Annual Report on

Performance and

Accountability

Fiscal Year 2005

U.S. Department of the Interior • Bureau of Land Management
PREFACE The Bureau of Land Management (BLM, or 

Bureau) is a small agency with a big mission 

and a lot of ground to cover. We administer 

more Federal lands than any other agency: 

261 million acres of public lands and their 

myriad resources, plus a total of 700 million 

acres of subsurface mineral estate.

Our workforce is spread across the country in numerous state offices 

and field offices. Most of the public lands and resources we manage 

are in the western states and Alaska. Our Eastern States office in 

Virginia manages land and natural resources in 31 states east of and 

bordering the Mississippi River. We also have national centers for 

business, science and technology, human resource management, 

and information resource management in Denver; fire management 

in Boise; and training in Phoenix. Our headquarters is located in 

Washington, D.C.

In managing the Nation’s vast public land holdings for multiple 

uses, we perform many tasks: resource inventory, land use planning, 

environmental impact assessment, land surveying, road construction, 

fish and wildlife habitat restoration, and resource condition 

monitoring, to name just a few.

Public lands administered by the Bureau include millions of acres 

of open rangelands; geological formations containing the oil, gas, 

and coal resources needed to sustain our economic well-being; 

recreation areas and remote landscapes with spectacular scenery and 

opportunities for solitude; over 116,000 miles of fishable streams; 

high forested slopes; alpine tundra; majestic canyons; and rugged 

badlands.

We invite you to read our 2005 Annual Report and see what we have 

accomplished. Take a moment to reflect on the wealth of resources 

and opportunities offered by America’s public lands . . . and this year, 

think about planning a visit to your public lands! 

BLM 2004 Annual Report
BLM 2005 Annual Report

TABLE OF

CONTENTS

Director’s Letter . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1

Message from the Chief Financial Officer . . . . . . . . . . . . . . . . . . . . . 2

Cooperative Conservation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4

Management’s Discussion and Analysis . . . . . . . . . . . . . . . . . . . . . . 5

The BLM’s Mission and Organizational Structure . . . . . . . . . . . 5

Performance Goals and Results . . . . . . . . . . . . . . . . . . . . . . . . . . 8

Systems, Controls, and Legal Compliance . . . . . . . . . . . . . . . . 29

Future Effects of Existing, Currently Known Demands, Risks, 

 Uncertainties, Events, Conditions, and Trends . . . . . . . . . . 37

Discussion and Analysis of the Financial Statements . . . . . . . . . 41

Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44

Principal Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . . 44

Notes to Principal Financial Statements . . . . . . . . . . . . . . . . . . 50

Supplementary Statement of Budgetary Resources

 by Major Budget Accounts . . . . . . . . . . . . . . . . . . . . . . . . . 80

Stewardship Assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 84

Stewardship Lands . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 84

Natural Heritage Assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 91

Paleontological and Cultural Heritage Properties . . . . . . . . . . . 97

Museum Collections . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 99

Investment in Research and Development . . . . . . . . . . . . . . . . . . 103

Deferred Maintenance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 105

Independent Auditors’ Report . . . . . . . . . . . . . . . . . . . . . . . . . . . 109
ii BLM 2005 Annual Report

OUR VISION

To enhance the quality of life for all citizens through the balanced 

stewardship of America’s public lands and resources.

OUR MISSION

To sustain the health, diversity, and productivity of the public lands

for the use and enjoyment of present and future generations.

OUR VALUES

To serve with honesty, integrity, accountability, respect, courage, and 

commitment to make a difference.

OUR PRIORITIES

To improve the health and productivity of the land to support the 

BLM multiple-use mission.

To cultivate community-based conservation, citizen-centered 

stewardship, and partnership through consultation, cooperation, and 

communication.

To respect, value, and support our employees, giving them resources 

and opportunities to succeed.

To pursue excellence in business practices, improve accountability to 

our stakeholders, and deliver better service to our customers.
BLM 2005 Annual Report 

DIRECTOR’S

LETTER

The Bureau of Land Management, part of the U.S. Department of the 

Interior, is a small agency with a big responsibility. It manages more land 

than any other Federal agency—261 million surface acres, an area about 

the size of California and Texas combined, along with 700 million acres 

of sub-surface Federal mineral estate. The BLM’s mandate from Congress 

is to manage this land for multiple uses while ensuring its health and 

productivity.

This is a challenging mandate, but the BLM does not try to go it alone 

in carrying out its multiple-use mission. To succeed in its role as a steward 

of the land, the Bureau works in cooperation with a host of partners: 

states, counties, local communities, agencies, organizations, businesses, and 

private individuals. This management approach, known as Cooperative 

Conservation, reflects President Bush’s commitment to strengthening 

partnerships and promoting citizen stewardship. As Interior Secretary Gale 

Norton has put it: “Ultimately, the people who are best able to take care of the 

land are those who live on the land, work on the land, and love the land.” 

Bringing a “can-do” attitude to its mission, the BLM manages and 

protects land that encompasses some of America’s most spectacular 

landscapes, including 175 Wilderness Areas and numerous other special 

places that are part of the agency’s National Landscape Conservation 

System. These and other BLM-managed lands, most of which are located 

in 12 Western states, offer myriad outdoor recreational opportunities. The 

public lands also support a variety of commercial-related activities, such as 

livestock grazing, which, besides its economic and social benefits to rural 

communities, helps preserve open space and wildlife habitat in the fastgrowing West. Other vital public land uses—energy development, timber 

harvesting, and mineral production—contribute to the economy of the 

West and the nation as a whole. 

In managing such a wide array of uses, the BLM works to reduce 

conflicts among the various land users while minimizing impacts on the 

land’s resources. As part of that work, the Bureau must deal with new 

and complex challenges resulting from urbanization, which has brought 

many Western cities and suburbs closer to once-remote public lands. This 

phenomenon of “wildland-urban interface” is moving across the landscapes 

of the West, where the population of the 12 public land states, including 

Alaska, rose from 19.6 million in 1950 to 61.9 million in 2000. 

