Auditor General highlights Alberta grazing lease scam

[sjd]

Good article today about the ongoing grazing lease rip off that Bob Scammell has written so much about.

http://calgaryherald.com/news/politi...-lease-dollars

Outrageous that ranchers are pocketing dollars that belong to the public, and also a joke that lease rates haven't changed since 1994.

Looks like taxpayers are losing 30 million per year in unnecessary payments to ranchers that belong to the public. Rules that would have put us in line with SK and BC were never proclaimed. Good old PCs!

Funny that the Wild Rose rep doesn't care about fiscal responsibility or protecting taxpayers when its his constituents.

Nice to see it explained so clearly. I've got no problem with using public land for grazing, as long as rates are fair and these sorts of abuses are cleared up. The sense of entitlement of some ranchers about "their" lease (public) lands are a disgrace, and I'd expect some clean up here a nice side benefit of our new government.

[Talking moose]

[rugatika]

Hopefully the NDP will fix this.

[Big Grey Wolf]

It would be interesting to know how much of that cowboy welfare $$$ actually made it back to the local PC MLA for his re-election fund?? "Never bite the hand that feeds you"

[Okotokian]

THIS is one area where I could see the NDP government doing something useful (maybe) if we bring it to their attention. They aren't in the back pocket of ranchers. GRAZING RIGHTS are all a rancher should get from a grazing lease.

[LCCFisherman]

Grazing leases period in alberta are a joke.

[dmcbride]

Originally Posted by Okotokian

THIS is one area where I could see the NDP government doing something useful (maybe) if we bring it to their attention. They aren't in the back pocket of ranchers. GRAZING RIGHTS are all a rancher should get from a grazing lease.

And get the one cow off the lease, come hunting season so the public can hunt their land.

[Sundancefisher]

Originally Posted by Okotokian

THIS is one area where I could see the NDP government doing something useful (maybe) if we bring it to their attention. They aren't in the back pocket of ranchers. GRAZING RIGHTS are all a rancher should get from a grazing lease.

I would be curious to see someone argue otherwise. Grazing rights should be bid on. If a rancher feels it is extra work to have an oil and gas lease present they can bid less.

Why on earth these million dollar companies can keep leases indefinitely is beyond me.

Then comes the question...how dare they stop us from going fishing up a creek on a grazing lease. Even hunting should be allowed and they should be flexible to make it work.

[Redfrog]

"Funny that the Wild Rose rep doesn't care about fiscal responsibility or protecting taxpayers when its his constituents."

Is that what he said?

I guess if you wanted WR to change something, you should have voted for them. You see they have never been the government, and neither have the NDP, sooooo the PEOPLE must have wanted the PC to do what they do.

[Okotokian]

Originally Posted by Redfrog

"
I guess if you wanted WR to change something, you should have voted for them. You see they have never been the government, and neither have the NDP, sooooo the PEOPLE must have wanted the PC to do what they do.

What is the WR position on grazing leases, the resource revenue derived from them, and hunter access?

[nicecurr]

Originally Posted by Redfrog

"Funny that the Wild Rose rep doesn't care about fiscal responsibility or protecting taxpayers when its his constituents."

Is that what he said?

I guess if you wanted WR to change something, you should have voted for them. You see they have never been the government, and neither have the NDP, sooooo the PEOPLE must have wanted the PC to do what they do.

What an absolutely brilliant observation! You are one sharp fellow!

[FCLightning]

Originally Posted by Redfrog

I guess if you wanted WR to change something, you should have voted for them. You see they have never been the government, and neither have the NDP, sooooo the PEOPLE must have wanted the PC to do what they do.

I thought the Wildrose WAS the gov't until they got their pouty face on about not getting their way, took their ball home and started playing their own game.

How is that working out for them?

[3blade]

"Drew Barnes, the Wild Rose MLA for Cypress-Medicine Hat and a rancher who receives surface rights payments from energy companies, cautioned against major changes to a lease system that has served rural communities well.

