Selling BLM?

[dgibson]

Here's something I'm having trouble with...perhaps someone can explain. DISCLAIMER: No, I'm not looking to buy, just curious.

Take a look at http://www.montanalandauction.com . They're auctioning off 27,367 acres, of which 20,154 are "deeded." The balance is listed as BLM land. Now, I understand that the rancher pays BLM leases to those 7000-odd acres, which gives him grazing rights and so forth. But how can they effectively sell the BLM acreage? Are people so desparate for this acreage that they will pay for it as if they are buying it, even though they really won't own it? Or do I not get the whole BLM concept?

On the other hand, this gives all of you Montanny western types the chance to a) buy your own property and kick the cattle off--put up or shut up

; or b) start your own high-fence operation!

 

[Oak]

I didn't download the maps because it was taking forever on my dial-up. But it could be that the BLM is landlocked (no public access). The buyer wouldn't own the land, but better, he gets exclusive rights to use the land without paying taxes on it. Not sure if that's the situation. Maybe I'll look at it tomorrow at school with the fast connection.

Oak

 

[JoseCuervo]

DG,

The leases are typically associated with a tract of deeded property. For Forest Circus leases, (and I believe BLM is the same) you have to have a "base property" to have the grazing lease. Then, when they sell the base property, they sell the "rights" to the lease.

The people who have these leases are referred to as Welfare Ranchers and they believe they own the leased land. (Keep in mind, the lease is for Grazing, nothing more.)

So, the BLM leases are sold with the deeded ground. The one you found is not as bad as some. As the ratio of deeded to BLM is relatively high. Sometimes you will see the deeded being a small percentage of the Leased land. And as Oak said, that one may also have "landlocked" BLM ground.

The smartest Welfare Ranchers are the ones who are selling today, while they can claim to some unsuspecting fool, that the leased land is valuable. Bankers are having a hard time lending on this land, and this market may soon be going bust. Many people have a hard time with the concept of people selling public ground and the rights to the ground.

Here is a good one for you, where this was turned upside down. Up in the Salmon region of Idaho, some lady decided to donate her ranch to one of the environmental organizations, including the grazing leases. And rumour has it, she was able to get credit from the IRS for the value of the leases of the federal government's property she donated.

The end of the Welfare Ranchers is likely in sight, possibly at the end of the current generation of Welfare Ranchers. If you notice the advertisement you referenced, they are marketing toward the Hunting/Sportsman, who wants to own some ranch. These Welfare Ranchers have created such an artificial value on their ranches, that as they try and pass them on to future generations, they can not. It is kind of ironic, how they claim they are preserving a lifestyle, but yet their kids can not follow the lifestyle.

er

<FONT COLOR="#800080" SIZE="1">[ 04-17-2003 22:06: Message edited by: Elkgunner ]</font>

 

[Oak]

Elkgunner explained it much better than me. Thanks, gunner!

Oak

 

[JoseCuervo]

Check out the hunting page on that advertisment. Here is how they hunt Coyotes... No .220 Swift, no 22.250, just the old reliable 700....

Wasn't there somebody in this Forum who was also familiar with this method

er

 

[Ithaca 37]

Elkgunner, good job!!

 

[dgibson]

I'm aware of the grazing leases and "welfare ranching," but it's incredible that they are allowed to sell these leases like property. Transfer grazing rights at cost? Sure. Maybe a little inflated to turn a profit? OK. But to "sell" a BLM tract for the same price per acre as an adjacent deeded tract is absolutely ludicrous. The fact that it ever got started to begin with amazes me; who wants to "buy" land they won't own, and theoretically could lose with no compensation some day? And if it is landlocked and they want to control it like it's theirs, the gubmint should make them pay full market price for it. But then I guess it wouldn't be "welfare," would it? Bah!

 

[danr55]

Let's go all the way back to how they lock up public land because they have a grazing lease. How the hell does that work?

 

[Washington Hunter]

Dan, I don't think it's necessarily because they have a grazing lease, it's because of the fact that the public BLM property is surrounded by private property and there is no public right of way through the private to the public.

 

[Ten Bears]

News to me.

 

[Lostagain]

This is typical, YOU thru YOUR Congress made the rules and other folks play by the rules and now you're pissed because they are playing by the rules.
Historically, most BLM ground didn't have much "value", and the adjancent private ground has the "value", so together the peices had real "value".
Now all land has "value" so they can subdivide out these pieces and sell for real money. It'll sell for way more money, prob 100X more as a bunch of sportsmen's places than it ever would have as another welfare ranch.

 

[dgibson]

For starters, Lost, please remind me of what year all of this was set up. When exactly did I and MY Congressmen set this up? Funny, I thought the BLM system had been around for a while.

For seconds, I sincerely doubt that the selling of property you don't own is what was intended when BLM leases were created.