While the challenges are formidable, the BLM, as a “can-do” agency, 

has made notable accomplishments in Fiscal Year 2005, and I invite you to 

read about them in this Annual Report. Our agency is determined to build 

on these accomplishments, and we will do that by continuing to strengthen 

and expand our partnerships at the local, state, and national level.

By succeeding in its multiple-use mission, the BLM will ensure that 

current and future generations are able to use and enjoy America’s public 

lands. 

Kathleen Clarke

Director,

Bureau of Land 

Management
BLM 2005 Annual Report

MESSAGE FROM

THE CHIEF

FINANCIAL

OFFICER

The BLM’s mission—to sustain the health, diversity, and productivity 

of the public lands for the use and enjoyment of present and future 

generations—is both complex and challenging. Accomplishing this mission 

requires dedication and professionalism from our employees, as well as 

partnerships with others. We work together with individual citizens, 

communities, interest groups, Tribes, and business and industry to achieve 

both healthy lands and thriving communities. Secretary of the Interior 

Gale Norton’s principle of the Four Cs: consultation, cooperation, and 

communication, all in the service of conservation, provides the foundation 

for our efforts. 

The BLM continues to face significant challenges that are critical to 

the productivity and well-being of local communities and the Nation as 

a whole. These challenges include promoting responsible development of 

our Nation’s energy resources to reduce our reliance on foreign sources; 

providing for the exploration and development of new or renewable sources 

of energy, including wind, solar, geothermal, and biomass; reducing fuel 

buildups in our Nation’s forests and rangelands that increase the risk of 

wildfires; providing recreation opportunities and places of solitude for an 

exploding western population; improving wildlife habitat; and working 

toward the recovery of threatened and endangered species. While these and 

other challenges have sometimes proven difficult, our successes have been 

many.

These successes result both from effective natural resource stewardship 

and from a close partnership between our natural resource program 

responsibilities and our business and administrative functions. We 

continually strive to provide the business tools and capabilities needed to 

accomplish our natural resource and public land management mission as 

efficiently as possible. We have a state-of-the-art management information 

system that provides all employees and managers with current information 

on spending, performance, and the cost of doing business. This system 

increases our efficiency and productivity.

As part of our continual search for new and better ways of conducting 

business and delivering services, we have expanded E-Government 

initiatives to improve service and accessibility to our customers. For 

example, we continue to make available to the public our most-used forms 

on the Internet through an E-Forms initiative. We are also planning a 

release of Version 2 of our E-Planning system in late 2006 that will allow 

the public to review and comment on environmental impact statements and 

other land use planning documents via the Internet. We will continue to 

develop these and other E-Government efforts, providing more electronic 

services to the public in other business areas. 

BLM employees are vital to our success. To continue to be successful, 

we must ensure that we have a highly trained, motivated workforce that can 

meet the challenges the BLM faces today, as well as those that lie ahead. 

We are addressing a variety of human resource issues, including developing 

worker competencies and appropriate skill levels, expanding work capability, 

retaining vital knowledge in the face of an aging workforce (knowledge 

management), and improving business practices to enhance efficiency and 

effectiveness. 

Michael A. Fergusen

Chief Financial Officer
BLM 2005 Annual Report 

We are continually exploring new ways to 

improve the way we conduct business. This includes 

taking advantage of new technologies; establishing 

and maintaining partnerships with other Federal, 

state, and local government agencies as well as 

industry and nonprofit groups; continuing to 

expand our broad base of volunteers; and using the 

expertise and resources of the private sector.

We are also always exploring greater 

opportunities for cost sharing and cost recovery 

to leverage our resources and ensure that users 

pay an equitable cost for the services we provide. 

We continue to expand our highly successful 

Challenge Cost Share program and to implement 

the Secretary’s Cooperative Conservation Initiative. 

This Secretarial priority provides for matching 

contributions from conservation groups, state and 

local governments, industry, and others to complete 

critical on-the-ground conservation projects.

I am pleased to report that the BLM is in 

a sound financial position as Fiscal Year (FY) 

2005 ends and we move forward to face the 

opportunities of the coming fiscal year. For the 

eleventh consecutive year, the BLM has obtained an 

unqualified (“clean”) audit opinion on its financial 

statements.

We are continuing pre-implementation activities 

for the Department of the Interior’s Financial and 

Business Management System (FBMS)—a new 

system that will significantly change how we do 

business and replace our current Federal Financial 

System (FFS). During FY 2005, we worked on 

system configuration, system interfaces, and data 

conversion/verification issues. We also completed 

a role mapping process that defines workload, 

responsibilities, and access to the new system, 

based on the nature and requirements of individual 

positions. A key element was a change management 

process that addressed the human side of the 

equation by increasing employee awareness of the 

new system and providing organizational support. 

The BLM’s implementation date for FBMS has been 

revised from October 2005 to October 2006.

In 2005, we added a new “Standard Billings 

Interface” to the BLM’s Collections and Billings 

System (CBS). This new interface receives billings 

data and transactions from a remote system and 

processes them in CBS. The new interface is 

intended to have the flexibility to interface with a 

variety of different systems with minimal changes 

to existing CBS programs and data structures. 

The first remote system to use this new interface 

was the Lands and Realty Authorization Module 

(LRAM), previously known as the Automated Lease 

Management System, maintained by the Lands and 

Resources Project Office. LRAM can now print 

all of their bills in CBS instead of having to use 

multiple distributed systems. This allows LRAM 

bills to be sent to FFS via CBS for the first time.

The BLM is in the process of re-competing 

several consolidated acquisitions for the Department 

of the Interior. The resulting contracts will continue 

to provide significant cost savings and streamlined 

purchasing procedures. Acquisitions will include 

Department-wide acquisitions for personal 

computers, laptop computers, servers, printers, 

monitors, consumables (cartridges, disks, etc.), and 

hazardous fuels reduction.

