Long-term leaseholders of city-owned farmland won’t have first right of refusal after their lease is up again in five years.
During Monday’s executive committee meeting, the majority of executive approved Coun. Brian Swanson’s motion to continue tendering city-owned farmland every five years to the highest bidder. Current farmland leases are set to expire at the end of 2012.
“I can understand why a farmer who gets a five-year lease would like to get the first right of refusal, but that would go for any service that we tender out there,” said Swanson. “The farmland is a valuable asset. The price of farmland’s gone up significantly recently. The price of farm commodities has gone up significantly.”
Swanson added that if the highest bidder wins the five-year tender, then the bidder knows he or she has five years to work the land.
City administration had recommended for farmland agreements to include a five-year revolving right of first refusal to the successful tenders. The rate would have been established by the city based on current market conditions and would have taken effect in 2013.
In the business development division’s report to executive, it stated in the current process, long-time leaseholders could lose their lands despite the significant investment they placed into the land if they are outbid. The right of first refusal would have allowed leaseholders to exercise an option at a rate established by the city and make investment decisions for more than five years at a time.
“I don’t think there’s any big stampede to lease these lands,” said Mayor Deb Higgins. “Five years really isn’t out of the question and it does offer some stability for the producer who is looking at leasing and farming the land.”
For more information, see an upcoming edition of the Times-Herald.