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Permit Value:
A Hidden Key to the Public Land Grazing Dispute

by
Bill Steven Stern
B.S. Portland State University, 1991
presented in partial fulfillment of the requirements for the degree of
Master of Science
The University of Montana, 1998

Stern, Bill Steven, M.S. March 1998                    Environmental Studies
Permit Value: A Hidden Key to the Public Land Grazing Dispute (129pp.)
Director: Bill Chaloupka
(Reformatted for the web, December 2001)

Abstract

This study examines the extent and importance of the real estate market value (permit value) of Forest Service grazing permits and Bureau of Land Management grazing leases. This value is not officially recognized by either agency, although it does influence the IRS calculation of inheritance taxes since it is considered to increase the total assessed value of a ranch. Permit value is traced through its historical and legal development. The theories as to why this value exists are explored. The numerous economic studies that have attempted to enumerate permit value in a specific region or trace the total extent of permit value throughout the 11 Western states are collected and their methods and results are discussed.

Informal interviews and surveys were conducted with forty-three individuals who have varying connections to the current political conflict over public land grazing. These interviews focused on discussing the political and economic importance of permit value in an attempt to assess the political viability of various proposed new management tools. These individuals included ranchers, both with and without grazing allotments, public land managers, academics, environmental activists, bankers, a Realtor and a newspaper reporter. Results showed that it is generally acknowledged that these permits and leases do have real estate value. More than two-thirds felt that this value had at least a significant influence on ranchers' opposition to grazing level reductions. Most felt that some new management tools would be helpful and more than half supported, to various degrees, plans to compensate ranchers for reductions in their grazing privileges or options to buy-out allotments entirely.

Various issues that affect public land grazing and which need to be considered when examining new management tools are discussed and then some new management plans are discussed. Finally, a hybrid proposal is offered that might make grazing reforms more politically viable by considering and compensating ranchers for permit value as their permitted stocking rates are reduced or voluntarily eliminated.

Acknowledgments

I would first like to thank the many men and women whom I interviewed, for their willingness to share their views and ideas, and occasionally their homes, with a total stranger.

Thanks to Arbokem Inc. who manufactures Downtown™ paper from a blend of wheat straw and recycled pulp, on which the bound copies of this thesis are printed.

Special thanks to Bill Chaloupka for his time and patience, to Tom Power for his insistence on focus and rigor, and to Dan Flores for his support and easy-going nature. Thanks to Vicki Watson, Don Snow and Mary O'Brien for stirring my interest in grazing politics. To Paul, Gary and Linnaea of the Grazing Group. To Karl Hess, Jerry Holechek, Allen Torell, Johanna Wald, Rose Strickland and Dan Heinz for paving the way with their ideas, as well as their support and interest. To Bill, Ben, Karen, Kira, and Julie for putting up with thesis stress on the home front. To Peter, Brian, Mo, Lisa and Jen, for just being themselves.

Special thanks to my uncle Milton and brother Ricky for making grad school possible, and to my mom, for always being there when I need her.

Tables and Figures

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