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Wetland credits keep farm’s income flowing

About 20 years ago, fourth-generation farmer Glenn Hawes entered the world of wetlands mitigation banks, using his property's environmental characteristics to generate income and help developers move ahead with projects.
Tim Hearden

Capital Press

Published on October 18, 2013 3:41PM

Last changed on October 18, 2013 3:42PM

Tim Hearden/Capital Press   
Palo Cedro, Calif., farmer Glenn Hawes entered the world of wetlands mitigation banks in the 1990s. He says selling the credits has helped him fund equipment and improvements on his farm.

Tim Hearden/Capital Press Palo Cedro, Calif., farmer Glenn Hawes entered the world of wetlands mitigation banks in the 1990s. He says selling the credits has helped him fund equipment and improvements on his farm.

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PALO CEDRO, Calif. — Nearly 20 years ago, fourth-generation cattle and produce grower Glenn Hawes learned he was farming on some of the most valuable wetlands in his region, and he decided to use them to generate income.

Hawes, now 70, entered the world of wetlands mitigation banks, where developers who need credits for building in sensitive areas pay him to set aside a certain portion of his land as open space.

The property — about 700 acres — is placed in conservation easements and can still be grazed under proper management, and Hawes also has a hunting club that uses it, he said. The credit program has generated hundreds of thousands of dollars for improvements and equipment.

“It’s really a win-win for us,” Hawes said. “A lot of it’s been reinvested into farm equipment. We’ve got some nice farm equipment we didn’t have before, and we eliminated a nice chunk of debt.”

Hawes Farms celebrated its 150th anniversary in September. Glenn Hawes’ great-grandfather, William Hawes, emigrated from Germany and started farming more than 1,400 acres on Cow Creek and the Sacramento River in 1863. William Hawes’ family mostly grew dryland wheat, and they had the first horse-drawn grain harvester in Northern California, according to the farm’s website.

In 1977, Glenn and Wanda Hawes opened a feed store using a barn built in 1914, and their son Greg helped them open a second store in Red Bluff in 1994. Today the family grows cattle pasture as well as walnuts, vegetables, peaches, melons, tomatoes and wheat for hay.

The family also operates a popular pumpkin patch and corn maze that attracts thousands of autumn visitors.

Glenn Hawes, a former 16-year Shasta County supervisor who finished his final term in January, first considered offering wetlands mitigation credits after California State University-Chico did a survey of the area and found that Hawes Farms had some of the highest density of wetlands.

There was no shortage of paperwork needed to get started. Hawes did an economic study to see if participating in the program would pay off, then did a prospectus and a long-range plan. Then he had to create an enabling instrument to sell the credits, and the USDA's Natural Resources Conservation Service surveyed the property.

Wetlands credits were still a new phenomenon in the early ’90s, as the need arose to take measures to protect wildlife as a result of the Endangered Species Act, Hawes said.

“We were kind of on the breaking edge of this thing,” he said. “In our plan, I drew up where I had done some leveling and farmed it. We were able to re-create what was lost. … The whole point was not to lose valuable wetlands.”

The farm started selling credits in 2000. When a development project arises, the U.S. Army Corps of Engineers requires the developer to preserve or create an acre of wetlands for every one that is lost, and the U.S. Fish and Wildlife Service requires a 2-to-1 ratio, Hawes said.

When someone needs to purchase credits, they pay as much as $150,000 per acre for newly created wetlands or $100,000 an acre for preservation credits, he said.

Hawes admits he had reservations about taking part in such a government program. He planned the set-asides in three separate stages and started small.

“There is some distrust of government now, and it seems like it’s more now than I’ve ever seen,” he said. “I know there’s people who think we’re crazy, but it’s been good for us. The key is to have enough demand in your area where people need the credits.”

Hawes said he would encourage other growers to participate in the program, although it’s getting more difficult to deal with agencies because they're short-staffed.

“The cost is not cheap,” he said, noting that property enhancements that cost him about $250,000 would now cost as much as $1 million. For one thing, growers have to set up an endowment to maintain the property in perpetuity, and the money must be provided upfront, he said.

“It’s definitely a challenge,” he said.

However, the program has been a boon for the Hawes family, which plans to keep farming for generations to come.

“I think this will help keep it there,” Glenn Hawes said. “With the conservation easement, it reduces the value of the property so there’s not going to be the incentive to sell it and go. The conservation easement will perpetuate this for many generations.”

Glenn Hawes

Age: 70

Occupation: Farmer

Residence: Palo Cedro, Calif.

Family: Wife Wanda; son Greg Hawes; daughter Lori Richards; eight grandchildren and one great-grandchild

Websites: http://hawesranch.com , http://historichawesfarms.com


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