Board of Directors Agenda
1. Call to Order of the Regular Meeting of the Board of Directors
ADMIN: The Board Chair will call the meeting to order if a quorum is present. Announcements by the Board Chair or Executive Director may be made at this time. Board members may make announcements at this time as well.
2. Public Comments
Opportunity for members of the public to address the Conservancy’s Board of Directors.
3. Approval of the minutes
The Board Chair will request approval of the minutes and consent items of the Board of Directors meeting of November 4, 2015.
4. Cancellation of the January 6, 2016 Board Meeting
The scheduled January 6, 2016 Board meeting (“first Wednesday”) is proposed for cancellation.
5. Audit Committee Charter updates
The Audit Committee has reviewed and recommends the Board of Directors approve updates to the Audit Committee Charter. The last review/update of this charter was December 7, 2011.
6. Internal Financial Control Policy
The Audit Committee has reviewed and recommends the Board of Directors approve updates to the Internal Financial Controls Policy. The last review/update of this charter was December 4, 2013.
Download the Internal Financial Control Policy (PDF, 146 KB)
7. Compensation & Governance Committee Charter
The Compensation & Governance Committee has reviewed and recommends the Board of Directors approve updates to the Compensation & Governance Committee Charter. The last review/update of this charter was June 1, 2011.
Download the Compensation & Governance Committee Charter (PDF, 60 KB)
8. Executive Director performance evaluation practices
The Compensation & Governance Committee has reviewed and recommends the Board of Directors approve updates to the Executive Director’s Performance review procedure document.
Download the Executive Director performance evaluation practices (PDF, 203 KB)
9. Donation Policy
The Compensation & Governance Committee has reviewed and recommends the Board of Directors approve updates to the Donation Policy. The last review/update of this policy was August 1, 2012.
10. Finance Committee Charter
The Finance Committee has reviewed and recommends the Board of Directors approve updates to the Finance Committee Charter. The last review/update of this charter was June 3, 2015.
11. Corporate Funds Policy
The Finance Committee has reviewed and recommends the Board of Directors approve updates to the Corporate Funds Policy. The last review/update of this policy was August 5, 2015. The key change in this update is extending the maturity of investments from two to five years.
12. Endowment funds agreement expansion
The agreement between T. Rowe Price and the Conservancy engaging T. Rowe Price as endowment funds manager expires at the end of December 31, 2015. Staff seeks authorization from the Board for its Executive Director to execute and deliver an agreement with T. Rowe Price under the same general terms as the existing agreement, but that the agreement be “at will” and not include a defined and specific termination date. T. Rowe Price indicates that it has no other clients with “end date” agreements, and that all other clients have migrated to an “at will” arrangement.
The Conservancy previously wanted to limit its term with T. Rowe Price pending T. Rowe Price having an opportunity to perform as the Conservancy’s endowment funds manager. Staff is pleased with T. Rowe Price’s performance, clarity and documentation. Judging from Conservancy Board member comments, as well as Finance Committee action, there is general satisfaction with T. Rowe Price as well.
Download the Endowment funds agreement (PDF, 64 KB)
13. 2016 Agricultural leases
The Conservancy has farming leases with its farm tenants. In recent years, farm income has been a significant source of revenue for the Conservancy.
With the help of legal counsel, the leases were standardized last year, and with minor exception, the leases proposed for this year all conform. This round of farm leases is proposed for acceptance by the Board as to basic terms, conditions and form, and in most cases, for a three-year term.
There are two types of leases, rice and non-rice:
Rice leases. The rice lease proposed calls for a basic cash rent of $190.00 per acre with a bonus rent payment based on meeting or exceeding certain price and yield thresholds. For example, the average amount paid per acre by Conservancy rice farming tenants in 2015 is $330.00 (approx.), in 2014 was $328.06, and in 2013 was $288.48. The base rent and the bonus rent triggers and percentages are identical to those in the Conservancy’s 2015 leases.
Non-rice leases. As to the non-rice leases, the terms and conditions are typically the same as the rice leases, except the payments are generally $100.00 per acre cash rent for alfalfa and $50.00 per acre for all other non-rice crops.
Certain exceptions are made to farming contracts. For example, inducements are often made to farmers for planting Swainson’s Hawk-friendly crops on soils that typically would not support them economically. Another example is offering only one-year leases for rice fields targeted for being next in line for conversion to managed marsh (one-year layout is required). Finally, last year the Board approved multi-year contracts for alfalfa on TNBC and SAFCA-owned properties.
No changes are planned in farm tenants engaged for this round of leases. There are presently six (6) farm tenants in number, not including an occasional livestock tenant.
