NEWS RELEASE

Contacts:

Nicole Rosmarino, Ph.D., Conservation Director, Forest Guardians · (505) 699-7404
Mark Salvo, Director, Sagebrush Sea Campaign · (503) 757-4221

$1.1 Billion in Bank Loans to Public Lands Ranchers
Guaranteed with Bureau of Land Management Grazing Permits

SANTA FE, NM * Scores of local, regional and national banks have issued approximately 1,700 loans totaling more than $1.1 billion to western public lands ranchers who use Bureau of Land Management (BLM) grazing permits as collateral for their debts. Forest Guardians confirmed the practice after receiving public records from the BLM following a four-year legal battle with the agency. The organization previously received information through the Freedom of Information Act in 2002 showing that approximately 300 ranch operations have assumed more than $450 million in loans on Forest Service grazing permits.

Among the banks and insurance companies that have issued loans to western ranchers using publicly owned grazing permits as collateral are some of the largest financial institutions in the world, including Metropolitan Life Insurance, Mutual Life Insurance, and Prudential Insurance. However, many BLM permit "lienholder agreements" are also held by federal and quasi-federal lending institutions such as the Federal Land Banks, the Farmers Home Administration and the Farm Service Agency.

In a report released today, Mortgaging Our Natural Heritage: An Analysis of the Use of Bureau of Land Management Grazing Permits as Collateral for Private Loans, Forest Guardians and the Sagebrush Sea Campaign claim that federally sanctioned permit-based loans have enabled the finance industry to become a silent player in the subsidized destruction of western public lands. Since banks and insurance companies have loaned $1.5 billion dollars on federal grazing permits, they use their considerable clout in Washington, D.C. to oppose any public land grazing reforms that may threaten their investment.

“It’s no surprise that the federal government and ranchers fought us tooth and nail to prevent the disclosure of records documenting $1.1 billion in loans on BLM grazing permits,” said Dr. Nicole Rosmarino of Forest Guardians. Livestock groups intervened in Forest Guardians’ lawsuit to obtain the records pursuant to the Freedom of Information Act. “The financial industry’s pervasive involvement in public lands ranching erects a huge barrier to much-needed reform on our public lands. We will push for the abolition of the use of public lands grazing permits as collateral for private loans.”

According to the report, the states where public lands ranchers have collateralized BLM grazing permits for the highest amounts are Montana ($371 million), New Mexico ($200 million), and Wyoming ($166 million). The report also indicates that almost a third of the total $1.1 billion in BLM permit-based loans are made on permits managed by just three field offices: Miles City, Montana; Dillon, Montana; and Roswell, New Mexico.

“Permit-based loans are an economically decrepit and legally dubious practice, and the latest example of subsidies enjoyed exclusively by public lands ranchers,” said Mark Salvo, Director of the Sagebrush Sea Campaign. “Taxpayers and the environment ultimately foot the bill for these special loans—and private lands ranchers should be outraged by the competitive advantage public lands ranchers receive.”

There are significant conflicts between endangered species and public lands ranching across the West. One example is livestock grazing’s depletion of vital nesting cover for the Lesser Prairie-Chicken, which occurs on public lands managed by the BLM Roswell Field Office. The grouse was designated a Candidate Species under the Endangered Species Act in1998. The Roswell Field Office manages grazing permits that have been collateralized for $93 million in private loans. The Forest Guardians and Sagebrush Sea Campaign report profiles conflicts between livestock grazing and native wildlife across the West, underscoring the pervasive involvement of the financial industry in public lands livestock grazing and the impact of permit-based loans on public lands grazing management and reform.