Given the above strengths and accomplishments, 

we remain in an excellent position to implement 

the President’s Management Agenda, allowing us 

to ensure the health and productivity of the public 

lands in the most effective manner possible. The 

BLM has proven to be a leader in government in 

integrating performance and budget by developing 

a sophisticated cost management system that is 

helping to improve performance and on-the-ground 

program delivery. We are ensuring that products 

and services are delivered to the public in the most 

cost-efficient manner by applying competitive 

sourcing procedures to our commercial program 

functions. We are making our services more available 

to our customers and the public electronically 

through E-Government initiatives. Our workforce 

plan has been completed and is being implemented. 

And we are providing accurate and timely financial 

information that is useful to managers in executing 

the BLM’s programs.

The Bureau of Land Management is meeting 

the challenge President George W. Bush set forth 

for all agencies of the United States Government: 

“ . . . ensuring that the resources entrusted to the 

federal government are well managed and wisely 

used.”
BLM 2005 Annual Report

COOPERATIVE

CONSERVATION

The Bureau of Land Management works with numerous 

partners—states, counties, local communities, other agencies, 

organizations, businesses, and individuals—to meet its stewardship 

responsibilities for our Nation’s vast public land holdings. This 

partnership approach promotes citizen involvement and stewardship, 

known as Cooperative Conservation.

Aldo Leopold, noted 20th century conservationist, envisioned a 

Nation of citizen stewards. Simply put, each of us needs to care for 

local landscapes and environments. Our individual actions in our 

own backyards, at our places of work, on our farms and ranches, 

and in our communities can make a crucial difference. Cooperative 

Conservation seeks to recognize and take full advantage of the 

knowledge, wisdom, talents, and enthusiasm that local people, 

communities, and governments bring to the table.

Cooperative Conservation is far more than just a clever catch 

phrase or slogan. The Department of the Interior has already made 

over $500 million available in conservation grants for a variety of 

Cooperative Conservation programs. Two of these, the Private 

Stewardship Grant and Landowner Incentive programs, provide 

assistance to private landowners in their voluntary efforts to protect 

threatened, imperiled, and endangered species.

Almost $13 million was given to the BLM and other Interior 

bureaus in Cooperative Conservation challenge cost-share grants to 

fund 256 projects. These range from eradicating invasive species to 

restoring wildlife habitat and providing stable water supplies for elk. 

The grants cover 40 states, involve 749 partners, and leverage $24 

million in partnered dollars.

Everyone benefits from Cooperative Conservation—especially our 

environment. The voices of local people and communities are heard 

and their actions count. BLM efforts and expenditures are multiplied 

though partnerships and cost sharing. Everyone benefits as we work 

together to sustain the health, diversity, and productivity of the 

public lands for the use and enjoyment of both present and future 

generations.
BLM 2005 Annual Report

MANAGEMENT’S 

DISCUSSION 

AND ANALYSIS

The BLM’S Mission

and Organizational Structure

The BLM’s Mission and History

The Bureau of Land Management’s (BLM’s) vision is to enhance 

the quality of life for all citizens through the balanced stewardship 

of America’s public lands and resources. Its mission is to sustain the 

health, diversity, and productivity of the Nation’s public lands for the 

use and enjoyment of present and future generations.

The BLM manages 261 million acres of surface estate on public 

land, about one-eighth of the land in the United States. The BLM 

also administers approximately 700 million acres of on-shore Federal 

mineral estate on or underlying both Federal surface ownerships 

and some privately owned surface. In addition, the BLM has trust 

responsibilities on 56 million acres of Indian trust lands for approval 

and supervision of mineral operations and cadastral (land) survey.

BLM-managed public lands contribute to the quality of life of 

the American people and to our national interests in many different 

ways. The public lands offer boundless opportunities for recreation 

and adventure in some of the most spectacular landscapes on the 

continent. These public lands also support economic activities 

that are vital to the health of local economies and to our national 

economy.

The way of life we Americans take for granted every day depends 

on a stable and abundant supply of affordable energy. Oil and natural 

gas supply 65 percent of the energy we use in our country, and BLMadministered lands provide 5 percent of the nation’s current oil supply 

and 10 to 11 percent of the nation’s natural gas supply. America 

contains large reserves of natural gas and coal. 

Through its leasing and permitting program, the BLM is 

encouraging the development of alternative energy sources such as 

hydropower, wind, geothermal, biomass, and solar. At the same time, 

the Bureau encourages Americans to use energy wisely—not waste 

it—thus reducing future demand. 

The BLM administers some of the most ecologically and 

culturally diverse, and scientifically important, lands belonging to the 

Federal government. Among its varied responsibilities for managing 

and protecting our Nation’s priceless natural and cultural legacy is 

stewardship for:

• Commercial activities

• Conventional energy sources (oil, natural gas, coal, etc.)
 BLM 2005 Annual Report

Management‘s Discussion and Analysis

• Renewable energy (wind, solar, geothermal, 

biomass, etc.)

• Minerals (gold, zinc, precious metals, etc.)

• Public land survey system plats and field 

notes

• Rights-of-way

• Transportation systems (roads, trails and 

bridges) 

• Fish and wildlife habitat 

• Range management and grazing 

• Wild free-roaming horses and burros 

• Rare, vulnerable and representative habitats, 

plant communities, and ecosystems

• Threatened, endangered, and special status 

species

• Invasive and noxious weeds

• Wildland fire activity and the wildlandurban interface

• Paleontological resources and archaeological 

and historical sites, including museum 

collections derived from those areas

• Interpretive activities to meet scientific and 

educational needs 

• Wild and scenic rivers

• Wilderness and wilderness study areas

• Recreation opportunities

The BLM was created in 1946, when the 

Grazing Service was merged with the General 

Land Office to form the Bureau of Land 

Management within the Department of the 

Interior. When the BLM was initially created, 

there were over 2,000 unrelated and often 

conflicting laws for managing the public lands. 

