Barnes Ranch deal goes to Washington (D.C.)


(Note: This is one way to place more water storage in the Klamath Basin.)


January 17, 2003


By Lee Juillerat

H&N Regional Editor

Herald and News

P.O. Box 788

Klamath Falls, OR 97601-0320


Fax: 541-883-4007

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Agency Lake, Oregon - Rich McIntyre believes some of the hard part is done. Now it's up to members of the Oregon congressional delegation and President Bush.

McIntyre, Oregon coordinator for the American Land Conservancy, said Thursday that his group has obtained an option to buy the 2,785-acre Barnes Ranch in the Wood River Valley along Agency Lake.

Under the agreement, the ALC will hold the option for an undisclosed period of time so that the federal government can buy the property from the group for slightly more than $9 million.

The land is seen as a "key" by federal agencies in providing water storage in the Upper Klamath Basin. Surplus water that could be stored in Agency Lake in the winter is currently sent to Upper Klamath Lake and down the Klamath River. Water users have been aiming at securing 100,000 acre-feet of storage.

In a letter sent to Bush last June, Rep. Greg Walden and Sens. Gordon Smith and Ron Wyden urged purchase of the ranch, noting it would allow for up to 50,000 acre-feet of water to be stored annually for use in the Klamath Reclamation Project use. They said that the purchase would allow the restoration of two creeks, Fourmile and Sevenmile, that are designated critical habitat for the Lost River and shortnose suckers.

"Everyone recognizes that this is the key piece of property in the Klamath Basin," McIntyre said.

McIntyre said the Bush administration has pledged to support Klamath Basin water users. He believes the potential Barnes Ranch purchase "presents them with an opportunity to remain consistent with that difficult promise."

He also defended cost of the land, which includes a 7.5 percent administrative and cost reimbursement fee to the ALC for brokering the deal.

"If you look at the Basin as a whole and where money can be productively spent, this is a great value," said McIntyre.

He said the ALC's cut goes back into the work of the group, a nonprofit organization formed by a former Nature Conservancy worker. The ALC was recently involved in a land deal to preserve beachfront property near the Hearst mansion in central California, and McIntyre said he's been living in the Basin and working on restoration projects for years.

McIntyre said that the adjudicated water rights that go with the ranch itself and the potential storage on adjacent U.S. Bureau of Reclamation land amounts to 52,905 acre-feet of water per year, or a cost of $3.42 per acre-foot of water over 50 years.

Efforts to purchase the Barnes Ranch, used an operating cattle ranch by Wally and June Barnes, who live near San Diego, Calif., have been ongoing for several years.

The purchase would enable the Bureau of Reclamation to fully use storage capabilities on the Bureau's 7,400-acre Agency Lake Ranch.

That storage has been below maximum levels because it would have flooded the adjacent Barnes Ranch.

Lauren Ward, ALC realty consultant from San Francisco, said the agreement took several years to negotiate because the Barneses "are very attached to the property. For them this was really a big decision ... This ranch works really well for these people." He said June Barnes is a descendant of the Mathis ranching family in the Basin.

The Barneses use the Wood River property as summer grazing pasture for cattle, which are shipped to the Cottonwood, Calif., in the fall and winter.

"Putting together deals of this sort are very, very difficult," McIntyre said. He said that others had tried to reach an agreement, but "we have a habit of pulling off deals other people are unable to accomplish."

Under terms of the option, McIntyre and Ward said, the Barnses have time to seek replacement grazing land and work out an arrangement that will allow them to avoid capital gains taxes and to continue their north-south cattle shipments.

McIntyre and Ward emphasized that ALC is being involved only in brokering a transaction and will take no position on which federal agency should take ownership and myriad other issues.

"Our strategy," said Ward, "is to increase the water supply, not to say where it goes."

Ward said the Barnes Ranch, like other properties, was "reclaimed" from Agency Lake by the federal government in the 1950s, originally for row crops such as potatoes.

The peat soil proved unproductive for crops but has proved excellent for cattle grazing.

McIntyre said ALC representatives have been meeting with representatives from various government agencies, including Klamath County commissioners. Under various rulings, land removed from agricultural production is subject to roll back taxes that could add $300,000 to the sales price. The ALC wants to eliminate that fee because of the benefits possible from the increased water storage.

McIntyre said estimated cost of restoring Fourmile and Sevenmile creeks ranges from $500,000 for basic restoration to $1.5 million for relocation and restoration similar to work done on the Wood River channel restoration project.


Copyright 2003, Herald and News.