Our blog will help keep you informed about news and information related to the farm, ranch and rural real estate markets. If you share our desire for wide open spaces and investment in the land, we hope you will subscribe, read and discuss the stories we find and develop here. More than just an investment, ranch, farm and rural real estate evokes a type of lifestyle that was born over a century ago and still provides a certain romance and passion for those who embrace the pioneering spirit from those days gone by.

Defensible Space Helps Safeguard Against Wild Fires

By: Randy Shelton

With many parts of the West at risk from wildfires, it has become more and more common for potential buyers as well as current sellers to ask how their improvements can be safeguarded from fire destruction. The most effective prevention is maintaining a defensible space.  Defensible space is an established area around your house that creates a defensible position for firefighters to do their job.  Structures are more likely to withstand a wildfire if brush, trees and other common forest fuels are removed or at least reduced. This is the best way to minimize your structure’s damage and stop the fire from spreading to adjacent fuel sources.

A good example of maintained defensible space can be seen at the 3,070± acre Cove Canyon Ranch sits just 20 minutes west of downtown Billings.

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What’s in a Rain?

Rain is one of those things that we often take for granted until we don’t get enough of it or inundated with too much. It is elusive, yet common. It is something that we have absolutely no control over, and so we must learn to adapt. Rain is one of those subjects that unites people of all walks of life, particularly those with rural backgrounds. It is almost without exception that rain is always the initial topic to start a conversation. Hence, any self-respecting ranch broker will be well versed in the current climatological conditions of most any region, nearby or distant, that he might be in contact with. Too much rain, untimely rain, summer monsoons, and recurring rain shortfalls, and various stages of drought are all fair sub-topics potentially levied into a conversation. Why is rain such an important topic? Because one rain can change everything, yes everything.

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One rain can be the difference between selling light calves and heavy calves.

One rain can be the difference in the spread of a wildfire.

One rain can keep the banker from calling a note due.

One rain can change a poorly germinated crop into a viable one.

One rain can change fawn survival in the deer herd.

One rain can flood a crop ready for harvest.

One rain can make a ranch ready to be photographed before it’s put on the market.

One rain can wash out the only bridge between you and town.

One rain can turn an oppressively brown horizon lush green.

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So, the next time you are asked about the weather, don’t take it as casual small talk or unsophisticated rural charm. It’s everything.

Beachfront Paradise on Oso Peninsula of Costa Rica Hits Market

By: Bill McDavid

Years ago, I spent three weeks in Costa Rica exploring its interior and west coast from the Nicoya Peninsula all the way south to the Osa Peninsula right next to Panama. At the time, I was simply on a personal quest to see another land and wasn’t thinking at all about real estate. I was fascinated with and had never seen (and still haven’t) so much diversity packed into a relatively small country.

I started in a geothermal wonderland near the Arenal Volcano where I sat in a hot spring like none I have seen elsewhere. Picture a clear, mountain stream tumbling over boulders… with hot water. I traveled over the mountains through the Monteverde Cloud Forest down onto the Pacific Coast where tiny towns like Santa Teresa and Mal Pais exist because of a thriving surf culture. I made my way south towards the Osa, a place that National Geographic calls the most biologically intense place on earth.

This region quickly became one of my favorite places on earth. I boated across the bay to the Osa Wildlife Sanctuary where I met “Sweetie”, an orphaned monkey who had been raised by humans. She had recently received a nasty bite on her leg. She beckoned me with her eyes and showed me exactly how she wanted to scratch it in a most human way. I felt as if I had just encountered a talking dog. Sweetie rode around on my shoulders and introduced me to all sorts of creatures from avian to reptilian.

Now years later, my experience there has translated to an opportunity to market a piece of property that would lead most to gasp in disbelief that it is possible to even own something like this. Finca Rio Oro is a substantial holding by any measure. Not only is there a multitude of flora and fauna, there is also over a mile of frontage on the planet’s largest ocean which is teeming with life. Costa Rica is all about life… pura vida.

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Hall and Hall Sponsors Big Sky PBR

Last Saturday, Hall and Hall played sponsor to the Big Sky PBR, arguably the biggest event in the Big Sky Resort.  The toughest bull riders in the world were matched with the meanest bulls to see who comes out on top, and who ends up in the dirt.  The bulls were victorious once again this year in a series of exciting matchups.

