The Des Moines Register from Des Moines, Iowa • Page 48

4 i nr 3 SECTION FML1 CLASSIFIED fJ)3 1, -t i 1 4 I I It V- LJ! if. i ft iUoincs Sunday Jktjistcr jilv i984 Copyright )VM pt Msiims Rteitttr nd Trlburw Company li fo s. .1 4 -A i i REGI5TFR PHOTQ BY CHRIS YOUNG rate investoRS Frie mas Nebraska measure Iowa lawmakers still causes sparring may ease land laws By TOM WITOSKY Rtotitar Staff Writer ii (i u( 1 1 i- A. i "Hi i 'lt k. rfir kl acres adjacent to Ralph Black- tora rural Linn county larm look pretty much like any other field in the midst IK kw4 of a good growing season.

-l i I H1 I 1 Jt I i I 1. I it By LARRY FRUHLING Rtaiitor Staff Wrlttr LINCOLN. NEB. A year and a half later, Nebraskans still are quarreling over the tight restrictions the majority voted to place on corporate buying of farms and ranches. Opponents, who still are trying to undermine the restrictions, contend the corporate farming amendment to the Nebraska Constitution has contributed to the continuing slide in land prices by cutting into the pool of potential buyers.

They also say the 19-month-old amendment has made it harder for farmers and ranchers to borrow money. Those who promoted the amendment as a way of saving the family farm say that the restrictions have been fairly effective in keeping corporations from obtaining additional agricultural land Corn is waist high along the gently rolling landscape, a mixture of greens, blacks and browns under the summer sun. But looks can be deceiving. The land, tilled by Blackford and his family who run a 4,000 acres family farming operation, is different. The land is not owned by an Iowan; the owner is a West German.

Blackford remembers the resentment voiced by some neighbors when they learned several years ago that the land had been bought by a foreigner for investment purposes. "There was naturally some resentment I even had mixed emotions even though some complain that the Nebraska attorney general's office has been lax in enforcing the restrictions. What's more, proponents of the restrictions say that blaming the amendment for falling land prices is a bum rap. At Walthill, the L1EMCAU about it," Blackford recalled. "You have to ask yourself how much farmland do we want gobbled up by foreign investors?" But Blackford isn't the only Iowan asking himself that question these days.

The ques tion of how much land should be owned by foreign investors oe owneu oy ioreign invesiors Joe McVoy has plenty of reasons to smile, considering the performance of Decal Specialties Inc. Sticky situation spells profits, riot troubles, for Mason City firm AGRICULTURE Center for Rural Affairs, cenier ior nurai Aiiairs, rpi which champions family 1 ItCJlQiltjOY SUYVlVttl as well as large corporations farming, says that although apparently win ue one oi uie BY KENNETH PINS Register StH Writer ASON CITY, IA. Ten-year-old Shannon Duda hit the jackpot here recently: She received a half dozen packets of free stickers. prices for Nebraska agricul tural land have fallen 25 percent since 1981, the decline has been even more abrupt in two other major farm states. The center says that in the three-year period, land prices plunged 28 percent in Ohio, which has no restrictions on corporate farming, as well as in Iowa, which does have some limitations.

In general, the center said, a survey of 12 states in the Upper Midwest shows a 21 percent land-price decline in the four states that have no rules against corporate farming. In the eight states with some sort of restrictions, land prices dropped by 16 percent on average. "This should lay to rest charges that Nebraska's 25 percent land-price drop, which ranks third among the 12 states, is due to passage of Initiative 300," says Chuck Hassebrook, an analyst at the center. Initiative 300 was approved as a constitutional amendment by 57 percent of Nebraska voters in November 1982. Advocates and opponents both said that the clamps placed on corporate farming were among the tightest in the nation.

The amendment prohibits corporations and NEBRASKA major issues that will confront the Iowa legislature next year. Gov. Terry Branstad, several influential state lawmakers, farm groups and real-estate groups all acknowledged last week that lawmakers will consider easing existing restrictions on corporate and foreign purchase of Iowa land, as they search for ways to stem the massive decline in farmland values estimated to be as large as 30 percent. "What we need now are buyers and while most corporations won't be too interested, it's an obvious source of money. Many farmers would be much better off to sell some of the land they bought in the past few years, than getting all these credit extensions people are talking about," says Carl Hertz, founder of the Hertz Land Management Co.

in Nevada. "It is something that the governor believes Ls a serious option," said Susan Neely, Branstad's press aide. "He is open to considering it." Key legislators, both Republican and Democrat, say they've been approached in recent weeks by real estate and land management represcnta- LAND Please turn to Page 3F gum-backed Darth Vader can do for a corporate balance sheet. "We're looking at sales of somewhere around million for next year," McVoy said. Launched in 1981, Decal Specialties has seen sales skyrocket, producing nearly undreamed of growth $250,000 in sales the first year, $1 million the second, more than $6 million last year.

