[Senate Report 106-453]
[From the U.S. Government Publishing Office]
Calendar No. 899
106th Congress Report
SENATE
2d Session 106-453
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WASHINGTON COUNTY, UTAH LEGISLATIVE TAKING
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October 2 (legislative day, September 22), 2000. Ordered to be printed
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Mr. Murkowski, from the Committee on Energy and Natural Resources,
submitted the following
R E P O R T
[To accompany S. 2873]
The Committee on Energy and Natural Resources, to which was
referred the bill (S. 2873) to provide for all right, title,
and interest in and to certain property in Washington County,
Utah, to be vested in the United States, having considered the
same, reports favorably thereon without amendment and
recommends that the bill do pass.
purpose of the measure
The purpose of S. 2873 is to provide for a legislative
taking of approximately 1,550 acres of private lands within the
federally designated Red Cliff Reserve in Washington County,
Utah.
background and need
In 1983, Environmental Land Technology (ELT) acquired 2,440
acres from the State of Utah for development purposes and
completed appraisals, engineering studies, site plans, and
other work in preparation for development of its property. In
April, 1990, the desert tortoise (Gopherus agassizii) was
listed as a threatened species pursuant to the Endangered
Species Act of 1973. The landowner testified before the
Committee that he has been unable to develop the property as
originally intended because of the occurrence of critical
desert tortoise habitat in and around the ELT property. In
February 1996, the United States Fish and Wildlife Service
(USFWS) adopted a Habitat Conservation Plan (HCP) creating the
Red Cliffs Reserve for the protection of the desert tortoise
habitat. Under the plan, the Bureau of Land Management (BLM)
proposed to acquire all private lands in the designated habitat
area.
To date, the BLM has acquired nearly all the private
property located in the Reserve except for approximately 1,516
of ELT land. Numerous attempts to reach an agreement withthe
BLM for exchanges of this property have failed, at considerable cost to
the landowner. In the interim, Congress has enacted legislation to
exchange large blocks of Federal lands with the State of Utah, making
other land exchanges in the State much more difficult to complete.
No funds were appropriated to the BLM in FY 2000 to
purchase the property. The Department of the Interior did not
request funds for this acquisition in FY 2001, though the
acquisition of the ELT property remains a high priority for the
BLM.
The continued inability to develop or otherwise dispose of
the property has resulted in economic hardship for the
landowner. Conventional financing to hold the property was not
available to the landowner because the banks were unwilling to
lend money against the land without a clear payoff date.
Accordingly, ELT has had to borrow substantial sums, sometimes
at high interest rates, to hold the property. S. 2873 is needed
to complete the land transfer and to compensate ELT for its
land in a more timely manner than is available without the
legislation.
legislative history
S. 2873 was introduced on July 14, 2000 by Senator Bennett
and referred to the Committee on Energy on Natural Resources.
The Subcommittee on Forests and Public Land Management held a
hearing on S. 2873 on September 13, 2000. At the business
meeting on September 20, 2000, the Committee on Energy and
Natural Resources ordered S. 2873 favorably reported.
committee recommendation
The Senate Committee on Energy and Natural Resources, in
open business session on September 20, 2000, by a voice vote of
a quorum present, recommends that the Senate pass S. 2873.
section-by-section analysis
Section 1 lists several findings of Congress.
Section 2(a) transfers title to the United States for 1,516
acres of property owned by Environmental Land Technology (ELT)
within the Red Cliffs Reserve and 34 acres owned by ELT
adjacent to the land within the reserve.
Subsection 2(b) provides for compensation to ELT through an
initial cash payment of $15,000,000 and the balance to be paid
in cash or, at the option of ELT, as provided in Subsection
2(e). Payment shall be in the amount of appraised value plus
interest and reasonable costs and expenses of holding the
property from February, 1990.
Subsection 2(c) directs that, in the absence of a
negotiated settlement, the Secretary shall initiate a
proceeding in the U.S. District Court to determine just
compensation.
Subsection 2(d) provides for the orderly termination of all
current activities of the landowner.
Subsection 2(e) provides that the Secretary, at the option
of ELT, credit a surplus property account in the amount of the
unpaid compensation due which ELT could use to bid for surplus
property.
cost and budgetary considerations
The Congressional Budget Office (CBO) estimate of the cost
of this measure has been requested but was not available at the
time the report was filed. When the report is available, the
Chairman will request it be printed in the Congressional Record
for the advice of the Senate.
regulatory impact evaluation
In compliance with paragraph 11(b) of rule XXVI of the
Standing Rules of the Senate, the Committee makes the following
evaluation of the regulatory impact which would be incurred in
carrying out S. 2873.
