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Federal Public Land Management Reports

Congressional Research Service
Report for Congress

Survey of Grazing Programs in Western States

Pamela Baldwin, Legislative Attorney
American Law Division

Betsy Cody, Specialist in Natural Resources Policy
Environment and Natural Resources Division

January 30, 1996

SUMMARY

This report sets out in chart form a survey of grazing programs on state-owned lands in 16 western states. It presents information on acreage, numbers of permits or leases, and fees for state grazing programs. It also contains information on state policies relating to various features such as non-use, range improvements, and subleasing. The Report is based on telephone interviews with state grazing program officials.

OVERVIEW

The Bureau of Land Management (BLM, Department of the Interior) and the Forest Service (Department of Agriculture) manage approximately 70 percent of the 650 million acres of land owned by the federal government, much of which is classified as rangeland. The BLM generally manages lands that were obtained by the federal government from sovereign nations through purchase, treaty, or other means, and which, for a variety of reasons, were retained in federal ownership. These lands are generally known as "public domain" lands. The Forest Service manages numerous National Forests, many of which are "reservations" from the public domain lands, together with other national forest system lands acquired and managed for specific purposes. Both agencies have well-established programs to administer private livestock grazing on agency lands. Grazing is also allowed in some national park units and national wildlife refuges.

Congress is currently considering changing the laws governing livestock grazing on the lands managed by the Forest Service and the BLM. As background for the consideration of federal grazing issues, the attached charts compare several features of the management of livestock grazing on state-owned lands in the 16 western states. At the time of statehood, the western states received grants of land from the federal government to support schools and for other purposes. Some states retain those lands and use the revenues generated by the lands for the purposes stated in the relevant grants; other states have sold some or many of the lands and have used the proceeds to support the intended purposes. Therefore, some states have substantially more lands remaining in state ownership than do other states.

CRS prepared the following charts by conducting a survey of the grazing practices of the 16 western states: Arizona, California, Colorado, Idaho, Kansas, Montana, Nebraska, Nevada, New Mexico, North Dakota, Oklahoma, Oregon, South Dakota, Utah, Washington, and Wyoming. We interviewed state grazing program of finials by telephone, asking each representative specific questions relating to grazing fees; lease (or permit) preferences and qualifications; the number of acres and leases; and policies and requirements related to "nonuse", on range improvements, stocking or Animal Unit Month (AUM) reductions and monitoring, subleasing, water rights, wildlife, riparian programs, other use access, and advisory boards.

Several aspects of the grazing survey warrant brief explanation or discussion.

The statistics on acreages and number of leases (or permits) involved are approximate. The states vary widely as to the amount of land currently under grazing use. Again, this is largely due to differing state policies regarding the retention and use of state-owned lands.

Grazing fees and the means of calculating them also vary widely from state to state and sometimes even within a state. Some states solicit public bids at auction; some states derive the grazing fee through use of a formula; some states may combine a bidding system for allocating leases, yet also charge additional fees such as rental fees or AUM charges. Some formulas are patterned after the formula in the Public Rangeland Improvement Act (PRIA); others differ. Most state formulas rely on some combination of forage value and other livestock market factors such as beef prices, costs of production, or livestock income. (For more information on grazing fees, see, Grazing Fees: A Primer, CRS Report for Congress 95-1, by Betsy A. Cody, December 23, 1994.) The grazing fees charged by the states are consistently higher than those charged for grazing on federal rangelands. In some areas state and federal rangeland quality is comparable; however, in others it is not. Fees listed in this report are generally those charged for grazing on state school or trust lands and not lands managed by state wildlife agencies.

Nonuse of federal grazing allotments is allowed under the new regulations of the Bureau of Land Management (BLM) that became effective August 21, 1995. The first two columns on Part II of the chart probe whether applicants for a state grazing lease or permit must be in the livestock business and whether an allotment may be rested or retired from grazing during a permit term.

There is considerable variation with respect to titling and sharing the costs of range improvements such as fences, structures, and water improvements. Typically, more significant improvements are titled in the name of the state. Additionally, title to water rights is almost universally retained in the name of the state. Respondents often emphasized that because livestock grazing is allowed only by permit or lease, it is appropriate for the state to hold the water rights in the underlying legal estate.

The states approach the issue of subleasing differently, and vary as to whether additional fees or revenue-sharing requirements are imposed. Some states that charge "fair market value" for grazing leases take the position that if an allotment can be subleased at a profit, that is evidence that the rental fees charged by the state should be raised; others were less concerned with the revenue issue.

