Did the Nature Conservancy overcharge New York state for Adirondack land?
The Adirondack Nature Conservancy is facing a crunch of negative press, following a report in the New York Daily Post claiming that the organization was overpayed for land that it sold to the state in the Adirondack Park.
According to the newspaper, the Conservancy acquired the land — roughly 20,000 acres — for $6.3 million dollars, then sold it to the Department of Environmental Conservation for $10 million.
“We intend to begin an investigation into the potential overpayment by the state for these lands in the Adirondacks and into questions about the evaluation methods that were used to value the property,” a spokesman for Attorney General Andrew Cuomo told the Post.
“Questions have been raised by the valuation of the land and the possible motivations and relationships of those involved, and we will review all of the above.”
The article was reported by Fred Dicker, a journalist and opinion writer who has been outspokenly hostile to conservation efforts in the Adirondack Park.
In a letter written to the Post, and published on the Conservancy’s website, the green group’s state director described the account as “extremely misleading.”
“The price the state paid for the land,” wrote Bill Ulfelder, “was determined by two independent appraisals commissioned by NYSDEC. The price was further substantiated by state review one month prior to the purchase and approved by the Office of the State Comptroller.”
However, the Comptroller has also announced that he will review the land deal and the process used to valuate land being considered for the state forest preserve.
This report comes at a precarious time for the Conservancy.
The organization used the revenues from the 2008 sale to help finance the massive Finch, Pruyn and Follensby land transactions.
Environmentalists hope that the land will soon be acquired for addition to the Park’s constitutionally protected land.
But the state budget crisis has caused Governor David Paterson to propose deep cuts to funding for land acquisitions.
State Senator Betty Little and other regional lawmakers have proposed a moratorium on land purchases.
I think this whole thing is ridiculous. If the state overpaid it will be an outrage. What is ridiculous is the accusations toward Nature Conservancy.Brian – the link from NCPR homepage:"Did the Nature Conservancy Scam NY taxpayers? "and "Did the Nature Conservancy overcharge New York state for Adirondack land?"If the state payed too much, that is the state's mistake. If the two "independent appraisers" payed by the state were corrupt, than they are to blame. The only fault I could remotely imaging the nature conservancy could have is if they conspired with the appraisers. Is there any shred of evidence of this, or even any speculation? Is this the "scam"???The fact that its the nature conservancy should be a side note and should really be a story about the state and how they value their land purchases regardless of who is the seller.
If the state wants to buy land – and the state already has over 3 million acres in the Park- why not buy it directly from the original owners rather than buy it from a middleman who jacks the price way up? That's just common sense. Common sense, it seems, is pretty uncommon in Albany. No more land purchases from the Conservancy.Green groups are not uncorruptible. They accepted the overpayment, instead of doing the ethical thing and declining it.
blackus – i agree that 'scam' was an inappropriate and loaded word given the facts as we currently know them. i changed it within seconds of posting my original blog, but our website takes a while to update its headlines.that said, this clearly comes at a time when the nature conservancy's agenda in the park is already under fire.–brian, ncpr
But why would it be the Nature Conservancy's problem?If I were them I would push for the absolute most a buyer would be willing to pay, including the State. In fact it is their duty to get the most they can so they can best carry out their mission. I would be more concerned if they were selling land for less than they could get. If you are a donor of either land or dollars to the Nature Conservancy you would want them to maximize their income from any land sales they do make so that they could buy the most land in the future.Unless of course we are talking true corruption, where someone at the Nature Conservancy or the state or both personally benefitted from the sale.
The deal gave the conservancy a 50%increase in the value of the land over 3 years. Read the whole story and see if you don't come away outraged.
The fact that this comes at a time when the Nature Conservancy is under fire makes it suspicious. Between this, biased piece by Dickerson, Douglas's slap lawsuit, and Doolittle-gate, I think the conspiracy is on the other side of the debate.
%50 profit over three years seems like a wise investment on TNC's part and a poor investment for us. Good for TNC and their supporters, woe to us. Sure, I'm outraged. Outraged at the state, if its true, not TNC.
Seems like we should know more. Maybe the original seller needed to sell fast or was willing to give TNC a deal. TNC should try to maximize their doners funds. If the appraisals were done correctly, TNC should except what the state was willing to pay.