The Bureau had no unified legislative mandate 

until Congress enacted the Federal Land Policy 

and Management Act of 1976 (FLPMA).

In FLPMA, Congress recognized the value 

of the remaining public lands and declared 

that these lands would remain in public 

ownership. FLPMA also gave us the term 

“multiple use management.” This is defined as 

“the management of the public lands and their 

various resource values so they are utilized in 

the combination that will best meet the present 

and future needs of the American people.”

The needs of a growing and changing 

West are increasing and we must address them. 

The American West, home to most of our 

BLM-managed public lands, is now the fastest 

growing region of the Nation. Eight of the 12 

fastest-growing states are in the West, and the 

rate of growth in these western states averaged 

30 percent from 1990 to 2000—more than 

twice the national average of 13 percent during 

the same period. Millions of people in rapidly 

growing western communities are now within 

an hour’s drive of formerly remote public lands. 

As a result of these and other changes, 

public lands are increasingly viewed from 

the perspective of their diverse recreational 

opportunities, their cultural resources and, in 

an increasingly urban world, their vast open 

spaces. However, the more traditional land 

uses of grazing, timber production, and energy 

and mineral extraction also remain important, 

especially to the economic and social well-being 

of many rural western communities.

Livestock grazing on public lands is an 

integral part of the lifestyle in the American 

West. Many ranchers point proudly to the 

generations before them who have managed the 

lands for productivity and continuity. They 

have not only supported their families and 
BLM 2005 Annual Report 

Management‘s Discussion and Analysis

enriched their communities, but they have 

conserved the quality of the rangelands while 

providing food for the world. 

Wild horses and burros, traditional icons of 

the Old West, are also key factors for successful 

range management. The BLM and the Forest 

Service received authorization in 1971 to 

manage, protect, and control these animals on 

the nation’s public lands to ensure healthy herds 

and healthy rangelands. The BLM monitors 

rangelands and herds of wild horses and burros 

to determine the number of animals, including 

livestock and wildlife, the land can support. 

Each year the BLM gathers excess wild horses 

and burros from areas where vegetation and 

water could become scarce if too many animals 

use the area.

Many diverse partners—the general public, 

various constituent groups, and other agencies 

and levels of government—have eagerly joined 

the BLM in collaborative decision-making 

ALASKA STATE OFFICE

State Director Henry Bisson

222 West 7th Avenue, #13

Anchorage, AK 99513-7599

(907) 271-5080

Public Room: (907) 271-5960

ARIZONA STATE OFFICE

State Director Elaine Zielinski

One North Central Ave.

Phoenix, AZ 85004

(602)417-9500

Public Room: (602) 417-9300

CALIFORNIA STATE OFFICE

State Director Mike Pool

2800 Cottage Way, 

Room W-1834

Sacramento, CA 95825

(916) 978-4600

Public Room: (916) 978-4400

COLORADO STATE OFFICE

State Director Sally Wisely

2850 Youngfield Street

Lakewood, CO 80215-7093

(303) 239-3700

Public Room: (303) 239-3600

EASTERN STATES OFFICE

State Director Mike Nedd

7450 Boston Blvd.

Springfield, VA 22153

(703) 440-1711

Public Room: (703) 440-1600

IDAHO STATE OFFICE

State Director K. Lynn Bennett

1387 S. Vinnell Way

Boise, Idaho 83709-1657

(208) 373-4001

Public Room: (208) 373-3889

MONTANA STATE OFFICE

State Director Marty Ott

5001 Southgate Drive

Billings, MT 59101

(406) 896-5012

Public Room: (406) 896-5004

NEVADA STATE OFFICE

State Director Ron Wenker

1340 Financial Way

Reno, NV 89502

(775) 861-6590

Public Room: (775) 861-6500

NEW MEXICO STATE OFFICE

State Director Linda Rundell

1474 Rodeo Rd.

P.O. Box 27115

Santa Fe, NM 87502-0115

(505) 438-7501

Public Room: (505) 438-7471

OREGON STATE OFFICE

State Director Elaine Brong

P.O. Box 2965

Portland, OR 97208-2965

(503) 808-6026

Public Room: (503) 808-6001

UTAH STATE OFFICE

State Director (vacant)

P.O. Box 45155

Salt Lake City, UT 84145-0155

(801) 539-4010

Public Room: (801) 539-4001

WYOMING STATE OFFICE

State Director Bob Bennett

5353 Yellowstone Road

P.O. Box 1828

Cheyenne, WY 82003

(307) 775-6001

Public Room: (307) 775-6256

NATIONAL BUSINESS CENTER

Director Thomas Boyd, BC-600

Denver Federal Center, Building 50

P.O. Box 25047

Denver, CO 80225-0047

(303) 236-8857

NATIONAL SCIENCE and 

TECHNOLOGY CENTER (NSTC)

Director Lee Barkow, ST-100

P.O. Box 25047

Denver Federal Center, Building 50

Denver, CO 80225-0047

(303) 236-6454

NATIONAL HUMAN RESOURCES 

MANAGEMENT CENTER

Director Annette Martinez

HR-200

P.O. Box 25047

Denver Federal Center, Building 50

Denver, CO 80225-0047

(303) 236-6503

NATIONAL INFORMATION 

RESOURCES MANAGEMENT

CENTER (NIRMC)

Director Ken Wilbert

NI-100 (Bldg. 40)

P.O. Box 25047

Denver Federal Center, Building 50

Denver, CO 80225-0047

(303) 236-6965

NATIONAL INTERAGENCY FIRE 

CENTER (NIFC)

Director Larry Hamilton

3833 South Development Ave.

Boise, ID 83705-5354

(208) 387-5446

NATIONAL TRAINING CENTER 

(NTC)

Director Don Charpio

9828 North 31st Avenue

Phoenix, AZ 85051

(602) 906-5500

(A) = Acting

and on-the-ground projects. These cooperative 

efforts continue to greatly benefit the public 

lands and everyone who relies on them. We 

appreciate the Tribes, the States, the counties 

and local communities—our many partners, 

volunteers, friends, and neighbors. We are 

grateful for their many contributions and 

valuable help.

