Report says transferring federal lands to state would cost billions

In Montana, where land managed by the U.S. Forest Service and Bureau of Land Management comprises 30 million acres — roughly a third of the state — the notion of turning swaths of terra firma to state control could be costly, according to a newly published report. 

The report, written by longtime natural resources manager John Tubbs, calls the financial implications of federal lands transfer “staggering and disproportionately impactful for a rural state with large swaths of national public lands.”

“The costs associated with maintaining national public lands at the state level — ranging from wildfire operations to the loss of essential federal funding for rural counties — would be far too great for Montana to bear per capita,” the report states. It amounts to an $8 billion “gamble on Montana’s future.” 

Tubbs, who authored the report with support from the Montana Wildlife Federation, Backcountry Hunters and Anglers, Mountain Mamas and the Montana Conservation Voters Education Fund, is the former director of the Montana Department of Natural Resources and Conservation under Democratic Gov. Steve Bullock.

The long simmering dispute over whether the federal government should relinquish lands managed by the Departments of Interior and Agriculture to individual states has been turned up at all levels, from the halls of Congress to Montana’s capitol.

The estimated roughly $8 billion increase to Montanan’s balance sheet would be primarily driven by the costs of managing the land, according to the report, including for wildfire, deferred maintenance backlogs, and abandoned mine reclamation.

Citing reports by the Legislative Fiscal Division, the report states that during the last 20 years, Montana has paid more than $2.3 billion in wildfire mitigation costs on federal land — comprising just 25% of total cost, as the federal government covers 75% of costs. 

A transfer of federal lands to state management would shift the cost of future wildland fire suppression to state taxpayers to the tune of $5.5 billion — the bulk of the total.

On a press call about the report, Tubbs pointed to the essential partnerships with federal agencies  — including the large fleets of firefighting aircraft operated by the Forest Service — and the difficulty in replicating that from the state or private industry. 

“That is untenable,” he said.

 Tubbs also focused on Payment in Lieu of Taxes funds the federal government disseminates. The PILT program channels money to rural counties with swaths of untaxable federal land to support vital services such as public safety, housing, social services and transportation. 

In fiscal year 2023, Montana counties received more than $40 million in PILT funds — and another $16 million from the similar Secure Rural Schools program — a loss the state likely couldn’t make up. 

Tubbs said such a loss would result in the largest “unfunded mandate” in state history, and “several of Montanaʼs counties would be bankrupt—- in particular, the 11 counties in which more than half of the acreage is owned by the federal government.”

The report also states that Montana would be on the hook for $623 million in deferred maintenance and repairs on current federal lands; between $474 million and $1 billion for reclamation work on the state’s 5,000 abandoned mines; and a 1,600% increase in grazing fees. 

 “The state simply cannot afford the responsibility of managing such vast swaths of land without significant financial strain,” the report concludes. 

Tubbs said the value of public lands goes far beyond the numbers, and supporters need to strengthen efforts. 

“The core value I think most of us find in public lands is there’s some landscape that means something to each of us,” he said on the press call. 

Discussions about the federal lands transfer came to the forefront in Washington D.C. and nationwide following statements by the Trump administration that federal lands are part of the nation’s “balance sheet” and could be utilized to help pay off the national debt. 

Earlier this month, the U.S. Senate passed a federal budget in a series of late night votes, and one particular budget amendment saw Montana’s two Republican Senators buck their party. 

The amendment, brought by Sen. John Hickenlooper, D-Colorado, would have prevented the sale of public lands to lower the federal deficit. 

Montana Sens. Steve Daines and Tim Sheehy joined all Democrats in supporting the amendment, but it was defeated 49-51. 

In a similar vein, Republican U.S. Rep. Ryan Zinke, Montanan’s western representative, reintroduced his “Public Lands in Public Hands Act,” earlier this year with a Democratic senator from New Mexico.

The provision would ban the U.S. Department of Interior and U.S. Forest Service from selling or transferring “most public lands” except in specific circumstances. It also would require Congressional approval for disposals of publicly accessible federal land tracts over 300 acres and for public land tracts over 5 acres if accessible via a public waterway.

“In Montana, public lands are our way of life. It’s not just Yellowstone and Glacier, it’s also the BLM and Forest Service areas where a kid fills their first tag, a lake in the Beartooths that is the perfect picnic spot, and the trail just down the road that helps you clear your head after a long workday,” Zinke, a former Secretary of the Interior during Trump’s first term, said in a press release. “Public lands must remain public, and the federal government has a responsibility to manage and ensure access to those lands.”

Earlier this month, Montana’s eastern representative, Republican Troy Downing, signed on as a cosponsor to the legislation, as did Idaho Republican Rep. Mike Simpson. 

In Helena this legislative session, Montana’s state lawmakers also got to offer their own takes on the issue thanks to a lawsuit filed by the State of Utah against the federal government in favor of land transfer.

The suit, which claimed federally-managed land infringed on the state’s sovereignty and sought a return of millions of acres, was rejected by the U.S. Supreme Court.

Despite that, freshman Rep. Tom Millett, R-Marion, introduced a resolution supporting Utah’s position.

While Millett stated House Resolution 24 did not concern Montana’s federal public lands, his comments were broadly applicable to all states. 

“Nothing in the U.S. Constitution authorizes the federal government to hold vast unreserved swaths of unreserved territory in perpetuity over the states’ express objection,” he told the House Energy, Technology and Federal Relations Committee during a hearing. “The U.S. generates significant revenue from these unappropriated lands — millions of dollars annually that would go toward our counties and schools. But instead, we get but a pittance, leftover crumbs from what should be our lands.”

The bill passed out of committee on partisan lines, but saw broad bipartisan opposition on the floor. 

“Montanans have overwhelmingly rejected transfer time and time again,” Rep. Debo Powers, D-Whitefish, told her colleagues during the debate. “In fact, 87 percent of Montana voters considered the conservation — not the transfer, but the conservation — of public land to be influential in their voting decisions. That’s why so many political candidates in Montana from every political party pledged to keep public lands in public hands.”

The bill failed to pass the House floor in a bipartisan 33-66 vote.