I read the whole article and I'm not outraged. First these are claims, none of which appear to have been verified. Outrage is jumping the gun. The reason The Nature Conservancy buys land then sells it to the state is that often in recent years the state hasn't had the funds to buy Adirondack land as it became available. The Nature Conservancy buys it and holds it until the state can purchase it. There are costs involved in doing this. How much is too much for the state to pay? That was for the appraisers to determine. If they over priced it the fault is theirs. Perhaps the Nature Conservancy got a bargain. Should they tell the state that it shouldn't pay them fair value because they got it cheap? Would you? They have operating expenses they have to cover. Bottom line this is hype journalism, the sort of thing Fox News does. Take a few facts or in this case suspicions and build a story around them as an attack on some group you don't like. There isn't enough real information there to make a judgment.
The question is was there collusion among the participants in the deal? If this turns out to be some sort of back room "you rub my back, I'll rub yours" thing then the gloves should come off. If it's just ignorance on the part of the State, then it's time we stopped State land purchases altogether. We have way more than we need and it's all agenda driven any way. If it's nothing more than some Wall St wannabes making a killing…tough for us.
Jim,I agree that we don't know enough about TNC: they need to dsiclose how much their executives make. The dirty little secret about many of these organizations is the amount of money spent on administration and executive salaries. I have long thought that it was inefficient to buy land from TNC, and it appears my suspicions have been vindicated. If the state has enough money to be the land from TNC at an inflated price why wouldn't they have enough money to buy a conservation easement from the original owners at a much lower price? This land is not going to turn into Clifton Park if the state takes a couple of years to buy it. I understand that the greenies are out in full force to defend TNC, but this whole policy of buying land from TNC is a waste of money and utterly incomprehensible. No wonder our taxes our so high.
I like Bret's position:I don't think we need more state land, so i hope this is true so we can say "it's time we stopped State land purchases altogether"
Another case of Republicans eating their young. The Nature Conservancy was started by wealthy conservative conservationists who believed in using market mechanisms to preserve lands.And the Fox wing of the GOP is now on the attack against them because modern conservatives hate conservation.We have always been at war with Eurasia.
scratchy: you assume the previous owners woudl be willing to sell an easement and that they'd sell it for a much lower price. If I recall correctly, didn't they cut it hard before selling?
I though TNC was started by scientists in the Ecological Society of America.
Bret 4207 writes, "We have way more than we need and it's all agenda driven any way." Whether or not the state has too much land is debatable (I don't think it does, but there's no point in arguing about that here). What interests me is the 2nd clause–" it's all agenda driven." What does that mean? The word agenda means simply a to-do list or a plan. But on the right it's come to suggest something devious, corrupt, or perverse. Sure, TNC has an "agenda": it's to protect open space, especially critical or endangered habitats, ecosystems, etc. Is there something scary about that? Something duplicitous or covert or conspiratorial? If they can turn a profit on one deal and devote the proceeds to the next one, is this "agenda" something we should be suspicious of? If so, why?
Thanks for keeping my name out there, blackus. I like that, which is why I use my name whenever I comment. And I use it because I am willing to take responsibility for what I say.
we are all impressed willdoolottle
This is in response to several prior posts. I am not a Republican; I voted for Al Gore, John Kerry, and Ralph Nader; am not opposed to conservation per se; and do not watch Fox or any other tv. Even if the previous owners wouldn't sell a conservation easement, the state could still buy it outright at a much lower price than they bought it from TNC.I have to wonder if the state's insistence on purchasing directly from TNC is designed to reward the politically well connected. It will be interesting to see if TNC will reveal its expenses- including executive salaries- to justify its selling price. I have not seen any evidence that Adirondack habitats are threatened as a result of overdevelopment. To the extent they are endangered, it is a result of global warming and acid rain. With respect to agenda, I believe that Bret may mean these land purchases, in conjunction with APA regulations, are designed to drive people and businesses out of the park.If that is the agenda- and I don't believe it is the state's agenda, though it is perhaps the agenda of some environmentalists- it certainly has been successful. One need only look at Census data. In an earlier post Brian Mann cited Census data that showed the 2 counties that are located completely within the park, Essex and Hamilton, suffered steep population declines. St. Lawrence and Franklin Counties had more moderate percentage declines. Clinton, Warren, and Jefferson all gained thousands of people. I'm not sure about the other NNY counties: Lewis and Washington.
