water requirements for the rivers, agreements made with surrounding states and the federal government.
Irrigation water users will be taxed to pay the $83 million price of the land, plus interest. And, the loss of taxes on the property would fall on all property owners. That lost tax income could amount to $500,000 each year, Lincoln County Assessor Julie Stenger said, if the land comes off the tax rolls. Stengers said that it could, because a government agency does not have to pay any taxes.
The deal was arranged so quickly even elected officials are still grasping the consequences. It was signed in mid-October, before the public knew about it, out of concerns that more time and knowledge would sour the deal. Within days, county and school officials expressed concern about the loss of tax revenue.
The managers of the resource districts say their intention is not to hurt schools and county services, but have not said how they will prevent it.
On Nov. 8, the water farm took another step toward reality. One of the four NRDs – the Twin Platte NRD headquartered in North Platte -- okayed a financial agreement to make the purchase, approving an amount not to exceed $75 million. They also approved an interest rate as high as 5 percent, which would add $50 million or so to the overall cost of property.
Longer range, the four NRDs, or the new entitiy created to manage the farm, intends to sell bonds at a lower interest rate, Kent Miller, the Twin Platte NRD manager, told the Bulletin.
People filled the Twim Platte NRD meeting room and lined up in the hallways before the vote on Nov. 8. Many spoke, asking questions to a board that made no response, although the chairman said their questions would be recored, and he promised to answer them in the future.
Stenger was among the speakers. She told the board when they decide to address the public, to have all four NRDs present, to "please" highly publicize the time and date, to have the meeting as soon as possible and have it in a room big enough to seat everyone.
The board of directors -- elected public officials -- of the Twin Platte NRD voted 9-2 for the financial agreement. The two no votes came from the same two dissenters – attorney Doug Stack and retired constructor Bob Peterson – who have vote no all along on the deal.
Stenger previously estimated a tax revenue loss of $300,000 a year to the county, schools, fire departments, community college and cemeteries, but that amount did not include personal property taxes on farm equipment.
There are 117 pivot irrigation systems on the farm valued at $60,000 each, she said. Removing them creates a loss of $7 million in taxable valuation, amounting to nearly $100,000 a year in actual tax revenue. And, there are tractors, combines, other farm equipment, houses and buildings. All that could add another $6 million or so in lost valuation, Stenger said.
Considering all that, the loss per year in property taxes would be around $500,000, or maybe more, she said.
“People are just starting to realize the economic impacts of putting the place out of business,” said Ken Anderson, who works at the farm.
Anderson has said the farm:
• Generates 1.75 million bushels a year of corn and soybeans, plus millions of pounds of potatoes -- enough potatoes to fill two warehouses before the spuds are shipped 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 supplies, including new machinery and nearly $1 million in seed each year from North Platte businesses.