BRA divestiture takes big step

Authority OKs resolution allowing staff to move ahead with request for bids from prospective buyers.

By Libby Cluett
lcluett@mineralwellsindex.com

WACO – Many eyes and ears have been tuned to Brazos River Authority’s quarterly board meetings – mostly to find out what the board decides regarding selling land at Possum Kingdom Lake.

On Monday, the BRA board authorized a four-page resolution directing staff to move ahead with a request for bids for the purchase of BRA residential and commercial leases lying outside of the Federal Energy Regulatory Commission project boundary.

“The resolution gives clarity as to how the BRA plans to move forward with third-party divestiture at this time,” according to BRA Government and Customer Relations Manager Matt Phillips.

Possum Kingdom Lake Association President Monte Land called the resolution “very attractive,” adding “a lot of people like it and we’re wanting the best thing for our people out here.”

Lessee Michael Patterson, who submitted an all-inclusive bid to purchase BRA land for a lessee group, told the Index Tuesday, “I think [Monday] was a great day for all PK BRA lessees and the BRA. We, the lessees, got what we asked for. I cannot imagine the BRA being any more accommodating.”

“We don’t know when [the RFB] will be posted,” said BRA Public Information Officer Judi Pierce. “There are things we have to do with FERC first before posting the bid.”

She said the board removed the option of selling unencumbered areas – areas not under lease. Currently the BRA is discussing giving about 425 acres, all open land with no leases and contiguous with Possum Kingdom State Park, back to the park, she added.

“Not having to deal with the undeveloped properties will make my effort much simpler,” Patterson stated. “Once we know which commercial properties will be included I will adjust my bid accordingly.”

Patterson explained that the BRA took elements of the proposal he presented to the board last month and incorporated these into their resolution.

“I think that is a very good thing,” he said. “My proposal had four proposed options for lessees (two sale and two lease) that we did not have before. Those options are now imbedded in the BRA’s RFB.”

The resolution requires the RFB to allow lessees to purchase their leased property in cash or through preferred-lender financing for 90 percent of the 2008 county appraised value.

“We’re all real encouraged,” Land added about the provisions for lessees.

Because the resolution incorporates these lessee provisions and does not include the undeveloped land, Patterson said, “It is now less important to the lessees who is the successful bidder for their leases. As a lessee, any differences regarding my group’s ownership of the leases or someone else’s should be of minimal to no impact on the lessees. It is OK now if we get outbid for the leases. It won’t cost the lessees anymore and the undeveloped land stays ‘as is’ for the time being.”

Roads

The resolution also provides a bright spot for Palo Pinto by including BRA-maintained roads in the sale.

The resolution requires “any purchaser to purchase all roads which are currently maintained by Brazos River Authority and maintain such roads (or cause such roads to be maintained), provide an access easement to [BRA], and ensure that the users of the leased property and property retained by [BRA] are able to access and use such roads.”

“I think any bidder would have to have an understanding [or] agreement regarding what the counties – Palo Pinto, Stephens and Young – would be willing to accept regarding existing roads,” Patterson noted.

FERC question

The FERC setback issue is one of the main issues still lingering.

Unlike Lake Granbury, also under the BRA, where landowners own down to the water, a 25-foot setback from the PK Lake shoreline is a required part of the BRA’s FERC license. This setback – approximately 300 acres – is public property, which the BRA must maintain in accordance with their license.

“The BRA is the [FERC] license holder, therefore we are the ones who have to be accountable for the land,” said BRA board secretary Wade Gear.

The BRA resolution states, “that the request for bids notify the prospective bidders that the Brazos River Authority is in the process of requesting approval from FERC that all residential leased property located within the FERC project boundary be excluded from the FERC project boundary, and that if at the time a bid is accepted FERC has approved such exclusion, the bid will include such property and its associated leases.”

“The BRA filed in the summer to get answers [from FERC] and we filed a motion for clarification from FERC of the BRA’s original petition,” said Land of the PKLA’s recent action.

He admitted the BRA’s “hands are tied” by their FERC license, but said he was “pleased they addressed the FERC issue” to the extent they did.

“What we are wanting to do is make that land available in the sale, if possible, so that eventually lessees can own it all the way to the water,” said Phillips.

He added that this would simplify the overall sale, however called it a process that will take time.

“Regardless, the resolution made clear that FERC land is public land and access to it will continue,” Phillips said.

“The resolution also dictated that the RFB would have to include a clause that if FERC license ever went away that that land would transfer to the adjacent landowners,” he explained.

Legislation?

The PKLA has spent time and dollars on getting BRA divestiture on state legislators’ radar. When asked about continuing toward a bill, Land responded, “We’re still working in that direction. The BRA knows and is not opposed to it.”

He said there is a draft bill, but he has not yet seen it.

He said continuing with legislation is a response to what he has heard from area representatives and senators, “that there still may be a need for legislative action. If we drop everything right now and later down the road find we need it, it will be like trying to start a cold engine again,” Land said.

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