Land Leasing

Introduction

As income from traditional agricultural products declines, many landowners are looking to diversify their sources of income. Hunting, fishing and wildlife-associated types of recreation may be this "alternative" crop that landowners in Mississippi have been looking for. For example, hunting in the United States is big business, especially in Stuttgart, Arkansas, the "duck capital of the world." Here, waterfowl hunters bring millions of dollars into the local economy. Mississippi does not have this hunting business, but it does have the potential of being a world renowned area for hunting, fishing and wildlife viewing. Today, more than ever before, there is the opportunity for landowners to develop and manage their wildlife resources for profit through leasing. However, there are several factors in developing a good lease operation: 1) one must be able to control a large acreage, 2) one must have several refuge areas and 3) mobility.

Controlling poaching, unwanted access and vandalism are primary concerns for many landowners. Sportsmen who have paid for wildlife leases usually patrol their lands. The presence of sportsmen who pay to hunt, fish or view wildlife usually is enough to deter poachers and trespassers.

Habitat improvements can be used as a profitable investment by landowners willing to allow their land to be leased for wildlife. Money is needed to manage land properly to obtain optimum wildlife populations. Many landowners in Mississippi want to manage their lands for wildlife but cannot justify the expense unless there is a financial return. Sportsmen who lease land for wildlife can provide this return. At times, these individuals are willing to help supply equipment, materials and labor in exchange for part of the cost of a lease.

Need Proof
A study of hunting leases was conducted in a 14 county region of the Mississippi Delta, by Mississippi State University in 1993. This study was done to determine market conditions and to identify critical factors to aid in marketing.

Socioeconomic information was collected by mailing questionnaires to lessors and lessees. The study identified 179 hunting clubs operating under 264 separate leasing arrangements encompassing 193,679 acres. Responses were divided according to county and landowner category (public, private non-industrial and forest industry).

Overall, lease rates are above those previously found in past research. Lessors and lessees were mostly white males with at least a high school education; however, lessors tended to have a greater income and be older. The typical lessee travelled 30 miles to his/her lease, making over 20 trips each year. Average hunting trips involved two days. Lessors and lessees expressed a high level of satisfaction with their leasing arrangements. The average lease rate per acre for public land was $6.90 per acre, private land was $5.78 per acre and forest industry was $5.01. The combined average was $5.87 per acre in the 14-county study area.

Annual Lease
Leasing land is currently the most popular method of fee-based wildlife recreation in the Southeastern United States. There are three types of leases: 1) annual leases, 2) season leases and 3) short-term leases. Waterfowl hunting leases are, on the average, the highest in value. Also, the value of the lease is affected by the types of habitat on the property or on the surrounding property. For example, a 500 acre rice field located miles from any other rice field will be less valuable than a 500 acre rice field surrounded by other rice fields or flooded timber. Many landowners invest much money in these areas for pipe and flashboard risers, roads and sometimes caretakers. A good landowner/lessee relationship may result in a long-term lease. Although not necessary, most annual leases allow for a long-term lease by including options for lease renewal. Once a desirable clientele is found, marketing efforts and landowner involvement are usually minimal.

Season Lease
The season lease is the most common hunting lease. By working with individuals who are interested only in one species, the landowner may realize higher income than if all species are included. Also, season leases are more common among landowners who have a skill for marketing.

Day Lease
One example of a short-term lease is a day lease. It is often found close to population centers. For example, Mississippi would benefit from the centers of Dallas, Memphis, Little Rock, Birmingham, Jackson, Baton Rouge and New Orleans. With this type of lease, a daily fee is charged and the lessee pays for the time actually spent hunting, fishing or viewing wildlife. With a day lease, a variety of services are rendered and charges usually vary accordingly. This type of lease can capitalize on a larger market. There are additional costs (such as advertising) with a day lease than with the seasonal or annual lease. Also, a consistent income is more difficult to obtain with this type of lease. There are several advantages and disadvantages of leases. The advantages include: 1) higher wildlife populations, 2) better law enforcement on the land and 3) the lessee's concern over the land. The disadvantages of leases include: 1) not allowing local residents to hunt for free and 2) the lessees may feel like they own the land and may interfere with the landowner's management policy.

