What's a "Welfare Rancher?"

[JoseCuervo]

RockyDog,

If the only thing keeping these guys from selling out to the Yuppie-Castle builders is their dependence on Public Lands, then they are likely the "weak sisters" of ranching. If they are that close, then my guess is some Californian (or Atlantan in your case) can decide to build a 8000 sq footer, and spend the rest on buying the land plus the grazing rights.

I am not sure using Public Assets to prop up 10% of an industry is a good idea. Most ranchers I know, or at least the ones I eat dinner with, are good people, and most of them are tired of the Welfare Ranchers staying in business, at their expense.

You guys in Montana may have a different set of dynamics, but with Forest Service leases in Idaho, many of the "base properties" are 100's of miles away from the Leased land. The elk that rely on the forage on the Leased land could never winter on their base property, unless they were loaded into a truck.

But don't confuse Ranchers who risk their capital, their assets, and scratch a living with the Welfare Ranchers who use Public Lands to feed their cattle, at the expense of YOUR Elk and YOUR Deer.

 

[Nemont]

Elkgunner,
You may have hit on something which I have tried to say before. Maybe some cattle producers do have different dynamics and rather that insist on a complete end to grazing public lands you should work to end those practices which in your area which you see as harmful.
I have been researching this subject and here are a couple issues that are not discussed:
From Red Canyon Sheep Co. Vs. Ickes
But we do conclude that if the Secretary determines to set up a grazing district including lands upon which grazing has been going on, then those who have been grazing their livestock upon these lands and who bring themselves within a preferred class set up by the statute and regulations, are entitled as of right to permits as against others who do not possess the same facilities for economic and beneficial use of the range. (98 FR 2d 314)

The courts use of the words "entitled" and "right" resound for those who would like public land grazing to be an absolute property right, even if the decision only actually clarifies the decision-making process that chooses which ranchers are to get permits.

Further, although this decision agrees with other courts that grazing is not a vested right, it also states that:

Yet, whether they be called rights, privileges, or bare licenses, or by whatever name, while they exist they are something of real value to the possessors and something which have their source in an enactment of the Congress. (98 FR 2d 315)

In such a statement, grazing rights activists see the courts affirming permit value. On the other hand, most environmentalists are either unaware of such statements, or chose to downplay or ignore them. Although they are correct in continually calling allotments public land, simply calling them such does not take away the privileges to their use that Congress gave to ranchers. The question then becomes, "To what extent is that privilege itself something substantial?"


The other issue that I have difficulty with is the IRS places a value on those grazing rights.The other major legal quandary that has solidified the value of grazing permits in the minds of many involves the practices of the IRS. Although I have not been able to find a clear starting point for this practice, for many years the IRS has figured inheritance tax on the total value of a ranching estate, including the assessed value attributed to its grazing allotments. Thus, although originally a permit may have been awarded to some lucky rancher, the rancher's heirs are required to pay for 50% of the allotment's value. Even though this law only applies to the value of an estate that exceeds a certain limit, all but the smallest ranches have at least part of their value taxed. The sentiment among many ranchers is that if the IRS recognizes the value of permits, than the Forest Service and BLM should also.

To clarify much of the above was cut and pasted from various sources and is not my orginal writing. It does represent some views which I tend to agree with and the isssue of IRS value I have not seen discussed here.


If a ranch has been through a couple of generations, like our has, we have paid estate tax on the value of those grazing rights twice. Even a good attorney and accountant and a lot of tax planning could not help us avoid the paying of those taxes when my grandfather died.

It is not that we are a "weak sister". We graze primarily our own deeded land but we also do graze some BLM land for summer pasture. It is not in poor condition.
Nemont

<FONT COLOR="#800080" SIZE="1">[ 01-07-2004 11:00: Message edited by: Nemont ]</font>

 

[Ten Bears]

Well said NEMONT.

 

[JoseCuervo]

Nemont,

Here is some more reading, while you are browsing the Federal Register...

Grazing on public lands is a privilege, and not a right: See 43 U.S.C. § 315b & 16 (1943 Taylor Grazing Act, stating that grazing preferences "shall not create any right, title, interest, or estate in or to the lands" belonging to the U.S. Government); 43 U.S.C. § 580l (FLPMA similar provision);

In Omaechevarria v. Idaho, 246 U.S. 343, 352 (1918) ("Congress has not conferred upon citizens the right to graze stock upon the public lands. The government has merely suffered the lands to be so used");

And further, in US v. Fuller, 409 U.S. 488, 494 (1973) (grazing permittee does not acquire a property interest in grazing permit);

Additionally during Swim v. Bergland, 696 F.2d 712, 719 (9th Cir. 1983) ("license to graze on public lands has always been a revocable privilege");

And to add more clarity in Osborne v. United States, 145 F.2d 892, 896 (9th Cir. 1944) ("it has always been the intention and policy of the government to regard the use of its public lands for stock grazing. . . as a privilege which is withdrawable at any time for any use by the sovereign without the payment of compensation");

And if that is not enough, in Diamond Bar Cattle Co. v. U.S.A., 168 F.3d 1209, 1217 (10th Cir. 1998) (permittees "do not now hold and have never held a vested private property right to graze cattle on federal public lands");

And finally, if you still have questions, Alves v. U.S., 133 F.3d 1454 (Fed. Cir. 1998) (holding that neither grazing permit nor preference is a compensable property interest).