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This year, Hall and Hall teamed up with Yeti as corporate sponsors.  This provided VIP access and seating in a reserved platform near the ground level of the arena.  We took the opportunity to promote our friend Micah Fink who founded a non-profit program called Heroes and Horses.   This program was conceived to reintegrate our returning veteran soldiers into “normal” society through a three-phase program designed to inspire personal growth in veterans suffering from the mental and physical scars of war.  Uniquely, this program combines the utilization of the backcountry wilderness of Montana and horses to help these soldiers push through their trauma and find purpose in life again.  This is without a doubt, one of the most impacting and effective programs we have seen or heard about.  These are incredible people and we felt it was our turn to serve them.

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Our guests included Micah Fink and Rick Franco who served in the military special forces and were involved in special operations and overseas projects for nearly two decades.  It was also a privilege to have had Kris and Gayle Coleman from REDFIVE Security who traveled from Virginia to join us and help promote our friends at Heroes and Horses. Kris and Gayle offer security solutions on a global level to high profile individuals in need.  We were also joined by a congenial group of friends and ranch clients who drove down from the Yellowstone Club.  The rodeo venue is spectacular and the weather was near perfect for the large sold-out crowd.  It is easy to see why this has become the #1 rated PBR in the country.

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Shelby Shuman Competes in International Junior Auctioneer Championships

The National Auctioneers Association knows how to put on a show, which is expected as it’s an organization of professional speakers and event planners. This year’s 2018 Conference and Show in Jacksonville, Florida was nothing short of excellent.  Hall and Hall’s auction team took full advantage of networking and educational opportunities and even made time to give a little back.

Hall and Hall’s Scott Shuman handed his Presidential gavel over to Tennessee’s Tim Mast, yet will continue to serve the association as the newly elected Chairman of the Board.  In addition, Krista Shuman was elected President of the National Auctioneers Association Auxiliary, a non-profit organization that provides educational scholarships to deserving NAA family members. Keeping it in the family, Krista and Scott’s daughter, Shelby, finished near the top of the International Jr. Auctioneer Championship. This was the second time she has competed in the IJAC, and she has been the youngest the past two years. This year she was the only female! Keep an eye on this girl, she’s already conducting fundraising auctions!
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Maintaining & Protecting Your Water Rights

By:  Deborah Stephenson and Stephen R. Brown

This article is the second in a continuing series regarding water in the western United States. This edition focuses on operational and administrative practices that can help maintain your water rights by first ensuring that all filings and administrative reporting requirements are up to date, and secondly, by keeping your rights active to protect them from abandonment.

The initial registration and ongoing reporting requirements for your water rights vary from state to state and by type of water entitlement. For example, in most western states small water users can be exempt from a lengthy permitting process. This instance is commonly referred to as an “exempt filing.” However, water users are still typically required to register these small water uses with the state or local groundwater management agency. Another example is that certain types of water certificates, permits, and change authorizations may have annual reporting requirements related to the permit holders’ annual water diversions. Other reporting requirements call for weekly monitoring of the physical flow rates in the source of supply to ensure that pre-existing water rights are met before any new permit is utilized.

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Other examples of both water use registration and subsequent reporting requirements are found in Texas and California. In Texas, the state water planning process, originating in the mid-1950s, created regional planning areas and smaller groundwater conservation districts (GCDs) within the regional planning areas. There are no statewide requirements for registration or reporting of groundwater use. Instead, the local GCDs are tasked with creating groundwater management goals and then implementing groundwater registration and reporting requirements to achieve the GCDs’ goals. Because each GCD approaches these tasks differently, it is important to be involved with your local GCD to ensure that all groundwater uses are properly registered and reported each year.

In 2014, California passed new legislation regarding groundwater use called the Sustainable Groundwater Management Act (SGMA). Within certain high and medium priority basins, SGMA requires governments and water agencies to halt overdraft and bring groundwater basins into balanced levels of pumping and recharge. To implement SGMA, local agencies formed Groundwater Sustainability Agencies (GSAs) in 2017. The GSAs are now working to define safe-yields and allowable groundwater withdrawals within their local areas and work towards adopting Groundwater Sustainability Plans.  Through this planning process, the allocation of the rights to withdraw groundwater will be defined within each GSA. Thus, being aware of and engaging in the GSA process could be vital to protecting and defining your groundwater rights.

In addition to the administrative filings described above, there are active adjudication processes occurring throughout Montana, northern Idaho, parts of New Mexico, and countless other areas across the western United States. At a high-level, adjudication means inventorying, investigating, and defining the rights to use water within a geographic area through the courts. Although the specific rules and procedures vary from state to state, adjudications typically involve a district or water court, the state engineer’s office, and water users throughout the basin. Within the adjudication process there are court-ordered deadlines to initially file on your water use. Once filed, there are ongoing deadlines throughout the adjudication process. Missing any of these deadlines can be fatal to the preservation and adjudication of your water rights.

