DeFazio: Turn BLM Lands into Trusts

Oregon Representative Peter DeFazio is floating a proposal to turn the Bureau of Land Management’s “Oregon and California” lands into two trusts, one focusing on timber production and one focusing on environmental protection. This plan was partly developed by frequent Antiplanner commenter Andy Stahl.

The Oregon & California (O&C) Railroad land grant lands now managed by the BLM are shown in orange; green is national forests; click for a larger view.

The Antiplanner has long supported the idea of turning public lands into fiduciary trusts. My most-recent proposal would also create two trusts: one driven by markets and the other to protect non-market-resources. Some of the revenue from the first trust would go to fund the second.

The DeFazio-Stahl proposal is slightly different, more like the New Zealand solution, which is to divide the lands into two. One chunk of land would include mainly old-growth forests that have not been logged; the other would mainly be partly or fully logged forests. The latter forests would be the base for the timber trust; the former would be in the care of the environmental trust.

One reason for the difference is the history of the Oregon & California lands, which, despite the name, are actually all in Oregon. The lands were once granted to a railroad to build from Portland to San Francisco. The railroad failed to live up to the terms of the land grant (which were to sell the land to actual settlers for no more than a fixed amount per acre) and so Congress took the unsold lands back, at least those in Oregon.
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In 1937, Congress passed a law giving the counties in which the lands were located 75 percent of the revenues from any sales of timber on those lands. This was far more generous to the counties than any other federal law; most counties get only 5 percent of revenues from other BLM lands, and 25 percent from national forest lands. The counties voluntarily relinquished 25 percent to pay for the management of the lands.

When timber sales declined in the early 1990s, the counties suddenly lost their number one source of revenue. Congress appropriated funds to keep the counties going for a number of years, but the law providing those funds is due to expire soon and in today’s political atmosphere few think it will be extended. The situation is so dire that at least one county government (Curry) is likely to disappear.

Turning the lands into trusts would accomplish two goals: provide a revenue source for counties from the timber trust and stabilize the protection of old-growth forests (some of which the BLM has proposed to cut despite environmental concerns about the future of the spotted owl). The Antiplanner’s approach would not provide as much revenue to the counties, but it could still be used for other areas where the counties aren’t as dependent on public land revenues. A third goal of this plan is that it could provide a model for turning other federal lands, whose management costs taxpayers something like $8 billion to $10 billion a year, into true fiduciary trusts.

One tricky part of the DeFazio-Stahl proposal is how the lands will be divided between the timber and environmental trusts. The plan delegates that decision to a board consisting of timber industry and environmental representatives. They would basically look at aerial photos and put the lands into one trust or another based on the age and condition of the forests. Considering this land covers something like 2 million acres, that could be a time-consuming job.

A fiduciary trust is more than just an asset with the name “trust” appended to it. Neither the Social Security Trust Fund nor the Highway Trust Fund are true fiduciary trusts. A quick definition of what a fiduciary trust is and how it works can be found in this article by Jon Souder and Sally Fairfax.

When something qualifies as a true fiduciary trust, a set of common laws kick in that put many checks and balances in to the management of that trust. To make sure this happens to the O&C lands, Representative DeFazio will have to be careful with how his proposed legislation is worded to insure that the courts treat the lands as true fiduciary trusts.

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About The Antiplanner

The Antiplanner is a forester and economist with more than fifty years of experience critiquing government land-use and transportation plans.

22 Responses to DeFazio: Turn BLM Lands into Trusts

  1. Andrew says:

    I’ll say it again – sell the land!

    Let people own a little piece of terra firma.

    Its ridiculous that the US Government clings to something like 1/3 of our landmass, and the majority, it appears, of land west of the Rockies.

    If conservations want to conserve land, let them put up money to do so. If timber companies want to log it, let them buy it up and take responsibility for access and restoration. If farmers or miners or developers want it – ditto.

    What is so hard about this concept?