“These grazing associations and those with grazing revenue are contributing to air ambulance services and renovating schools, so a lot of the money stays local,” Barnes said.




One more reason I will NEVER vote wildrose. Exactly what I said from the start, PC rats that jumped ship. Suckling on the public teat, just like the leftards. I'll bet they contributed towards the schools and healthcare they hate.
Faces firmly planted in the trough. Financially responsible

Red, give it up. This one stinks worse than the red queen. They have been stealing public dollars (in several steps through the process) and public resources, and prohibiting access to public land. And contributing to a political regime that kept it all going. No excuses.

The wildrose have also endorsed the sale of public land, and paid hunting access. May as well as it seems to be current policy in their areas anyway, legal or not.

[Deer Hunter]

Yep.

[Okotokian]

Originally Posted by 3blade

"Drew Barnes, the Wild Rose MLA for Cypress-Medicine Hat and a rancher who receives surface rights payments from energy companies, cautioned against major changes to a lease system that has served rural communities well.

“These grazing associations and those with grazing revenue are contributing to air ambulance services and renovating schools, so a lot of the money stays local,” Barnes said.

.

SO schools and medical services in rural areas are paid for by passing the hat around to ranchers, and not by the government? Who knew??? LOL WR will never rock the boat with ranchers, NEVER.

[hal53]

Originally Posted by 3blade

"Drew Barnes, the Wild Rose MLA for Cypress-Medicine Hat and a rancher who receives surface rights payments from energy companies, cautioned against major changes to a lease system that has served rural communities well.

“These grazing associations and those with grazing revenue are contributing to air ambulance services and renovating schools, so a lot of the money stays local,” Barnes said.




One more reason I will NEVER vote wildrose. Exactly what I said from the start, PC rats that jumped ship. Suckling on the public teat, just like the leftards. I'll bet they contributed towards the schools and healthcare they hate.
Faces firmly planted in the trough. Financially responsible

Red, give it up. This one stinks worse than the red queen. They have been stealing public dollars (in several steps through the process) and public resources, and prohibiting access to public land. And contributing to a political regime that kept it all going. No excuses.

The wildrose have also endorsed the sale of public land, and paid hunting access. May as well as it seems to be current policy in their areas anyway, legal or not.

"in their areas" ?????

[fish_e_o]

Originally Posted by 3blade

"Drew Barnes, the Wild Rose MLA for Cypress-Medicine Hat and a rancher who receives surface rights payments from energy companies, cautioned against major changes to a lease system that has served rural communities well.

“These grazing associations and those with grazing revenue are contributing to air ambulance services and renovating schools, so a lot of the money stays local,” Barnes said.




One more reason I will NEVER vote wildrose. Exactly what I said from the start, PC rats that jumped ship. Suckling on the public teat, just like the leftards. I'll bet they contributed towards the schools and healthcare they hate.
Faces firmly planted in the trough. Financially responsible

Red, give it up. This one stinks worse than the red queen. They have been stealing public dollars (in several steps through the process) and public resources, and prohibiting access to public land. And contributing to a political regime that kept it all going. No excuses.

ummm i receive surface rights payments from energy companies... am i a crook?


oh ya i own the land. i don't believe it says anywhere that his case is not the same as mine

[avb3]

Urban against rural OR leaseholders and the rest of Alberta?

Most farmers and ranchers do not get the benefit of lower input costs.... Only leaseholders do. Plus oil industry income from land they don't own that is often in excess of what their operations produced.

Reality.

[hal53]

Originally Posted by avb3

Urban against rural OR leaseholders and the rest of Alberta?

Most farmers and ranchers do not get the benefit of lower input costs.... Only leaseholders do. Plus oil industry income from land they don't own that is often in excess of what their operations produced.

Reality.