The bill is not a regulatory measure in the sense of
imposing Government-established standards or significant
economic responsibilities on private individuals and
businesses.
No personal information would be collected in administering
the program. Therefore, there would be no impact on personal
privacy.
Little, if any, additional paperwork would result from the
enactment of S. 2873, as ordered reported.
executive communications
On September 20, 2000, the Committee on Energy and Natural
Resources requested legislative reports from the Department of
the Interior and the Office of Management and Budget setting
forth executive views on the bill. These reports had not been
received at the time the report on S. 2873 was filed. When the
reports become available, the Chairman will request that they
be printed in the Congressional Record for the advice of the
Senate.
The testimony provided by the Department of the Interior at
the Subcommittee hearing follows:
Statement of Tom Fry, Director, Bureau of Land Management
Mr. Chairman and members of the subcommittee, I appreciate
the opportunity to appear before you today to testify on S.
2873, to provide for all right, title, and interest in and to
certain property in Washington County, Utah, to be vested in
the United States. The Administration opposes this legislation.
The bill seeks to accomplish the Federal government's long-
awaited and much-desired acquisition of the last major block of
private lands within the Washington county Habitat Conservation
Plan (HCP) area near St. George, Utah. Specifically at issue is
the area known as the Red Cliffs Desert Reserve which provides
critical habitat for the threatened desert tortoise. There is
no disagreement as to the important goal and desire to
consummate the final, critical acquisitions in this unique and
special place, yet we believe the objectives of S. 2873 can be
accomplished through the normal land acquisition process for
which the Bureau of Land Management (BLM) has well-established
procedures. I would like to point out that the Administration
also opposed Mr. Hansen's companion bill on this issues, H.R.
4721, at the House Resources Committee hearing held on July 13,
2000. I will now briefly outline the legislation and our
reasons for opposing it.
S. 2873 would provide for the acquisition by the BLM of all
right, title and interest to 1,516 acres of private property
within the Red Cliffs Desert Reserve and 34 acres of private
property adjacent to the Reserve. The Red Cliffs Desert Reserve
was established in 1996 as part of the Desert Tortoise HCP for
Washington County, Utah. The County developed the HCP, with
technical advice from the Fish and Wildlife Service, in order
to receive a permit to allow for the incidental take of about
12,000 acres of privately-held desert tortoise habitat and to
mitigate that take by developing the Reserve to ensure the
protection and recovery of the threatened Desert Tortoise and
other listed species in the Area. S. 2873 provides compensation
to the private landowner, Environmental Land Technology, Ltd.
(ELT) as of the date of the approval of the HCP, with an
initial payment of $15 million and any remaining judgment
backed by the full faith and credit of the United States.
Compensation would also include interest, reasonable costs,
expenses of holding the property and attorney fees from
February 1996 to the date of final payment.
Since 1996, BLM has coordinated the acquisition of nearly
4,400 acres of Desert Tortoise Habitat within the Red Cliff's
Desert Reserve worth approximately $35 million. These state and
private acquisitions have included land exchanges, direct
purchases at fair market value and one donation. BLM has
expended $10.5 million in Land and Water Conservation Fund
(LWCF) monies to date in completing land purchases and has an
additional $1.5 million available to purchase high value
habitat in FY 2000. BLM has completed five separate
transactions with ELT, the private landowner at issue in S.
2873, for a total of approximately 383 acres, including both
exchanges and LWCF purchases.
In addition, since 1997, the Fish and Wildlife Service has
provided approximately $4.7 million in grants to the State of
Utah for land acquisitions associated with the Washington
County HCP. These grants were provided through the Service's
HCP Land Acquisition Program under the Endangered Species Act
section 6 Cooperative Endangered Species Conservation Fund. The
Washington County HCP is one of only two HCPs which have
received funding through this program in each year since its
inception in 1997. This program is based on a competitive
proposal process. To date, the Fish and Wildlife Service has
not received a proposal for grant assistance for acquisition of
the 1,500 acre ELT property. If a proposal were submitted and
included the required 25% non-Federal cost sharing, it would be
eligible to compete for funding under the HCP Land Acquisition
Program. However, the acquisition would have to satisfy all
applicable Federal appraisal and other land acquisition
requirements.