    Sell the land – with first rights to purchase to Americans currently leasing and using the land, second rights to any interested American citizen or company, third rights to any legal resident, fourth to any person or company.

    Why is everyone afraid of a free country with freeholders so that there is a rush to lock away land from the people forever?

  2. bennett says:

    Andrew says: “Why is everyone afraid of a free country with freeholders so that there is a rush to lock away land from the people forever?”

    BLM, USFS, and NPS lands are very accessible to the public, are they not? Not that I disagree with your solution, but I grew up in Colorado where the is a ton of federally owned land and have lived in Texas for the better part of a decade where almost all the open space is held privately. Both have their advantages, but I would argue that the TX model locks away the land much more than the Western US model.

    User fees and funding mechanisms aside, there is something to be said for being able to walk in the wilderness from the New Mexico/Mexico border to the Montana/Canada border without crossing a private property line. If you want to go on a hike in Texas you’re most likely looking at a 2 mile loop in a state park campground on some man made lake (or a trip to Big Bend which is 8hrs from everywhere).

  3. bennett says:

    Mr. O’Toole,

    I know that this proposal is for OR and CA, but I’ve been to several BLM lands in other states where there is no substantive timber or ore resources. In the model you suggest would these lands be automatically grouped into the “protect non-market-resources,” group?

  4. Andrew says:

    bennett:

    I’m all for parks and recreation areas, especially in scenic and historic districts. If Texas has a paucity of them, that is Texas’ problem. Most of the BLM and Forest Service land is grazing and timber land already under quasi private control. All the grazing lease land I’ve seen is surrounded by barbed wire. Its just ordinary citizens have zero chance of ever owning or leasing a part of it for their own enjoyment or use.

    I’m not suggesting selling parks, wildlife refuges, recreation areas, or wilderness areas. In fact, if we rid the government of focusing on land that is put out to benefit private interests, there would be a lot more money to keep up on maintenance in the areas used by the general public for recreation, hiking, boating, camping, hunting, etc.

  5. bennett says:

    Thanks for the clarification. I will say however, my experience of BLM lands is very different than what you describe, probably because I’m not aware/going to the locations on lock-down. I have camped, hiked, rock climbed, Mtn Biked and skied at several BLM locations in CO. Some of these locations were even being used for cattle grazing while I was there.

  6. Dan says:

    The people’s land is the people’s land. Not to be sold so some politician can sell it to a golf buddy, then p*ss away the money somewhere.

    As for the majority of BLM land (which is generally marginal land): I’m all for charging much more for grazing fees, to allow it to try and recover and reduce erosion – especially after this year in TX and OK. I’d also want a full cost-benefit before logging to determine if watershed protection is more valuable than timber – full-cost accounting to calculate existence value vs use value. I’d also want better protection against siltation from roadbuilding and better buffer enforcement.

    DS

  7. bennett says:

    Dan,

    I could be wrong but I don’t think there is any BLM land in TX. If there is, there’s not much and it’s probably not being used for timber (probably oil). There is only 675k acres of forest service land (mostly grassland) and Big Bend is the only NP. For those of you familiar with NF lands out west, let’s just say the quality is not the same down here. Also, for such a big state there is an amazing dearth of public lands.

  8. Frank says:

    I’ve been an advocate of trusts since discovering environmental economics four years ago after weighing ten years of experience with DOI corruption, mismanagement, waste, fraud, and abuse. This is a great step forward, and despite Dan’s proclamation that “[c]lownish privatization dreams” will fade, this post proves there’s momentum to free public lands lands from government bureaucracy.

    My friend works for the USFS as a land law adjudicator, and he previously worked in this position for the BLM, and man, the stories he tells me about his incompetent co-workers and extreme mismanagement make my head spin.

    This is great news. Great news indeed. Thanks for sharing.

