The Buelton Ranch

It was November 22, 1963 that Bob Fowler and I drove up to look at a small piece of land that I had heard was for sale near Lompoc, in Santa Barbara County. We went to Buelton, then turned left on Highway 246, towards Lompoc. About four miles out we spotted a sign advertising 165 acres for sale. We stopped long enough to write down the name of the Real Estate Broker, in Lompoc. Farther west we found the 25-acre parcel that we had come to look at. A farmer that had bought something from Maulhardtís had told me that he wanted to split off a parcel of his ranch, and that the buyer would have an interest in the well. Bob had the idea of buying it, putting up a nice white board fence and selling it for a horse ranch. We could not find the owner, so we drove on into Lompoc to talk to the Realtor about the larger ranch that he had advertised. The person in the office didn't really know much about the property, other than the price of $100,000. We were asked to come back after lunch to talk to the realtor. Bob and I thought the price to be very attractive, so we went back to take a closer look at it. Without knowing where the boundaries were we could see that most of the ground was farmable. We went back to Buelton for lunch at Andersenís. While seated at the counter, we heard the news that President Kennedy had been shot. (Thatís the only reason I can remember the date).

After lunch we caught up with the realtor in Lompoc. He told us that the seller, a widow lady in Lompoc, wanted a minimum of $25,000 down. She was willing to carry a note for the balance, payable in ten yearly installments. He also drove out with us to show us the boundaries. There were 100 acres of farm land and 65 acres of pasture. The ranch had an old barn, house, and tool shed. There was a domestic well and pump that was not functioning at the moment, and a storage tank. Two old tractors came with the ranch: a D-6 Cat, and a small John Deere with a broken rear axle housing. There was no irrigation well.

George Chamberlain, a long time friend from Simi Valley was in the well-drilling business. I knew that he had drilled several good wells in the area, including one on a ranch about two miles west that he had bought. He had also drilled a good well about a half-mile up the canyon from the one we were looking at. I thought that there was a good chance that we could drill a good well, and make the ranch more valuable. We decided to explore this idea a little more. On the way home we went to the Courthouse in Santa Barbara to check out the Title at the Hall of Records. The ranch was clear of Liens and Encumbrances, except that it was under lease to an oil company for possible drilling. That seemed like more of a plus than a minus, so we got serious about how we could handle the deal. The down payment was doable. In fact, that was the easy part! Barbara and I had been diligent about saving money in the good years, and getting by in the bad years. By cleaning out the savings account, I would be able to make my half. Bob was much better off than I was, although cash was always a problem, but he said he could handle his half. I was worried about the payments. It would take a long time, not to mention lots more money, to make the ranch productive enough to pay itís own way. Bob was ever the optimist. He said we could just wing it; figure it out as we went along. He visualized that I could go up there and farm the ranch. With his contacts, selling the crops would be easy. I guess that his enthusiasm was contagious; I said, "letís go for it."

I suggested to Bob that we offer to make interest only payments for two years, with the balance amortized over the remaining eight years. He asked if I thought that was possible. "We wonít know until we try," was my response. The seller did agree to our offer, on the condition that escrow would have to close before the first of January. That meant that we must get our money into escrow as soon as possible. Late the next afternoon we walked into Santa Barbara Title Company, checks in hand. When we were finished signing papers we went back across the street to get Bobís car from the parking lot. When the attendant brought the car up, we both dug through our pockets, but between us we did not have the two or three dollars needed to pay for parking. The attendant said that we could get the ticket validated at the Escrow Company. Back in the office we found that there were two escrow companies on the block, and that they both used different parking lots. Wouldnít you know that we had used the wrong lot! We went back outside to discuss the situation, and by then they were locking the door behind us. We both had credit cards, but that was before the days of ATMís. Bob said it was no problem. We would simply watch for the attendant to go to the back of the lot for someone elseís car, then run across the street, jump in our car and make our getaway. The plan worked wonderfully well. As my father would have said, we showed the evidence of misspent youth! I wish that I could report that we went back on a later day to give the man his money, but the truth is that we did not. The escrow closed in late December, and we were the proud and somewhat apprehensive owners of The Buelton Ranch.

I told Lew and John what I had done. Also that there was the possibility that I would be leaving at some time in the future. "But please donít hire my replacement just yet." Lew had bought a couple of small lots, one on the coast, and one in the Sierras. He remarked that I was really lucky to find a deal like that. I reminded him that good luck was the convergence of opportunity and preparation! John said something that took me by surprise, but it was very good advice. He told me that Bob was wealthy in his own right, and to be careful that he did not pull me into a situation where I would be in over my head. He also told me to avoid getting into a positon where I needed Bob more than he needed me.

