B-174833, MAR 10, 1972

B-174833: Mar 10, 1972

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SENTER ALLEGES THAT THE COMBINING OF SEPARATE TRACTS INTO A SINGLE LEASE PLOT DISCRIMINATES AGAINST THE SMALL FARMER AND WILL RESULT IN A LOWER FINANCIAL RETURN TO THE GOVERNMENT. HAS BEEN INFORMED THAT THE SUBJECT UNITS ARE OF SUCH VARYING ACREAGE THAT THEY WILL BE ATTRACTIVE TO SMALL AS WELL AS LARGE FARMERS. THAT THE CONSOLIDATION WILL REDUCE ADMINISTRATIVE COSTS. THERE IS NO LEGAL BASIS FOR OBJECTING TO THE ARMY LEASING POLICY AND THE PROTEST IS DENIED. SENTER: REFERENCE IS MADE TO YOUR LETTER DATED DECEMBER 21. ACTION ON THE LEASING OF PLOT D28-97 IS BEING HELD IN ABEYANCE PENDING OUR DECISION ON YOUR PROTEST. BIDS WERE OPENED ON DECEMBER 28. THE RECORD SHOWS THAT THREE BIDS WERE RECEIVED ON PLOT D28-97.

B-174833, MAR 10, 1972

BID PROTEST - CONSOLIDATION OF LEASED GOVERNMENT LAND - DISCRIMINATORY EFFECT DECISION DENYING PROTEST OF W. R. SENTER AGAINST AWARD OF A PROPOSED CONTRACT UNDER AN IFB ISSUED BY THE ARMY ENGINEER DISTRICT, LITTLE ROCK, ARK., FOR THE LEASING OF GOVERNMENT-OWNED LAND FOR AGRICULTURAL AND GRAZING PURPOSES. MR. SENTER ALLEGES THAT THE COMBINING OF SEPARATE TRACTS INTO A SINGLE LEASE PLOT DISCRIMINATES AGAINST THE SMALL FARMER AND WILL RESULT IN A LOWER FINANCIAL RETURN TO THE GOVERNMENT. THE BROAD AUTHORITY CONFERRED UPON THE SECRETARY OF A MILITARY DEPARTMENT, PURSUANT TO 10 U.S.C. 2667, TO LEASE GOVERNMENT LAND TO PROMOTE THE NATIONAL DEFENSE OR IN THE PUBLIC INTEREST, PRECLUDES THE ASSERTION OF ANY SPECIAL RIGHTS BY A LESSEE WHOSE PRIORITY PREFERENCE HAS EXPIRED. FURTHER, THE COMP. GEN. HAS BEEN INFORMED THAT THE SUBJECT UNITS ARE OF SUCH VARYING ACREAGE THAT THEY WILL BE ATTRACTIVE TO SMALL AS WELL AS LARGE FARMERS, THAT THE HIGH BID EXCEEDED THE AMOUNT RECEIVED FROM THE PRIOR LEASING, AND THAT THE CONSOLIDATION WILL REDUCE ADMINISTRATIVE COSTS. IN VIEW OF THE FOREGOING, THERE IS NO LEGAL BASIS FOR OBJECTING TO THE ARMY LEASING POLICY AND THE PROTEST IS DENIED.

TO MR. W. R. SENTER:

REFERENCE IS MADE TO YOUR LETTER DATED DECEMBER 21, 1971, WITH ENCLOSURES, PROTESTING THE PROPOSED AWARD OF A CONTRACT FOR THE LEASING OF GOVERNMENT-OWNED LAND (PLOT D28-97) FOR AGRICULTURAL AND GRAZING PURPOSES UNDER INVITATION FOR BIDS (IFB) NO. DACW 03-72-B-0052, ISSUED BY THE DISTRICT ENGINEER, UNITED STATES ARMY ENGINEER DISTRICT, LITTLE ROCK, ARKANSAS. ACTION ON THE LEASING OF PLOT D28-97 IS BEING HELD IN ABEYANCE PENDING OUR DECISION ON YOUR PROTEST.

