Reforms to Manitoba’s Crown lands still frustrate leaseholders

Rent break and extending lease renewals to family transfers seen as positive moves by industry, but producers say issues still exist with new program

Agricultural Crown land leaseholders in 18 Manitoba municipalities that declared a state of agricultural disaster in 2019 will be given a one-time rent credit.

However, some leaseholders say this won’t make much difference due to the rising rental rate introduced as one of the many reforms to the agricultural Crown land (ACL) lease program in 2019.

“(Manitoba Beef Producers) recognizes that it will help some but not all ACL lease and permit holders in the province,” said David Hultin, communications co-ordinator for Manitoba Beef Producers (MBP). Hultin noted that the provincial government didn’t consult the association about the rent break. “Our longstanding position has been the need for a five-year transition to the new rental rate.”

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In October, the provincial government announced that leaseholders in affected municipalities would have their 2021 rent reduced by 20 per cent, as long as they held that lease in 2019. According to the province, this adds up to an estimated credit of around $430 per producer, on average.

Some leaseholders have argued that with this year’s increase in rental rate, from $2.13 per animal unit month to more than $7, and the rate expected to jump again in 2021, this credit may not be as helpful as the province anticipates.

Last fall, the Manitoba government announced a range of new regulations for the ACL leaseholder program, causing an uproar from producers.

The changes to the program included decreasing lease terms from 50 to 15 years; allocation by open auction; an increase in rental rates; removal of unit transfers (later amended to exclude family transfers); and land improvements made by the leaseholder would no longer be purchased by the province at the end of the term.

The province said these changes would modernize the program and encourage growth for Manitoba’s beef industry, while producers who rely on Crown leases said that raising costs and creating financial instability would result in uncertainty for the viability of their operations.

Among the major concerns for producers was not having the first right of renewal on their lease lands. In October 2019 the province announced this would be amended so legacy leaseholders would be given the option to renew rather than having their lease going right to open auction.

In late September of this year, the provincial government announced a proposed regulation to extend lease renewals to family transfers, allowing the next generation to retain the lease as long as the previous leaseholder held the lease before the regulatory changes. A public consultation period was ongoing at the time of writing.

“When the Crown Land Act was brought forward and passed, this was missed, just plain and simple, it was missed,” Blaine Pedersen, minister of agriculture and resource development, said in an October 5 Manitoba Co-operator article.

The proposed change has been applauded within the beef industry. “This change specific to the first right of renewal for legacy leases is seen as a positive move, as it can help ensure stability and succession within the beef sector for those who currently utilize ACL parcels,” said Hultin. “The continuation of viable farms and ranches that care for these public lands is very important.”
Some leaseholders, though, still argue that the new regulations pose great challenges to their operations.

On October 29, Dougald Lamont, MLA for St. Boniface, sent a letter to Federal Agriculture Minister Marie-Claude Bibeau, to ask the federal government to “consider a support program in the form of income supports or debt relief to ranchers in Manitoba who are facing bankruptcy because of the Province of Manitoba’s disastrous reforms to Agricultural Crown Lands.”

In the letter, Lamont wrote that this situation “is rapidly becoming a crisis” and that producers “cannot wait for the provincial government to recognize and fix its errors. Some ranchers have already been rendered insolvent and others are facing the same challenges.”

Hultin said that MBP wasn’t aware of Lamont’s request to the federal government before the letter was sent.

“The changes that were announced in the fall of 2019 have raised a number of concerns for lease holders regarding predictability and affordability,” he said. “The first right of renewal is an important change, but other aspects such as unit transfers, rent increases and informed access still need to be addressed moving forward.”

MBP plans to continue lobbying the provincial government on these issues and others raised by its leaseholder members, such as “whether there will be an opportunity for new entrants to establish their own legacy lease with their own family members” and “mechanisms to address concerns about the new process for valuing leaseholder improvements.”

About the author

Field editor

Piper Whelan

Piper Whelan is a field editor with Canadian Cattlemen. She grew up on a purebred, Maine-Anjou ranch near Irricana, Alta., and previously wrote for Top Stock, Western Horse Review, and various beef breed publications.

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