On August 21, 1995, Secretary of the Interior Bruce Babbitt implemented new grazing regulations on federal lands administered by the Bureau of Land Management. The new regulations are the result of the Administration’s "re-invention known as "Range Reform ‘94."

The "Range Reform" program has been strenuously resisted by the western livestock industry and by many of their congressional representatives. Ranchers throughout the west feel that the regulations will destabilize the federal land ranching industry and sharply reduce the market value of 25-30 thousand western ranches.

On January 15, 1996, five major industry organizations refiled their opening brief in the Wyoming federal district court challenging the new regulations, claiming that many of the regulatory changes violate the Taylor Grazing Act (TGA) of 1934 which has resulted in the current system of regulated livestock grazing. Other statues claimed to be violated include the Federal Land Policy and Management Act (FLPMA) of 1976, the National Environmental Policy Act (NEPA) of 1969, and the Administrative Procedures Act (APA) of 1946. Plaintiffs asked the Court to enjoin implementation of the "Range Reform" regulations.

On June 12 1996, U.S. District Court Judge Clarence Brimmer issued his decision in that case, Public Lands Council, et. al. v. Babbitt (No. 95-CV-165-B).

Siding in part with the western ranching industry, Judge Brimmer decided that the heart of the "Range Reform ’94" regulations are unlawful. "The Court cannot ignore the Secretary’s disregard of his congressionally imposed duties; it must be stopped before it wrecks havoc with the ranching industry that Congress has tried to preserve," wrote Brimmer.

Judge Brimmer noted that under law a federal court must uphold agency action unless it is arbitrary and capricious, exceeds statutory authority, or violates the Constitution (5 U.S.C. § 706(2), Mountain Side Mobile Estates v. Secretary of HUD. F.3d 1243, 1250 (10th Cir. 1995)). He found that four of the eight changes in regulations challenged by the plaintiffs exceed statutory authority; and that three of the four also are arbitrary and capricious meaning that they are irrational, unprincipled, or are without basis in fact or law (Woods Petroleum Corp. v. Department of the Interior, 47 F3d 1032, 1037 (10th Cir. 1995)).

The Four Provisions Found to be Unlawful

Found unlawful on both counts were (1) elimination of grazing preference, (2) assigning title of future range improvements to the United States rather than to the rancher constructing those improvements, and (3) reduction in mandatory qualifications for receipt of a grazing permit. A fourth change in grazing regulations, the creation of a new "conservation use" category, was found to exceed the Secretary’s statutory authority under the Administrative Procedures Act and to be in violation of existing law and congressional intent. Judge Brimmer’s reasons for ruling each of these four provisions of the 1995 regulations to be illegal are summarized below.

Secretary Babbitt would replace the grazing preference, defined by Judge Brimmer as "an adjudicated right to place livestock on public lands...measured in an amount of forage...attached to base property...following the base property if it is transferred...comporting with congressional intent" with a vague term called "permitted use."

The existence and amount of grazing preference is a major part of the market value of many western ranches. "Bank loans are often based on carrying capacity. A permittee without a definite and certain grazing preference may be unable to obtain necessary financing and be forced out of the livestock industry."

"With a mere stroke of his pen, the Secretary has boldly and blithely wrested away from Western ranches the very certainty, the definitiveness of range rights, and the necessary security of preference rights that their livestock operations require," said the Judge. Brimmer called attention to §3 of the TGA wherein Congress authorized the Secretary to classify public domain lands "chiefly valuable for grazing and raising forage crops," to designate such lands as grazing districts, and then to preferentially issue permits to land or water property owners qualified under the TGA to graze their stock on such lands.

Displaying an awareness of federal land history, Judge Brimmer noted the possibility, following passage of the TGA, of over-appropriation of public domain forage, since there could be more qualified property owners claiming more AUMs of forage than the aggregate amount of forage actually available. "Thus, the Department of [the] Interior engaged in a lengthy adjudication process to determine who was eligible for a grazing preference. This process began in the 1930s and took nearly 20 years to complete...The adjudication process provided predictability and security to livestock operators who remained in one area."

