A $150 million deal to sell N.C. State's Hofmann Forest to an Illinois farming empire is nearly complete—but an injunction hearing to block the sale is still scheduled for Tuesday, Nov. 12.
The forest owners, N.C. State University's Board of Trustees of the Endowment Fund and the North Carolina State Natural Resources Foundation, Inc., plan to unload the 79,000-acre property to Jerry Walker, who owns and manages Walker Ag Group. The family-run business operates in at least 23 counties in seven states. It is based in Danville, Ill.
A coalition of professors, foresters, landowners and wildlife conservationists are suing the university over the proposed sale, saying the environmental impacts could be significant.
Walker, a third-generation farmer, is the prospective buyer of the property near Jacksonville. He is also the sole officer listed for Hofmann Forest LLC, a company filed with the N.C. Secretary of State's office on Jan. 30—12 days after N.C. State announced it was selling the forest.
Walker's farming operations are substantial; they have received more than $18 million in federal conservation, commodity and disaster subsidies since 1995, according to an Environmental Working Group database, making his business among the top recipients in Illinois. The EWG sources its data from the U.S. Department of Agriculture.
Walker indicated last week that he does not intend to develop Hofmann Forest for agriculture. Tom Percival, the Lumberton-based spokesman for Hofmann Forest LLC, said Walker wants to diversify operations with timber farming, which has been the mainstay of Hofmann Forest, bringing in nearly $2 million annually to the university. An N.C. State press release announcing the sales agreement says a working forest will be maintained on the property, and students and faculty will have access to it to conduct research.
But nothing in the sales agreement mandates that Hofmann Forest remain a working forest, nor are there any provisions in the contract barring development or farming.
Ron Sutherland, a conservationist for the Wildlands Network and plaintiff in the lawsuit, said the only part of the forest the contract preserves are the wetlands in the middle of the property.
"Otherwise, the agreement doesn't preserve a single tree," he said.
One of the plaintiffs, Fred Cubbage, an N.C. State professor and former head of the Department of Forestry and Environmental Resources, said Percival's assurance that Walker does not plan to convert any land for agriculture or development is "not credulous."
"If the university cannot make enough money growing trees with no debt and no taxes," Cubbage said, "how can a buyer pay off a $150 million debt and pay property and income taxes, allow the same research and teaching uses, and make more money than us without finding more developed uses? If he can, we must have managed the forest incredibly poorly."
The sale agreement recognizes the U.S. military's interest in obtaining an easement from the buyer, which the press release says "would ensure long-term protection" for 70,000 acres of the property and "formalize the military's long-standing interest in the conservation of the property."
"We knew the military has an interest in protecting (the forest) from being overrun with houses, but the easement could still allow forestry, crops and livestock production," Sutherland said. "They're selling it to a farming consortium, not a forestry group. We will be surprised if some level of agriculture is not attempted on the property."
Leaders at N.C. State say the sale of the forest will generate $6 million annually— "more than three times the current yearly yield from the forest"— to the university's College of Natural Resources.
In an opinion piece published this weekend, N.C. State Chancellor Randy Woodson and Dean of the College of Natural Resources Mary Watzin cited the university's "commitment to students" and putting educational opportunities first when deciding whether to sell the Hofmann Forest.
The piece goes on to say the decision was made thoughtfully and strategically, and "the process was openly communicated to faculty, staff, students and other constituents of the College of Natural Resources, and there were multiple opportunities for opponents and supporters to present their views."
But Cubbage says most of the funds derived from the Hofmann Forest and spent at N.C. State are diverted to staff and not to students or faculty.
Of a total $1.9 million in expenses that year, 48 percent was spent on administration/staff salaries," Cubbage said, 25 percent was spent on the Natural Resources Foundation development staff; 18 percent on graduate assistantships; 2 percent on faculty, and just 6 percent on undergraduates and scholarships.
"The administration and college staff will consume most of any increases in funds, just as they have in the past," Cubbage said.
Opponents of the sale say the worst-case scenario for Hofmann Forest is that it will become the next Open Grounds Farm, land 35 miles east of Hofmann in Carteret County, which is planted with 36,000 acres of crops. It is the largest single farm east of the Mississippi River.
Open Grounds Farm is "the poster child for negative water quality impacts on sensitive coastal creeks and estuaries," wrote James D. Gregory, an N.C. State professor and hydrology expert, and another plaintiff in the lawsuit, in an email forwarded to the INDY. "All of the drained mineral soils at the Hofmann can easily be converted to agriculture."
The provisions of the contract—keeping the Hofmann name, allowing access to students and faculty for research— are only binding on the current buyer. Hoffman Forest could lose up to an eighth of its land to development while as many as 40,000 acres could be converted for agriculture, according to Sutherland.
Sutherland says he hopes the coalition will have the same judge at next week's hearing, the one who earlier denied a temporary restraining order to stop the sale of Hofmann Forest based on claims from lawyers from the attorney general's office that a sale of the forest "was not imminent."
"The sales agreement only adds to our case to say the potential of significant environmental impact is huge," he said.