Permit
Another short-term lease is a permit. With permit wildlife recreation, there are several variations of the permit program, but most base their fees on whether the individual wants to hunt, fish or view wildlife in a single county or throughout Mississippi.

Outfitting Enterprises
Another option for leasing, would be to lease to a guide service or outfitter. The guide service business has expanded throughout Mississippi, and will continue to expand as the demand for fee-based outings continues to increase. The landowner can lease his/her land to an outfitter for a set fee for the season or can lease the land on a "per-gun" basis. Due to the outfitter's interest in the land, the outfitter will aid in the landowner's wildlife management activities.

Corporate Enterprises
This type of enterprise provides a quality outing to a person willing to pay a relatively high fee. The landowner leases the right to use the land through an annual fee and usually it takes a considerable amount of time, effort and money to manage these lands for the production of wildlife. The owners of corporate enterprises for wildlife associated types of recreation normally combine farming and wildlife management practices so that they complement each other.

The advantages of corporate enterprises include: 1) knowledge of the potential annual income, 2) a high income and 3) a complementary part of his/her farming operation. Disadvantages of the corporate enterprise include: 1) a relatively high investment of capital, 2) high operating expenses and 3) finding a market willing to spend high amounts of money.

Market Opportunities

Marketing is one of the areas in the wildlife business that is often neglected and is many times the limiting factor of a successful program. Marketing includes all business activities involved in selling the product, which is the hunting, fishing or wildlife viewing experience. It includes identifying the clientele who may be interested in the land, advertising the land and leasing it.

Identifying the Clientele
The first step in the marketing process is to identify the clientele who may be interested in leasing the land. Once the clientele is determined, one needs to find out what type of leasing arrangement to initiate, advertise the land, determine the cost for the land, sign an agreement and satisfy the clientele.

Advertising and Public Relations
Advertising is very important in the lease and something that we all do to some degree. The most cost effective type of advertising is word-of-mouth. This is not only the cheapest, but it is the best type. Another tactic, although quite similar, is to have an outdoor writer do a feature story on the land's wildlife and amenities in a newspaper or outdoor magazine, professional journal, trade magazines or airline magazine. However, this usually will not take place until the operation has developed a good reputation. Another good way to advertise is to purchase booth space and to have a display at hunting and fishing trade shows, such as the Mississippi Fish and Wildlife Expo. These shows, which are usually held in most major cities, usually encompass a weekend.

A personal letter to potential clients can also be a cost effective way to make initial contact. Mailing lists of potential clients can be obtained from professional and trade associations, state wildlife agencies, golf and country clubs or from professional list brokers.

Classified Advertisements
Most outdoor magazines and newspapers have sections for advertising lands for lease for wildlife purposes. The most effective advertisements are short and accurate.

Example:
Attention Waterfowlers! Twelve hundred acres prime waterfowl hunting (three hundred acres flooded hardwoods, nine hundred acres flooded rice land). Center of Mississippi Flyway. Will lease waterfowl hunting rights to responsible group. Call (Phone number).

Bulletins
Taxidermy shops and sporting goods stores are also good places to advertise. Many businesses will allow one to display bulletins in their offices; however, they should be attractive and interesting. They should include photographs of the area and successful outings in addition to what is offered and the fee charged.

Brokers
Many real estate agents and landowners will lease hunting, fishing and wildlife viewing rights with the understanding that the lessor may sub-lease the rights to another group or individual. This arrangement reduces the landowner's marketing effort but also reduces his/her control over the land. It is best to have a written agreement that can be canceled at anytime if the lessee is not satisfied.

Fees
Fees vary tremendously. Some landowners are satisfied if they only have their taxes paid. Others seek a much higher return. Of all leases for hunting, fishing and wildlife viewing, waterfowl hunting leases demand the highest price. Depending on to what extent the area is managed and marketed, waterfowl hunting leases usually bring from $5 to $50 per acre. White-tailed deer leases range from $3 to $15 per acre. Some landowners even lease their land with sealed bids. A landowner has the right to choose the highest bid or reject clients if he/she is not satisfied.