Very few states have formal monitoring requirements, but rather rely heavily on the professional judgment and range condition evaluations of their range managers. (One respondent stated that the managers do "ocular surveys.") Carrying capacity of allotments often is established by applying the range evaluation criteria of the Natural Resource Conservation Service (formerly the Soil Conservation Service) in the Department of Agriculture, BLM evaluations, past history of use, or the judgment of the range managers. In some states, AUM capacity may be determined by the state, but annual reductions in active use or stocking rates are left up to the lessee or permittee. In other states, reductions are directed by the range managers. Some states indicated reluctance to reduce active use where doing so would result in a reduction of fees.

Typically, no express allowance of forage is made on behalf of wildlife, although this element might be included at least to some degree in the initial evaluation of range condition and determination of carrying capacity, especially in those states that rely on BLM range assessments. However, Wyoming expressly sets aside at least 2% of forage for wildlife consumption, and may list a higher percentage in order to reduce fees to a lessee for an allotment where actual wildlife use is higher than 2%.

Not many states have a formal program of riparian protection, but this aspect of range management appears to be under study and may be changing in many states. At least one state in the northwest affected by declining salmon populations has instituted a riparian program.

Very few states make use of any continuing citizen advisory boards, although some states have used boards to address particular issues.

PART I. STATE GRAZING STATISTICS AND FEES

         
State Acres (millions) Number of Leases (and/or Permits) $/AUM (1996) Fee Structure
Arizona 8.4 1,426 $2.18 Based on the "appraised value of forage on Arizona State Trust land," from work of the Grazing Land Valuation Commission. From 1982-1994, fees were based on a modified PRIA formula, using a base fee of $0.95 instead of $1.23. Fees during this time ranged from $1.40 to $1.53 per AUM.
California 0.075 26 $500/year, minimum Fee based on costs and revenues associate with the grazing program. Rental is based on comparable private leases with a $500 minimum rental charged for all new grazing leases. Historically, the State Lands Commission used the PRIA formula. Additionally, lessees must pay an "expense deposit" to cover lease processing costs. Applicants pay a $25 statutory filing fee, plus processing costs. The minimum expense deposit is $1,500.
Colorado 2.6 2,800 6.50-$7.17 The State charges four fees based on regional differences; generally, about two-thirds of private lease rates. This new fee structure started January 1, 1996, and will be phased in over three years rising to a range of $6.65-$8.66 in 1998. Earlier fees were 50 percent of the USDA National Agricultural Statistics Service (NASS) survey of private grazing lease rates, adjusted annually.
Idaho 1.9 1,200 $4.86 A formula based on livestock (cattle and sheep) market factors. Open bid for lease preference. The 1995 fee was $5.15 for cattle, and $3.86 for sheep.
Kansas fewer than 1,000 acres NA NA No grazing program. State lands are grazed incidental to other management.
Montana 4.1 8,000 $4.05 and $4.53 A rate derived from multiplying the average price per pound for beef in Montana (from the previous year) by 6.71. The State Board of Land Commissioners raised the multiplier from 6.0 effective June 16, 1995, for leases renewed or issued after July 1, 1993. For previously renewed or issued leases, the 6.0 multiplier will be used until the next lease renewal; hence, two different fees.
Nebraska 1.25 2,500 $15.50 A formula based on market factors. Credits are issued for permittee/lessee provision of fences, wells, etc.
Nevada 0.11 Unknown Highly Variable The fee is determined by the highest bid at open, public auction. Fees vary widely depending where the land is located.
New Mexico 8.0 3,400 $3.54 (1995) A formula based on land carrying capacity and livestock market factors. The fee is adjusted annually, but may not rise or fall by more than a third in any year. The current fee formula was adopted in 1987 following public hearings.
North Dakota 0.71 4,900 Highly Variable Public auction for leases, with minimum bids applying a Fair Market Value Leasing System. Highly variable rates, ranging from a few dollars on western rangelands to $30-$35 for best lands. This System is based on average private rents adjusted to reflect the value of the particular lands involved.
Oklahoma .50 2,800 $10 average Public auction for leases. Fees vary widely, ranging from less than $6 up to $14, depending upon land and forage conditions across the State.
Oregon .55 171 $2.72 and $3.43 A formula based on livestock market factors and parcel size. The State charges two fees: one for smaller or more isolated tracts of land and a higher fee for large blocks of State land that resulted from exchanges with BLM. Oregon has consolidated many formerly "checkerboard" lands, and 90 percent of its State lands now fall in the large block category. In July 1994, the State Land Board adopted regulations for competitive bidding; however, this decision was subsequently withdrawn. The current fee system is being reviewed; some aspects of the lease Program are in litigation.
South Dakota .81 3,000 +-$7.00 A formula based on State data published by the NASS and statewide livestock market prices.
Utah 3.150 1,550 $2.50 (1995) Based on the PRIA formula, plus $0.35 (for the last 5 years). Five cents is attributed to weed control. At the end of the lease term, permits are offered under a competitive bidding system. The permittee has a "preference" right to meet the high bid, but must meet the high bid to retain the permit. Some large blocks of State lands have brought in bids of more than $10,000.
Washington .91 1,224 $4.55 and $7.34 Formula plus a 12.84 percent lease-hold tax (a tax that is passed-through to counties in lieu of receiving property tax on State owned lands). The standard formula is based on livestock market factors and other factors such as landlord's share of land income, permittee share of land assessment, and lessee improvements. Washington State charges two different fees: one for "permit range" and one for a dryland grazing lease. The dryland grazing lease fee is basically the permit range fee multiplied by 1.5. The fees are set below private lease rates to account for higher operating costs on State lands (i.e., the State does not pay for fences and provision of water that might be provided by private landowners). The current base fees are $4.04 and $6.50, respectively.
Wyoming 3.6 3,700 $3.50 minimum Board established fee of $3.50 per AUM, per statutory requirement that fees be established on an "equitable basis." Annual rental fees are based on bids. Where there are conflicting applications, the current lessee has a preference to meet the highest bid; however, conflicting applications are not common.

