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Monday, December 31, 2012

Federal Land Transaction Facilitation Act: Operation and Issues for Congress

Carol Hardy Vincent
Specialist in Natural Resources Policy

The Federal Land Transaction Facilitation Act (FLTFA), which expired on July 25, 2011, provided for the sale or exchange of lands owned by the Bureau of Land Management (BLM) that have been identified for disposal under BLM’s land use plans. Most of the proceeds were to be used for land acquisition. The law’s goals included allowing for reconfiguration of land ownership patterns to better facilitate resource management, improving administrative efficiency, and increasing the effectiveness of the allocation of fiscal and human resources.

The authority to sell or exchange BLM lands under FLTFA was initially authorized for 10 years, expiring on July 25, 2010. When it expired, an estimated $52 million in the account ceased to be available for purposes of the law. These funds have not been reinstated in the FLTFA account. On July 29, 2010, the authority was subsequently extended for one year, expiring on July 25, 2011. Upon expiration, there was $2 million in the FLTFA account, which also ceased to be available.

An issue for Congress is whether to reauthorize the FLTFA authority and, if so, in what form. One question is the extent to which there is a need for this authority, given other laws authorizing the sale and acquisition of federal land and other sources of funding for these purposes. A second question is whether any extension of FLTFA should be relatively short (e.g., one year) or relatively long (e.g., 10 years or more). A third question is whether to continue to require land use plans as of July 25, 2000, to be used as the basis of land sales, or to allow updated plans to be used. A fourth set of questions relates to the retention and use of proceeds, including the extent to which any future proceeds should be retained by the agencies, used exclusively for land sales and acquisitions, and used primarily in the state in which they were generated, and whether the previously generated funds should be returned to the FLTFA fund.

The Obama Administration has proposed making FLTFA permanent, and using current land management plans for determining which lands to sell or exchange. S. 3525, S. 714, and H.R. 3365 would extend the law for varying numbers of years. In other respects they are similar, for instance, in allowing BLM to use updated land management plans to sell and exchange land.

Proceeds from the sale or exchange of BLM lands under FLTFA were split between the state in which the lands were disposed of (4%) and a separate Treasury account (96%). No more than 20% of the funds in the account could be used for administrative expenses. While BLM alone disposed of land, not less than 80% of the funds in the account were used by the four major federal land management agencies to acquire lands. In addition to BLM, these agencies were the Fish and Wildlife Service, National Park Service, and Forest Service. The agencies could acquire inholdings and other non-federal lands (or interests therein) that are adjacent to federal lands and contain exceptional resources. Of the funds for acquisition, at least 80% were to be used in the state in which the funds were generated; remaining funds could be used in any state. Further, not less than 80% of the funds for land purchases within a state were for acquisition of inholdings.

From the enactment of FLTFA through FY2010, a total of $115.7 million was raised through the sale or exchange of BLM lands, and 25,967 acres were sold. Disposal of land under FLTFA was concentrated in Nevada and Oregon, with most of the revenues (76%) being generated in Nevada. Over the same period, about $63.7 million in funding was disbursed, of which $49.2 million was spent on the purchase of 18,135 acres (together with $9.7 million in other funds). The acquisition of lands and expenditures on acquisitions were less concentrated in particular states than land sales and receipts.

Date of Report: December 10, 2012
Number of Pages: 19
Order Number: R41863
Price: $29.95

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