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Old 02-08-2011, 01:10 PM   #1
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Aristotle and the land debate

Some of you might enjoy this commentary on the controversy over the Finch lands and Follensby Pond.
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Last edited by adkeditor; 02-08-2011 at 01:10 PM.. Reason: correct typo
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Old 02-08-2011, 01:47 PM   #2
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Thanks for the education.

The article made me think of the debate over the Grand Canyon, when it almost got dammed for hydro power. Someone asked (to the effect of) how could it be that that the USA could not afford to leave the river unharnessed.
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Old 02-08-2011, 05:06 PM   #3
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Great article. And I wholeheartedly agree with the notion that there are many far less worthy expenditures for government money.
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Old 02-08-2011, 06:07 PM   #4
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There are indeed many less worthy places to spend big bucks.

However, the harsh reality is the NY's spending is MASSIVELY out of line with the rest of the country. NY's per capita budget is 70% higher (yes, you read that right) than the national average state budget. NY's per capita budget burden is by far the highest in the nation.

Given that, to even get reasonably close to being in line, NY's budget has to be cut 25% (not the measly 3% that is currently on the table). NY won't be able to buy a toothpick, much less 100,000 acres of land. We will be lucky to keep the roads plowed and the lights on when this is over. I think plowing the roads is more worthy than adding to the 3 million acres we already own.
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Old 02-08-2011, 08:46 PM   #5
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The seller is The Nature Conservancy. If it were Toll Brothers or some other developer and the property were actually threatened with subdivision and development, I'd be all for the purchase.

NYS needs to keep its powder dry to maintain the millions of acres it has (how soon we forget it was proposed a little over a year ago that NYS cap its tax payments on Forest Preserve), and more importantly to buy title or conservation easements on land that actually is threatened with subdivision and development. It was barely over 15 years ago that the land around Little Tupper was about to get sliced and diced... and that same property owner still has how many tens of thousands of acres? What's going to happen with it in the next decade or two?
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Old 02-08-2011, 10:19 PM   #6
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The seller is The Nature Conservancy. If it were Toll Brothers or some other developer and the property were actually threatened with subdivision and development, I'd be all for the purchase.
It's my understanding that the Nature Conservancy doesn't have the funds or resources to hold on to large tracts of land indefinitely. They purchase these large tracts, such as the Finch Lands, and then often will sell the timber rights to private forest management companies and the development rights to the state, ensuring a protected and sustainable working forest. Other times, they will sell all the rights to the land to the state so that it is added to the forest preserve. They act primarily as a go between, an organization that can move quickly to purchase large tracts of land immediately when they go up for sale, and then hold on to that land while the bureaucratic government moves slowly (as it usually does) to finalize plans for the state to take possession of the land.

The concerns about NYS being able to purchase more lands given the current financial situation are valid.

However, if we also expect that the Nature Conservancy, a not-for-profit, to be able to indefinitely hold on to this land and pay taxes for it, then it may end up that the conservancy is forced to sell rights to the land to those who might not protect it as well as we'd like them to. If we carry out this ambivalence on a large scale at the societal level, expecting our not-for-profits to be able to step up where our government is failing, and conserve and preserve land for us without our aid, then we might not have organizations like the Nature Conservancy to protect our land in the future.
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Old 02-08-2011, 10:43 PM   #7
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Does TNC need to be bailed out? If so, then I'm all for the purchase - TNC is probably the most important private organization in the Adirondacks. But that's not the case being made for the purchase. Instead we're being marketed a huge, already protected tract we don't need when we can barely afford to care for the land we already own.

We don't need this property, but we do need TNC. If TNC needs our help, they should be honest and upfront with us.
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Old 02-08-2011, 10:51 PM   #8
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Does TNC need to be bailed out?

We don't need this property, but we do need TNC. If TNC needs our help, they should be honest and upfront with us.
At present, not that I'm aware of. My point, however, was that (as I understand it, those in the know please correct me if I'm wrong) that the TNC will need bailing out if they continue to hold on to this land and pay taxes on it indefinitely. Like I said, they purchased the land with the intention of turning it over to the State, and (again, as I understand it), they don't really have the funds to hold on to large tracts of land forever. At the very least, continuing to pay taxes on this land will sooner or later impede upon their conservation and preservation efforts elsewhere, as they are forced to divert more and more funding into tax payments over time.