I should mention that this seemingly wild thing that I had done did not come totally out of the blue. Some years before, a customer-neighbor named Daryl Smith mentioned that he had started the purchase of 480 acres near Chowchilla, in central California. He was looking for someone to take over a third of that, or 160 acres. I told him that I would like to see it, so we drove up, spending two days in and around Madera and Chowchilla. His place was near the San Joaquin River. It had been leveled, but not farmed at that time. There were two newly drilled wells that produced about 2,000 GPM each. He offered me 160 acres, with one of the wells for the average price that he had paid for the whole parcel, which I think was only 425 dollars per acre. It looked like a real opportunity, but I was not properly prepared. I didnít have much cash, and hadnít really thought out how to finance it. The ground was somewhat alkalai, but I could see from the ranches on both sides that applying lime and planting barley for a few years would clean it up. When I got home I talked to Bud Milligan, President of Bank of A. Levy. Our family had done lots of business with the bank over the years, so I had a very casual acquaintance with him. Bud said that they were not at all interested in lending money outside the immediate area. Beyond that, he pointed out all the pitfalls of trying to manage something that far from home, and many other reasons that it would be a mistake for me. I was a little disappointed for a while, but I realize that when the bank wonít loan money on something, there is usually a good reason. As a rule, when they turn you down they are really doing you a favor! I started then and there to be better prepared for the next opportunity, mentally, emotionally, and financially!

When the deal was completed Bob took me to his accountant, to arrange for him to keep our books. We went to a young attorney, Tom Ferguson, to have a partnership agreement drawn and signed. I was not, and am not a big fan of partnerships. They are the easiest way for two or more people to work together in a business venture. But there are pitfalls. I saw many partnerships fail because there was no clear definition of each personís duties and responsibilities. The most successful partnerships that I observed all had one thing in common. Each partner had a job to do. One was business manager; another ran the farming operation; maybe another ran the packing shed, or the shop. The biggest risk in a partnership is that each partner can be held liable for all the debts and obligations of the partnership. So, if your partner fails to meet his half of the bills, you have to do it by yourself. I put my misgivings aside. I suppose that the excitement of the moment took over!

The first order of business was to get a well drilled. For this, we needed money. We went to talk to Bud Milligan about the possibility of the bank giving us a loan for the improvements needed, or maybe refinancing the whole thing. I knew that the Levy Trust owned a ranch not far from ours, so he knew something about the area. He was not interested in loaning money on the property, but said that he would give us an unsecured line of credit for $40,000, which is what we thought we needed. I didnít kid myself for a moment about whose credit rating got us this loan; and it wasnít mine! An unsecured loan sounds really nice, but the truth is that legally, if we defaulted on the loan, either one, or both of us could be held responsible, and our assets seized.

The first project was to drill a well. I got George Chamberlain lined up to drill for us, but he had some work ahead of us. I consulted with Bob on all things, but he was content to have me do the legwork, and the negotiating. I arranged a meeting with the man who was presently farming the ranch. He had a crop of barley already planted. His deal with the old owner was that he used her D-6 to work the ground, and gave her 50% of the crop. He also told me that he had a full-time job, and would not be interested in leasing the ranch once we had water on it. That meant that I would need to find another tenant, at least until I might move up there and farm it myself.

Incidentally, the ranch was known locally as the Kellog Ranch. There had been a Kellog Seed Company operating in the Lompoc area at one time. Within the pasture was a small earthen reservoir, fed by a spring. It always had water enough for livestock. This pasture was rented out for $250 per year for all the time we owned the ranch. The oil company did not renew their lease, so that little bit of income went away.

Before we got started drilling I got a call from the realtor. He told me that our neighbor to the north was offering to sell 25 acres of flat land adjoining our ranch for $20,000. I took this to Bob, and we decided that it was too good an opportunity to pass up. It gave us more land to farm and moved our property line to within about 200 yards of a good water well. We made a down payment on it, with ten years on the balance. This turned out to be a very good move. When we drilled a test hole on our original ranch it turned out to be dry. We moved the drill-rig to the northern edge of our new property, where we got a decent well.

Bob was still determined that we should farm the ranch to vegetables. He also was determined that we should, as he put it, "put the land to grade". In other words have it leveled so that we could furrow irrigate.

