In a letter to the Joint Legislative Budget Committee dated August 3, 2004, we raise a number of significant concerns about the proposed allocation of state bond and other funds for a conservation-related transaction concerning the Hearst Ranch property in San Luis Obispo County. In particular, we find that the level of resource protection provided by the transaction needs strengthening and greater certainty. We make recommendations to improve the state's oversight of the enforcement of the terms of the transaction to ensure that the state's significant investment is adequately protected in perpetuity.