For thirds, your argument about the property now having "real value" is still BS. It may be true that BLM property adjacent to a privately held ranch is rendered more valuable because of its location, but that does NOT change the fact that the rancher does NOT own the property. They're selling and profiting from the sale of property that they do NOT own. You CANNOT justify that with a lame excuse about "this land wouldn't be worth anything if it wasn't for the ranches." Relative value by proximity does NOT assign ownership. That's like saying that farmland next to a shopping mall belongs to the mall because the property value is much greater due to its proximity to the mall. Bah!

 

[Lostagain]

Once again, I need to realize most folks have no clue about the history and I need to add a bunch to be clear.

They are NOT selling BLM land, they are selling their rights they have previously bought to that land.
Historically, the only reason the BLM has that land is because no one else thought it had much value, or beleived it had 0 value because of the private land next to it had the valuable parts(water). At the time of homesteading, there was no point in claiming that land that is now BLM..... just homestead the areas with water and then use that BLM land b/c no one could.... it had no value without water.
NOW in 2003, people have realized that BLM ground has value even w/o water.

 

[Oak]

The BLM is and will be owned by the public after this sale. All that will be sold is the grazing leases. The ad is a little misleading in that it adds the BLM acreage into the total. However, I looked at the maps and the BLM IS landlocked (ie., no public roads touch it). Therefore, the only people able to use it in any way are the adjoining landowners and the grazing lease holder (before and after the sale). It's a BS system, but that's the way it is.

Oak

 

[1_pointer]

DG- The now BLM was set up in 1934 as part of the Taylor Grazing Act, which removed all undeeded land from public domain and most is now managed by the USFS and BLM.

I see the purchase of grazing rights the same as water rights.

LA is correct, this land was not percieved valuable by society then as it was not economically valuable. Now other values are being attributed to lands, open space, pretty views, wildlife, etc.

 

[dgibson]

This is all great and fine, and I agree that the selling of grazing rights is reasonable. I don't agree that those rights should be sold at the same price as deeded land. In my non-ranching, non-landowning opinion anyone who would pay deeded-land prices and not get a deed out of it is a dumbass. If I'm going to pay full price for something then I'm going to own it outright. But hey, if that's what turns their crank, then by all means!

While we're on the subject, what happens if the government is taken over by Ithacans who declare all BLM land off-limits to ranching? These guys will have this honkin' mortgage (or hole in their bank account) for something that doesn't exist anymore. I just don't get the logic.

 

[Lostagain]

dg== true, if IT runs the BLM then those leases won't be "worth" any money at the bank. Many AG folks are betting that ITs will run the BLM soon so are getting out of the AG business now while there are buyers(who don't care about the money end of the leases) for these land/leases that will pay viewshed prices.
Its just economics 101; sell high, buy low.
The new buyers aren't really buying the the leases at private land prices, the prices subsidize each other. In fact some of the lease land will sell for more than the deeded. Most deeded ground over in that part of the state goes for $25-$50 an acre, some more some less. Since there are many buyers out there for a section and few buyers for a whole ranch.... makes econ sense to sell in sections. Just subdivide the whole ranch and sell it out. winwinwin. The ag guy and his stock are gone, the realtor made money, the developer made money, the surveyors made money, the income tax is paid by all those, the property tax base went up, the new buyers need construction on their places...homes, roads, ditches, ponds, .....the wildlife lose by more human activity around, but posssibly win in less stock to forage with and less ag activity.

 

[JoseCuervo]

DG,
I am not sure if selling those rights is reasonable, as they are not acquired from the government in ANY sort of fair market transaction. These are sweetheart deals made to the Welfare Rancher and result in a private interest being provided a public asset, without everybody else being able to acquire the asset.

If you look at the flyer details on this ranch, one page talks about the ag interests, and how there are subsidies that make farm ground a great investment.

You also look at the marketing angle toward the hunting use of the land, and then you really have to ask yourself how you feel about some "rich Texan" buying this place up, getting subsidies for his hunting preserve, and keeping you off the land.

It is great that the bankers are starting to get worried about lending on these operations, as they rely on the government programs to prop up the value.

er

 

[Muledeer4me]

Darren,I have a book I can send you to read if you want.
It's biased of course because it's written by a lady that now own's a ranch in the owyhee's.

But it give's a look at it from the human factor that is so often left out .
It does explane a number of things about the ranching end of it.

Steve and I met this family about 12 years ago while we were hunting.
We dont know them real well but have always been treated like friend's any time we met them moving cattle or working.

Last summer we went to thank them again for letting us hunt on some of there (deeded land)and as we got to talking she mentioned her book ,so I bought one.
I would be happy to mail it to you if you want to look it over.
It's short & fast to read.
Email me if ya want it.
The term walfare rancher,is used in the same way as calling the radical environmentalist a treehugging greenie

The differnece would be that NO Treehugging greenie I ever met could even hope to keep up with even the oldest of the ranching women I have know and the work they do while helping to keep the (welfare ranch going).

 

[Ithaca 37]

"The differnece would be that NO Treehugging greenie I ever met could even hope to keep up with even the oldest of the ranching women I have know and the work they do while helping to keep the (welfare ranch going)."

Is that supposed to justify the destruction of public lands by welfare ranchers?