Texas Parks and Wildlife Commission
Conservation Committee

April 8, 2004

Commission Hearing Room
Texas Parks & Wildlife Department Headquarters Complex
4200 Smith School Road
Austin, TX 78744

BE IT REMEMBERED, that heretofore on the 7th day of April, 2004, there came on to be heard matters under the regulatory authority of the Parks and Wildlife Commission of Texas, in the Commission Hearing Room of the Texas Parks and Wildlife Department Headquarters Complex, beginning at 9:00 a.m. to wit:

APPEARANCES:

THE TEXAS PARKS AND WILDLIFE COMMISSION:

THE TEXAS PARKS AND WILDLIFE DEPARTMENT:
Robert L. Cook, Executive Director, and other personnel of the Texas Parks and Wildlife Department

P R O C E E D I N G S

CHAIRMAN MONTGOMERY: First order of business is approval of Committee minutes, which have been distributed. Motion for approval?

COMMISSIONER WATSON: So moved.

COMMISSIONER BROWN: Second.

CHAIRMAN MONTGOMERY: All in favor?

(A chorus of ayes.)

CHAIRMAN MONTGOMERY: Opposed?

(No response.)

CHAIRMAN MONTGOMERY: Mr. Cook.

MR. COOK: Thank you, sir.

One of the charges that we're involved in, particularly in this Committee, is the implementation of a strategic plan for land acquisition and our strategic planning process overall.

I'm going to ask Scott Boruff to bring you up to speed on where we are in that effort. I think it's going very well.

MR. BORUFF: Mr. Chairman, Commissioners. My name is Scott Boruff, deputy executive director for operations.

Pursuant to the Commission's directive to implement the Land and Water Conservation Plan. We have been moving forward aggressively with that.

As I mentioned in an earlier committee meeting, we have been working closely with the Administrative Resources shop to integrate and make sure that we're consistent when we talk about the two different plans which are on the table here.

There has been a little bit of confusion about which one is a strategic plan and what will we call these plans.

Just for clarification, we have decided to call the Natural Agenda, which was described earlier, our strategic plan. And it really is a plan that is designed to provide funding information through the legislative appropriations process for us.

The Land and Water Resources Plan which was approved November before last, however, is also a strategic document, but for clarification, we've decided to call it a tactical document.

So the Land and Water Conservation Plan will be called a tactical document just for clarification in this presentation.

One of the first things we did, after getting the marching orders to move forward with implementation, is look at water and the way water interacts with all the business that this agency does.

To that end, we've asked some of our senior scientific staff to put together a model for the State of Texas which would reflect the importance that water plays in conservation.

To that end, that team came forward with a model which has essentially divided the state into ten aquatic ecoregions, mostly aligned along major river basins or combinations thereof.

We have pulled together a cross—divisional team which represents each one of those major aquatic ecosystems and have, over the last two months, had a series of ten meetings actually combined into five meetings with two of each of those ecoregions represented at each meeting, just recently completed last week.

Those were meetings where we went out into the field. We talked with folks from all the different divisions about the way we're going to implement the Land and Water Plan and the processes for which we're going to use in the future to make sure the plan stays relevant.

Commissioner Montgomery has been appointed to lead that effort. I look forward to working with him. Gene McCarty and myself from the staff perspective have kind of taken the lead.

The idea is that in this upcoming November meeting, we will come back to the Commission with recommendations for changes to the Land and Water Plan, and will probably do so on a biannual basis thereafter.

Every couple of years come back, look at this, talk to field staff, talk to our constituents and come back with recommendations.

The plan is now in May to go talk with our partners, the major NGOs and other conservation organizations out there to let them have an opportunity to give us input.

I think the good news is that I would guess about 70 percent of the items that articulated in the Land and Water Resources Plan are well underway and have been in fact underway for quite some time, even prior to the adoption of that plan.

The other components of the plan continue to be high on our list. I know each one of the resource divisions have taken these aggressively to their staffs in the field.

We're looking to put together a model that will drive operations in the future.

Obviously, the focus for us is going to be not only just the Land and Water Plan, but the Chairman's Charges related to that. We don't have the resources to really do the whole plan at any one given moment.

