M.D. clears up confusion on local grazing leases

Posted on October 5, 2016 by Taber Times

By Nikki Jamieson
Taber Times
njamieson@tabertimes.com

A grazing leaseholder meeting held last month has caused concern over the spread of misinformation on local leases.

During their regular Sept. 27 meeting, the Municipal District of Taber council brought up in discussion the Sept. 13 Alberta Grazing Leaseholders Association meeting in Taber. The purpose of the meeting had been to discuss the M.D.’s policy on grazing leases, and its compensation to ranchers for impacts caused by oil and gas activity.

While council itself did not receive a formal invitation to attend the event, individual councillors had received a call about the meeting and attended. Although some AGLA members defended the M.D.’s Tax Recovery Land lease as being fair, the majority of the meeting had featured a solicitor urging members of the association to challenge the compensation they received through the Tax Recovery Land Lease agreement to the Surface Rights Board.

In a letter from the AGLA to M.D. grazing leaseholders, advising them of the meeting, it says that under the M.D.’s new policy for grazing leases and oil and gas activity compensation, implemented on Feb. 28, leaseholders will not receive full compensation for operation impact, as some of that money will go towards the M.D.

The compensation would be paid directly to the M.D., instead of the leaseholder, who would then pay out to leaseholders $800 per surface mineral lease for the first year, and $400 per lease ever year afterwards.

“Bob (Wallace) and I addressed the crowd, and I think we got the point across,” said Dwight Tolton, M.D. councillor. “If they want something like that, they need to come to this venue, which they had the opportunity for ten years and they never had. I’m not sure if it’s over with.”

According to a memo from councillors Tolton and Bob Wallace to council, two of the four members of M.D. council who had attended the meeting, council members had stressed that compensation paid to leaseholders is fair given lease rental rates; the AGLA cannot logically advocate for the property rights of leaseholders while ignoring the rights of the property owner; the Tax Recovery Lease Agreement has been in effect since 2007, with an automatic renewal on Feb. 26, 2016 for an optional 10 years, and all leases have been renewed for that period, with the only change in the lease being consideration of lease rental rates; and the Crown Grazing Lease issue of surface lease revenue from the oil and gas industry is an issue that should be taken up with the Alberta government, whereas Tax Recovery Land is not Crown land, it is owned by the M.D.

“I think Mr. Keith Wilson (AGLA presenter) did a great job at explaining leaseholder rights, but he forgot to mention, or planned on mentioning — which is what I would liked to have him to address — is the M.D. owns this land,” said Wallace. “Definitely, the AGLA brought a lawyer in to stir the pot here, to (tell people) that M.D. of Taber leaseholders are martyrs for provincial land.
“He’s missing the mark; there’s provincial grazing leases and there’s M.D. of Taber grazing leases. One is on (M.D.-owned) land, and one is on provincial land. He’s missing the mark, when he’s giving you this spiel on resource revenue.”

Wallace also reported a worry among leaseholders, that “this group are able to come in and blow up their lease agreement”, and requested that council gets “the proper information” out to their leaseholders, assuring them that no one can mess with their lease agreements with the M.D. without their approval.

“This M.D. of Taber lease agreement was a negotiated settlement between the council of the time, and the leaseholders,” said Wallace. “(The leases) are intact, they’ve been renewed as of February 2016 for ten years. And nobody else can mess with their lease unless they’ve given them permission to do it.”

“There is a clause in there (the leases) that states it’s automatically renewed for ten years, absolutely. They don’t have to come in and sign,” said Brian Peers, director of municipal land and leases for the M.D., adding that there is also the option, for those that prefer, to come in and physically sign the agreement.

Along with the memo and the letter were some reports, from which the lawyer speaking at the meeting had referenced, but only in snippets, so attendees didn’t get all the information.

“It’s important to note that the lawyer told the group that they are eligible to go to Surface Rights Board on every one of the oil well. Well, the dispositions are not in the leaseholder’s name, they’re the M.D. of Taber’s name,” said Wallace. “I don’t know if they had the right or not, but the Surface Rights Board will look at that.They don’t get the notification from oil companies in lease agreements anymore. They’re in the agreement. The lease review is February 2026. He was giving us some improper information (for the M.D. leases). Proper information probably for provincial grazing leases? I couldn’t tell you, but the important message here is this guy needs to petition the Alberta government for the changes that he’d like to see.”

“The issues that he brought up about the surface rights board, which I don’t understand; if the Surface Rights board, if the leaseholders have the power he was talking about on the Surface Rights Board, they equally could go on the provincial grazing lease and do the same thing. So why does he need to blow this lease agreement up, in order to shed light on the other?”

Another issue the lawyer had raised was that he wanted to make sure that the money that the M.D. kept from the compensation went towards the residents.

“A lot of this has come up because there has been a change in their leases this year,” said Brian Brewin, reeve for the M.D. “This is the year that the new lease came into effect… so certainly it is to be expected that there is some concerns there. But the leases carry on; it was something we negotiated 10, 15 years ago.”

“To be clear, it is only one or two of the individuals that have asked this group to come, or this group asked those two individuals to come,” said Wallace. “The vast majority of the M.D, leaseholders are happy with their agreements, and they know how things change and they’re nervous this group will come in and be able to blow up their contract. And we need to get some information out there, proper information too, and dispel that fear.”

“This meeting was clearly, clearly an AGLA meeting, with nothing else on the agenda, or attempt to use another resource. We’re back to the one per cent that’s causing the issues for the 99 per cent.”

Council accepted the documents as information, and directed Peers to do up an information package to send information on the agreements to their leaseholders and draft something on the information to include in the M.D.’s next newsletter.