No one on here really understands the whole situation, lease holders are following guidelines, others are wining about a small amount of money on "some" leases...as usual it boils down to access...there are regulations put in place to deal with these problems with the few leaseholders that abuse the original intent. I can see both sides of it, but you must admit that the lease holder invests a lot of money and damn few are getting 10X their investment on oil access revenue

[Sneeze]

Few years ago I stated on AO the access issue was opening people's eyes at the cronyism of our lease system.

I stated lease holders needed to get their krap together or big changes were coming. I was berated and insulted.

My I told you so moment is coming.

I feel bad for those that just bought into the ponzi. Smart money is selling now.

[hal53]

Originally Posted by Sneeze

Few years ago I stated on AO the access issue was opening people's eyes at the cronyism of our lease system.

I stated lease holders needed to get their krap together or big changes were coming. I was berated and insulted.

My I told you so moment is coming.

I feel bad for those that just bought into the ponzi. Smart money is selling now.

It definitely does put the spot light on the PC crap we have put up with.....

[avb3]

Originally Posted by hal53

No one on here really understands the whole situation, lease holders are following guidelines, others are wining about a small amount of money on "some" leases...as usual it boils down to access...there are regulations put in place to deal with these problems with the few leaseholders that abuse the original intent. I can see both sides of it, but you must admit that the lease holder invests a lot of money and damn few are getting 10X their investment on oil access revenue

I think I understand a lot about it, having negotiated dozens of surface disturbance leases on a grazing lease.

I do have empathy for the rancher who bought a lease just before the election. He was operating under the rules in place at that time, with full expectation they would continue. He should not be out that investment. How do deal with that part of the equation is a huge question.

However, if that rancher bought on the premise that surface disturbance will continue to be the prime income source off that land, my empathy for him becomes more muted. In that case, the prime motivation was not necessarily ranching. Then it was more like an outside investment rather than ranching operations.

Is a situation complex? You bet it is. Should it be addressed? Most Albertans rural or urban believe it should.

[BlackHeart]

Originally Posted by avb3

I do have empathy for the rancher who bought a lease just before the election. He was operating under the rules in place at that time, with full expectation they would continue. He should not be out that investment. How do deal with that part of the equation is a huge question.

However, if that rancher bought on the premise that surface disturbance will continue to be the prime income source off that land, my empathy for him becomes more muted. In that case, the prime motivation was not necessarily ranching. Then it was more like an outside investment rather than ranching operations.

Is a situation complex? You bet it is. Should it be addressed? Most Albertans rural or urban believe it should.

There are other similar situations that a lease or a quota system developed by the govt is not well thought out and suddenly the contract/agreement/quota/lease itself is the asset and not the resource.

In most cases where this happens, there is significant financial benefit from holding the lease/quota/arrangement and this then turns it into an PERCEIVED ASSET in the form of future benefits. Most businesses depreciate the cost of their improvements over time and factor them into their cost of operations and income taxes. For these leases, I suspect the cost of these lease improvements are expensed in the year they are incurred.

For these leases, they put some improvements in to further their own interests and benefits from that lease (hard to graze cattle without a water supply and fences. And then capitalize the value of these improvements as well. Now when they go to sell these lease rights, they want the value of those future gains, the value of those improvements in generating income AND the surface lease payments from the oil companies.

So who is responsible for the fact that these lease conferred a significant future benefit to the holder which was capitalized on the sale/transfer??? No the govt's. You bought these leases knowing full well the terms and conditions of those leases. If those leases have a right to revise them, then you were foolish to pay good money for a right you cannot legally enforce or depend upon. (Who would buy a home/business on a leased lot with a 12 month notice cancellation clause.........only a fool. Or you would discount all future value beyond 12 months significantly and only pay the value of the use of that home for 12 months and what you could get out of it at that end.)

These leases are a ponzi scheme......they are based on an agreement that can be changed. Just because you got a good deal and the transfer of value worked for the last seller, does not mean the govt has any responsibility to compensate for a loss of value for you buying a future benefit not 100% secure. You should have factored that into the price you paid.

