Oasis Ranch Information Booklet (53mb)
Online Bidder Registration" /> Oasis Ranch Information Booklet (53mb)
Online Bidder Registration" />

Home / Auction Info

640+/- Acre Land and Associated Water Production Rights Auction

San Bernardino County, California - 65+/- Miles North Of San Bernardino, 20+/- Miles Northwest of Barstow

Owner: Curt Jahnke Thu, Feb 28, 2013

AUCTION IS OVER

• in cooperation with Lee & Associates • Water consultants have estimated between 20,000 to 30,000 acre feet per year • Historic use of 10,000+/- acre feet per year • 23 years of alfalfa production • Historically Known as Water Valley • Located at the Mouth of Black Canyon • Potential for 120MW Solar Farm • 7+/- Miles Northeast of Large Solar Plant •

Downloads: (click the links below to download)
Oasis Ranch Information Booklet (53mb)
Online Bidder Registration


PROPERTY LOCATION

From the intersection of I-15 and CA-58, 3 miles west of Barstow (exit 179), travel west on CA-58 Barstow-Bakersfield Hwy toward Bakersfield 8.8 miles to Hinkley Road. Turn right (north) on Hinkley Road and travel 8.1 miles to sign for Oasis Ranch. Turn left (west) and travel about 1 mile, then right (north) about 2.5 miles to the entrance of Oasis Ranch. Road signs are limited in the area. Watch for Auction Signage.

AUCTION LOCATION

Bacara Resort, 8301 Hollister Avenue, Santa Barbara, CA
(805) 968-0100

From the Santa Barbara Airport, travel north on William L. Moffett Place (which becomes Fowler Road) 0.3 miles. Fowler Road then becomes South Fairview Avenue, continue for 1.1 miles to US-101. Take the US-101 north ramp and travel 4 miles to Winchester Canyon Road/Hollister Avenue (Exit #110). At the first stop sign, go straight onto Calle Real, which runs parallel to US-101 north (NOTE: Do not exit onto Route 217-Hollister Avenue/Goleta). Turn left at the second stop sign toward Hollister Avenue (which takes you over the highway). Take the first right onto Hollister Avenue and continue to Bacara Resort.

PROPERTY DESCRIPTION









California Real Estate Broker: Clifford Crowe,
Principal Lee & Associates, Carlsbad, CA
License ID# 00982577



UPDATE: Certain statements in the previously-printed auction brochure require clarification with regard to the water rights. All water production rights are included in the sale of the Property and will be acquired by the purchaser at closing. However, only the First Tier Water Rights will be included in the Bid Price paid at closing. The purchase price for the Additional Water Rights will be paid post-closing based on actual production volume over and above 10,000 acre feet per year.

UPDATE: Buyer will assume the property taxes beginning with those assessed for the calendar year 2013. All prior property taxes will be paid by Seller at or prior to closing or via credit to Buyer at closing. The property taxes will not be pro-rated (notwithstanding the terms stated in the previously-printed auction brochure).


The Property consists of 640+/- acres in Section 5 of Township 11 North, Range 3 West in San Bernardino County, State of California. The successful bidder at auction will receive the surface rights, mineral, oil, solar, the right to produce water from the property up to and including 10,000 acre-feet in any calendar year (First Tier Water Rights), and the right to produce water from the property in excess of 10,000 acre-feet in a calendar year (Additional Water Rights). Additional Water Rights are included in the sale of the property, but will be paid for post-closing, based on volume, in the amounts, at the times and in the manner set forth in the Agreement to Purchase on the following basic terms:



  • 10,000 acre-feet up to 15,000 acre-feet shall be purchased as a permanent Additional Water Right at the price of $5,500 per acre-foot. For example, if the purchaser/producer who previously had not produced water in a calendar year exceeding a volume of 10,000 acre-feet produces 12,002 acre-feet in a calendar year, that producer shall then pay to seller the sum of $11,011,000.00 and shall have the permanent right to produce up to 12,002 acre-feet annually.

  • 15,000 acre-feet up to 20,000 acre-feet shall be purchased as a permanent Additional Water Right at the price of $6,500 per acre-foot.

  • Production in excess of 20,000 acre-feet shall be purchased as a permanent Additional Water Right at the price of $7,500 per acre-foot.

  • The purchase price per acre foot for Additonal Water Rights above shall be increased on each January 1 following the fourth year subsequent to the auction by the percentage increase in the Mojave Water Agency Replacement Water Assessment from January 1 of the previous year.

  • A fixed-sum for the bundle of Additional Water Rights is available. Contact the Auction Company for Details.


  • Surface rights include, on the eastern half of the property, 2 Lindsay/Zimmatic irrigation systems put up in approximately 2005. (The 2 irrigation systems on the western half of the property have been removed due to age.) Additional improvements include a 93 ft. x200 ft. hay barn, 50 ft. x80 ft. steel building with concrete floor used as a shop, a 3-bedroom home and a double-wide modular home.