Obviously there is adequate Case Law to support the removal of Welfare Ranchers from Public Lands, when needed. Now we just need to discuss when needed.

As to your contention that the IRS somehow legitamizes the rights, I would submit Mr. Al Capone as evidence that the IRS does not care how you make your money, they just want their share. Money made illegally is still taxable, and the IRS taking a cut does not make illegal activities legal. Many times the Drug Dealers are busted on Tax law...

Ten,
Still hanging out as Nemont's Lapdog????

 

[Nemont]

EG,

Don't have time right now, gotta take the kids skating,

to begin to point out some additional readings as well. Will have a more in depth post on Monday.

Thanks for the Al Capone reference, I guess that is why when I showed the post to my dad he was beet red and couldn't talk, had to leave to finish feeding his cows. Not only is he evil for even thinking about grazing BLM lands now he is in the same class and Al Capone and is earning his money illegally. WOW.
Will be back soon.
Nemont

 

[JoseCuervo]

Nemont,

Sorry if the Capone refence was taken wrong. I just used it as an extreme, but common, example of the IRS not being the determiner of the legal status of ownership, rights, etc... If you inferred that I was suggesting your family wealth was gained illegally, I am sorry, as that was not my inferrence. I was merely separating the IRS goal of getting tax money from the type of assets.

Additionally, I believe Estate Taxes are for income/wealth already accumulated, and do not take into considertation of Future Value of earnings. So, paying the Estate Tax just acknowledges previous earnings from the land, but does not constitute a future right.

Maybe your Dad was just red from the Cold weather???

 

[Nemont]

EG,
Pretty sure it wasn't the cold. Maybe.

If you lease your neighbors deeded land, perhaps for years and you die, do any of your heirs pay estate tax on the value of your neighbors land? Why then if there is no right, implied right or special privileges to this lands should I pay estate tax on the value of lands owned by the Gov't? That seems a little goofy. Because as you say there exists plenty of case law which says we have no rights to the land just a lease. Which can be revoked at any time.
Nemont

<FONT COLOR="#800080" SIZE="1">[ 01-10-2004 16:55: Message edited by: Nemont ]</font>

 

[The Hedgehog]

Nemont, there's always going to be guys that don't want to even weigh in the flip-side to their opinions. But then again, the world would be boring without a few extremists around.

I'm from a small farm/ranch to the east of you.. in Froid. The folks still live there and have a few cattle... and CRP.

 

[Nemont]

Greenhorn,
I have a few clients in Froid. Mainly, I cover the school there. My neice also just moved there this year to teach. I travel through there about every other week.

As far as public lands grazing goes I don't suspect I will change many minds here but that doesn't really matter.

Nemont

 

[1_pointer]

Newmont- Just a question for one in the 'biz', but where do you see public lands grazing 30 years from now?

So as to not totally beg the question, my stance is that it will still be occuring, but the reasoning behind it will be different. Public lands grazing will be used as a tool to manage the habitat with food and fiber production being an ancillary benefit. Proper management will allow for money to be made and the land made better. I think the health of the land will be a more important component than just the production of food/fiber. Thoughts?

Some FYI for all:
<BLOCKQUOTE>quote:</font><HR> “It is our strong contention that when properly implemented and supervised, grazing could become an important management tool benefiting fish and wildlife riparian habitats”. <HR></BLOCKQUOTE>Armour, C. L., D. A. Duff, and W. Elmore. 1991. The effects of livestock grazing on riparian and stream ecosystems. Fisheries 16(1): 7-11.
This is an article that mostly talks about the negative impacts of livestock on riparian areas, but at least they realize that it can be beneficial.

 

[Nemont]

1 Pointer,
I think there will still be some public lands grazing going on in 30 years. I think it will be greatly diminished in many areas.
Will the land be returned to a pristine or natural state, no.
Many of the more enviromentally sensitive grazing allotments will be taken back by the BLM or FS. Some allotments that have been over grazed should be left to rest or completed abandoned.
My gripe is that many people want a complete end to all public lands grazing. Doesn't matter if ranchers are doing right or not. Doesn't matter to them at all just get the cattle of the land. Many, I suspect, have never set foot on BLM land in their lifetime. It is kind of like that old walk a mile in my shoes before you judge thing.
There are many, many ranchers who, regardless of what you hear here, want the public lands in good condition. They should be allowed to continue to use that land for cattle ranching.

BTW I don't ranch, My family does and so does my in-laws.
Nemont

 

[1_pointer]

Thanks, was just curious. You're right, proper management makes all the difference. Sorry, I inferred you were in the ranching business.

<FONT COLOR="#800080" SIZE="1">[ 01-12-2004 14:05: Message edited by: 1_pointer ]</font>