 

PART II. STATE GRAZING PROGRAM FEATURES

State Qualifications of Permittees Nonuse Range Improvements AUM Limits; Reductions; Monitoring Subleasing
Arizona Must be in livestock business and have registered brand. Lessee elects full, partial, or nonuse each year. Constructed, paid for, and owned by lessee, with some exceptions. Overall AUM limits and per section limits. Reductions based on range inventory and conditions. No :mandatory monitoring; monitoring is part of voluntary plans. Allowed if approved. State doesn't share revenues.
California Not necessary to be in livestock business. Allowed, but lease can be terminated if not being used for the purpose of the lease. Paid for by lessee; no cost sharing or reimbursement. Title comes to State at end of lease term. Usually follow BLM or lessee's advice on carrying capacity. No reductions by State; lessee decides active use. No monitoring. Allowed if approved, but unusual. State share of revenues would be negotiated.
Colorado Not necessary to be in livestock business. Allowed, but lease may be converted to a special use permit (e.g. recreation) and re-leased for grazing as well. Must be approved; lessee pays (with some cost sharing available); lessee holds title and is reimbursed on transfer. Range analysis to determine AUMs. Usually historic levels or that of nearby lands (BLM, etc.). No formal monitoring. If lands are in poor condition, may impose a range plan. Allowed if approved, e.g. if health problem. May reconsider if long term; State shares revenues.
Idaho Not necessary to be in livestock business. (Issues involving qualifications are being litigated.) Allowed, at reduced fees if not more than 2 consecutive years nor more than 3 years of 10 year term. Allowed indefinitely if full fee is paid. State does larger improvements and has title; lessee may do smaller ones, owns them, and is reimbursed upon transfer. Range managers set AUMs based on "ocular inventory;" no formal study or monitoring requirements. Usually lessee decides reductions in active use. Allowed with approval; small additional fee to State.
Kansas No grazing program. State lands grazed incidental to other management. NA NA NA NA
Montana Not necessary to be in livestock business. Corporation that can hold land may apply. Allowed, but lessee must pay for permitted AUMs. If long term, might reclassify lands and re-lease for grazing too. Must be approved; lessee pays with some cost sharing; lessee owns, new lessee buys out. State sets AUM capacity; lessee determines active use. No formal monitoring; decisions based on staff judgment. Usually reviewed only every 10 years, unless a problem is noted. Allowed if approved, up to 2 years; will reevaluate if longer time. Can have pasturing agreements with limits on amounts charged.
Nebraska Not necessary to be in livestock business. Allowed, but State may change rental if used for other than agricultural. Paid for by lessee; lessee has title and is reimbursed upon termination or transfer. Carrying capacity determined by interviews with area ranchers, benchmark leases, and NRCS criteria. AUMs determine fees, but lessee determines active use. No formal monitoring. Allowed with approval. State doesn't share revenues, but may raise lease fee if subleasing ate is higher.
Nevada Nevada allows private grazing on very few State lands, negotiated on individual basis. There is no overall grazing program per se; however, the Division of Wildlife may allow incidental grazing on their lands. Not usually an issue because of individual negotiated leases and use. Must be approved; lessee may be allowed an offset. Carrying capacity determined by NRCS forage criteria. No formal monitoring. Prohibited.
New Mexico Not necessary to be in livestock business. Allowed, but same fees paid based on carrying capacity. May cancel and release active or nonuse areas if higher use available. Must be approved. Lessee pays and owns. Carrying capacity and AUMs determined by range scientists. May be reevaluated at request of lessee, because payment is based on capacity. No system for temporary reductions, but studying issue and may give a prorated fee reduction. Allowed if approved. Lessee pays extra 20% of usual rate. No criteria for approval.