Essex County did not suffer a steep decline, they lost about 700 out of 38000, which is on par form most of rural NY. Are the environmentalists to blame the population declines in the rest of rural US, or just here? The state doesn't buy only from TNC. They buy a lot of land from TNC because the the state moves very slowly, so when land goes up for sale, TNC buys it in a normal timefram and holds onto it for years while the state goes through whatever procedures they need to go through. When a company like domtar decides to sell, they want to sell as fast as possible. But I agree, it would be nice if the state could move faster when buying land. Maybe that would be the solution. Allow the state to expieite land purchases so they can buy directly from the original seller and they might get a better deal for us tax payers.
Scratchy said:"It will be interesting to see if TNC will reveal its expenses- including executive salaries- to justify its selling price." Did you not read the article? The state dictated the buying price based on appraisals. What do the salaries of TNC have to do with the appraisal price? Should the price been higher if their salaries are lower. Should all real estate appraisals be based on the salaries of the seller? Had the state purchased from Domtar, should they have known Domtar executive salaries? It really comes as no surprise that you voted for Nader.
I think the issue is NOT with the Nature Conservancy. It is with the state and the dumb process where we — taxpayers — overpaid for a piece of property at the behest of our elected leaders.
Brian Mann,Your comment is just perpetuating hearsay that has significant implications for TNC. Shame on you. With a few phone calls, for instance, you could have found out that the AG's office signed off on this deal. Or that several independent appraisers were used to establish the purchase price. I hope you will do a follow up.
Just as a comment the top five salaries of people who make over 50k per year for any Private Not for profit will be listed in the 990 return for the agency. 990 returns are open public information which can be found on the site guidestar. So simply look up the NYS TNC and you will find who is making what.
Is the State being assessed at the price that was paid for the property?
Brian, The Nature Conservancy welcomes Attorney General Cuomo’s prompt inquiry into the land transfer system in New York State, by which the state and state agencies appraise, acquire, and sell land. We agree with Governor Paterson that the system should be efficient, timely, and reliable and look forward to working closely with the Attorney General. While recent interest in the Domtar transaction may have sparked the AG’s investigation, it is by no means its sole focus. The Nature Conservancy is confident that all land transactions conducted between our organization and New York State have been completed according to proper procedures. When the state buys land from The Nature Conservancy or any other entity, the fair market value is appraised independently. The state’s purchase price of 20,000 acres of former Domtar lands was determined by two independent appraisals done in May and June 2007 and was upheld by a June 2008 review by the Department of Environmental Conservation. Both the Attorney General and Comptroller approved the transaction in July 2008 and September 2008, respectively. In the rare instance when the state purchase price exceeds the Conservancy’s total project costs, the Conservancy applies the remaining funds toward another project with the state where New York’s open space and wildlife conservation goals align with the Conservancy’s mission to protect ecologically important lands and waters for nature and people. Over the past several decades The Nature Conservancy has sold tracts of land to the state at below fair market value. For instance, in December 2006 the Conservancy sold 1,109 acres purchased for $1,046,200 to New York State for $644,500. In fact, on a number of occasions the Conservancy has donated land to the state.Connie Prickett, The Nature Conservancy
Gromit, the agenda I see is the State buying lands, that it doesn't need, to put them in the Forest Preserve as Forever Wild lands. That means they will remain essentially unused, untouched and unproductive. Look at the Whitney tract in Long Lake. That is a prime example of complete mismanagement in my view. That tract was crisscrossed with roads. It could have been used like a National Park where drive in use was allowed. Someplace Gram and Gramps could have gone. Instead the vast majority of that land will never see a human foot step. Why? Why buy land only to make it unusable by the population? That's the agenda. Put land in the status that will make any future use of that land impossible. That's not CONSERVATION, that's PRESERVATION.And then there are more questions. Why buy land with taxpayer dollars and then use those same dollars to pay taxes on that land? It makes zero sense. Either take the land off the tax rolls (and the screams from the Towns start) or leave the lands in private hands. It's nuts for the State to have to pay taxes on land it doesn't need. What is the need for this land? Is there a particular reason all this land should be in state hands? Not that I can see. If there is a unique physical or environmental quality to the land (The High Peaks for instance) or historical significance (Fort Ticonderoga, John Browns Farm, Saratoga Battlefield) then I can see it. But buying land to keep it from ever being used (developed in any way) is definitely an agenda, and it's not in the best interests of NYs taxpayers IMO.Anon 8:46- Conservatives don;t hate conservation. They dislike inefficiency, waste, throwing good dollars after bad and false pretenses used to further an agenda. Conservation of natural resources and good stewardship of the land is one thing. Preservation for the sake of a "green agenda" and subjective aesthetics is quite another.