These transactions demonstrate a long-term record of
successful accomplishments in meeting the goals and objectives
of the HCP despite widely varying expectations by many
landowners.
The Administration believes that S. 2873 is not in the
public interest for several reasons:
(1) S. 2873 provides preferential treatment to one land
owner and provides for compensation above and beyond the
benefits received by other landowners in previous acquisitions
in this area. The amounts that S. 2873 directs the landowner be
paid are not supported by the preliminary appraisal for this
property and, in fact, are considerably in excess of the
appraised values on other adjacent properties. We see no
justification to add interest, reasonable costs, expenses of
holding the property and attorney fees to any settlement with
the private landowner. Given the early absence of clear title
and other delays in final settlement, no such considerations
are in the public interest.
(2) The bill also legislates the acquisition of 34 acres
adjacent to but not within the Reserve. This parcel abuts the
Reserve on only one side and is surrounded on three sides by
private land which has been developed. Access is available to
the parcel through adjacent lands. The parcel has not been
included in any agreement, it is not addressed in the HCP and
because of its size and configuration, it has marginal
potential for habitat management. We have no reason to believe
that the public interest would be well served by this 34-acre
acquisition.
(3) The BLM has attempted to work with ELT over the last
four years to reach agreement on a fair and reasonable process
in conducting appraisals in reaching agreement on the value of
the remaining 1,500 acres. After completing a number of
previous transactions using approved and acceptable appraisal
standards, the company has departed from the process and sought
independent private appraisers who have used appraisal
assumptions not consistent with BLM policies and procedures
used on previous HCP acquisitions. All previous appraisal
reports have complied with Public Law 104-333, the Omnibus
Parks and Public Lands Management Act of 1996, which requires
the BLM to disregard the listing of the Desert Tortoise in the
appraisals and determination of value for other properties.
Appraisals involving Federal acquisitions must carefully
conform to established and accepted procedures to ensure a fair
and an unbiased estimate of value. Laws and regulations
pertaining to land exchanges provide reasonable administrative
discretion for resolving disputes concerning property value.
(4) S. 2873 would provide for the acquisition of all right,
title and interest of the 1,516 acres of property within the
Reserve and the additional 34 acres outside the Reserve. Title
to the subject property was clouded by litigation for many
years with the State of Utah and was not resolved until a
settlement was signed between the parties in 1997. We are
uncertain as to what rights, title and interest the land owner
may possess at this time. The State of Utah may have also
retained the mineral rights to these properties. There is also
some concern that title may still be encumbered by other liens
or financial obligations.
(5) The legislation is premature because it circumvents the
normal court considerations of a property owner's claims. The
property owner has the right to bring a civil action in a court
of law to seek indemnification for an alleged government taking
of private property. The court would determine whether the
property has been taken and the amount of just compensation. If
S. 2873 is a legislative taking, Congress should determine the
full amount of just compensation and leave it to the property
owner to contest the payment.
(6) The legislation requires the United States to take
title immediately upon enactment but does not provide an
adequate time frame to ensure clear title or remove
encumbrances, potential liens, and satisfy property taxes that
may be due on the property. Also, the bill does not address how
or when to complete pre-acquisition site assessments, hazardous
material investigations and follow through on findings to
protect the interests of the United States.
In closing, Mr. Chairman, the acquisition of these lands
within the Reserve is a high priority for the BLM and the Fish
and Wildlife Service because there is no question this area is
critical to the protection and recovery of the Desert Tortoise.
The HCP has provided a mechanism to both protect listed species
and allow for continued economic opportunities in Washington
County, Utah. Completion of the land acquisition goals within
the Reserve is supported by State and local officials, the Utah
Congressional delegation and the Administration. We fully
support the concept of transferring title to the land inside
the reserve to the Bureau of Land Management in a manner that
compensates the landowner in accordance with existing Federal
law. We thank Mr. Bennett for his efforts to resolve this
difficult issue. While we cannot support S. 2873 for the
reasons set forth in this testimony, we are nevertheless
committed to working with the land owner to finalize the
acquisition of its lands within the Red Cliffs Desert Reserve.
This concludes my statement. I would be pleased to answer any
questions at this time.
CHANGES IN EXISTING LAW
In compliance with paragraph 12 of rule XXVI of the
Standing Rules of the Senate, the Committee notes that no
changes in existing law are made by S. 2873, as ordered
reported.