N. Dakota Not necessary to be in livestock business. Individual and corporations may apply. Allowed. All must be approved, except fences. State holds title unless otherwise agreed. Lessee may get a credit or cost-share Range specialists determine carrying capacity which is reviewed at least every 5 years. Lessee determines active use usually, but reductions may be required. No formal monitoring. Prohibited, except for technical subleasing by a grazing association to its Members.
Oklahoma Not necessary to be in livestock business. Corporations must be agricultural. Disqualified if violated previous lease. Allowed, but would not approve long term nonuse. Must be approved; discourage long term infrastructure, because State builds major structures, lessee smaller ones. Carrying capacity determined by using NRCS evaluation techniques. Reductions in active use determined by land management technicians (this possibility specified in contract). No monitoring requirements. Allowed 1 year for health reasons; not Otherwise. Lessee may add other names to Lease. No revenue sharing, but State may raise rate next time.
Oregon State regulations on bidding and qualifications of lessees are suspended pending appeal. May allow nonuse established in a Range Management Plan, otherwise not. May allow "conservation use" on a particular parcel. Under old rules, lessee owned to the extent paid for; under new rules, State will own. Carrying capacity determined by professional judgment; AUMs reevaluated annually by range management in consultation with lessee and approved by supervisor. Photos to indicate condition and trend. Allowed with approval; State keeps all of subleasing compensation.
S. Dakota Not necessary to be in livestock business or own base property. Allowed, even if whole term (5 years). Must pay full fees and taxes. Must be approved and permit issued. Title to lessee, who is reimbursed upon transfer. Carrying capacity determined by using NRCS evaluation criteria. No required reductions during term; active use left up to lessee. No monitoring. Can graze other people's livestock, but not sublease to control of another.
Utah Not necessary to be in livestock business. Allowed, but permittee pays full fee. Must be approved. All are titled to State, but permittee reimbursed for value upon transfer. Carrying capacity determined through professional judgment of range managers. Reductions in active use also based on managers' judgment. Some monitoring done by BLM statewide. Allowed with approval. State may increase fees or impose an additional flat fee per AUM.
Washington 2 systems: 1) permits similar to federal; 2) leases with greater rights. By law, applicant must have 2 years' experience in range management or animal husbandry. Allowed for grazing leases. Temporarily allowed for grazing permits, depending upon certain conditions and with State approval. Leases: If approved, lessee pays for and owns, and is reimbursed current value upon transfer, etc. Permit: some cost-sharing; State owns all. Carrying capacity determined through professional judgment of range managers. Reductions: if lease, reductions are determined by lessee; if permit, State may adjust AUMs based on professional judgment of range managers. Permits are monitored annually. Leases are monitored at least every five years, up to monthly if resource issues/concerns are present. If lease, allowed with approval and State does not share in revenues because State charges fair market value. If permit, subleasing is not allowed.
Wyoming For initial leases, must have grazing or agricultural use for the lands. Allowed because State does not check number of stock or level of use, unless condition deteriorates. Approval required for costs more than $750. Lessee pays and owns, and is reimbursed by the new lessee or purchaser upon transfer Carrying capacity determined in 1970s by visual inspections by managers. Not reevaluated unless change or lessee requests. Number of stock up to lessee. No monitoring. Allowed if approved. Also pasturing agreements. State gets 50% of money above the State lease fee.
           