We ought to be asking ourselves why TNC making a small profit is a "scam" to our local news media, when billions in giveaways to corporations goes virtually unreported. Who is scamming who?
I don't think conservatives have cornered the market on disliking inefficiency, waste, throwing good dollars after bad and false pretenses used to further an agenda. In fact that dislike is most probably universal across the political spectrum. One persons waste is another persons "must do" government program.
Bret: How do we decide whether we need more forest preserve or not?Do you decide or do I? Are you praying before you go to bed that there was wrong-doing here so state has a harder time buying land?
My tax dollars are being used to buy more land. Its paid through real estate transaction fees – I haven't bought real estate in a while. I'm am fine with us paying taxes on the land, we are very fortunate to have so much land accessible to us. I cannot wait till the state buys Follensby Pond. I hear there are some monster fish out there and thanks to TNC and (hopefully) the state, the public will have access to this beautiful piece of land for the first time.
Anon 8:55- Beyond your snide remarks, why should the state own any lands other than those required for it's buildings or those unique or historic lands I mentioned? What purpose is served by the State owning so much land? Is there some problem with the concept of private property or does the idea of some private party owning a large tract go against the grain somehow?No, I don't pray for anything like that. I'm resigned to living in world full of people who think using tax dollars to suit their agendas is "right".
Perhaps I missed it somewhere in this discussion or in the NY Post article, but now that the state owns the land, has there been any discussion or agreements for easements or continued logging on this property? Or will it be truly "Forever Wild?" It seems more recent land purchases have been more balanced in that easements and continued logging are allowed. I believe the Fynch Pryn deal is structured in that matter. Anyone?
The issue here is not that the state overpaid but that the Office of Real Property Services (ORPS) undervalued the land in question. All tax payers in the Park should be concerned about the undervaluation of state land because it impacts our local property taxes. Once land is purchased through the DEC, responsibility for assessing its value for tax purposes moves to ORPS. ORPS follows a valuation process that accurately determines the inventory (amount and type of timber, amount and quality of waterfront, etc.), but uses outdated valuation assumptions that result in undervaluing the land for assessment purposes. In this example, the DEC got 2 independent appraisals and took the average (9.8M$) as the purchase price. That yielded a value of $490 per acre. The ORPS valuation process yielded a value of only $235 per acre. Most current town revaluations of state land in the Park put a value on state land much more in line with the $490 value per acre. The assessed value of the state land is the basis for the property taxes that the state pays the local communities. Undervaluation of state land means the state underpays its share of a town’s property taxes and the local tax payers must make up the difference. Since the state owns such high percentages of the acreage of many towns in the Park, the underpayment by the state is a substantial hit on the local tax payers.
I think all this land has been added to the Forest Preserve. Other land related to the original "Domtar" deal may be encumbered by working forest easements. 58,000 acres of the FP deal could be added to the Forest Preserve. The remaining land has (will have?) working forest easements in place. One thing that tends to be overlooked in these deals is the money required to manage these tracts. I was hiking this weekend up Azure mountain. This is on a small Forest Preserve parcel that was added when a larger deal was enacted over a decade ago. The trial is a disaster, the land is being destroyed by the public. The money was never spent to properly design the trail for the crowds that now visit. It basically goes straight up the hill, and it is eroding at an alarming rate. I think that this mountain was much better “protected” under its original private stewards. Once these large tracts (equaling almost 1 million acres with easements) are opened up they will be destroyed as well if they are not properly managed. Almost none of the proposed maintenance work that was planned on the Champion easement lands has been accomplished. This is 11 years after the sale. There is more than just a “purchase” price to consider. But go ahead and keep buying more public land we need all we can get!
