Land Deal Off, UA Looks to Replace Cash

Federal investigators are looking into a recent University of Arkansas land deal worth $17.6 million.
Red flags, including questions from lawmakers, scuttled a proposed $16.5 million land sale by the University of Arkansas System Division of Agriculture. (J.B. Lightle)

With the collapse of a $16.5 million land sale that drew opposition from Arkansas legislators, the University of Arkansas System Division of Agriculture is searching for ways to replace the lost revenue.

Last year, the Division of Agriculture had planned to sell a portion of recreational land in St. Francis County and use $5 million of the proceeds to help pay for the Northeast Rice Research & Extension Center south of Jonesboro.

But the proposed sale drew protests from hunters and allegations of bid manipulation.

A portion of the timber and farmland in St. Francis County, known as Pine Tree Research Station, was under contract to be sold to Lobo Farms of Fisher (Poinsett County) for $16.5 million. In addition, the buyers agreed to donate $1 million to endow a program in waterfowl and wetlands conservation. The sale was contingent on congressional approval under the terms of the UA’s purchase of the land from the U.S. government in 1960.

State Sen. Ronald Caldwell, R-Wynne, and Reps. Steve Hollowell, R-Forrest City, and Reginald Murdock, D-Marianna, introduced legislation in March to retain Pine Tree Research Station’s recreational land as public property.

Caldwell also introduced legislation that would appropriate $16.5 million to the Division of Agriculture, but that hasn’t been funded yet.

“We remain dedicated to securing the necessary funds to proceed with our targeted projects that will greatly impact the rice industry, Arkansas agriculture and the large number of Arkansans served by the Division of Agriculture’s programs,” Mary Hightower, chief communications officer for the division, said via email.

The division also would have spent $6 million for smart farming, which involves using advanced technology in farming operations; $2 million on waterfowl and wetlands research, education and management; and $1 million for the portion of the Pine Tree Research Station that wasn’t sold.

Hightower didn’t respond to follow-up questions from Arkansas Business.

Meanwhile, Andrew Grobmyer, executive director of the Agricultural Council of Arkansas, said his group’s interest is in funding for the Northeast Rice Research & Extension Center.

“The research service provided by the UA at this location is beneficial to farmers in that area,” Grobmyer said.

The nonprofit organization represents several hundred entities involved in agriculture.

“We’re hopeful that there is funding available” for the center, Grobmyer said.

Conservation groups also are investigating ways to buy the land from the UA and keep it public, said James Brandenburg, the chair of the Arkansas chapter of Backcountry Hunters & Anglers of Missoula, Montana.

He isn’t sure the UA will receive the $16.5 million it had under contract. “But, … frankly speaking, they didn’t have the right to sell it in the first place,” Brandenburg said. “So they should never have expected to get that total.”

Brandenburg told Arkansas Business last week that he was pleased that the legislation passed preventing the sale of the land. “It was a great win for the people of that area, and the rest of the citizens of the state, for that matter,” he said.

He said since the property remains public, anyone can use the open sections of the property for hunting or fishing.

‘No Public Hearings’

After state Sen. Caldwell learned about the proposed land sale last year, he told Arkansas Business in September that he had concerns. “It didn’t pass the smell test,” he said at that time.

Caldwell’s “issue,” he said, “is how quietly it was handled, got through the process without any of the public knowing that it was going on. There were no public hearings.”

The Division of Agriculture said the transaction followed UA System policy and Arkansas law.

But at a committee hearing on March 18, Caldwell said the division didn’t have the legal authority to sell the property. Under the terms of the deed, the land couldn’t be sold to anyone unless it’s for public use, he said.

“But I have a contract signed between the university and a private company, and the deed says you can’t do it,” Caldwell said. A video of the hearing is posted on the Arkansas Legislature’s website. The UA’s “argument is they give you a wink and a nod and said, ‘Well, we’re going to go to Congress and get that changed.’”

Caldwell also noted that the owners of the potential buyer, Lobo Farms, didn’t live in Arkansas. At least one of the owners lives in Tennessee.

“Why would we ignore our taxpayers and our citizens and give the advantage to somebody from out of state?” Caldwell said. “If we let this land get out of the public domain, we’ll never, ever get it back again.”

Lobo Farms’ attorney, Justin Allen of Wright Lindsey Jennings of Little Rock, didn’t respond to requests for comment.

The Division of Agriculture had been trying to sell some of its nearly 12,000-acre Pine Tree Research Station property for years.

While some of the land was being used for research, the rest was being underused. In 1999, the division signed a lease agreement with the Arkansas Game & Fish Commission that allowed for some public access for hunting and fishing on the property.

Rep. Hollowell said in the committee hearing that residents who hunt, fish or bird-watch on the land opposed the sale because “it further reduces publicly available habitat in an area. The state resources are already extremely limited.”

The legislation overwhelmingly passed.

“It’s been a pretty remarkable thing to see the little guy win one for once,” said Brandenburg, of Backcountry Hunters & Anglers.