So each January we will look to the Chairman to tell us where he wants us to go.

I'd be glad to answer any questions.

CHAIRMAN MONTGOMERY: I'd like to start with a comment. Commissioner Parker and I attended the planning meeting in Killeen, and some of you may have made some of the others.

But they really are well done. Scott, you deserve a compliment — Gene, Bob — for starting that process. A great mix from the department from all the different divisions.

I thought it was an outstanding planning process and thought process. It should yield a very good product just based on the session I attended. So thank you very much.

Any questions or comment?

(No response.)

CHAIRMAN MONTGOMERY: Okay. Thank you, Scott.

Item Number 2, Ted Hollingsworth. Oil and Gas Lease Nomination.

MR. HOLLINGSWORTH: Good morning. My name is Ted Hollingsworth. I'm with the executive office division.

And I'm here this morning to present to you a request for the nomination of a tract for oil and gas lease at Mustang Island State Park in Nueces County on the south coast.

The tract being requested for nomination is roughly 1,362 acres. It comprises roughly the northeast third of the park.

The language in the nomination would allow for onsite exploration and mineral recovery, if conditions as set by staff of the agency are met.

There is currently production under way in the state park. Three operating wells and a tank farm. Staff feels that the impact from those facilities are acceptable and are pretty much limited to the footprints of those facilities.

The expected revenue at the minimum bid established by the General Land Office is over $200,000. There would be an addition to that surface use revenues, if the successful bidder chooses to explore or drill onsite.

Staff does recommend that the Commission authorize the executive director to forward the nomination for the 1,362—acre tract to GLO for bidding for lease.

Are there any questions?

CHAIRMAN MONTGOMERY: Questions or comments?

COMMISSIONER RAMOS: My only comment is you're not actually designating a drill site, but you're making a condition that they cannot use the surface unless we agree to the proposed site. Correct?

MR. HOLLINGSWORTH: That's correct. What would normally happen is that they would present us with a work plan, which would describe the location and the schedule, the equipment they propose to use, the means of drilling and so forth.

We would review that, work with them if necessary to choose a more acceptable location, then we would write a surface use agreement that includes all the conditions — everything from onsite toilet facilities to where they can and how they can construct a road, what condition to leave the surface in, time and coordination for access.

It would include conditions for all operations from that point.

COMMISSIONER RAMOS: But in the absence of that agreement, they would have to drill from offsite.

MR. HOLLINGSWORTH: That's correct.

COMMISSIONER BROWN: Where did you come up with the $150 per acres price?

MR. HOLLINGSWORTH: I believe that's a minimum that is established by the General Land Office.

COMMISSIONER BROWN: Okay. So that's controlled by the Land Office, as far as the minimum.

MR. HOLLINGSWORTH: Yes, sir.

CHAIRMAN MONTGOMERY: Other questions or comments?

CHAIRMAN FITZSIMONS: We've had offers in excess of that. For instance, in the Tarrant County one, we've had offers in excess of that.

MR. BAUER: I'm Jack Bauer, director of land conservation. I think what the GLO does is they look at what the market is bearing.

You all can set your minimum. We usually recommend a minimum. The Tarrant County lease that was done a couple sessions ago — the GLO chose to double that, based on just the Barnett shale activity that was ongoing.

The bids received for that project, it was double that. So it was $600 an acre. So those things do bear on the market.

COMMISSIONER RAMOS: I think Commissioner Brown's point may be that there's offset production right next door, so perhaps the likelihood of production is greater here, although we do have a very good royalty at 25 percent.

MR. HOLLINGSWORTH: The locations indicate are onsite. Those are oil and gas tracts that were nominated and bid for and acquired years ago. But they're onsite production in the park.

Whoever picks up this lease would have the option of drilling from offsite or negotiating a surface use agreement to drill onsite.

COMMISSIONER RAMOS: And how long have these gas wells been producing. Do you know?

MR. HOLLINGSWORTH: Twenty years.

CHAIRMAN MONTGOMERY: Other questions or comments?