Dave, Yes the taxes are based on the appraisal, that does not mean that the state should be compelled to pay more than necessary for the land. Just like any other property tax payer their payments are based on the appraised value not on the purchase price. I don't see any good argument for the state to pay more than they have to.
My house is assessed at less than it was appraised at. looks like FP is done the same way
Paul,I'm confused. Was that sarcasm at the end of your first post? In other words are you suggesting the state should stop buying additional land as they can't begin to properly manage the land they already own? Given your two examples, the Champion lands being the tract I'm most familiar with, you make a good point. Please clarify if I'm reading you correctly.
boognish,According to Brian Mann's post both Essex and St. Lawrence counties lost 1,200 people and Franklin lost 1,000. given that St. Lawrence county has about 110,000 and Franklin 50,000, Essex's decline is relatively steep. In NNY Jefferson gained 7,000, Clinton 2,000 and Warren 3,000. So not all NY rural counties are losing population. It seems the 2 counties completely within the Park are outliers in comparison to the rest of NNY. Whether this anything to do with APA or land purchases, I have no idea. But it should be of concern given those two counties are so spararely populated that maintaining public school enrollment, volunteer fire departments, EMTs, etc. is a challenge. Mann doesn't provide any links but he is a respected journalist so I trust his post.http://northcountrypublicradio.org/blogs/ballotbox/2010/03/census-hamilton-county-losing-1-of.htmlblackus,I read the article and I also read the the letter from TNC's NY director which states that the Conservancy's costsfor the project exceeded 9.7 million. I don't think it's unreasonable to ask to see some evidence of their expenses. I see you believe voting for Nader is a bad thing. I stand by my vote: he was against TARP and in favor of reforming our broken political system. mervel, Thank you. I'll look that up.
i don't think its unreasonable to ask for a private organization's financial matters, its is not reasonable expect it.
Essex lost 1.8%. Broome County (Binghampton) lost 3%. Who is the big bad regulatory authority that's killing them and not St. Lawrence County?
If Clapton is God, Warren Haynes is Jesus said… You are not confused that was sarcasm. The state admittedly has more land than they can manage and their staff and budget are shrinking. But that doesn't seem to have nay impact on the process moving forward. If we don't buy the land now, no matter the price or impact, we will lose the chance forever (sarcasm again!). The TNC should have kept this land. If this "open space" has all the intrinsic and extrinsic value that they say it has then why not keep it on their books they should be able to make it work? No, I am afraid that only we as a state are that foolish.
"I don't think it's unreasonable to ask to see some evidence of their expenses.". Scratchy, The TNC is a registered NFP. You can view all their audited financial statements and find the expenses without too much trouble.
I believe the TNC will be vindicated in this.BTW, the purpose of the organization is not to own the land, but to preserve it. New York state has been willing to own and preserve.If New York State does not want to do this, I say, let's go for federal funds to preserve Tahawus and Follensby. It is time to relook at a National Park or two in the Adirondacks.I notice the people in the Hudson Valley are considering this for the Hudson River Valley…. which by they way, may mean a federal preserve will be coming to the adirondacks….
2:02,Not if they receive taxpayer dollars.2:05,Broome county is a primarily urban suburban county and, consequently, different from Hamilton and Essex. The two counties located entirely within the Park had the largest and third largest drops in population, percentage wise, in NNY. Lewis county, heavily reliant on the decling diary and paper mill industries, had the second largest decline. Clinton, Washington, Warren, and Jeffersonhave all gained population. Paul,If the NY Director of TNC is writes a letter claiming that the expenses were large enough for them not to receive a profit, then I think it is incumbent on him to elaborate on what those expenses were.
"The two counties located entirely within the Park had the largest and third largest drops in population, percentage wise, in NNY." Sure Broome Co population declines, but its an urban county, so we can't compare, Cattaragus is rural but not in NNY, Lewis is rural and NNY but it doesn't count either. You are really stretching to show some causation.