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In addition to ensuring that your water right is properly filed and defined through adjudication, it is also important to continue the “beneficial use” of your water. As described in our previous article for this publication, water rights in the western United States are subject to the Doctrine of Abandonment, commonly referred to as “use it or lose it.”  While details vary from state to state, each prior appropriation state recognizes some form of the concept that, if water is not put to “beneficial use” for a certain period of time, the right to that water will be considered abandoned or forfeited.  Abandonment and forfeitures rules and regulations are intended to assure that water rights, a right to a valuable public resource, are not held for speculative purposes without being put to beneficial use.

Generally speaking, under the laws of prior appropriation states’ non-use alone does not cause a water right to be abandoned. “Intent” to abandon is also required. However, intent to abandon can be presumed after a long period of non-use. While some states allow for automatic abandonment after a period of time (also called “forfeiture”), most states require a court or administrative proceeding before abandonment occurs. However, long periods of non-use can shift the burden to a water right’s owner to demonstrate that there was no intent to abandon, which can be difficult to prove in a court or administrative proceeding.

A variety of actions can be used to show lack of intent to abandon a water right. The simplest protection is simply to use them when water is available in priority and can be put to beneficial use. For example, if you have an irrigation right, irrigate. If you have stock rights, watering livestock will keep the rights active. Using your rights will usually require maintenance of infrastructure such as diversionary headgates, cleaning out conveyance ditches, and repairing pumps and pipelines. Any of these activities and many others can be used to show lack of intent to abandon a water right. In contrast, one of the tell-tale signs of non-use and potential abandonment is a lack of working infrastructure. If infrastructure such as conveyance ditches have not been maintained and used for an extended period of time, this nonuse can be used to show abandonment of the water right. However, there may be other considerations to think through when putting water rights back into use after a long period of non-use, such as ditch easements.

Using your rights could also mean enforcing them against other users on the source. A senior water right holder has the right to make calls on junior water right holders on the same stream. This authority may also mean ensuring you use your rights at least periodically throughout the entire period of diversion. The need to utilize your rights each year and/or enforce your rights against other users on the source is very site specific, and in some circumstances, it may not be required to use water rights every year as long as they are used periodically when water is available.

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In addition to using your rights, measuring and documenting your use can be important.  If a water right is junior and water is not available, that fact should be documented by keeping records and photographs because lack of water can be a viable defense in an abandonment proceeding. If you have a recreational water right, you may want to document your enjoyment of the water resource by taking pictures. Or if you have a water right for fisheries use, you may want to hire a biologist to assess the fish population in your pond on a regular basis. With irrigation rights, installing a flume with a staff gauge in your ditch and then regularly measuring your diversions is a simple way to document your water use. Collecting and preserving your water use data can be important in defending your rights from claims of abandonment or forfeiture.

If you find that your operation has changed over the years and you no longer need your full water right, various options exist for protecting, preserving, and obtaining value for your “excess” water.  Perhaps you installed a pivot or drip irrigation system, thereby reducing your diversionary needs, or maybe there is a change regarding land usage which makes it difficult to utilize the full water right. Administrative options may include a change application to protect the reduced diversionary water as instream flow or it might be possible to change the place of use to another location and/or even change the type of use itself. Keep in mind, a change application may be limited to the actual and historic beneficial use. Therefore the “excess” water you are hoping to change must have been part of what was utilized historically in the operation.

Market-based opportunities may also exist, enabling water right holders to obtain value for their water assets. For example, within the Arizona Active Management Areas, if you have a certain type of groundwater right that you do not need, you can extinguish the groundwater right and turn it into an Extinguishment Credit (EC). The ECs can then be sold to and/or used by a municipal water provider to reduce groundwater usage fees. This process avoids annual reporting requirements for the groundwater right holder and enables them to obtain monetary compensation for their valuable rights.

In Summary

These water use registration and annual reporting processes, especially court led adjudications, vary tremendously based on your location and type of water use. The opportunity to register your water use and define your rights may only occur once and could be a definitive determination of the extent of your water rights. Understanding the site-specific rules, regulations, and deadlines is important.  Once you have registered and defined your rights to use water, it is important to follow the general steps described above to keep your rights active. The hard truth is once a water right is determined to be abandoned, the right is lost forever. Our best advice to water right owners is to keep good records, open your mail, respond to notices you receive, and seek help when you are too busy or unaware of what filings are necessary.