Liability

Risk
Landowners who lease their property for pay may subject themselves to liability risk. For the landowner to be negligent, he/she must be proven guilty to be held liable for personal injury. Your attorney should be consulted about liability issues and to tailor the sample lease and permit documents in this publication to fit the specific needs of each landowner. These documents are offered only as samples and should not be used without legal counsel. In order to reduce the risk of liability, the following suggested steps should be followed.

Example:
We, the undersigned, do hereby assume all risks associated with hunting and do herby release____________________ and all properties of any and all negligence.

Signed_______________________________

Date_________________________________

Maintain Safety
Note all dangerous situations on the property and give each guest a map of the property. Be sure to point out all boundaries and dangerous situations.

Supply Regulations
Supply each guest with a set of both federal and state hunting and/or fishing regulations. Have the guest sign an exculpatory clause. This is a statement that the guest holds the landowner innocent of anything that should happen on the premises.

Require Liability Insurance
Liability insurance can be obtained at a reasonable cost. This coverage will protect the landowner. Also, require the lesse to pay for this insurance and this should be stated in the lease.

Written Contracts

Sample Lease
(For Annual and Season Leases)
State of Mississippi

County of ______________________________

Subject to the terms and conditions set forth in this document. _______________________________

(hereinafter called LESSOR) does hereby grant to__________________________________________

(hereinafter called LESSEE) the right to access and hunt only which may be found upon and harvested from the following property(s) treated as comprising a total of_______________ acres, more or less.

Describe Property
Refer to an Attached Map
1. The term of this lease shall run from (date)__________________ to (date)________________________.

2. The LESSEE hereby agrees to:

a. Pay to the LESSOR the sum of ($)________________ per acre, totaling ($) __________________ on or before (date)
________________________.

b. Allow LESSOR to hold in deposit the sum of ($)___________________, refundable at the termination of the lease, if the lease has been adhered toand no damages have been placed upon the LESSOR as a result of the actions of the LESSEE.

c. Hunt only on the property described and not trespass on any property that may be adjacent to said property. Trespassing of any kind is punishable by immediate expulsion of the entire LESSEE'S party and/or fine established by the LESSOR.

d. Abide by all state and federal hunting regulations. Any arrests for violation of any law shall be immediately reported to the LESSOR.

e. Be personally responsible for the actions and activities of all persons hunting under this lease and to act as a representative in matters regarding all activities carried out under this lease.

f. Maintain proper safety procedures regarding firearms, particularly see in that all firearms are unloaded while in vehicles and in the vicinity of all buildings.

g. Maintain proper vigilance aimed at preventing fires or damage by other means to the leased area.

h. See that vehicles are driven only on established roads and to see that all gates are left as originally found.

i. Maintain a no hunting or shooting zone within 200 yards of any occupied building and around all other designated areas.

j. Keep records of all numbers and species of game harvested and supply these records to the LESSOR.

k. Remove all structures placed or constructed by LESSEE from the lease areaat termination of this lease unless prearranged with LESSOR.

l. Limit number of hunters so as not to exceed __________ with number on lease property at any one time not to exceed
_______________.

m. Provide the LESSOR with a current certificate of insurance covering the LESSOR, LESSEE and all guests of the LESSEE against damages and liabilities. Coverage shall be in at least the amount of $500,000.00.

n. Abide by all written rules and regulations supplied at the onset of this agreement.

o. Absolutely no littering, defacing or alteration of any kind on premises will be tolerated. LESSEE agrees to remove all garbage and trash from premises upon departure. LESSEE specifically agrees not to leave or place any garbage, entrails or other trash upon the premises or in the pasture.

3. The LESSOR hereby agrees that only the LESSEE and his/her Guests shall have hunting rights on the leased area during the term of this lease except those reserved as follows:_______________________________________

4. Agricultural and/or Forestry practices are necessary on the premises and take precedence over the rights given in this agreement. Hunting shall not interfere with any such practices.

