SALT LAKE CITY — An agricultural company owned by the LDS Church agreed Thursday to purchase 382,834 acres of timberland in the Florida Panhandle.
The St. Joe Co. announced Thursday it will sell the land to AgReserves Inc., a taxpaying company owned by The Church of Jesus Christ of Latter-day Saints, for $565 million. The transaction is expected to close by April 1.
The deal is a glimpse into one way church leaders practice financial responsibility with the reserves they set aside against down economic cycles.
The sale is a boon for Florida because it is "a long-term investment in the state's timber and cattle industries," Adam Putnam, the state's commissioner of agriculture, said in a statement.
News of the transfer of nearly 600 square miles in the Panhandle drew responses from a variety of sources.
Conservationists hope the church's company is mindful of the important northwest Florida watersheds it has acquired. The Conservation Fund's George Willson said he was pleased "to see that someone with a record of stewardship is buying it."
"This is not a bad outcome," he told the Tallahassee Democrat. "I suspect the new owners will pay attention to all these rural communities they will be a part of."
Many of the reactions alluded to the way the church has managed another large spread in Florida, the 290,000-acre Deseret Ranches in central Florida, since the early 1950s.
A manager at Foley Timber, a Florida-based timber company, told the Tampa Bay Times the church's track record made him view the deal favorably.
"We're glad to see roughly 400,000 acres will be in long-term private ownership," Bo Taff said. "And based on what we know of the company and their land management practices in central Florida, we believe they will be good stewards of the land in north Florida as well."
Putnam, the commissioner of agriculture, echoed that sentiment: "This transaction between two of Florida's largest and most-committed land stewards is a meaningful reminder of the economic and ecological value of agriculture in our state. For decades, The St. Joe Company has played an important role in conserving the landscape of Florida’s Panhandle, and AgReserves, Inc., will build on that commitment while continuing to support the local economy."
The chairman of the board of AgReserves Inc. said Friday in a statement provided to the Deseret News that the company would remain invested in agriculture and conservation.
"This purchase clearly demonstrates the depth of AgReserves’ commitment to agriculture in Florida," Paul Genho said. "We are farmers and ranchers. We’ve been ranching in Florida for 63 years. We love to grow things. We think agriculture is a noble pursuit, and we are proud to be agriculturists. We help feed the world. We love the land and strive to be good citizens in the communities where we live and work. We preserve and protect our land and natural resources and plan far into the future for the places we call home. It is our intent that this purchase will remain in agriculture for a long, long time.”
A 2011 story in the Deseret News detailed some of the operations at the Deseret Ranches. The story said the land managed more than 40,000 head of cattle. The diverse ranch also is home to about a quarter million citrus trees, timberland, sod and tree farms, some commercial crops and large deposits of fossilized seashells used in road base.
The ranch is centered between Orlando and Disneyworld on the west and Cape Canaveral to the east. Ranch managers are participating in state studies about future transportation corridors in the area. The Orlando Sentinel reported that Florida Gov. Rick Scott signed an executive order last week that created a task force to plan for roads, development and environmental protection in the region.
A church's principles
Agriculture plays a key role in the LDS Church's management of reserves it holds in case of rough economic times, according to church leaders.
The Tampa Bay Times story on the announced sale referred to the church's principles on preparation and financial responsibility.
"The theme is consistent with a broader teaching (for families) within the Mormon Church," Times reporter Jeff Harrington wrote, "to be prepared for adverse times by building a three-month supply of food; storing drinking water; saving a financial reserve; and, as possible, accumulating a longer-term food supply of items like wheat, white rice and beans that can last 30 years or more."
Church finances operate on two simple principles, Elder David A. Bednar of the Quorum of the Twelve said during last month's general conference of the church.
"First, the church lives within its means and does not spend more than it receives," he said. "Second, a portion of the annual income is set aside as a reserve for contingencies and unanticipated needs. For decades the church has taught its membership the principle of setting aside additional food, fuel, and money to take care of emergencies that might arise. The church as an institution simply follows the same principles that are taught repeatedly to the members."
Leaders set aside a fixed percentage of church income to build reserves for what late church President Gordon B. Hinckley called "a possible 'rainy day.’ ”
"Prudent management requires that this money be put to use," he said during a church general conference in 1991. "In that process, we have purchased and hold some good, productive farms. They are well operated under capable management, and they yield a conservative rate of return. We have felt that good farms, over a long period, represent a safe investment where the assets of the church may be preserved and enhanced, while at the same time they are available as an agricultural resource to feed people should there come a time of need."
These commercial properties, like AgReserves Inc., pay property taxes and income tax on any profits.
Focusing on St. Joe
The Times said the per-acre price of Thursday's announced deal — $1,475 per acre — appeared consistent with the sales of large timber tracts. AgReserves Inc. is assuming agreements and contracts existing on the purchased timberlands and intends to maintain the timber and agricultural uses of the lands.
The St. Joe Co. is a Florida-based real estate developer and manager. Company leaders wanted to focus on those core missions.
"This sale of timberland will help the company concentrate on its core business activity of real estate development in Northwest Florida," said Park Brady, CEO for The St. Joe Co. "The proceeds from the sale will provide the company with significant liquidity and numerous opportunities to create long-term value for our shareholders."