The current Administration is placing more 

faith and trust in the people, their knowledge, 

their experience, and their respect for the land. 

The BLM ensures consultation with those 

most affected by the Bureau’s decisions, open 

communication with everyone affected by or 

involved in our programs, and cooperation with 

all stakeholders as we solve problems creatively. 

These actions result in effective conservation, 

the cornerstone of our efforts to manage healthy 

public lands for the benefit of current and future 

generations. 

BLM’s Headquarters and Field Organization
BLM 2005 Annual Report

Management‘s Discussion and Analysis

Performance Goals and Results

Implementing the Government Performance 

and Results Act in the BLM

The Government Performance and Results Act requires Federal 

agencies to set priorities and goals, determine strategies for reaching 

those goals, measure their performance, and report on progress each 

year. In 1997, the BLM developed and published its first strategic 

plan for the period 1997-2002. In 2000, the Bureau revised its 

strategic plan for the period 2001-2005 by simplifying its structure 

and refining its goals.

In 2004, the BLM developed a totally revised strategic plan, now 

referred to as an operating plan, for the period 2004-2008. This 

operating plan tiers directly off of the Department of the Interior’s 

strategic plan, which is available on the Internet at http://www.doi.

gov/ppp/strat_plan_fy2003_2008.pdf . The Department’s plan 

was released in September 2003.

The BLM’s annual performance reporting requirements under the 

Government Performance and Results Act are now handled as part 

of the Department of the Interior’s Annual Report on Performance 

and Accountability. This report outlines both long-term and annual 

goals. It also shows planned and actual performance levels for the 

current year, as well as actual performance in recent years to show 

trends. A discussion section gives background information and 

explains how and why goals were met, not met, or exceeded.

In addition to the annual performance reporting noted above, we 

publish this Annual Report at the end of each fiscal year to assist the 

Department of the Interior in complying with the Chief Financial 

Officers Act of 1990 and the Governmental Management Reform Act 

of 1994. Our BLM Annual Report is designed to:

• Provide a management discussion and analysis of performance 

goals and results, systems and controls in place to ensure legal 

compliance, and future effects of current risks and uncertainties.

• Present our financial statements and notes, along with an 

overview of the information presented.

• Present our “Stewardship Assets” report, which describes the 

fulfillment of our stewardship responsibilities for public lands/

resources, natural heritage assets, museum collections, and 

paleontological and cultural heritage properties.
BLM 2005 Annual Report

Management‘s Discussion and Analysis

• Discuss deferred maintenance issues for the 

BLM’s buildings, roads, bridges, recreation 

facilities, and other infrastructure assets.

The “Overview of Performance Goals and 

Results” narrative presented later in this section 

serves as a general overview and discussion of 

the BLM’s performance goals and results for 

Fiscal Year (FY) 2005.

Evaluations to assess performance are 

an important aspect of complying with the 

Government Performance and Results Act. We 

are responding to this need by implementing a 

new approach to conducting evaluations for our 

offices and programs.

To detect and prevent problems, our new 

system uses two interlocking components: local 

self-assessment and national validation. Best 

performance practices are identified and shared 

with others, resulting in productivity and 

efficiency gains over time and helping to ensure 

that American taxpayers are receiving the best 

value for their money.

Overview of Performance Goals 

and Results

The Bureau has aligned its goals and 

outcome measures under four overarching 

mission areas:

• Resource Protection

• Resource Use

• Recreation

• Serving Communities

The following paragraphs present selected 

performance information for the BLM’s longterm goals and highlight some important 

milestones used for measuring our performance.

Resource Protection

The health of BLM-administered 

public lands continues to be of paramount 

importance. Healthy lands are more resilient to 

environmental fluctuation and disturbance, and 

can better sustain increased use by the public. 

Based on projections in the BLM’s 2006 Budget 

Justification document, the Bureau expends 

approximately 31 percent of its total funding on 

its resource protection mission. 

Effective restoration requires complex, 

multi-faceted actions that may include 

investments in land treatments, as well as 

project construction and maintenance. Because 

knowing the existing condition of public lands 

is critical to implementing appropriate treatment 

schemes, the inventorying and monitoring of 

resources is a major component of the BLM’s 

resource protection efforts. 

The BLM’s resource protection mission is 

divided into three areas:

• Improving, restoring, and maintaining the 

health of watersheds and landscapes.

• Sustaining biological communities.

• Protecting cultural and natural heritage 

resources.

During the next few years, the BLM will 

focus on restoring and conserving sagebrush 

habitat, which is home to over 350 plants and 

animals classified as BLM species of concern, 

including the greater sage-grouse. The 

Bureau is focusing its efforts on limiting the 

fragmentation of habitat, restoring areas that 

have lost their productivity, and conserving 

sagebrush habitat that is in proper functioning 

condition.

The BLM will continue to support prairie 

grassland habitat restoration projects. Prairie 

grasslands on BLM-managed lands support 

136 species of birds, mammals, amphibians, 

and reptiles, as well as 42 species of plants, 

considered to be sensitive.

Alaska, Oregon, Washington, Idaho, and 

California all provide habitat for a variety 
10 BLM 2005 Annual Report

Management‘s Discussion and Analysis

of Pacific salmon species. Thirteen specific 

populations of salmon are listed under the 

Endangered Species Act. Collaboration with 

riparian/wetland, soil, water, and air program 

priorities will accelerate habitat restoration in 

important watersheds where both fish and water 

quality are primary concerns. Appropriate 

management of these important aquatic 

resources will allow continued commercial, 

sport, subsistence, and tribal use.