    The property has 3 unique features over almost any other property in the Mojave River Agency, an area roughly the size of Connecticut:
    1) The property owner retains the legal right to pump water free of the restrictions imposed in the Mojave River Basin adjudication
    2) The property lies at the mouth of the Black Canyon watershed, an area referred to as Water Valley (shown on map below)
    3) There are few (if any) wells north of this property in the Black Mountain Wilderness Area


    History of Oasis Ranch

    Purchased in 1979, Curt Jahnke developed the 640 acres into a profitable alfalfa operation, raising alfalfa until 2006 with an average annual production of approximately 6,000 tons of alfalfa hay under 4 pivots. Water for the pivots came from 5 wells, producing an estimated 10,000 acre-feet per year for the cropland, 2 lakes created on the property, 20,000 trees, and 16 miles of additional trees bordering the property. The water in the lakes brought geese, ducks, and sandhill cranes, and the transformation was complete: the property truly became The Oasis Ranch. Due to health issues with Mrs. Jahnke in 2006, Mr. Jahnke was not able to continue the operations at Oasis Ranch.


    2011 Water Testing

    In a 2011 Hydrogeologic Evaluation of the property, Well #3 was test pumped for 72 hours and had an average pumping rate of 1,621 gpm. During the 72-hour test, a total of about 7,000,000 gallons were pumped or 21.5 acre-feet. The five surrounding wells were monitored around the pumping well on the property showing a drawdown of 2 inches (from well 3,732 feet northeast of the pump) to 18 inches (from well 1,222 feet south of the pump) during the test. After 72 hours, the water level in the pumping well had drawn down about 27 feet. Within 6 seconds after turning the pump off the water level had risen to 77% of total recovery. One minute after turning the pump off, the water level had risen to 100 percent. (Refer to Property Information Booklet and Test Pump Log, available from the Auction Company)


    There is no limitation on the amount which can be produced annually except for natural limitations of the sustainable availability of water. Further, the water may be used to supply beneficial demands on property off of the ranch under the paramount appropriative right which would be established by the project. Under California common law, the priority of appropriative rights is based on first in time is first in right. We are not aware of other appropriative production in the area of concern. To understand this important principle, you need to understand the definition of overlying rights and appropriative rights. They are: Overlying rights are the use of water produced from land owned by a party and used on land owned by the same party. Appropriative rights may be generally described as the use of water produced from land owned by one party on land owned by another party. For example, retail water supply systems operated by public entities and public utilities are examples of appropriative use of water. While overlying use has a priority to appropriative use, we know of no significant overlying production in the area of concern. I know of no water producer or potential water producer other than Oasis Ranch within the jurisdiction of the Mojave Water Agency which has the legal opportunity to provide a substantial quantity of water to third parties free of the constraints of the judgement entered in the Mojave Basin adjudication.
    -James L. Markman


    INTERACTIVE MAP

    TRACT MAP(S)

    AREA MAP(S)

    PROCEDURE; REGISTRATION: The Property will be offered as a total unit. The conduct of the auction and increments of bidding will be at the direction and discretion of the Auctioneer. Bidders can either preregister with the Auction Company on or before Thursday, February 21st, 2013 by submitting the preregistration form available on the Auction Companys website, or provide a bank letter of credit on the day of auction.

    PURCHASE CONTRACT; SELLERS ACCEPTANCE: The final bid price is subject to the Sellers acceptance or rejection. The successful bidder will be required to sign a purchase contract at the auction site immediately following the close of the auction. Copies of the purchase contract will be available prior to the auction upon request. The terms of the written purchase contract will supersede and take precedence over any prior statements or advertisements.

    PROPERTY: The successful bidder at auction will purchase and acquire all of Sellers rights with respect to the Property, including:

  • Surface rights, with existing improvements and irrigation equipment;

  • Mineral, oil and solar rights;

  • The First Tier Water Rights (i.e., the right to produce water from the Property up to and including 10,000 acre-feet in any calendar year); and

  • The Additional Water Rights (i.e., the right to produce water from the Property in excess of 10,000 acre-feet in a calendar year).

    UPDATE: Certain statements in the previously-printed auction brochure require clarification with regard to the water rights. All water production rights are included in the sale of the Property and will be acquired by the purchaser at closing. However, only the First Tier Water Rights will be included in the Bid Price paid at closing. The purchase price for the Additional Water Rights will be paid post-closing based on actual production volume over and above 10,000 acre feet per year.

    PAYMENT OF BID PRICE; EARNEST MONEY: An earnest money deposit in the amount of 10% of the winning Bid Price will be due on the day of auction and the balance of the Bid Price will be due in cash at closing. The earnest money deposit may be paid in the form of a cashiers check, personal check, or corporate check.

    YOUR BIDDING IS NOT CONDITIONAL UPON FINANCING, so be sure you have arranged financing, if needed, and are capable of paying cash at closing.