  9. Dan says:

    Bennett, I may have tried to tie too many things together upthread in 6. I’m asserting that BLM land hereabouts in the Intermountain West is marginal, pounded from grazing, and made much worse this year as cattlemen down your way move their herds up here to escape near-unprecedented drought and heat – and will continue to do so more often in the future as the effects of man-made climate change worsen. So increasing grazing fees on BLM land hereabouts will be a disincentive to pound BLM land with cattle grazing on marginal land. Any decent cost-benefit analysis will show that cattle grazing on BLM land (and much FS land) is subsidized. Fewer head of cattle running around on public land (or even Trust Land, as in the proposal) is not a bad thing.

    DS

  10. Frank says:

    “Any decent cost-benefit analysis will show that cattle grazing on BLM land (and much FS land) is subsidized. Fewer head of cattle running around on public land (or even Trust Land, as in the proposal) is not a bad thing.”

    Yeah, it’s cheaper to graze a cow for a month on USFS land than it is for a family to camp on USFS land for one night. Cattle subsidies need to end and consumers need to pay the actual cost for beef. The US is currently the second highest per capita consumer of beef in the world; end these subsidies that degrade the land and watch that ranking slip.

    Or restore bison to public lands as an environmentally friendly beef substitute.

  11. Dan says:

    Frank, BLM land ? Nat’l Park land. Argumentation different. Not same.

    HTH.

    DS

  12. Dan says:

    Cattle subsidies need to end and consumers need to pay the actual cost for beef. The US is currently the second highest per capita consumer of beef in the world; end these subsidies that degrade the land and watch that ranking slip.

    And watch our individual and public health get better in concert with less beef consumption. Next up: ag subsidies overall.

    DS

  13. Frank says:

    BLM land. National parks. Both under Department of the Interior. Same mismanagement. Argumentation same. Not different.

    FO.

    F

  14. C. P. Zilliacus says:

    Frank and Dan, in case you did not know this, there is at least one place in the East where the National Park Service leases land to farmers (though I understand it to be an unusual practice).

    Where, you ask?

    Along the Blue Ridge Parkway in Virginia (and maybe in North Carolina), NPS land is leased to farmers for grazing and cropland.

  15. C. P. Zilliacus says:

    Dan wrote:

    The people’s land is the people’s land. Not to be sold so some politician can sell it to a golf buddy, then p*ss away the money somewhere.

    Before it was the people’s land, wasn’t it the Native American’s land?

    As for the majority of BLM land (which is generally marginal land): I’m all for charging much more for grazing fees, to allow it to try and recover and reduce erosion – especially after this year in TX and OK. I’d also want a full cost-benefit before logging to determine if watershed protection is more valuable than timber – full-cost accounting to calculate existence value vs use value. I’d also want better protection against siltation from roadbuilding and better buffer enforcement.

    But it strikes me as relatively easy and cheap to “patent” land owned by BLM, converting it to private ownership. Frank likely knows more about this than I ever will.

  16. LazyReader says:

    Yes conservationist groups can put up the money for the lands. The Nature Conservancy does it all the time as do hunting groups and nature clubs. You never see Greenpeace or Earth First or PETA cutting a check, they give their money to arsonists.

  17. Sandy Teal says:

    1. Texas has very little federal land because it was its own nation for a little while before becoming a state, thus all of Texas belonged to someone or the State when it entered the US. Most federal land is “leftover” land that was never homesteaded or granted, etc.

    2. One problem with putting the land up for sale or auction is that there is just so much land hitting the market all at once, even if you spread it out over 50 years. Some very bad things could happen (inefficiencies or environmental) in markets where so much land is put up for sale at once.

  18. Dan says:

    CPZ, the issue is between the quality of land that BLM administers overall, and the land discussed in Randal’s post. Generally BLM land is more marginal and more easily degraded (cheatgrass, e.g.). I am for a cost-benefit analysis to ensure it recovers and implementing the outcome of the analysis. Also in the West, FS land is increasingly being valued for watershed protection (a form of use value) as well as recreation; conservation (existence value) is harder to valuate and enter into markets, as markets don’t provision such public goods (non-rival, non-excludable). My point about raising grazing fees would knock off one large stressor on the BLM lands, and help on some of the FS lands, although the invasives brought in for 100+ years on grazing animals won’t go away.