5. It is mutually agreed that failure to abide by the terms and stipulations above by any person present on the leased area under this lease will constitute cause for the forfeiture of all hunting rights, deposits and fees.

6. LESSEE shall not assign or otherwise convey any rights granted by this agreement to other persons without the expressed written consent of the LESSOR.

7. The addressees of the parties hereto for the communication of notices are, unless altered by written notice, as follows:

For the LESSOR: _____________________________________________

(Address)____________________________________________________

(City) (State) (Zip)_____________________________________________

(Phone Number)

For the LESSEE: _____________________________________________

(Address)____________________________________________________

(City) (State) (Zip)_____________________________________________

(Phone Number)

8. This agreement will be automatically renewed on an annual basis unless writte notice is delivered on or before
(date)__________________________.

9. In case any one or more of the provisions contained in this lease shall for any reason be held to be invalid, illegal or unenforceable in any respect, all other provisions and this agreement shall be construed as if such invalid, illegal or unenforceable provision has never been contained herein.

10. This agreement shall be construed under and in accordance with the laws of the State of Mississippi.

11. Lessee recognizes the inherent dangers associated with hunting, both natural and man made: Lessee recognizes that accidents involving firearms, ammunition, fallen trees, hidden ground openings, poisonous plants and various other dangers may forcibly occur on the property aforementioned. Lessee acknowledges his/her recognition of these dangers and the possible existence of dangerous physical conditions upon the premises such as but not limited to those described on the enclosed map. With the aforementioned recognition in mind: Lessee agrees to indemnify and hold harmless landowner and all of his/her family, employees and agents from all claims, suits, losses, personal injuries, deaths, property liability and all other liability resulting directly or indirectly from or on account of hunting activities engaged in by Lessee or Lessee's guests on the premises heretofore mentioned, said obligation to indemnify extending to the reimbursement of landowner for all expenses and suits including but not limited to, judgements, attorney's fees and court costs.

Executed in duplicate on this ______ day of ________________ 19____.

Lessor ______________________________

Lessee ______________________________

Sample Short-Term Lease

State of Mississippi

County of _____________________

Subject to the terms and conditions set forth in this document, ___________________________

(hereinafter called LESSOR) does hereby grant to ______________________________________

(hereinafter called LESSEE) the right to hunt upon and harvest from the following property(s).

Describe Property
Refer to an Attached Map
1. The term of this agreement shall run from (date) _______________ to (date) _______________.

2. The LESSEE hereby agrees to:

a. Pay unto LESSOR in advance a fee of $___________________.

b. Abide by all state and federal hunting regulations. Any arrests for violations of any laws shall be immediately reported to the
LESSOR.

c. See that vehicles are driven only on established roads and to see that all gates are left as originally found.

d. Maintain a no hunting or shooting zone within 200 yards of any occupies building and around all other designated areas.

e. Keep records of all game numbers and species harvested and supply these records to the LESSOR.

f. Remove all structures placed or constructed by LESSEE from the property at termination of this lease unless prearranged
with LESSOR.

g. Abide by all written rules and regulations supplied at this onset of this agreement.

3. Limit number of hunters so as not to exceed ____________ with number on lease property at any one time not
to exceed ________________.

4. This lease shall be construed under and in accordance with the laws of the State of Mississippi.

I, the undersigned LESSEE, do hereby assume all risks associated with hunting and do hereby release_______________
and all their properties and their agents of any and all negligence.

Executed in duplicate on this__________day of____________19____.

LESSOR________________________LESSEE__________________________

SAMPLE PERMIT
Date:____________

To whom it may concern:

The bearer of this permit, ____________________, has permission to hunt on the following property:

___________________________________________

located at (Name of Farm) _____________________

during the period _____________________________

He/she agrees to obey the current State and Federal hunting regulations and to repair or pay for any property damages which occurs.

He/she has been shown property boundaries and agrees not to hunt on adjacent properties without written permission.

Landowner: __________________________________

Permittee: ___________________________________