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Trust Issues

Two sides have locked horns over white peak—which land commissioner candidate can sort out the tangle?

May 5, 2010, 12:00 am

The conflict between ranchers and hunters has taken center stage in the White Peak controversy—Lyons says it is one of the primary reasons for the trade.

But both hunting and grazing are small potatoes when it comes to generating revenue for the state trust.

For example, before relinquishing some of his grazing leases in the trade, Stanley had leases on more than 21,000 acres from the State Land Office. Stanley currently pays approximately $6,000 annually for the entire tract—roughly 30 cents an acre.

The Department of Game and Fish, according to its spokesman Dan Williams, pays the State Land Office a flat fee of $200,000 a year for an easement that allows it to distribute public hunting licenses on all 9 million acres of state trust land. That’s just over 2 cents an acre (though not every acre of state trust land has viable hunting resources).

Compare that to revenues from oil production, which average approximately $166 per acre of state trust land. Under Lyons, revenues from state trust lands—his office oversees 9 million acres of state trust land and 13 million acres of mineral rights—have risen steadily, almost doubling during his eight years in office, and have paid out $2.7 billion in total to schools, hospitals and universities. Of that revenue, approximately 95 percent comes from oil and gas production. Royalties, bonuses and income from lease sales for oil production also are significant sources of revenue for the state—and almost 40 percent of that production happens on state trust lands.

“Obviously, they’re the most important asset the state trust fund has,” Matt Rush, a Republican candidate for land commissioner who swept his party’s pre-primary convention with almost 65 percent of the vote, says. But Rush, like the other candidates in the race, recognizes the danger of a uniform investment portfolio.

“We must look at ways to diversify that,” Rush tells SFR. “We can’t have all our eggs in one basket.”

Rush’s opponent, Republican Bob Cornelius, has made “alternative” energy the linchpin of his campaign, saying he’s interested in exploring “natural gas and oil as well as solar, wind, nuclear power, coal and uranium.”

That, he says, is simple self-preservation: The State Land Office won’t have much to do and its 22 beneficiaries will be out of luck once all the oil and gas in its 13 million acres of trust lands has been extracted.

One of Lyons’ most vocal detractors is Ray Powell, a former land commissioner (1993-2002) and a Democratic candidate in the June 1 primary election, who has the backing of groups like Conservation Voters of New Mexico and the Sierra Club. According to Powell, Lyons’ model of fiscal responsibility isn’t enough.

“I’m really upset at the way the Land Office has been run,” Powell tells SFR. “I think it’s a disaster.” Powell’s election platform—which echoes his failed candidacy in the primary election for this office four years ago—is rooted in the adage that the office needs to protect public lands and diversify its sources of income.

“The trust is in perpetuity; it’s forever,” Powell says. “So you [try] to make that revenue stream as stable and as large as you can for perpetuity. Doing projects that make you some money on the short term but cost you opportunities on the long term don’t make any sense.”
White Peak, he says, is a classic example.

If the trade goes through, Powell says, “You may make a couple thousand dollars more a year, but what have you cost in terms of economic return to the entire community?”

(Lyons counters that his administration “did more conservation than” Powell “ever did.” He, too, cites White Peak. “Look at all the roads, the ruts, the trespass. If [Powell] is such a good conservationist, why did he advocate to leave it as is? All conservation groups ought to be for this!”)

Powell’s two opponents in the primary, Santa Fe County Commissioner Harry Montoya and Public Regulation Commissioner Sandy Jones, largely echo his call for change—each with his own idea of how to improve the State Land Office.

“We really need to look at renewable energies,” Montoya says, indicating he’d develop wind, solar and hydrogen through partnerships with private firms already producing renewables. He’s also a vehement opponent of the White Peak swap, both because “things are fine the way they are” and because part of the trade involves a 3,630-acre section of Arroyo Seco. The area falls within Montoya’s county commission district, yet he says Lyons kept him in the dark about the trade.

Jones, too, mostly opposes the trade—mainly because he doesn’t see enough justification for it.

“If I’m land commissioner, there’s going to be a much more stringent process for land swaps,” Jones tells SFR.

Since trades between the state trust and private landowners transfer surface but not mineral rights, Jones says they make the revenue configuration more confusing. “It makes it more difficult to go get those minerals,” Jones says. That view is typical of his revenue-oriented approach to the office. Rather than looking to renewable energy, Jones wants to increase the trust fund by stimulating oil and gas production for a limited time period.

But while Lyons has increased the revenue his office generates over his two terms, he also has come under fire for what many conservationists consider inappropriate coziness with oil and gas interests. It’s a suspicion that has crept into the furor over White Peak—as well as the upcoming election.

Vesbach compares White Peak to the Valle Vidal area of the Carson National Forest, which was under threat of drilling until it received congressional protection in 2006.

“It’s a place similar to Valle Vidal; it’s an issue similar to Valle Vidal,” Vesbach says, “and if the trades were completed, it would make the area harder to protect.”

Potential oil and gas development is of grave concern to Mora residents, as well as the Sierra Club, according to Norma McCallan, the vice-chair of the Sierra Club’s Rio Grande Chapter.

“Our concerns are not with the private ranch owners,” McCallan says. “We’re concerned because the [exchange] seems to have been done with a lack of transparency and openness. The state land commissioner has an enormous amount of power.”

In February, Lyons told the New Mexico Game Commission that he had denied a request to lease 30,000 acres of state trust land in White Peak for oil and gas development because “we want to save that area as a pristine area.”
Lyons has publicly committed not to open White Peak to drilling while he’s land commissioner—if all four trades go through.

“We want to maintain it as a quality area,” Lyons tells SFR. But, he adds, “If the exchange is killed by the attorney general and if the private guys start leasing all their lands that are checker-boarded within us, then we have to step back and look at that.”

Chances are, though, Lyons won’t be the person overseeing the ultimate fate of White Peak.

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