This year the company has budgeted for sales of $16 million. By McVoy's own accounting, Decal Specialties has become the second-largest company in the sticker business, just behind Hallmark. And he doesn't expect to stay there long. "We think we'll pass them in about eight to twelve months," McVoy predicted. "Our goal is to become the largest sticker company." Three years ago, McVoy and partner Brian Crane began making souvenir decals for the tourist industry.

But decals, with separate designs for each tourist spot, had high unit costs, and the two quickly recognized the growing universal appeal of stickers for kids. They apparently made the right decision. A year ago Decal Specialties employed 80 people. Now it has 240 employees. Stickers are currency in a youthful economy, each assigned a trade value: Scratch 'n' sniffs are worth more than regular stickers, shiny prismatic stickers worth still more, and three-dimensional holographic stickers the most valuable of all.

McVoy thinks his young company has barely scratched (and sniffed) the surface of the market out there. The company recently opened a London office, and is now elbowing its way into markets in Canada, Europe and South America. Might this be an ephemeral phenomenon, the lava light of the 1980s? McVoy doesn't think so. "The thing to be clear about on stickers is we don't think this is a fad, like the hula-hoop," he said. And Ira Friedman, publisher of the New STICKERS Please turn to Page 4F Wow, thanks," Shannon said in wide-eyed wonderment, reacting not unlike Dorothy when she received the ruby slippers.

Stickers those adhesive images of hearts, balloons, animals and superheroes have become the passion of pre-adolescent life, spawning a 500 million-a-year industry complete with collectors' clubs, a magazine, activity sets and hundreds of thousands of individual designs. No one knows just why the sticker market has literally exploded in the last two years. "I think they're neat," offered Shannon, almost incredulous that anyone would think to ask why children gobble them up. "You can stick them on anything." Equally impressed by stickers is Joe McVoy, 36, of Mason City. But he likes stickers for a different reason he's making big money with them.

His company, Decal Specialties has seen first hand what a Please turn to Page 3F REGISTER PHOTO BY BOB NANDELL This Ottumwa rail operation is on track a very short track Record barge traffic comes fo abrupt Eiaif By WILLIAM RYBERG Of Tht Raatster'i Davanpart Bureau By RANDY EVANS Rcotster Staff Writer TTUMWA, IA. Pat John-json has a one-track mind land it's on the railroad. Johnson's Ottumwa Con arges carrying record ton-'nages of grain and other kcargo were charging through IT Mississippi River locks on the flatcars out of the sprawling Deere grounds, beneath U.S. Highway 34, and over the 750-foot iron bridge that spans the Des Moines River. The cars were uncoupled on a Milwaukee Road siding southeast of the Ottumwa business district, and Johnson headed the engine back across the river.

Joining Johnson on the trips was the railroad's only other employee, Tony Long of Fairfield, a 29-year-old veteran railroader with the Burlington Northern who had been laid off by that company because of the downturn in the economy. (Johnson expects to add another full-time employee in the weeks ahead, and as business warrants, he plans to add a couple of part-time workers.) Johnson's background is in transportation. He face owned a srrfall bus company in Kansas, and he was one of the owners of a small Oklahoma railroad, the Northwestern Oklahoma, before he began looking two years ago for a potential short line operation of his own. "I functioned as the general manager of the railroad, but that didn't mean all that much because I was also the engineer," Johnson said. "Flexibility.

That is the secret for a successful short line being able to have people who can do a whole lot of things." He added: "Yesterday, Tony and I both were working on the track. Today, I was taking care of some of the paperwork. This is really a mom-and-pop operation. We're planning to paint the bridge ourselves over the course of the next couple of summers." Johnson learned that a short line might fly in Ottumwa from officials in the rail division of the Iowa Department of Transportation. Community leaders here tad expressed concern to the DOT that John Deere and Ralston RAILROAD Johnson is among a growing number of entrepreneurs across the country who believe that marginal rail lines of no interest to the major railroads can be worked at a profit by small companies having only a handful of employees and no expensive union contract requirements.