The Judge noted that the adjudicated grazing preference right comported with the intent of Congress in passing the Taylor Grazing Act, providing ranchers with "some type of assurance as to where and what kind of range they may have and depend upon for their stock, what they can definitely rely upon in the way of pasturage."

Quoting language in §3 of the TGA, Brimmer found the Secretary to have an affirmative duty to protect long-established grazing preferences (Oman v. United States, 179F.2d 738, 742 (10th Cir. 1949)), and that permitted use as a proposed substitute for grazing preference does not enjoy the same protection as a statutorily directed grazing preference. "A grazing preference could not be canceled, suspended, or reduced without an evidentiary hearing that afforded due process to the permittee" (43 U.S.C. § 315h).

"Under the 1995 regulations, a permittee no longer has an adjudicated right to graze a predictable number of livestock on public lands." In other words, the new regulations if implemented could result in the "taking" without just compensation of a private property interest. "The Court cannot ignore the Secretary’s disregard of his congressionally imposed duty; it must be stopped before it wreaks havoc with the ranching industry that Congress has tried to preserve."

Judge Brimmer found that Secretary Babbitt’s elimination of grazing preference violated the Taylor Grazing Act, and moreover, was arbitrary and capricious. For these reasons, the elimination of grazing preference was enjoined, or set aside, thwarting that major aspect of "Range Reform" - and blocking a thinly guised taking.

The Law Proscribes that Ranchers Own Range Improvements to the Extent of Their Investment

Similarly, Judge Brimmer concluded that assigning the ownership of future range improvements to the United States rather than to the rancher who constructs those improvements also is unlawful. Section 4 of the TGA authorizes the Interior Secretary to issue permits or enter into cooperative agreements for the construction of "fences, wells, reservoirs, and other improvements necessary to the care and management of permitted livestock." That section goes on to say that "no permit shall be issued which shall entitle the permittee to the use of such improvements constructed and owned by a prior occupant until the applicant has paid to such prior occupant the reasonable value of such improvements...."

The intent of Congress was referenced by Judge Brimmer in ruling that this statutory language, together with the discussion appearing on pages 77-80 of the Senate Public Land and Surveys Committee report on H.R. 6464 (the bill that when enacted became the Taylor Grazing Act), made it clear that title to authorized range improvements would adhere to the individual who constructed it. If any doubt remained, the Judge said, that doubt should be erased by the provision in FLPMA (43 U.S.C. § 1752(g)) requiring the United States to compensate the permittee or lessee for the value of his interest in range improvements. Obviously, compensation would not be required under the law if the rancher did not own a property interest, in this case an ownership interest, in the range improvement.

"The Court holds that the 1995 regulations regarding title to range improvements contradicts the Taylor Grazing Act and discourages private lands and rangeland improvements." Setting aside that provision, Judge Brimmer said "The Secretary seeks to confiscate the improvements the ranching industry makes to increase the carrying capacity of the range. This regulation exceeds statutory authority and lacks a reasoned basis."

Grazing Preferences Attach Only to Properties Used in Livestock Businesses

Another proposed reform found by Judge Brimmer to be in violation of law is the Secretary’s attempt to allow individuals who do not actually raise livestock to receive BLM grazing permits. Specifically, the new regulations require only that a permittee own or control base property that is capable of being used in the livestock business.

Calling attention to wording in §3 of the TGA, Brimmer linked ownership of private land used in a ranching operation to the granting of a range right, or preference. "Preference shall be given in the issuance of grazing permits to those within or near a district who are landowners engaged in the livestock business, bona fide occupants or settlers, or owners of water or water rights" (43 U.S.C. § 315b).

The Judge found that the intent of Congress would be frustrated if grazing permits were extended to persons or organizations other than ranchers. "The reduction in mandatory qualifications violates the Taylor Grazing Act and frustrates its purpose "ruled Judge Brimmer. "Congress intended for the Taylor Grazing Act to benefit people actually engaged in the livestock business." Setting this new provision aside, Brimmer said that the Department of the Interior had failed to provide a rational explanation for it.