THE IFB ISSUED ON DECEMBER 3, 1971, SOLICITED BIDS ON 135 LEASING UNITS, INCLUDING LEASE PLOT NO. D28-97, CONSISTING OF TRACTS NOS. 2803, 2804, 2805, 2808, 2809 AND 2810 CONTAINING 397 ACRES. BIDS WERE OPENED ON DECEMBER 28, 1971, AND THE RECORD SHOWS THAT THREE BIDS WERE RECEIVED ON PLOT D28-97. YOU STATE THAT YOU DID NOT BID IN RESPONSE TO THE IFB BECAUSE (1) YOU DO NOT WISH TO LEASE LANDS OF OTHER FORMER OWNERS; (2) YOU DO NOT HAVE THE CAPABILITY TO FARM A 397-ACRE UNIT; AND (3) YOU PREFER TO LEASE ONLY THE TRACTS FORMERLY OWNED BY YOUR FATHER.

FOR THE PERIOD OF 2 YEARS BEGINNING JANUARY 1, 1970, YOU WERE THE SUCCESSFUL BIDDER ON TRACTS NOS. 2804 AND 2808 CONSISTING OF 120 ACRES. YOU NOW OBJECT TO THE ISSUANCE OF THE INVITATION WHICH COMBINED TRACTS NOS. 2803, 2804, 2805, 2808, 2809 AND 2810 INTO A SINGLE LEASE PLOT OF 397 ACRES. YOU MAINTAIN THE INVITATION DISCRIMINATES AGAINST THE SMALL FARMER AND FORMER OWNERS OF THE LAND INVOLVED; IS FAVORABLE TO LARGE FARM OPERATORS; AND WILL RESULT IN A LOWER FINANCIAL RETURN TO THE GOVERNMENT. YOU ALSO STATE THAT IT APPEARS THAT THE LAND WILL NOT BE REQUIRED FOR THE PURPOSE FOR WHICH ACQUIRED WITHIN THE FORESEEABLE FUTURE AND, CONSEQUENTLY, SHOULD BE RECONVEYED TO THE FORMER OWNERS AT THE GOVERNMENT'S PURCHASE PRICE LESS THE RENTALS PAID BY THE FORMER OWNERS.

YOUR FATHER, MR. W. R. SENTER, SR., WAS THE FORMER OWNER OF TRACTS NOS. 2804 AND 2808 WHICH WERE ACQUIRED BY THE CORPS FOR THE LAKE DARDANELLE PROJECT. AT THE TIME OF ACQUISITION OF THE LAND IN 1964, IT WAS THE POLICY OF THE CORPS TO GRANT LEASES FOR AGRICULTURAL AND GRAZING PURPOSES TO FORMER OWNERS, THEIR TENANTS, OR SURVIVING SPOUSES, ON A YEAR-TO-YEAR BASIS UNTIL THE ESTABLISHMENT OF THE LAND MANAGEMENT PLAN FOR THE PROJECT. AFTER ESTABLISHMENT OF THE LAND MANAGEMENT PLAN, LEASES OF ANY LANDS AVAILABLE FOR AGRICULTURAL OR GRAZING USE WERE GRANTED BY NEGOTIATION TO FORMER OWNERS, THEIR TENANTS, OR SURVIVING SPOUSES, FOR ONE TERM OF 5 YEARS. AFTER EXPIRATION OF THE 5-YEAR TERM, LANDS STILL AVAILABLE FOR LEASING WERE LEASED BY COMPETITIVE BID. IN ACCORDANCE WITH THIS POLICY, YOUR FATHER, AS A FORMER OWNER, WAS GRANTED A LEASE BY NEGOTIATION OF TRACTS NOS. 2804 AND 2808 FOR A TERM OF 5 YEARS FROM JANUARY 1, 1965, TO DECEMBER 31, 1969.