Of course, the argument could be made that the TNC always needs our help.
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Old 02-09-2011, 05:42 AM   #9
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I think we need to look at the fundamental nature of these purchases and what they represent to the State. When we look at governmental expenditures, most are "operating" expenses, money spent to fund the day-to-day operations of the government, as compared to "capital" investments by the State in tangible and permanent assets, those investments that have permanent or long term value.

These kinds of land purchases, if done for fair value or market value, are precisely what the the State should be doing if we believe more public lands are a good thing. There are few investments by the State that are more permanent and will provide benefits to everyone, forever. While there are "maintenance" expenses to even capital expenditures, it would seem the marginal additional costs for these kinds of investments are relatively low.

When we, businesses or governments "finance" or borrow to make expenditures, it is these kinds of purchases that economically warrant long term financing or bonding. On the other hand, when we finance or borrow to fund day-to-day operating expenses, that's like paying for your groceries with a credit card and not paying off the balance. It is simply not living within your means, your day-to-day expenses are exceeding your day-to-day income. We may have to do it from time to time, it ought to be short term, but doing it for a long time is a recipe for disaster.

There are a few realities in acquiring land from private owners. First is the opportunities only arise when the market conditions create the opportunities for the properties to be sold. Second, once the lands are "on the block," someone is probably going to buy them. (We now have Danish timber companies buying up Adirondack property.) Third, the properties or the various rights to a property are more likely than not to be progressively divided in some fashion as time progresses, the ownership of the properties is going to be come more diverse (now global) and the ability to assemble larger blocks of land is going to become much more difficult in the future.

The one benefit that The Nature Conservancy has is "nimbleness." They can apparently move quickly to acquire blocks of land when a ponderous state government can't move quickly. They seem to be proactive in identifying good acquisition targets before they are up for sale and they have some real "presence" in the marketplace, large land owners seem receptive to seeking them out for acquisitions before offering them to a wider market.

Like any business developing land, the "carrying" charges can be quite large and directly proportional to the time they are holding or carrying the property, so the ability to be nimble in putting the sale of the property together and getting it closed has a big impact on TNC's expenses.

If NY is going to remain committed to acquiring land for the Adirondacks, it is going to have to be perceived as a good partner and as willing and able to close their end of the deal. If they can't close the deal, TNC is going to think twice about committing to snatching up properties here, and will start looking for easier and more reliable opportunities elsewhere.

I have some concerns about TNC. See their annual report: http://www.nature.org/aboutus/annual...report2010.pdf

I think their focus is much more global than I realized. One concern is that the price paid by the state to TNC should reflect an arm's length transaction, the price should reflect the value of what is being purchased. The notion of some entitlement by TNC to a built-in or guaranteed profit, from the taxpayers of NYS, to fund TNC's foreign aid programs is a bit problematic.

The second concern is a lack of transparency in the annual report. Looks to be about 10% of budget (and this is a pretty huge budget) is spent on fund raising and 15% is spent on salaries and administrative expenses. Seems a tad high considering this does not appear to be a program where there are widespread local, on-the-ground, operations like other charitable programs, (Things like Red Cross, Salvation Army come to mind as comparisons.) The TOTAL absence of any information about executive compensation, salaries and benefits being paid to officers and senior management in an annual report always raises serious concerns about how the money is being spent. The information is not unintentionally missing.

It would seem to be more cost-efficient if a more locally-focused organization who could act as quickly and be able to close the deal, could cut the ultimate costs to the State. Right now, it looks like the TNC is the only game in town.

I'd rather see the State borrow money to make these kinds of real and permanent investments, if done for fair/market value, rather than to have to go into long term borrowing to have the cash to pay for paint stripes on highways. A good budget scrub is in order.

