A Grazing Buy-Out?

Rocky Mountain News
Fall 2003

By Holly Lippke Fretwell

Although little noticed by most Americans, grazing on federal land is a big business. Ranchers across the West lease permits to graze their cattle on about 250 million acres of federal land, an area more than twice the size of California. Some environmental groups, concerned that cattle can damage grazing land and riparian areas, are trying to remove livestock and reserve the land for wildlife.

A bill introduced in Congress by representatives Christopher Shays, R-Conn., and Raul Grijalva, D-Ariz., would authorize the federal government to purchase these grazing permits from ranchers. Sales would be voluntary. Where ranchers accepted the offer, the grazing land would be permanently closed to livestock.

At first glance, this appears to be a simple and straightforward measure to reduce the conflict over land use in western states. Taxpayers would pay the cost, of course, and if all western ranchers chose to participate, that could reach $3.2 billion.

Andy Kerr of the National Public Lands Grazing Campaign calls it a bargain. Today, he says, ranchers are not paying their fair share, because federal grazing leases cost less than their private counterparts. "Since the government spends substantially more than it receives for grazing, in a few years the savings realized by reducing livestock numbers can pay for the compensation," he says. The result, he contends will be benefits to wildlife and recreation.

Advocates of the buy-out claim that the current cost of managing the federal grazing program exceeds the revenues from leases by about $500 million per year. But they forget that once these leased lands are back in the hands of the federal government, management costs will increase with or without grazing. Given the above estimate, grazing currently costs taxpayers about $2 per acre per year. Yet the Bureau of Land Management spends $5 a year managing an acre of land. In other words, handing over the land to the federal government is likely to more than double the costs to the taxpayer! And without ranchers and their cattle, this land is more likely to be overtaken by noxious weeds and the risk of fire is likely to go up. If interested groups push for more recreation or restoring the land to more "natural" habitat, costs could rise even more.

Certainly, some lands are more valuable for wildlife habitat than others but which ones? The proposed legislation would offer all ranchers an equal price on landscapes from California to Montana. A rancher who values grazing rights less than the federal offer will accept the trade; a rancher who doesn't, won't. Unknown is the value of the land for conservation or wildlife habitat.

Those who know and love the land and want it to be habitat for wildlife should be the ones to identify which acres to buy and should bear the financial burden. Some environmental groups, working with state land agencies, have already begun to explore such approaches. In New Mexico, an environmental group called the Forest Guardians has outbid ranchers for leases on land near streams. As the new lessee, the group has planted willows and other cover to restore habitat along stream banks. State coffers have benefited from the higher revenues collected on grazing leases.

In Utah, the Grand Canyon Trust has been buying federal grazing permits since 1996 in the canyon country of the Colorado Plateau. The trust identifies lands it views as most threatened by livestock grazing, then offers ranchers a price based on the value of the land for conservation. If the offer is accepted, the trust pays the seller for the permits and takes over stewardship. The trade satisfies both rancher and trust or it does not take place. One problem remains. Under current law, federal rangeland can be left cattle free for only for three consecutive years. Then it must be re-opened for grazing bids.

Instead of forcing taxpayers to shoulder new costs, why not make the private bidding approach more viable by changing the current grazing laws to allow leases for alternative uses? That would enhance federal conservation, save the taxpayers money, and still allow ranching where it is highly valued.

Holly L. Fretwell is a research associate with PERC, the Property and Environment Center, in Bozeman, Montana. She is the author of a series of studies on public land management.

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Holly Fretwell is a Research Fellow at PERC and an adjunct instructor at Montana State University where she has taught  introductory economics, macroeconomics, natural resources and environmental economics. She works with the Foundation for Teaching Economics, giving workshops for  high school teachers to improve their skills in teaching and...
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