Hindsight is wonderful! Let the mistakes begin! If I had it to do over again we would not have leveled the ranch. We would simply have grown the crops that could be sprinkled. Probably an even worse mistake was to ask the U.S. Soil Conservation Service for help. They had a "giveaway" program for farmers that wanted to make their land more productive. They would do the engineering, and pay a certain amount of the cost of leveling. All this in the name of conservation. Forget for a moment that other branches of the Agriculture Department were paying subsidies to other farmers NOT to grow crops, and supporting the price of still more crops that were in over-supply! None of this made any sense, but the money was there, so why not go after it? I contacted the USSCS office in Lompoc and arranged for an engineer to survey the land, do the calculations and set grade stakes for leveling. This was quite a chore, as the ranch could not be leveled as one field. It had to be split into several smaller fields. There was just too much difference in elevation to make it all one.

We had planned to start leveling as soon as the barley crop was off. We really needed to do this while the ground was dry. The engineer kept putting me off, and putting me off, until summer turned to fall, and fall was slipping away. Now we were snared in the trap! If we did not start, and complete the leveling within a certain time frame, we would be obliged to pay for the engineering. Again, in retrospect, we should have paid for the Engineering and proceeded at our own pace. However, we chose to charge ahead. I had arranged with my brother, Tom, to do the leveling. He moved his TD-24 and carryall in and got started just about the time the rains set in. It was difficult working with wet ground, and eventually the ground got so wet that he had to be careful not to get stuck. Worst of all, the heavy equipment was packing the soil so hard that it would take years to restore it to a good workable condition.

Meanwhile, Denholm Seed Company in Lompoc had contacted me about leasing the ranch from us for the following year. We made a deal. It looked like things were starting to fall into place! I arranged to borrow a large Lanplane from them to do the finish leveling of the ranch. By now it was Easter vacation. I took David up and he stayed the week with Tom in the little house. We went to Lompoc to pick up the Landplane. It was so long that it had to have a man on the back to steer it around corners when it was on the road. I instructed Dave on this little exercise, and we were off. As we left Lompoc, we had to cross a two-lane bridge, on a rather busy highway. I pulled off the road as far as I could, waiting for a time when there was no oncoming traffic. The Landplane was twelve feet wide, and the steering mechanism so loose that David never knew just exactly where it was going to go. I guess we would be waiting still, but for the help of another friendly Highway Patrol Officer! He saw my predicament, and told me to wait for him to stop traffic on the other side of the bridge, then come on across. That was a lifesaver!

Dave used the old D-6 to pull the Landplane, and we got our leveling job finished. I was able to satisfy the engineer on most of the work, so we did collect a little money from the Soil Conservation. I donít remember how much we got, but whatever, it was not worth all the hassle, and the delays. Not to mention the damage we did to the ground by working it wet. I vowed never again to get involved with that sort of thing. "There is no such thing as a free lunch". I know that this is an exaggeration, but most "free lunches" have strings attached!

I had a pump installed in the well. And had several thousand feet of high-pressure pipe lain to deliver water to the lower end of the ranch.

Other things were going on during this time, but from this distance itís hard to put them all in sequence. Ralph Roatcap stopped by the store late one afternoon. He told me that he was going to attend a class for people wanting to get a real estate sales license. He suggested that I join him. This didnít seem like such a bad idea, so we had dinner and I enrolled in the class. We went once or twice a week for two months or so. I only remember with clarity one thing that the instructor told us. He was explaining something about real estate law to us when I said, "but thatís not logical!" I think he was waiting for someone to make that comment, because his answer was quick and forceful. "Young man, never, ever confuse logic and the law, for the two are seldom the same thing!" Good advice! Ralph and I went together to Los Angeles to take the State Exam. I wasnít worried about passing. The test was multiple choice, with four choices for each question. I figured that I would get all the math questions easily. Also all the questions regarding legal descriptions and map reading, which I had learned from working with a surveyor many years earlier. I had also been involved in some real estate transactions, so I understood some of the terms. Throw in what I had learned about the law in class, and I should easily get the seventy-five percent needed to pass. Also multiple choice always has one or two choices that are throwaway, making guessing easier. We both got notices that we had passed, but didnít tell us our scores. In order to be issued a license, I had to have a Real Estate broker to sponsor me. I asked around a little in Solvang, and found a broker, Fred Brown, that would sign my application, and subsequently hang my license in his office. Bob thought this was a great idea. He said that he had many contacts in Los Angeles that might be interested in buying land in Santa Barbara County. I could find ranches for them, and together we could farm, or otherwise manage the properties.

On one of my trips to the ranch I dismantled the broken axle housing on the John Deere tractor. I took it home and used Tommyís equipment to braze it back together. Then, on another trip, I put it all back together. I think that all I had to buy were some gaskets.

