Longform

HIGH PLAINS GRIFTERS

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Thanks to Four MVR's--and, for a brief time, Davis's--aggressive experiments in Colorado farming, by late 1985 the old Beaty ranch was eroding at a rapid enough rate to qualify for the government's sweeping new soil-conservation program. "If they'd kept it as a ranch," observes Harlan Fletcher, "there wouldn't have ever been any CRP on it."

In the fall of 1986, according to Department of Agriculture records, the Four MVR Farms partners agreed to idle nearly 12,000 acres for ten years, thus qualifying for $402,000 in annual CRP payments. Several months later, in March 1987, the Canadians sold the entire spread to a Missouri corporation called Interstate Agriservices, Inc. It was owned by a man named David Davenport.

Among Colorado agricultural officials, Davenport is a legend. A veterinarian by training, today he sells life insurance out of an office in Lee's Summit, a suburb southeast of Kansas City. He, perhaps more than anyone, recognized the value of land with generous CRP payments rolling in. And he's not ashamed of it.

"At one time," he says, "I controlled 50,000 acres of CRP land across the country. Thirty-three thousand to 34,000 acres of that was in Colorado alone, in Greeley, Kit Carson, Springfield." At one point, he adds, government subsidy checks from CRP provided him with about $3 million a year.

Davenport's biggest check was for the old Beaty ranch, a property that he says was only worthwhile because of the government contract. "The value of that land was lousy, about $75 to $80 an acre," he remembers. "But with the advent of CRP, it enhanced to $170 or $180 an acre. The CRP contract more than doubled the value of the land."

With a little digging, Davenport discovered more government subsidies for his new Lincoln County ranch. They came in the form of something called the 0/92 program.

The years between 1981 and 1985 were a magical period for American farmers. That was the window of time that Congress decided was crucial in determining who would be eligible for huge agricultural subsidies that became law as part of the 1985 Farm Bill.

For rural landowners, the key to millions of dollars in government aid was what is known as a crop base. That's the land government officials calculate has been worked enough to be considered farmland for the purpose of future subsidies.

Fortunately for Davenport, establishing a crop base was not a particularly onerous task. In fact, the two years' worth of crops planted by Four MVR Farms was enough to establish a crop base on thousands of acres of land that the Canadians had been unable to enroll in CRP due to the $50,000-per-person limitation.

That base proved lucrative. When Davenport purchased the Lincoln County land, crop prices were depressed. Congress decided that one way to help farmers earn a living was to cut the supply of crops, which would raise prices. So it enacted the 0/92 program to provide an enticement for farmers not to produce.

Here's how it worked: The government calculated a farmer's base, the projected yield of an imaginary crop on that base and a good market price to peg the value of what the farmer might have earned if everything had gone well. Then it paid him 92 percent of this virtual harvest.

Davenport qualified 3,100 acres of the old Beaty ranch for the 0/92 program. As a result, according to Agriculture Department records, between 1987 and 1988 he received $67,000 in government payments for not farming the land he had no intention of working in the first place.

Meanwhile, Davenport got busy lining up his CRP payments. This required some maneuvering. The toughest restriction to overcome was the $50,000-per-farmer payment limitation. Tom Wingfield, now Colorado's acting executive director of the Consolidated Farm Service Agency, remembers how Davenport worked the deal.

First, he says, Davenport formed a partnership called, coincidentally, Four MVR Farms--the same name as the Canadian company he purchased it from. "I believe he did that to deliberately confuse things," Wingfield says. Davenport replies that he selected the name "for no reason; I just did it." Also coincidentally, Davenport's Four MVR Farms had ten partners, thus making it eligible for all of the land the ten Canadians had placed in the program.

All that was fine. What local agriculture officials didn't like was that, even though Davenport had ten partners, all of the government's CRP payments seemed to be going to Davenport. Even Davenport concedes that his partners "didn't do anything--they just collected the money."

This might not have been discovered if Davenport hadn't tried to get even more cash out of the Conservation Reserve Program. Although the Canadians' original 12,000-acre contract was worth a hefty $402,000 in annual CRP payments, Davenport calculated he could do better. He requested the government send him a $472,000 yearly CRP subsidy check.

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Eric Dexheimer
Contact: Eric Dexheimer