    ADDITIONAL WATER RIGHTS: The purchase price for the Additional Water Rights will be determined and paid in the manner and amounts and at the times set forth in the purchase contract, on the following basic terms:

  • Water produced from the Property in any calendar year in excess of 10,000 acre-feet and up to 15,000 acre-feet shall be purchased as a permanent Additional Water Right at a price of $5,500 per acre-foot. For example, if the purchaser/producer who previously had not produced water in a calendar year exceeding a volume of 10,000 acre-feet produces 12,002 acre-feet in a calendar year, that producer shall then pay to seller the sum of $11,011,000.00 and shall have the permanent right to produce up to 12,002 acre-feet annually.

  • 15,000 acre-feet up to 20,000 acre-feet shall be purchased as a permanent Additional Water Right at a price of $6,500 per acre-foot.

  • Production in excess of 20,000 acre-feet shall be purchased as a permanent Additional Water Right at a price of $7,500 per acre-foot.

  • The purchase price per acre-foot for Additional Water Rights shall be increased, on each January 1 following the fourth year subsequent to the auction, by the percentage increase in the Mojave Water Agency Replacement Water Assessment from January 1 of the previous year.

  • Payment for Additional Water Rights produced shall be due on or before the March 1 immediately following the calendar year in which that production occurred. The payment shall be made together with accounting materials sufficient to document the amount of production which occurred in the previous calendar year. The payment and supporting materials shall be subject to audit by Seller at its discretion. The Purchase Agreement will contain more detailed provisions on payment for Additional Water Rights.

    POST-CLOSING AGREEMENTS: Seller has a substantial interest in the development of the full water production potential of the Property. Accordingly, the Purchaser shall be obligated to employ its best efforts to promptly conduct necessary studies to establish the maximum amount of water which can be produced from the Property and supplied for reasonable and beneficial uses and, upon establishing that amount, to continue to employ its best efforts to sell and provide that maximum amount of water through the applicable regulatory, construction and marketing processes. Those efforts shall include, but not be limited to, the following:

    1. By July 1, 2014, complete a bore hole on the Property at least 3,000 feet in depth and 8in. to 10in. in diameter and produce a full detailed drill log with an explanation of materials drilled every 5 feet, a full E-log with commentary and a full temperature log every 50 feet; and

    2. By January 1, 2016, complete the construction of two commercial production wells on the Property capable of producing 4000 GPM each with 1,000 feet of 24in. casing with adequate Roscoe Moss louvered screening, in accordance with the specifications provided in this material.

    3. Upon construction of the wells specified above, provide Seller with the results of a 72 hour minimum pump test of the wells (at a minimum of 7,000 gpm), monitoring all on-site wells, and, if possible, at least one well located off the Property to the south (e.g. well #7 mentioned in the Barto Report).

    The Purchaser shall provide to Seller copies of all information concerning the Property and its water bearing capacity and water quality obtained by Purchaser, including all test results, reports and the product of computer models, generated by all tests performed on and investigations of the Property together with the consideration of other available data.

    DELIVERY OF TITLE; TITLE INSURANCE: Seller will deliver title and provide title insurance in accordance with the terms and conditions of the purchase contract. The cost of title insurance will be shared equally (50:50) by Seller and Buyer.

    CLOSING; POSSESSION: The closing will be held as and when provided in the purchase contract. The closing agents fee for administering the closing will be shared equally (50:50) by Seller and Buyer. Possession will be delivered at closing.

    PROPERTY TAXES: Buyer will assume the property taxes beginning with those assessed for the calendar year 2013. All prior property taxes will be paid by Seller at or prior to closing or via credit to Buyer at closing. UPDATE: The property taxes will not be pro-rated (notwithstanding the terms stated in the previously-printed auction brochure).

    SURVEY; ACREAGE: The Property will be conveyed using existing legal descriptions, without a new survey. All tract acreages, dimensions and boundaries stated or depicted in the marketing materials are approximate and have been estimated based on existing legal descriptions and/or aerial photos.

    AGENCY: The Auction Company and Broker and their respective agents and representatives are exclusively the agents of the Seller.

    DISCLAIMER AND ABSENCE OF WARRANTIES: THE PROPERTY IS BEING SOLD AS IS, WHERE IS. SELLER, BROKER AND AUCTION COMPANY MAKE NO WARRANTY OR REPRESENTATION, STATED OR IMPLIED, CONCERNING THE PROPERTY. Prospective bidders are responsible for conducting their own independent inspections, investigations, inquiries, and due diligence concerning the Property. The Seller, Broker and Auction Company assume no responsibility or liability for errors or omissions. The Seller and its representatives reserve the right to preclude any person from bidding if there is any question as to the persons credentials, fitness, etc. All decisions of the Auctioneer are final with regard to the conduct of the auction.

    CHANGES: These general terms are subject to change. Check the auction website for updates at www.schraderauction.com. The terms of the written purchase contract, written auction day announcements, and/or official announcements made at the auction podium during the auction will supersede and take precedence over any other terms, statements or advertisements, whether oral, in print, or posted to the auction website.