Last edited by Paradox6; 02-09-2011 at 05:52 AM..
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Old 02-09-2011, 07:30 AM   #10
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Your thoughts here bring up great points.
Thanks for the informative post Paradox
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Old 02-09-2011, 08:05 AM   #11
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Your thoughts here bring up great points.
Thanks for the informative post Paradox
I'll second that!
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Old 02-09-2011, 11:29 AM   #12
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My point, however, was that (as I understand it, those in the know please correct me if I'm wrong) that the TNC will need bailing out if they continue to hold on to this land and pay taxes on it indefinitely.
This is obviously just speculation, but it seems like with a section of land that size, the taxes could be easily paid for with the timber they could harvest - as well as getting tax breaks for easements and such... no?
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Old 02-09-2011, 11:31 AM   #13
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Are there Hunting Clubs on the land in question?
If so, are the Hunting Clubs still paying rent?
If so, isn't that rent going to the NC?
Is the NC using the rent to pay the carrying costs?

I am not familiar with the makeup of the former FP lands that the NC has not offloaded yet.
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Old 02-09-2011, 11:37 AM   #14
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Please excuse my ignorance and my changing the direction (temporarily) of the thread, but what is the current status of Follensby Pond as far as accessibility? Can the public paddle and camp there?
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Old 02-09-2011, 11:49 AM   #15
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Quote:
Originally Posted by sp_nyp View Post
This is obviously just speculation, but it seems like with a section of land that size, the taxes could be easily paid for with the timber they could harvest - as well as getting tax breaks for easements and such... no?

Quote:
Originally Posted by chairrock View Post
Are there Hunting Clubs on the land in question?
If so, are the Hunting Clubs still paying rent?
If so, isn't that rent going to the NC?
Is the NC using the rent to pay the carrying costs?

I am not familiar with the makeup of the former FP lands that the NC has not offloaded yet.
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Old 02-09-2011, 12:27 PM   #16
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This is obviously just speculation, but it seems like with a section of land that size, the taxes could be easily paid for with the timber they could harvest - as well as getting tax breaks for easements and such... no?
Probably. I've never really gotten the impression that the TNC is in the business of Forest Management themselves. I'd assume (and this is a completely uneducated, unqualified assumption) that they'd have to contract the management and the harvesting of the land out to other companies.

As for easements, again, you'd need to get the State involved, and this would involve a purchase of the development rights by the state (I doubt that the TNC would simply hand something as valuable as the development rights over, unless they had a good source of funding to do so).
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Old 02-09-2011, 12:28 PM   #17
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Originally Posted by chairrock View Post
Are there Hunting Clubs on the land in question?
If so, are the Hunting Clubs still paying rent?
If so, isn't that rent going to the NC?
Is the NC using the rent to pay the carrying costs?

I am not familiar with the makeup of the former FP lands that the NC has not offloaded yet.
If the money from hunting club leases is enough to cover taxes and fees for owning that land, why then don't more hunting clubs own land instead of lease it?

Without any idea of the numbers involved, I would be very, very surprised if the income for hunting leases even began to cover the expenses of owning the land. I assume that's why so many hunting clubs lease land that is owned by timber companies, rather than purchase it outright.

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Old 02-09-2011, 12:44 PM   #18
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Originally Posted by sp_nyp View Post
This is obviously just speculation, but it seems like with a section of land that size, the taxes could be easily paid for with the timber they could harvest - as well as getting tax breaks for easements and such... no?
Another thought that occurrs to me is that TNC, as a not-for-profit, probably does get tax breaks. This of course throws a whole new set of obstacles into having the TNC harvest and sell the timber... obstacles that TNC might not want to deal with.
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Old 02-09-2011, 01:12 PM   #19
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If the money from hunting club leases is enough to cover taxes and fees for owning that land, why then don't more hunting clubs own land instead of lease it?.
I suspect the main reason is the initial capital for purchasing large tracks of land. Paying the taxes on land is typically a much smaller burden.
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Old 02-09-2011, 01:14 PM   #20
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Another thought that occurrs to me is that TNC, as a not-for-profit, probably does get tax breaks. This of course throws a whole new set of obstacles into having the TNC harvest and sell the timber... obstacles that TNC might not want to deal with.
I wonder if they could harvest timber to a point where they break even with their costs invested in the land... and then donate to the state.
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