Research & Commentary: Federal Ownership of Public Lands Update

Published January 21, 2016

According to the United States Geological Survey, nearly half the land in the Western United States is owned by the federal government. This includes 84.9 percent of land in Nevada, 64.9 percent of Utah, 61.6 percent of Idaho, 61.2 percent of Alaska, 52.9 percent of Oregon, 48.1 percent of Wyoming, and 45.8 percent in California. The federal government owns about 5 percent of the land in states east of the Mississippi River.

In March 2012, Utah Gov. Gary Herbert (R) signed the Utah Transfer of Public Lands Act into law, which instructs the federal government to relinquish more than 20 million acres of land to the State of Utah. Although Utah has yet to bring forward a suit in an attempt to enforce the law, a move that is expected to bring strong opposition from the federal government, similar legislation is being considered in nine other Western states. These states are arguing if the federal government turns over its property in the West to the states, it will result in better environmental stewardship of the land, as well as lower management costs.

Environmentalists support federal government land ownership in Western states because they say these lands contain the most biologically and environmentally valuable ecosystems in the nation that need to be protected by federal officials from less-environmentally concerned states. However, national parks, national monuments, and federal wilderness areas (FWAs) would be excluded from any future land transfers.

Most of the land held by the U.S. Bureau of Land Management, excluding national parks and monuments and FWAs, is the result of historical accident, not environmental concerns. During the Progressive Era, which ran roughly from the 1890s to the 1920s, Congress created federal agencies to control Western lands under the belief central authorities would dispassionately apply science to determine the best use of natural resources, but as Montana State University professor of economics Holly Fretwell writes, “Science cannot determine whether hiking, biking or timber harvest is a higher-valued use. Instead, management decisions—regarding recreation use, commodity production or restoration activities—depend on budget appropriations and special interest battles.”

Fretwell says this leads to gross mismanagement of public lands, leaving Western communities at risk of wildfires, soil erosion, and other environmental problems that impose steep economic costs.

Without allowing market forces to have a greater say in how federal lands are used, Western states will continue to suffer economic and environmental disadvantages. In addition to containing coal, oil, and natural gas, federal lands are also a major source of softwood timber, hard metals, and grazing areas.

A study comparing state trust lands in Arizona, Idaho, Montana, and New Mexico to federal multiple-use lands from 2009–13 by the Property and Environment Research Center (PERC) found these states earned a combined $14.51 for every dollar spent managing state trust lands, while the federal government earned only 73 cents for every dollar they spent managing federal lands. On a per-acre basis, the states earned $34.60; the feds lost $4.38.

PERC writes, “State trust management has demonstrated its ability to resist excessive political influence, respond to market signals, and accommodate new resources over time. … Managing these lands should provide a rich source of revenues to benefit the public, but is instead coming at a high cost to taxpayers.”

Not only would a transfer of Western federal lands to the states be better for the preservation of much of the land and the residents of the states, it would also be a better deal for taxpayers nationwide.

The following documents provide more information about federal lands.

Divided Lands: State vs. Federal Management in the West
This report from PERC states there is a great land divide in the United States. Most of the land east of the Rocky Mountains is privately owned, while approximately half of land west of the Rockies is owned by the federal government. Studies show Western states’ lands are managed far more efficiently than federal lands. The federal government often loses money managing valuable natural resources, while states consistently generate significant revenue from state trust lands.

Federally Managed Lands in the West: The Economic and Environmental Implications for the States
While the transfer of limited federal public lands to state control is an idea that is almost as old as the Republic itself, misconceptions about the policy are common, and the rationale underpinning the transfer is not widely understood. This report from the American Legislative Exchange Council answers many questions surrounding this contentious issue and provides clarification on what transfer-of-public-land petitions seek to do, as well as what is not in the proposals.

Ranching Realities in the 21st Century
This series of essays from Canada’s Fraser Institute demonstrates and analyzes the incentives that arise from various forms of government ownership and public management. These essays can help improve outcomes by helping legislators and other decision makers better understand the experiences of the past so that they may make use of the lessons to create a more cooperative and prosperous future.

Local Control Is Better Management for Federal Lands
Writing in February 2014 for the Washington Examiner, Montana State University professor Holly Fretwell points out the current incentive structure for the management of federally owned land in the Western United States creates numerous problems for Western communities. Fretwell says local and state governments should have more control over lands located within their borders. 

Research & Commentary: Private Management of Public Parks
Former Heartland Institute Policy Analyst Taylor Smith examines the poor financial shape of many of the nation’s public parks, which have become political footballs during intense budget negotiations. Such fiscal struggle and political meddling calls for privatization as the most intellectually prudent solution, but Smith notes partial privatization of public parks through public-private partnerships can be a more politically feasible, second-best alternative. 

Bringing Local Knowledge to Federal Lands
In a February 2014 paper for the R Street Institute, Montana State University professor Holly Fretwell argues the once widely held belief that an elite group of government experts could dispassionately use science to manage public lands better than free actors would in an open market should be reconsidered. Fretwell argues there is no one-size-fits-all reform for all federally owned lands; she says a range of strategies, from privatization to various devolution schemes, should be utilized. 


Nothing in this Research & Commentary is intended to influence the passage of legislation, and it does not necessarily represent the views of The Heartland Institute. For further information on this and other topics, visit the Environment & Climate News website at, The Heartland Institute’s website at, and PolicyBot, Heartland’s free online research database, at

The Heartland Institute can send an expert to your state to testify or brief your caucus; host an event in your state; or send you further information on a topic. Please don’t hesitate to contact us if we can be of assistance! If you have any questions or comments, contact John Nothdurft, Heartland’s director of government relations, at [email protected] or 312/377-4000.