LEASING OF AGRICULTURAL LANDS ON CIVIL WORKS PROJECTS IS AUTHORIZED PURSUANT TO THE PROVISIONS OF 10 U.S.C. 2667 WHICH AUTHORIZE THE SECRETARY OF A MILITARY DEPARTMENT TO LEASE REAL PROPERTY THAT IS NOT NEEDED FOR PUBLIC USE AND IS NOT EXCESS PROPERTY UPON SUCH TERMS AS HE CONSIDERS WILL PROMOTE THE NATIONAL DEFENSE OR BE IN THE PUBLIC INTEREST. THE CONTRACTING OFFICER HAS ADVISED THAT ALTHOUGH THE TOTAL ACREAGE OF THE NEW LEASE PLOT IS 397 ACRES, THE TILLABLE AREA IS ONLY 145 ACRES AND THE REMAINING ACRES CONSIST OF RANGELAND OR WOODLAND OF MINIMAL UTILITY. THE ESTABLISHING OF LEASE PLOT ACREAGES WAS ACCOMPLISHED BY AGRICULTURAL AND AGRONOMY EXPERTS EMPLOYED BY THE CORPS FOR LAND MANAGEMENT PURPOSES. THAT CONNECTION, THE CONTRACTING OFFICER HAS REPORTED THAT PORTIONS OF THE AREA ARE SUBJECT TO ANNUAL FLOODING WHICH WILL INCREASE AS SEDIMENT DEPOSITS BUILD UP AS A RESULT OF THE OPERATION OF THE LAKE DARDANELLE PROJECT. IN VIEW OF THE FOREGOING, THE AREA OF THE NEW LEASE PLOT WAS CONSIDERED AN ECONOMIC UNIT OF MINIMAL SIZE WITH DUE CONSIDERATION BEING GIVEN TO AVERAGE OR NORMAL AGRICULTURAL OR GRAZING UNITS IN THE LOCALITY OF THE LANDS ADVERTISED FOR BIDS. ALSO, THE CONTRACTING OFFICER HAS ADVISED THAT COMBINING THE SIX TRACTS INTO ONE LEASE WILL REDUCE THE NUMBER OF LEASES FROM SIX TO ONE AND WILL THEREBY REDUCE ADMINISTRATIVE COSTS.

THE FORMER OWNERS HAVE NO FURTHER SPECIAL RIGHT IN THE PROPERTY AFTER THE EXPIRATION OF THEIR LEASING PRIORITY PREFERENCE AND THE COMBINING OF TRACTS INTO ECONOMIC LEASING UNITS IS A DISCRETIONARY ACT IN FURTHERANCE OF GOOD LAND MANAGEMENT. FURTHER, WE ARE ADVISED THAT THE 135 ECONOMIC LEASING UNITS LISTED IN THE IFB ARE OF SUCH VARYING ACREAGE AS TO BE ATTRACTIVE TO SMALL AS WELL AS LARGE FARM OPERATORS. WITH REGARD TO THE FINANCIAL RETURN TO THE GOVERNMENT, IT HAS BEEN REPORTED THAT THE HIGHEST BID RECEIVED FOR PLOT NO. D28-97 EXCEEDED THE AMOUNT RECEIVED UNDER THE PREVIOUS LEASING OF SUCH TRACTS TO THE FORMER OWNERS.

THE PROPERTY IN QUESTION WAS ACQUIRED FOR AN AUTHORIZED PROJECT AND THE LAND IS REQUIRED FOR PROJECT PURPOSES. MOREOVER, IF ANY LAND WAS DETERMINED TO BE EXCESS TO PROJECT REQUIREMENTS, IT WOULD BE DISPOSED OF UNDER EXISTING DISPOSAL AUTHORITIES WHICH DO NOT ACCORD ANY PREFERENCES TO FORMER OWNERS OR THEIR TENANTS.

FOR THE REASONS STATED AND IN VIEW OF THE BROAD LEASING AUTHORITY VESTED IN THE SECRETARY OF THE ARMY BY 10 U.S.C. 2667, WE PERCEIVE NO PROPER LEGAL BASIS FOR QUESTIONING THE DEPARTMENT OF THE ARMY LEASING POLICIES AT THE LAKE DARDANELLE PROJECT.

ACCORDINGLY, YOUR PROTEST IS DENIED.