An additional area of focus for the BLM 

will include conservation and recovery plan 

implementation. By implementing conservation 

and recovery plans, the BLM will increase 

the percent of species of management concern 

that are managed to self-sustaining levels. 

Additionally, implementation of these actions 

can reduce or eliminate the need for listing 

and can ultimately reduce Endangered Species 

Act-related costs over the long term. This will 

be especially important with the anticipated 

increase in uses.

The BLM will continue to promote 

citizen-based stewardship of our public lands. 

Resource managers will look for opportunities 

to work with ranchers, conservationists, and 

other partners to achieve healthier western 

rangelands while providing for sustainable 

resource uses. An example of this effort is the 

integration of ecological, economic, and social 

factors and participation of affected interests 

that is occurring through the National Riparian 

Service Team and the extended riparian 

coordination network, which are focusing their 

efforts on cooperative riparian restoration. 

Through this collaborative effort, we are 

monitoring and accelerating the restoration and 

improvement of the riparian-wetland areas in 

the western United States. 

Initiatives the BLM has undertaken also 

harness the power of partnerships in restoring 

and protecting our resources. By building our 

Challenge Cost Share (CCS), Cooperative 

Conservation Initiative (CCI), and Application 

of Science Initiative (ASI), the BLM will be able 

to leverage resources to benefit the public lands.

The BLM is also focusing on managing wild 

horse and burro populations for healthy animals 

and herds that are in an ecological balance with 

other uses of forage. Proper management will 

ensure that these icons of the American West 

can survive on the range. When herd sizes are 

too large for the range they inhabit, excess wild 

horses and burros are gathered and removed 

from the public lands and then made available 

to private owners through the BLM’s Wild 

Horse and Burro Adoption program. The BLM 

has placed over 33,000 animals over the last five 

years through its adoption program.

The BLM carries out myriad activities on 

a day-to-day basis to ensure the protection and 

health of public land resources. These activities 

include the following examples:

• Completing watershed assessments on 

millions of acres of public lands and 

evaluating hundreds of grazing allotments as 

part of the Healthy Lands initiative.

• Pursuing water-quality-based abandoned 

mine lands cleanup projects on dozens of 

sites.

• Developing ground-water monitoring plans 

to monitor shallow ground-water resources 

in areas of natural gas development.

• Developing water quality/riparian 

improvement projects, restoration actions, or 

monitoring studies.

• Drilling water wells for livestock to protect 

nearby riparian vegetation areas.

• Completing gathers in Wild Horse and 

Burro Herd Management Areas to maintain 

herds at appropriate management levels and 

ensure healthy rangelands.
BLM 2005 Annual Report 11

Management‘s Discussion and Analysis

• Increasing the number of forest health 

restoration treatments and updating forest 

inventories to better track forest condition 

and identify insect and disease infestations.

• Reducing hazardous fuels to protect 

communities and the environment.

• Preventing substantial amounts of salts in 

the form of dissolved solids from entering 

the Colorado River system (over 11,000 tons 

as of the end of 2003).

• Controlling soil erosion through watershed 

maintenance work; for example, riverbank 

stabilization projects, tamarisk or sagebrush 

removal coupled with seed plantings of 

perennial grasses and forbs, and other 

activities.

• Conducting multistate regional analyses 

to support species conservation, wildlife 

program planning, and land use planning 

activities.

• Stabilizing abandoned mine tailings 

to prevent surface and ground water 

contamination as well as the airborne spread 

of toxic dust.

• Conducting soil surveys using advanced 

technology and developing predictive 

models using Landsat 7 satellite images, 10-

meter digital elevation models, etc.

• Completing multistate analyses to address 

air quality impacts, using state-of-the-art air 

quality dispersion modeling techniques.

• Participating in interagency visibility and 

atmospheric deposition monitoring networks 

to evaluate current air quality conditions, 

establish trends, and ensure that conditions 

remain within applicable thresholds.

• Encouraging public participation in 

protecting archaeological and historical 

resources through an umbrella program 

promoting public education and awareness 

called “Adventures in the Past.”

• Managing numerous properties for their 

paleontological values and promoting the 

use of fossils in research, education, and 

recreation.

The public lands contain exceptional 

geologic formations; rare and vulnerable plant 

and animal communities; wild free-roaming 

horse and burro herds; wilderness areas and 

wild and scenic rivers; and innumerable 

paleontological, archaeological, and historic 

sites. These resources are scientifically, 

ecologically, educationally, culturally, and 

recreationally important, representing a 

significant part of our Nation’s natural and 

cultural heritage.

BLM-administered public lands encompass 

an estimated 4 to 4.5 million potential 

archaeological and historical properties. These 

resources represent the tangible remains of at 

least 13,000 years of human adaptation to the 

land and include sites ranging from 12,000- to 

13,000-year-old mammoth kill sites associated 

with Paleo-Indian hunters to World War II 

and Cold War military sites. Please refer to 

the Stewardship Assets section (presented after 

the financial statements in this Annual Report) 

for specific information on the BLM’s cultural 

resource and paleontological programs.

Day-to-day management activities 

continue for wilderness areas, wilderness study 

areas, national wild and scenic rivers, herd 

management areas (for wild free-roaming horses 

and burros), national natural landmarks, and 

numerous other special management areas. 

The BLM also manages national monuments 

and Congressionally designated national 

conservation areas in the western states. 

Please refer to the Stewardship Assets section 
12 BLM 2005 Annual Report

Management‘s Discussion and Analysis

(presented after the financial statements in this 

Annual Report) for more specific information 

on all of these areas.