    Nonetheless, these lands are ours already. No need to privatize them. Trust Lands might be a way to fix some of what the politicans have wrought over the years. There are some private lands that are managed well – I used to hunt mushrooms on some in Western WA – but not too far away on FS land the management was just as good.

    DS

  19. the highwayman says:

    Just give the land back to the Native Americans.

  20. Tombdragon says:

    The east coast is wealthier economically BECAUSE there is more private land ownership, and “our” public land is relatively worthless if it use is restricted to serve the interest of only one economic sector, like recreation, especially when Timber serves such a diverse economic group like Banking, Heavy Industry, High Tech, and Transportation, and arguably helps a broader economic group, that simply “recreation”.

  21. C. P. Zilliacus says:

    Dan posted (and I added emphasis):

    CPZ, the issue is between the quality of land that BLM administers overall, and the land discussed in Randal’s post. Generally BLM land is more marginal and more easily degraded (cheatgrass, e.g.). I am for a cost-benefit analysis to ensure it recovers and implementing the outcome of the analysis. Also in the West, FS land is increasingly being valued for watershed protection (a form of use value) as well as recreation; conservation (existence value) is harder to valuate and enter into markets, as markets don’t provision such public goods (non-rival, non-excludable). My point about raising grazing fees would knock off one large stressor on the BLM lands, and help on some of the FS lands, although the invasives brought in for 100+ years on grazing animals won’t go away.

    Regarding watershed protection, I agree with you that if the land protects a drinking water watershed, then there are frequently reasons to protect. Places as diverse as New York City, Maryland, Virginia and California all have bought up land (or development rights) to protect watersheds, though I also know that the City of Los Angeles has been bashed and beaten for its (heavy-handed) ways of protecting its lands in the Owens River valley. New York City, for some reason, has escaped that bashing, even though it has limited development in many parts of its large watersheds in the Hudson River and Delaware River valleys.

    And here in Maryland, the USEPA and the U.S. Army Corps of Engineers (and anti-highway allies) tried to get the InterCounty Connector (ICC) toll road project re-routed into the watershed of the Patuxent River, even though that watershed is a source of drinking water, and out of the Anacostia River watershed, which is not used for drinking water, though this little project ultimately failed, and the road is now nearing completion along its master-planned route.

    And yes, we have invasives here, including the famous Southern invasive, kudzu. Interestingly, some of the ICC’s environmental stewardship money is being used for removal of invasives in certain areas near its route.

    Nonetheless, these lands are ours already. No need to privatize them. Trust Lands might be a way to fix some of what the politicans have wrought over the years. There are some private lands that are managed well – I used to hunt mushrooms on some in Western WA – but not too far away on FS land the management was just as good.

    Maryland has not one square centimeter of U.S. Forest Service land, though I have visited other states, including Virginia, West Virginia, Pennsylvania and North and South Carolina, which have extensive FS lands. But the practices of the FS, as Randal has documented for years, do not make a lot of economic or environmental sense to me.

    We do have some state forests, and they appear to be well-managed and healthy lands.

    Though I also think that extreme environmental groups, including the Sierra Club, take advantage of confusion by members of the general public, who do not understand the fundamental differences between lands owned by the National Park Service, the Forest Service and the Bureau of Land Management – with the Sierra Club’s efforts being to make people think that all of these lands are parklands, which they are clearly not.

  22. Sandy Teal says:

    I agree that many forested lands are valuable to city dwellers because of their watershed value.

    But another way to look at it would paint the relationship as the cities making colonies out of the mountains and rural areas. NYC has clearly “colonized” the Catskills so that NYC gets cheap water. You could argue that LA has “colonized” the west slope of Colorado and Utah so they get cheap water too.

    Once places are called “watersheds”, then their potential for local employment is practically nill.

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