 

PART III. ADDITIONAL FEATURES OF STATE GRAZING PROGRAMS

State Water rights Wildlife Riparian OtherUses;Access Advisory Boards
Arizona State holds title, unless diversion originates on other lands. No allowance made in allocating forage. No program or standard protection terms in leases. Some protection required when appropriate. Hunting and fishing allowed with license. Other recreational use allowed with permit. Access to lands not guaranteed. None for grazing program.
California State holds title. No allowance. All leases subject to Cal. Environmental Quality Act and will have riparian protections. Public uses allowed if public access exists and if use is compatible with livestock use. None.
Colorado State holds title. No allowance made in allocating forage. Currently being studied. No particular program; part of general range evaluation. Not allowed except through nomination process and special use lease (with fee). None used; under study.
Idaho State holds title. No formal allowance. Riparian concerns are addressed on a case-by-case basis through grazing management Allowed without restriction. None.
Kansas No program. NA NA NA NA
Montana If place of use is State land, State holds title. Permittee paid for value of improvements upon transfer of permit. No allowance made in allocating forage. Might reduce fees charged lessee if a problem, but not usual. Impose conditions in special interest areas, e.g. bull trout streams. Also may impose conditions if riparian areas are deteriorating. With recreational use permit, may hunt, fish, recreate, etc. in areas accessible without crossing private land (or with permission). None on management issues. Had special Board on fees.
Nebraska State holds title. No allowance in carrying capacity. No program. Up to lessee, but State may impose stipulations on case-by-case basis. Allowed, but must have lessee's permission. No public advisory boards; do have a Board of trustees that administers grazing.
Nevada State holds title. Not usually an issue because of special leasing program. No program; lease may contain terms. Other uses may be allowed depending on type of lands (e.g. park, refuge, etc.). None.
New Mexico Lessee in declared water basin applies for and holds title. If easement agreement, State holds title. No allowance in carrying capacity. No particular program; studying issue. State has hunting and fishing easement; recreational use allowed by permit. Free access except across private land where permission is needed). One advisory board for she State land office, no others.
North Dakota State holds title. No allowance because incidental use. No program; general requirement not to pollute. Public access allowed unless approved closure and posting. (Various degrees of closure.) No formal boards.
Oklahoma State holds title and usually builds wells, ponds, etc. No allowance in carrying capacity. Program over last 10 years to improve through individual lease conditions and EPA projects. Lessee regulates other uses and may charge public a reasonable fee or exclude public. None.
Oregon State holds title. No express allowance; wildlife is considered in Range Management Plans and determining range condition. Increasing attention to riparian issues, with protection by setting AUMs and seasonal restrictions. No restrictions on other uses, except no commercial allowed. permission of lessee not required. Rangeland Management Working Group assisting with development of Rangeland Management Plans. Balanced membership: lessee, environmentalists, government representatives, etc.
South Dakota State holds title. No specific allowance. The NRCS criteria to set carrying capacity deemed adequate. No program. Recreational uses (e.g., hiking, photography, hunting, fishing, etc.), allowed without permission of lessee. None.
Utah State holds title. Forage allocated on lands that are managed similar to surrounding BLM lands; not on larger State blocks. No program; may impose conditions if a problem exists on an allotment. Open to other uses without permission of permittee. Exclusive leases are available at higher rate. None at present -- had one board in past.
Washington State holds title. Taken into account when determining carrying capacity, but no specific amount or percentage. State has 110,000 additional acres, which are lease to the State Dept. of Fish and Wildlife for habitat. Yes; 1993 law for salmon protection resulted in standards for grazing lands. Riparian provisions may be included in Resource Management Plans for each lease or permit. Not regulatory at present; emphasizing partnerships. Multiple use access for low-impact activities, as long as it does not interfere with the State's fiduciary responsibilities to produce income from the State lands. Lands an be posted only with written permission from the State and only for protection of high value crops or improvements. Advisory boards are authorized, but have not seen used for grazing Program.
Wyoming Usually lessee and State hold rights jointly. Allowance of 2% left for wildlife consumption. May be set higher to reflect actual use levels. No specific program. Most lands are mixed with BLM lands and an private lands, and are treated the same, de facto. Other uses allowed through special use leases if compatible with grazing. More uses allowed in more recent times. Public access exists for approximately 70% of the lands. None. Some special purpose committees have been used.

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