Now what is the terms of these lease. It would be nice to see an actual grazing lease agreement. I suspect that we haven't for good reason. But one important point must be made....these leases have an end date.....expectation of continuation and paying for one near expiry is foolishness. It is fully within the govt's right to cancel these at expiry, revamp them dramatically, or do as they please.........you can pull your fences, but I suspect that might be a lot more work than its worth.


Now think about how the halibut quota has become an asset bought and sold and consolidated into few international corporate hands and made the actual commercial fisherman a contracted/hired hand in his industry. Another capitalization of an agreement that has actually bastardized the original intent.

[Okotokian]

Bottom line, I don't see the need for the government (and by extension all of us) to supply land to ranchers. Sell off the really small parcels (say less than a section) to the highest bidder, designate all other packages as undeveloped recreational areas that any citizen can access at any time for legal recreation purposes including hunting. No fencing, no nothing. Straight crown land.

If the general populace feels the need to continue some version of the present system, then revise the system so that ranchers are truly only leasing the right to graze cattle for a certain period of the year. Beyond that period no one needs permission to enter land as long as it is on foot. Any resource revenue goes to the owner (the crown), not the lessor. No resale of leases. Documented and approved leasehold improvements like fixing fencing could result in an offsetting reduction in lease payments. Basically set it up the same as if someone wanted to run his cattle on YOUR land. You wouldn't let some guy who ran cattle on your land get the resource revenue or allow him to decide who he wanted to sell his lease to.

[blgoodbrand1]

Haven't read all the comments but i will say one thing.
Oil and gas "disturbance" is often the only thing that adds value to a lease.
A grazing lease that is mostly bush has little grazing value. Start adding some pipeline and access rows and leases which are often fenced in close. Seed the above to tame grasses and all of a sudden there's something for the cows to eat.
Ranchers fuss and whine but actually it's almost all positive.

[JimPS]

Originally Posted by blgoodbrand1

Haven't read all the comments but i will say one thing.
Oil and gas "disturbance" is often the only thing that adds value to a lease.
A grazing lease that is mostly bush has little grazing value. Start adding some pipeline and access rows and leases which are often fenced in close. Seed the above to tame grasses and all of a sudden there's something for the cows to eat.
Ranchers fuss and whine but actually it's almost all positive.

Excellent points - the Ranchers generally fuss and whine as a smokescreen while the disturbance cheques roll in and the side deals are made.

Good on them if they can squeeze resource companies for a basement getting dug, a drive way getting improved, a well drilled, fencing improved etc.

[avb3]

Originally Posted by JimPS

Excellent points - the Ranchers generally fuss and whine as a smokescreen while the disturbance cheques roll in and the side deals are made.

Good on them if they can squeeze resource companies for a basement getting dug, a drive way getting improved, a well drilled, fencing improved etc.

No one has mentioned the "consulting fees" ranchers have charged and oil companies have paid do them simply for the fact of negotiating the contract.

That can end in itself amount to thousands of dollars over and above the surface costs.

Note not one leaseholder has mentioned that source of revenue. It is always a separate cheque.

[fish_e_o]

Originally Posted by avb3

No one has mentioned the "consulting fees" ranchers have charged and oil companies have paid do them simply for the fact of negotiating the contract.

That can end in itself amount to thousands of dollars over and above the surface costs.

no... it's not. unless of course it's a massive project and then that will take many many hours of work which i think he should be paid for.

our time is worth something it's just how much.

[avb3]

Originally Posted by fish_e_o

no... it's not. unless of course it's a massive project and then that will take many many hours of work which i think he should be paid for.

our time is worth something it's just how much.

I've negotiated those extra consulting fees.

[avb3]

So now we see that negotiating to make money that had nothing to do with ranching, makes money.

Food for foder.