National monuments and national 

conservation areas, along with wilderness 

and wilderness study areas, national wild and 

scenic rivers, national historic/scenic trails, the 

Steens Mountain Cooperative Management 

and Protection Area, the White Mountains 

National Recreation Area, the Yaquina Head 

Outstanding Natural Area, and the Headwaters 

Forest Reserve in California, make up the 

BLM’s National Landscape Conservation 

System.

In Fiscal Year 2005, the Bureau continued 

its efforts to protect our Nation’s cultural 

heritage by inventorying 607,128 acres for 

cultural resources, recording 7,474 properties, 

and issuing or continuing in effect 599 study 

or management permits (excluding permits for 

paleontological collecting). To date, the Bureau 

has inventoried a total of 17.2 million acres 

Table 1. Resource Protection: Selected Goals and Accomplishments

FY 2005 Annual Goal Target Actual

Percent of wetland areas achieving desired conditions 98% 98%*

Percent of riparian areas (stream miles) achieving desired conditions 89% 89%*

Percent of upland areas achieving desired conditions 56% 58%*

Percent of surface waters (stream miles) that meet EPA approved (State) water 

quality standards 89% 91%

Cumulative percent of acres degraded by wildland fire with post-fire treatments 

underway, completed, or monitored 20% 21%

Percent change in baseline in the number of acres infested with invasive plant 

species 0.9% 0.9%

Number of acres restored or enhanced to achieve habitat conditions to support 

species conservation 9,000 9,158

Number of stream/shoreline miles restored or enhanced to achieve habitat 

conditions to support species conservation 1,300 1,015

Cumulative percent of cultural properties on DOI inventory in good condition 81% 81%**

Percent of museum collections in BLM facilities in good condition 100% 100%

Percent of paleontology localities in good condition 90% 90%*

Percent of acres of designated wilderness achieving wilderness character 

objectives as specified by statute 86% 92%

* Estimated based on FY 2004 actual performance data; final data to be provided with the FY 2007 Budget Justifications.

** Based on a subset of 47,302 cultural properties that are monitored.

and “unofficially” recorded 278,948 cultural 

resource properties. Of these properties, 4,473 

are included under the BLM’s 406 National 

Register of Historic Places listings, helping 

ensure that they will be protected and preserved 

for future generations. Additionally, 21 of these 

403 National Register listings, encompassing 

a total of 160 properties, are designated as 

National Historic Landmarks.

Development related to increasing needs 

for goods and services, the natural weathering 

process, and the increased use of public lands 

for recreational activities are all contributing 

to a decline in the condition of cultural and 

paleontological resources. In addition, some 

sites continue to be targeted by pothunters, 

looters, and commercial collectors. The BLM 

is addressing these issues through a number 

of public education and outreach programs, 

including its “Adventures in the Past” website, 

Heritage Education and Project Archaeology

(school programs), and others. Additionally, the 
BLM 2005 Annual Report 13

Management‘s Discussion and Analysis

BLM has been using cooperative management 

agreements and challenge cost share 

arrangements for the past 15 years to leverage 

resources and maximize efficiency. More details 

can be found in the Stewardship Assets section 

of this Annual Report.

Table 1 portrays selected goals/targets 

and actual accomplishments for the resource 

protection mission area.

Resource Use

Americans have developed a quality-of-life 

standard that depends on a stable and abundant 

supply of renewable resources and affordable 

energy. The ranching culture of the American 

West has been the backbone of our country, but 

as the Nation’s population has expanded, energy 

has become increasingly important. The public 

lands of the West contain great reserves of oil, 

natural gas, coal, and minerals that maintain 

our quality of life. Energy keeps our homes 

warm in the winter and cool in the summer and 

is critical to producing, processing, transporting, 

preparing and preserving our food. Energy 

powers our communication and computing 

networks and allows us to move people and 

goods safely and quickly to all corners of the 

world.

Renewable resources allow our country to 

be the breadbasket for the world and provide 

economic opportunities for rural families 

and business developers. The BLM’s goal 

in managing the public lands is to achieve a 

balance among all the uses that contribute to 

the high living standards presently enjoyed by 

Americans.

America’s public lands provide myriad 

resources that provide opportunities for 

commercial activities. Commercially valuable 

natural resources include energy and mineral 

commodities, forest products, grazing forage, 

and special uses such as rights-of-way for 

pipelines and transmission lines. Recognizing 

the Nation’s need for a domestic source of 

minerals, food, timber and fiber from the public 

lands, the BLM expends approximately 24 

percent of its funding to carry out its resource 

use mission.

The BLM’s resource use programs fall under 

four primary headings that seek to balance the 

use of renewable resources with nonrenewable 

resources:

• Managing the use of energy resources; for 

example, oil and gas, as well as renewable 

resources (wind, solar, and biomass).

• Managing the use of non-energy mineral 

resources; for example, potassium, lead, 

zinc, sand, and gravel.

• Managing the use of forage resources; for 

example, domestic livestock grazing. 

• Managing the use of forest and woodland 

products; for example, timber, Christmas 

trees, posts, and poles.

The BLM also manages a significant helium 

operations program.

Managing the Use of Energy Resources 

In recent years, the on-shore Federal mineral 

lands have produced about 35 to 40 percent of 

the Nation’s coal, 10 to 11 percent of its natural 

gas, and 5 percent of its oil. Coal and natural 

gas production has been increasing, while oil 

production from on-shore Federal lands has 

experienced a slight decline. 

The BLM has approximately 52,000 oil 

and gas leases, 400 geothermal leases, 300 coal 

leases, 440 other solid leasable mineral leases, 

and about 220,000 mining claims in effect. 