Davis Brothers sent Bob to manage a ranch they had just purchased in Glendale, Arizona. That meant that he was only in Oxnard about one week every month. He sent some business my way while he was there. He bought a high clearance Farmall 504D, and an Eversman Leveler. I could not sell him the Eversman, but I arranged with Schreiner Bros. to ship it to him. Bob also told me that he had made some sort of business arrangement with a man in Arizona to do very deep ripping of farm ground. He asked me to find him a good late model D-8 Cat, gear drive, without a bulldozer. That was not an easy order to fill, as most D-8ís had blades, and most were being sold with torque converters. As luck would have it, a man that I had known for some time had just such a tractor for sale. He was in the rigging business. He had a couple of large cranes that were the core of the business, but I have no idea why he owned the bare D-8. The tractor was a then current model, and in excellent condition. I told Bob about the tractor, and he told me to make a deal for it. He also added that the price seemed low, and for me to take a generous commission on the deal. The owner had already promised me $500 to sell his tractor, so I made out like a bandit on that deal!

I should mention that all that I did at the ranch was in addition to working my regular job. I took off a day now and then, and spent quite a few weekends up there. Sometimes Barbara went with me on the weekends. We looked around the area for houses and checked out the high school, just in case we decided to move sometime in the future.

I got notice of a Public hearing in Buelton, to discuss the improvement and realignment of Highway 246. The existing road made a dog-leg around the southern and southwestern portion of our ranch. One look at the map confirmed my suspicion that we were going to be more affected than anyone else. The State planned to cut straight across our ranch, leaving about thirty acres isolated south of the road. During the meeting I objected to this as forcefully as I could, but I knew that the decision had been made, and was not going to change. As much as anything, I wanted to lay the groundwork for getting a satisfactory settlement from the State.

Whenever Bob was in Oxnard we got together to discuss our problems, and plan for the future. We talked about the upcoming negotiations with the State of CA. Finally we decided that any offer over $30,000 would be acceptable, and anything less we would contest. As he was leaving, Bob made the suggestion that we buy a mortgage insurance policy that would pay off the mortgage on the ranch in the event that either of us died. It would also provide for buying out the estate of the deceased, leaving the ranch to the surviving partner. We agreed that this would be the first order of business for his next visit to Oxnard. Had we done this, I would have ended up owning the Buelton Ranch by myself, without debt, except for the money owed to Levy.

Two or three weeks later I got a call from Al Herrin, our accountant. He informed me that Bob had died in his hotel room in Arizona. I was in a total state of shock. Bob was only in his early thirties, and Al told me that he had had a physical exam recently that did not turn up any problems. As the shock wore off, panic started to creep in. I had not only lost my partner; I had lost a very good friend. How was I going to deal with all the problems that still lay ahead? Who was I going to be dealing with? I could not have imagined at that time just how difficult it could be dealing with an estate!

Services were held at Forest Lawn. It happened that our family was on our way to visit my folks at San Miguel on that day. I went into the Chapel, while the others waited on the benches outside.

I found out from Al Herrin that Bob had named his sister, Barbara, to be executor (executrix?) of his estate. I got her address and telephone number from him.

Not too long after that I was contacted by a representative of the State of California about the acquisition of part of the Buelton ranch for the Highway 246 project. I called Barbara and arranged for a meeting with her on a Saturday morning to talk to her about the ranch, then meet with the State agent in the afternoon. Barbara and her husband lived in Rancho Santa Fe, so it was late morning when they arrived in Oxnard. We sat in their camper and, over coffee, I gave her a rundown of the Buelton Ranch affairs. I told her of the $30,000 figure that Bob and I had talked about as being a satisfactory settlement. We all agreed that the best thing for us to do was to let the State agent do all the talking. When he arrived, he spread a map out on the table and proceeded to show us how much ground they were going to take, where they were going to take it, and explained how he had arrived at a price. He had priced irrigated farm land in Santa Maria, and allowed us the same price, which was way generous! The price of the pasture was also generous. He explained that the new Highway was to have limited access, with no access at all on either side of the road where it cut through our ranch. That meant that we would have to use the old highway and Drum Canyon Road to get from one end of the ranch to the other. Finally, he told us that the State proposed to pay us about $45,000! I didnít dare look at Barbara. I just stared at the map while my mind raced. After some serious study I pointed out that some serious issues had not been addressed. Our pipeline stopped short of where the new road was going to be. We planned to use portable pipe to carry water the rest of the way. I told him that we would need some provision for extending our pipe. He agreed to have a large conduit pipe put under the road, so that we could put our pipe through it to the south side. I pointed out that we would be terribly inconvenienced by not being able to move equipment back and forth across the road. He understood that, and suggested that giving us money to buy a low-bed trailer would be the answer. This was too easy! The last thing I threw at him was that the road was going to destroy our little reservoir, rendering the pasture unusable, since it would no longer have water on it. He said that he would work on all these issues and get back to me with another proposal.