Conservation Use Is Not a Legal Use for which Grazing Permits May Be Assigned

Secretary Babbitt also created a new "conservation use" that assigns a grazing permit to a person who does not graze livestock. The obvious nonsequiteur led the Judge to find that this new kind of active grazing use "exceeds statutory authority and contradicts congressional intent" and it too was set aside.

In so ruling, Brimmer stressed that the TGA only authorizes the Secretary to issue grazing permits, not non-grazing permits. Noting that issuance of conservation permits would run counter to the statutory goal of promoting certainty and stability in the western livestock industry, the Judge said: "Such permits also circumvent the decision Congress made when enacting the Taylor Grazing Act that certain lands were best suited for grazing."

Brimmer’s use of this language is important because it implies that regulated domestic livestock grazing is the highest and best use of rangelands now administered by the Bureau of Land Management. There can be little doubt that the Court’s use of this language was intentional and unambiguous, because Brimmer goes on to say that "the Federal Land Policy [and] Management Act defines livestock grazing as a principal or major use. (43 U.S.C. § 1702(1)). The Department of [the] Interior must use the Federal Land Policy [and] Management Act’s land use planning process before it excludes a major use like livestock grazing from public lands." 43 U.S.C. § 1712. Thus, by declaring conservation use to be a type of active use "the Secretary exceeded his statutory authority by enacting this provision of the 1995 regulations."

Round Two? Round Three?

Although the court decision might have seemed to apply only in Wyoming, it effectively stopped implementation of several key aspects of the "Range Reform" program westwide. The scope of Judge Brimmer’s order is not limited to Wyoming but rather is directed at the Secretary of the Interior and therefore will apply throughout the United States.

The Department of Justice has decided to appeal, and has requested an extension of the filing date. As of this writing, the government’s appeal will be filed in the 10th Circuit of the U.S. Court of Appeals on or before November 10, 1996. Then the Public Lands Council et al. will have 30 days to respond to the government’s appeal. Two weeks later, the United States will post its response to the Public Lands Council. Regardless of the party prevailing in the 10th Circuit, it is probable that the case then will be appealed to the Supreme Court.

The Brimmer decision may, or may not, be overturned at some future date-but the federal land dependent western ranching community did win the first round.

Merging Smith and Brimmer

At Stewards Sun Valley Conference, Fred Obermiller gave his analysis of what had been accomplished specifically for federal land users between the Brimmer decision and the Hage (Judge Loren Smith) Summary Judgement Opinion. His analysis follows.

* from arbitrary and capricious behavior on the part of the federal land management agencies;

* from attempts by Secretaries of those agencies to regulate outside the scope of statutory authority given them by Congress; and

* from intentional or unintentional efforts to deprive them of their 5th and 14th Amendment constitutional rights

Those protections extend to both ownership and usufructuary property rights including

* authorized range improvements financed by the permittee or lessee;

* BLM grazing preference rights, including their adjudicated scope;

* BLM permit renewal rights when used as security on loans;

* stockwater rights on both federal and private lands with seniority dates prior to 1981 everywhere and prior to 1934 on the public domain;

* surface forage rights appurtenant to stockwater rights on National Forests

* ditch rights-of-way

* livestock

"When the federal government created a national forest or a BLM grazing district, it could not unilaterally ignore private property interests on the public domain. If Congress wanted to remove all private property interests in the public domain, which were created by the state under state law, the Constitution would have required the federal government to pay just compensation. Just as the federal government could not take private property rights in water or ditch rights-of-way when it created a national forest or a BLM grazing district, the government could not take any other form of private property in the public domain."

Obermiller concluded that the wording of the 1866 Act (43 U.S.C. : 661) still applies. "Whether, by priority of possession, rights to the use of water and forage have vested and accrued, and the same are recognized and acknowledged by the local customs, laws and decisions of the courts, the possessors and owners of such vested rights shall be maintained and protected in the same."