This item requests that the Board authorize the Executive Director to negotiate the final terms on farm leases for 2016, 2017 and 2018, then execute and deliver on farming contracts for the Conservancy farm tenants in a manner that is substantially consistent with the standardized leases presented with this issue and in the agenda.
Download the TNBC Worksheet Illustration (PDF, 42 KB)
Download the 2016 Non-Rice Template lease (PDF, 202 KB)
Download the 2016 Rice Template lease (PDF, 217 KB)
14. 2016 NBHCP Financial Model update and 2016 Budget
The proposed 2016 Conservancy budget is presented to the Board for adoption. A draft of the 2016 Conservancy budget was shared with the Board at the October 2015 Board of Directors meetings for review and discussion.
The Conservancy draft 2016 budget is integrated with the NBHCP Finance Model, so that the document submitted for action is one document. The consolidation of the two documents was introduced in 2007 with the intention of reducing the chance of differing budget numbers and because of the consistency it afforded.
The matter of reserves for property taxes has been a substantial issue for the NBHCP Finance Model calculation over the last several years. This year, the Conservancy made no change in the following assumptions with respect to the Williamson Act’s impact on Conservancy-held property:
- The State of California’s Williamson Act subventions to counties remains unfunded or largely unfunded in this and next years’ State budgets.
- Counties with which the Conservancy has Williamson Act contracts (Sacramento and Sutter) make no additional change to existing contracts.
- Counties permit no newly-acquired properties to be enrolled in Williamson Act contracts and to enjoy the property tax benefits such participation affords.
- All new properties acquired by the Conservancy for HCP mitigation purposes enjoy no Williamson Act property tax protection and are assessed at their full value at the time of acquisition.
- Sutter County’s Williamson Act contracts are reduced by 10 percent.
The 2016 Conservancy Budget and NBHCP Finance Model is now submitted for Board acceptance as is a request to the City of Sacramento to adopt the Finance Model’s indicated fee as follows:
- The NBHCP fee for 2016 is recommended to remain the same as in 2015 at $32,259 per developed acre.
- The NBHCP fee with land dedication for 2016 is recommended to remain unchanged at $21,009.
The fee is substantially influenced by land prices. The recommended fee, as proposed by Conservancy staff, is supported by work done by Stephen Harrington, MAI, updated for 2016. Harrington estimates the range for mitigation land acqusition will be $16,000 to $23,000 per acre.
The price estimate for future-acquired mitigation land is based on an assumption contained in the NBHCP Finance Model. The NBHCP requires that the Conservancy purchase mitigation land within 12 months of demand. There are no exceptions or extensions provided for. So the Conservancy’s estimate for mitigation land acquisition costs are based on a “looking forward” methodology, while appraisal valuations are typically based on recent historical valuations.
This item requests:
- approval of the proposed 2016 Conservancy Budget,
- acceptance of the 2016 NBHCP Finance Model recalculation, and
- adoption of a resolution to be submitted to the City of Sacramento requesting no change in the NBHCP fee (see attached resolution).
This item anticipates that should Sutter County express an interest in initiating its use of the NBHCP’s Incidental Take Permit acres, an identical resolution is approved for it as well, changing out only the City of Sacramento references to County of Sutter references.
Download the Conceptualized Illustration (PDF, 30 KB)
Download the 2016 Draft NBHCP Finance Model (PDF, 602 KB)
Download the Competitive land markets analysis (PDF, 431 KB)
Download the NBHCP mitigation fee recommendation resolution (PDF, 33 KB)
15. City of Sacramento report
Report from the City of Sacramento regarding HCP-related activity and other topics.
16. Financial statement review
A financial statement will be provided for the period ended October 31, 2015 (unaudited). Additional financial information will be provided.
17. Contracts summary
Staff will provide an overall update on the Conservancy’s contracts.
18. Website update
Staff will provide an overall update on the Conservancy’s progress of website refinement.
19. Proposed Natomas Vision Project Amendment
In follow up to the workshop regarding Natomas Vision, the project includes land use entitlements related to an Urban Services Boundary (USB) and a detailed land plan for the area north of Elkhorn Blvd and east of Highway 99 (North Precinct). The County of Sacramento Planning Commission has recommended to the Board Supervisors that the Board find the project adequate to begin the environmental review process. Staff will discuss the matter with the Board.
20. Public comments
Opportunity for members of the public to address the Conservancy’s Board of Directors.
21. Executive Session
Executive Session for real state is scheduled.
22. Executive Director’s Report
Various matters for Board members’ general information will be presented by the Conservancy’s Executive Director.
Official adjournment of the meeting.