Soon after that, I learned that I would not be dealing with Barbara any longer. I think that Bobís estate was probably quite complicated. I think he had several business ventures, with various people. I know that he was part of a group that had bought a ranch in Somis. Anyway, the Estate had been turned over to a law office in Los Angeles. My first meeting with them made me know that this was not going to be a fun experience. They wanted me to make no commitments of any kind without consulting with them, and they also made it plain that the Estate would not be putting out any money to keep the ranch going until they had analyzed everything thoroughly. They second-guessed me on everything that was going on. They would not pay their share of the bills that I thought had to be paid. I finally got so frustrated that I gathered all the ranch records, took them to the office in L.A. and put them on the desk. I said "you obviously donít trust me, you wonít pay me for the time I spend taking care of the ranch, so I think itís time for you to take over all the ranch business, without pay, and Iíll second-guess you!" I think I made my point. They assured me that they wanted no part of managing the ranch, and that they would be more cooperative in the future. There were still bills that I felt had to be paid, which they wanted to defer until the Estate was settled. In the end, I borrowed some money on my own to keep the ranch going for about a year.

The next offer from the State was for about $52,000. I took this to the lawyers, thinking that they would surely approve, and we could move on. It was not to be. They wanted more time to study and negotiate. I turned that over to them. I had done all I could. I will give them credit. It took quite a while, but they finally made a settlement with the State of California for about $62,000. That was a whole lot better than the figure that Bob and I had agreed upon more than a year earlier! I think we paid about $20,000 of that to the lady who held the Trust Deed on the original ranch. I wanted to use the rest to repay our loan at Bank of A. Levy. The lawyers said they could not agree to that. Only when the Estate was settled could that be paid. So, we divided the money, and I put my half into a savings account at Bank of A. Levy. I did not want to pay my half of the loan until the Estate paid their half. I think I was in the bank every month or so for a couple of years to keep them posted on what was going on. I learned a great lesson from this experience. It is SO important to have a good relationship with oneís banker. Itís amazing how patient they can be, as long as they know what is going on. They donít like surprises! I was able to make interest payments, and that always helps!

When Bobís Estate was finally settled, a Bank Trust Officer in Santa Monica administered it. Mr. Wilson, another non-relation, turned out to be a very agreeable gentleman. Together we paid off the Bank of A. Levy note, and he reimbursed me for half of all the money I had put out on behalf of the partnership. Also, he was willing to accept my judgement on the day to day things.

At some point I arranged to refinance the notes on the two land purchases. I got one twenty-year note, at a more favorable interest rate. Now our note payments were only slightly more that our rental income. I rented the ranch to several different farmers. None of them produced very good crops. All that land leveling we had done in the winter was taking itís toll!

There was never a year that we did not have to dig into our own pockets at least a little to make our payments. On the other hand, the depreciation and operating loss could be deducted from other income, so we did save on our taxes. When it became apparent that I was never going to farm the ranch, I sold the two tractors. I even sold the old tool shed to a movie company that was filming in the area. They hauled it to their location, and set it afire as part of the movie! Oh yes, the man that rented pasture from us continued to do so. He had water on the other side of the fence, on his own property.

Eventually Mr. Wilson and I decided that we should try to sell the ranch. I listed it with Fred Brown Realty, where my Sales license had been hung many years earlier. In due time it sold for $200,000, all cash. After paying off the long-term loan, my share of the balance was slightly more than $60,000. Not all of that was profit, by any means! I donít really remember how much I put into the ranch in down payment and yearly contributions. The good thing was that I got this money all at one time. The ranch had been sort of an enforced savings account. I did whatever had to be done to keep up the payments. I think that the ranch sold in 1972, which means that we owned it for about nine years.

Barbara and I put the money in T-Bills. They paid 7.5% interest, compounded monthly. Basically, we have never touched that money, other than to move it from one investment vehicle to another. When we retired we started drawing out the interest every month.

As is the case for ventures of any kind, a full range of emotions was involved; joy, satisfaction, apprehension, sadness, anger, and regrets. Once again, I learned many lessons. I have often wondered what turns my life would have taken had Bob not died when he did, or if we had bought that mortgage insurance policy. I have no doubt whatsoever that Bob and I would have made a good team. On the other hand, I suspect that I was eventually more successful as a farmer in the Camarillo area than I would have been in Buelton. Thatís all speculation, of course. We play the hand we are dealt! Iím not one to look back with regrets. The only reason to look back is to try to learn all we can from the experience, in order to be better prepared for the next episode.

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