The Post Star article was sadly misinformed and obviously the reporter didn't do his research.The system of checks-and-balances imposed by the Comptroller's Office makes corruption virtually impossible. The Comptroller is an independently-elected official and the Office completes many levels of review and pre-audit on such transactions before allowing the State to even enter into a land sale contract.The DEC uses —at a minimum — two independent appraisals to establish a RANGE of values for any particualr deal of this size. Often DEC staff will order three appraisals from outside companies. DEC staff, who are certified appraisers themselves, then review the appraisals. Only after this level of review do DEC staff establish a PROPOSED value.Contrary to one of the misinformed bloggers, an appraisal does not establish a maximum value for a property. Appraisals establish a RANGE of value and more often than not the DEC appraisers are looking hard for ways to establish a value at the LOW end of the range. DEC staff and the appraisers frequently go back-and-forth over the justification for using certain comparables and adjustments. The process is long and arduous for the appraisers. Finally DEC selects a proposed value and makes an offer to the seller. DEC staff do not negotiate!DEC will adjust its proposed value only based upon valid market data provided by the seller or the seller's appraiser. If DEC's staff appraisers missed something, then staff can adjust the value accordingly, based on these data. This is rare. Once the DEC and seller sign a contract, the review process starts all over again, this time at the AG's Office.The AG's Office reviews the contract for legal sufficiency, does a thorough title abstract, then passes the contract package to the Comptroller's Office.The Comptroller employs a small army of auditers whose sole function is to scrutinize the appraisals and DEC's proposed purchases price. Only after these staff are satisfied that the market data support the value, will the Comptroller's Office approve the contract and allow the State to begin the closing process.Sometimes the Comptroller will allow the State to reimburse a third party — such as TNC— its reasonable and documented expenses in holding the property until the State makes the purchase. Unfortunately, to theoutside world, this can seem as though the State overpaid. This is not thecase.As much as I held my nose while reading Mike Carr's interview, I have to agree with him on every point. Yuk!I believe the article was motivated by animus and left-over bad feelings by "locals" who were pissed off about the Domtar deal. I'm thinking of Howard Aubin and the Black Brook contingent in particular. Someone should ask how much the poor residents of Black Brook were bilked by Galvin & Morgan to fight the State over the Domtar deal. The Town lost pathetically, mainly because of the ineptitude of Galvin & Morgan. How much did the Town pay for that boondoggle????
Someone should check into the PAST TNC deals inthe park under Pataki and Charlie Fox – namely the MaryLou WHitney deal. TNC definitely had some shenanigans going on there and some double dipping chargining "expenses" like overhead on overhead
Suppose your grandma owns 80 acres and the State buys it for $30,000, and you later learn the State's appraised value was $80,000 but the appraisal was kept hidden from your grandma. Would you consider this to be ethical behavior on the part of the State? I bet you'd be screaming bloody murder and requesting an attorney general investigation into the State's "criminal behavior!"Suppose somebody gifted you 80 acres and you wanted to sell it to the State, but the State said "we can't let you make a profit so we won't pay you anything for it — you have to gift it to us." Would that be appropriate behavior on the part of the State? The only reason people are complaining about the alleged profit made by the Nature Conservancy is that the seller was the Nature Conservancy, not them! Suppose it's the year 2100 and more than half of the Adirondack Park has been turned into summer homes for downstate residents. When you ask why that happened, the response is "the State had an opportunity to protect some of this land from development 100 years ago, but they didn't buy it because at the time they had inadequate staff to manage the land the State already owned–some of the trails were getting muddy from hikers." You would be astounded at how shortsighted the State had been. IT'S MY TAX MONEY TOO AND I AM DAMNED PROUD THAT THE STATE IS USING IT TO ACQUIRE WILD LANDS BEFORE THEY BECOME DEVELOPED, TO ACQUIRE CONSERVATION EASEMENTS THAT ENABLE THE TIMBER INDUSTRY TO SURVIVE IN THE ADIRONDACKS, AND TO LEAVE A LEGACY TO BE ENJOYED BY FUTURE GENERATIONS. I think both DEC and the Nature Conservancy deserve a huge round of applause.
9:51,I don't know anything about Cattargus county. I didn't say Lewis county doesn't count. But when you have 9 NC counties and only two of those counties are located completely in the Blue Line and those two counties had the fastest and third fastest population declines then I think there may be a link. "makes corruption virtually impossible" Really? I can't believe anyone would be so niave about NY government. Remember the corruption in Hevesi's office?