MR. HOLLINGSWORTH: And this is a bid process. If somebody bids $150, and someone outbids them, it could be higher than that.

CHAIRMAN FITZSIMONS: But if they're onsite, they still have to negotiate a surface use agreement with us.

MR. HOLLINGSWORTH: For additional revenue. Yes, sir.

CHAIRMAN FITZSIMONS: They have a pretty good form, too.

CHAIRMAN MONTGOMERY: Any other questions or comments?

(No response.)

CHAIRMAN MONTGOMERY: If there are no further questions or discussion or objection, I authorize the staff to place this item on the Thursday Commission agency for public comment and action.

Item Number 3, Jack Bauer.

MR. BAUER: I'm Jack Bauer, director of land conservation.

This next item is another land associated item. The approval of a right—of—way easement is vested with the GLO.

They typically don't want to make a right—of—way easement unless the Commission gives them an opinion. So they honor that.

And the purpose of this is to describe what the right—of—way request is, let you have some input to that, and then it will go to the Board for Lease as a recommendation.

We have the park in Presidio County. The little blue circle on the extreme western end of the park is where this activity is. It's a request to put a fiber optic cable across the park.

We get our own telephone service from Big Bend Telephone, and they would like to improve service with some fiber optic infrastructure.

So the task was can we with our staff give them a recommendation for a route that will minimize impacts, the resources and improve our own service.

So the blue lines here are the northern and southern extent of the park. They needed to get across that to provide service to customers on downstream.

So we came up with this route. It follows some existing roads and overhead transmission line weaving in and around some fairly significant culture resources in the middle.

But we've got a very workable route there, and there has not been a problem coming to this. So we've got a route that avoids all impacts.

We're recommending a ten—year term, so we have the opportunity to come back and renegotiate. Currently the fees for this are $3,540.

And we've got some restrictions that basically will require us to have our cultural resource biologist in full contact through the digging and full coordination with that group so that we don't destroy any cultural resources.

CHAIRMAN FITZSIMONS: And they're responsible for the cost of restoration, too?

MR. BAUER: Yes, sir.

And you will see a staff recommendation tomorrow, where we're suggesting that you provide a recommendation to the Board for lease to approve the right-of-way easement.

I'll be happy to answer any questions.

COMMISSIONER RAMOS: How many feet are that easement?

MR. BAUER: Well, it's 3,540 divided by 16.5. That's how many rods it is. I don't have my calculator on me.

CHAIRMAN MONTGOMERY: Any other questions or comments?

COMMISSIONER RAMOS: The question is how are they going to make money with this one.

CHAIRMAN FITZSIMONS: It's hard to negotiate a very high per rod when they're fixing your phone.

The alternative's not very good.

MR. BAUER: This is not the usual rate. It's a reduced rate for that reason.

CHAIRMAN FITZSIMONS: This will go to Salsado to the headquarters.

MR. BAUER: Yes, sir.

CHAIRMAN MONTGOMERY: It's pretty amazing. If there are no further questions or discussion or objection, I authorize the staff to place this item on the Thursday Commission agency for public comment and action.

We now are on Item number 4, which I understand has been withdrawn. Is there any discussion we need to have on that?

Any other business to cover before we go to Executive Session? In that case, we will now recess for the Executive Session.

Therefore, I would like to announce that pursuant to the requirements of Chapter 551 of the Code referred to as the Open Meetings Law, the Executive Session will be held at this time for the purpose of consideration of Sections 551 and 072 of the Texas Open Meetings Act regarding real estate matters and including General Counsel advice.

(Whereupon, the meeting was recessed.)

C E R T I F I C A T E

MEETING OF: Texas Parks and Wildlife Commission

Conservation Committee

LOCATION: Austin, Texas

DATE: April 7, 2004

I do hereby certify that the foregoing pages, numbers 1 through 15 inclusive, are the true, accurate, and complete transcript prepared from the verbal recording made by electronic recording by Penny Bynum before the Texas Parks and Wildlife Commission.

4/19/04
(Transcriber) (Date)
On the Record Reporting, Inc.
3307 Northland, Suite 315
Austin, Texas 78731


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