Our Treasure, Our Future – Data Show Commercial Use of Public Land is NOT an Economic Benefit

Comment Until July 10 – More National Monuments Review Sample Comment Scripts for the Savvy Citizen

Data Show Commercial Use of Public Land is NOT an Economic Benefit

Many arguments offered in opposition to designation of National Monuments (as well as National Parks and Wilderness Areas) cite commercial uses that could otherwise arise from those lands, such as cattle grazing, logging, mining, and oil/gas extraction. The underlying assumption is that these commercial uses are of economic benefit to the American taxpayer.

The data show otherwise.

Grazing on public lands
  •  Americans pay between $500 million and $1 billion annually in taxes to subsidize cattle grazing on federal public lands across the West, a new study, “Assessing the Full Cost of the Federal Grazing Program,” shows:   “Taking into account the many direct and indirect federal expenditures that benefit or compensate for impacts of livestock grazing on federal lands, the full cost of the federal grazing program to the U.S. Treasury is likely to approximate $500 million annually,” Moskowitz and Romaniello note in their report. “Considering the many other indirect costs . . . due to resource damage and impaired opportunities for recreation and other non-commercial land uses, the full cost to the U.S. public could approach $1 billion annually.” (1)
  • “Receipts from grazing fees were $125 million less than federal appropriations in 2014. Total federal appropriations for the USFS and BLM grazing programs in fiscal year 2014 were $143.6 million, while grazing receipts were only $18.5 million (1).”
  •  “Appropriations for the BLM and USFS grazing programs have exceeded grazing receipts by at least $120 million annually since 2002. Had the federal government charged the average private forage market rate for non-irrigated lands in the western states, grazing receipts would have been on average $261 million, greatly exceeding annual appropriations (1).”
  • “The gap between federal grazing fees and private land fees has widened considerably. The federal grazing fee in 2014 was set at the legal minimum of $1.35/AUM, or animal unit month, which is the amount of forage to feed a cow and calf for one month. The annual federal grazing fee has been set at the minimum required by law since 2007 (1).”
Logging on public lands
  • The timber industry has declined dramatically in recent years, and profit margins—even for timber harvested on lands owned by timber companies—are small (after-tax profits in 2010 were 1.1%).  As a result, the U.S. Forest Service sometimes loses money on timber sales, with the profit more than overtaken by costs—such as building roads—footed by the American taxpayer (a net loss of $15 million in 1997, for example). (2)
Mining on public lands
  • According to a 2009 report from the Pew Charitable Trust, US taxpayers stood to lose $1.6 billion dollars over the course of 10 years.  “The report links the revenue loss to outdated policies that subsidize the mining of gold, uranium and other metals on federal public lands.” (3)
  • From the same report: “According to the Congressional Budget Office, approximately $1 billion in non-coal metals are taken from federal lands each year. Under the 1872 mining law, these minerals are extracted without royalty or rental payments.” (3)
  • Coal companies pay pennies on the dollar for coal extracted from public lands.  In addition, due to competition from cheaper energy sources, a number of companies have declared bankruptcy, allowing them to avoid the post-mining clean-up that is required for use of public lands—and the clean-up will devolve upon the taxpayer, at a potential cost of $10 billion dollars.  (4)
Oil and gas extraction from public lands
  • Although in fiscal year 2014, the federal government received $13 billion dollars from the leasing of public lands to oil companies, “Even as the average annual price for oil produced in the United States tripled in a decade, the minimum price the federal government charged for leases remained stagnant. In fact, for decades, the minimum bid to lease public land for fossil fuel production has beenjust $2 an acre. Annual rental fees, which companies pay to hold and explore federal lands before production, are just as low. And the royalty rate for oil and gas produced onshore has remained at just 12.5 percent since 1920. Those bargain prices give private companies a windfall while depriving American taxpayers of a fair return from energy production.” (5)
Other costs to taxpayers
  • The revenues received from leasing to oil and coal companies do not account for related costs paid by taxpayers.  These include damage to roads, other local costs (including health costs) from spills and air pollution, and the global climate-warming harms of extracting and burning more fossil fuels. (5)
  • One report puts the cost (in climate-change related damages) of burning coal (that companies already have leases to mine on public lands) at $150 billion over the next five years (4).
  • These revenues also do not take into account lost tourism dollars and other revenue streams harmed by commercial activities that degrade public lands ecosystems and limit access to the public.  As one café-owner remarked, about tourists who spend money at his business near public lands in Utah:  “They don’t come to see coal mines”(7).  Jobs in the recreation industry outnumber those in the mining industries by 10 to 1 (8).
  • We have barely begun to quantify the value of ecosystem services provided by our public lands.  These include (but are not limited to) carbon sequestration, erosion and flood mitigation, mitigation of air and water pollution, groundwater recharge, habitat refuges for rare species, and pollination services (7). “Consideration of non-market goods and services is essential to ensuring that conservation of our public lands is seen as an economic benefit, not just a cost.” (8)

In short, commercial use of public lands already involves enormous taxpayer subsidies to some of the richest corporations in the world.  Giving over more of our public lands for this purpose is not to the economic benefit of the American taxpayer—to say nothing of the cost of lost ecosystem services, and recreational, environmental, cultural, and scientific resources.

SOURCES:

(1)    http://www.publiclandsranching.org/htmlres/release_economics_report.htm

(2)    http://www.huffingtonpost.com/carol-pierson-holding/why-logging-us-national-f_b_1014855.html

(3)    http://www.pewtrusts.org/en/about/news-room/press-releases/2009/01/27/report-finds-mining-subsidies-cost-taxpayers-billions

(4)    http://wilderness.org/blog/report-coal-mining-public-lands-cost-billions-climate-damages-over-next-5-years

(5)    https://www.washingtonpost.com/posteverything/wp/2015/06/16/oil-companies-are-drilling-on-public-land-for-the-price-of-a-cup-of-coffee-heres-why-that-should-change/?utm_term=.fccb52319f89

(6)    http://www.thespectrum.com/story/news/local/2017/05/10/culture-war-grand-staircase/101534964/

(7)    http://scholarship.law.duke.edu/cgi/viewcontent.cgi?article=1043&context=delph

(8)    https://www.kinshipfellows.org/resources/assessing-the-economic-value-of-public-lands

 

Photo: STRIP MINING WITH DRAGLINE EQUIPMENT AT THE NAVAJO MINE IN NORTHERN ARIZONA. Shiprock, Peak, Arizona. June, 1972. Public Domain

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