The small railroads are called short lines, and the Ottumwa Connecting Railroad is one of six short lines that have been started in Iowa in the past few years, in the wake of the major railroads' widespread abandonment of their least desirable segments of track. Ten short lines are operating in Iowa now: the Ottumwa Connecting and the Iowa; Iowa Northern; Keokuk Junction; Boone and Scenic Valley; Colorado and Eastern; Cedar Rapids and Iowa City; Des Moines Iowa Terminal, and thetDavenport ftock Island and Northwestern railroads. Officials are working to get four other short lines going in the Center-ville, Washington, Burlington, and Forest City areas. While much of the talk of a national level deals with the possibility that another mega-merger will create a single railroad stretching for the first time from sea to shining sea, the talk in Ottumwa centers on this railroad that a person can traverse on foot without working up a sweat. The Ottumwa railroad is a shoestring operation, Johnson frankly admits.

Train service right now is provided only as often as the John Deere factory's production schedules demand. Flatcars carrying large forage harvesters were moved out last week, one load heading for a customer in the West and the other bound for a Virginia export terminal for shipment to customers in France. Johnson was at the controls of the railroad's 1946-vintage locomotive, a powerhouse that once belonged to the Burlington Northern Railroad, as he deftly guided necting Railroad isn't your typical railroad. When it came to life on June 11 and rolled quietly into town, it carried with it the distinction of being Iowa's shortest railroad and one of the smallest in the United States. The railroad gives new meaning to the word "small:" It has just 3Vi miles of track, one locomotive, one customer, and just one employee besides Johnson, who doubles for now as the company's president and its principal train engineer.

"I tell people that we're not as long as other railroads, but we're just as wide," Johnson said. "We're not much for show; we're strictly a little, working railroad." The Ottumwa Connecting Railroad links two of the city's principal industries the John Deere Ottumwa Works and the Ralston Purina feed plant with the main line of the Milwaukee Road. The companies' rail connection with the outside world was severed 28 months ago when the Norfolk and Western Railway abandoned its branch line between Ottumwa and Moulton. That decision forced the Ottumwa businesses to rely solely on trucks for all of their transportation needs. The Norfolk and Western, part of the Norfolk Southern one of the nation's largest rail companies, pleaded poor economics for deciding to pull out of Ottumwa.

The company said it was losing money on the branch line. But 53-year-old Johnson, a businessman from the Colorado Springs suburb of Fountain, believed black ink could flow where the red ink had once run. He convinced Colorado Springs railroad executive Gary W. Flanders to purchase the most valuable portion of the line from the Norfolk and Western this spring, and Johnson leased the track from Flanders' company. Iowa's eastern border in April and May.

But in recent weeks, shipments of grain have dropped off sharply, creating even more concern for the already troubled barge industry. One industry official called it a "record slowdown on the river," and officials were tying it to that spring rush of shipments coupled with last year's smaller-than-normal crop. "All of the grain companies are saying it's going to be a long, dry summer for people hauling grain," said Lloyd Eneix, senior vice president for Agri-Trans St. Louis barge line. A long dry summer is probably the last thing needed by the barge industry as well as by the river grain terminals and workers on the Mississippi's system of locks and dams.

"A lot of people are hurting real bad in this business," said Eneix. "They haven't made a dime in three years and that hurts." "Times are pretty tough in the barge industry as far as trying to make a buck. No doubt about it," agreed Morris L. Larson, executive vice president of the Merchants Exchange in St. Louis, where grain is traded by the bargeload.

Already, the family-owned St Louis firm of G. W. Gladden Towing Co. has called it quits after 34 years in the towboat business. The company, which operated eight tows and employed about 160 people, shut down operations at the end of May and plans to liquidate its assets.

And in recent weeks, barge companies serving the Missouri River on Iowa's other border have been watching profits slide away as floodwaters kept that river closed to boat traffic. Just a few months ago, things BARGE Please turn to Page 4F I MkMiiMi S'V r- 1 kv A A Ayi "AAyyxAy 'l ill A'A AAA I -V'r a mmm 'ajHii waaiiaMi'iia'n 'iy 'wmm tiiwioi Please turn to Page 4F Pat Johnson, who operates the shortest railroad in Iowa. i ih i h-t i r-.