Federal grazing permits.

08LSO-0061.C1

CORRECTED COPY

FISCAL NOTE

 

The non-administrative fiscal impact is indeterminable.

 

Sources of potential revenue decrease:

1) Potential reduction of land values associated with state acquired property without the associated federal lease previously tied to the property. 2) Potential reduction in the value of state property acquired through foreclosure, whereby the federal grazing permit is no longer associated with the property.

 

Assumptions:

Federal leases cannot be held by a state pursuant to the Taylor Grazing Act enacted in 1934. This act regulates grazing on federal public land. The Lease, however, may be held in suspense for a period not to exceed 2 years. This “suspense period” would in most cases, enable the state to either dispose of the property, keeping the federal lease tied to it or acquire the property and allow for re-assignment of the federal grazing permit to the new state Lessee, maintaining the property as a single grazing unit.

 

There are two situations, related to the above, whereby this bill would likely affect revenue generation.

 

Farm Loans. In some cases, the OSLI files liens on federal leases or permits (BLM and Forest Service) as part of the collateral for a loan. In the event of foreclosure, it is virtually impossible to sell acquired property within 90 days. Therefore, if the permit has to be relinquished within 90 days as required in the bill, then whatever value the permit contributed to the value would be lost.

 

Acquisition of trust land.  The Board of Land Commissioners may acquire a property to be held in trust with an associated Federal Lease. Depending on the circumstances, it could be difficult to get the property under lease to a private Lessee within the required 90 day period prior to loss of the federal lease as required in the bill. If the permit had to be relinquished, the value of the associated base property would most likely be adversely affected.

 

Exact financial impacts are impossible to determine due to dependence upon the occurrence of foreclosures or acquisition of trust lands that have a federal grazing lease tied to the subject property, both of which cannot be predicted.

 

Prepared by:   James Arnold, OSLI   Phone: 777-6639

NOTICE-AGENCY ESTIMATE OF ADMINISTRATIVE IMPACT REQUESTED

This bill has administrative impact that appears to increase (or decrease) duties or responsibilities of one or more state agencies and may impact agency spending or staffing requirements. As introduced, the bill does not modify any state agency budget or current personnel authorizations.

The following state agencies will be asked to provide their estimate of the administrative fiscal impact prior to the first committee meeting held to consider the bill:

Game and Fish Department