Applications for permit to drill (APDs) have 

nearly doubled in recent years, while oil and gas 

leasing has remained static. The number of coal 

leases has remained relatively stable over the past 

few years. Among the energy and mineral leases 

on the public lands, about 23,500 oil and gas 

leases, 55 geothermal leases, and an estimated 

130 coal leases are in producing status.
14 BLM 2005 Annual Report

Management‘s Discussion and Analysis

Renewable energy resources on the public 

lands include wind, geothermal, biomass, 

solar, and hydropower resources. The BLM 

and the Department of Energy National 

Renewable Energy Laboratory (NREL) 

established a partnership effort in FY 2002 to 

assess renewable energy resources, excluding 

hydropower, on public lands in the western 

states and to identify BLM land use planning 

units with the highest potential for renewable 

energy development. The final report, which 

was published and distributed in February 

2003, provides a foundation for the BLM’s 

future renewable energy program. Biomass 

resources on BLM lands are discussed below 

under Managing the Use of Forest and 

Woodland Products.

The BLM currently administers some 22 

wind energy right-of-way authorizations for 

wind energy production on public lands in 

California and Wyoming that encompass a total 

of approximately 5,000 acres and generate a 

total of about 500 megawatts of electrical power. 

An additional 63 right-of-way authorizations 

have been issued for wind energy site testing 

and monitoring activities in Idaho, Nevada, 

Oregon, California, Washington, Wyoming, 

and Montana.

The BLM currently manages geothermal 

leases that provide geothermal energy to 34 

power plants. These have a total rated capacity 

of over 2,000 megawatts of power. In addition, 

the BLM manages a small number of direct-use 

leases, which provide an alternative source of 

energy for greenhouses, spas, warm-water fish 

farms, and other commercial uses.

Solar energy is the most cost-effective 

approach to supplying power to most of the 

BLM’s remote facilities, which operate only in 

the summers when longer days provide plenty of 

sunshine. The BLM generated 196 megawatts 

of electricity from photovoltaics (solar panels) in 

2005 from over 600 installations. Photovoltaics 

provide power for water pumping, outdoor 

lighting, communication sites, weather and 

water monitoring, remote field stations, visitor 

centers, and other uses. Since 1995, over 130 

systems have been installed. These systems 

have focused on replacing fossil-fueled engine 

generators with photovoltaics.

Many of the dams and power plants in the 

West authorized under the Federal Power Act of 

1920 are on public lands formerly administered 

by the BLM, now withdrawn by the Federal 

Energy Regulatory Commission (FERC). Most 

of the projects involving public lands are located 

in California, Oregon, Washington, and Idaho. 

FERC published a final regulation on July 23, 

2003, that revises procedures for hydroelectric 

licensing under the Federal Power Act. The 

new regulation, which became effective on 

October 23, 2003, provides for expanded public 

participation and streamlines the licensing 

process, particularly with respect to compliance 

with the National Environmental Policy Act 

(NEPA).

Since the publication of the President’s 

National Energy Policy in May 2001, the 

BLM has been taking steps to implement its 

provisions. Consistent with the high priority for 

energy development, the BLM divided its LongTerm Strategic Goal for Energy and Minerals 

on the Federal lands into two separate goals: 

one for energy minerals and one for non-energy 

minerals. These two goals have been adopted 

as separate goal areas in the Department of the 

Interior’s Strategic Plan under the Resource Use 

section.

Managing the Use of 

Non-Energy Mineral Resources 

The number of leases in the “other 

solid leasable minerals” category (combined 

hydrocarbons, phosphate, sodium, potassium, 

gilsonite, asphalt, some hardrock, and some 

sand and gravel) has declined slightly in recent 

years. The number of active mining claims 

appeared to reach its lowest level in 2001 and 

2002, followed by increases in 2003 and 2004.
BLM 2005 Annual Report 15

Management‘s Discussion and Analysis

The public lands produce a large portion 

of the Nation’s fertilizer minerals, as well as 

mineral materials, gold, silver and other critical 

metals. About 13 million cubic yards of sand 

and gravel and other mineral materials were 

extracted during FY 2004.

Managing the Use of Forage Resources

Livestock grazing is an important use of the 

public lands, central to the economic livelihood 

and culture of many rural communities. A 

significant portion of the cattle and sheep 

produced in the West graze on public rangeland. 

Among all commodities, livestock grazing has 

the highest indirect effect as dollars recirculate 

through local communities, resulting in an 

economic multiplier effect of 4.3. In FY 2005, 

permittees and lessees were billed for about 

6.8 million animal unit months (AUMs) of 

forage out of the 12.7 million AUMs that 

are permitted/leased; the BLM collected 

approximately $14.5 million in grazing fees. 

These figures have been running significantly 

lower than in past years because of a severe 

drought throughout the western United States.

Managing the Use of 

Forest and Woodland Products 

The BLM’s forests and woodlands are 

managed to sustain, maintain, and restore 

ecosystem integrity, diversity, and productivity, 

thus providing long-term ecological and 

economic benefits. Forest products are an 

important economic component in western 

Oregon, which contains some of the most 

productive forest lands in Federal ownership. 

Many communities in California, eastern 

Oregon, Idaho, Montana, Wyoming, and 

Colorado also rely on the steady flow of public 

sawtimber.

Woodland products are another important 

component of the BLM’s forest management 

program. Woodland management is a primary 

component in Arizona, Nevada, Utah, New 

Mexico, and Colorado. The BLM continues to 

respond to the local demand for firewood, posts, 

poles and other wood or vegetative products.

The BLM developed a biomass utilization 

strategy in 2004 and updated this strategy in 

2005. The strategy addresses forest health 

and restoration concerns from the President’s 

Healthy Forests Initiative, reduces hazardous 

fuels identified in the National Fire Plan, 

and diversifies the Nation’s energy portfolio 

consistent with the Energy Policy Act of 2005.

Biomass thinning removes small-diameter 

trees and residues that result from the scientific 

application of forest and woodland restoration 

treatments. Biomass can then be converted 

into transportation fuels, such as bio-ethanol, 

bio-diesel and bio-gas, or used in combined 

heat and power plants for electricity generation. 

The BLM is exploring proposals for converting 

pinyon and juniper trees to chipped fuel to 

be used as a biomass source for generating 

electricity. 

A memorandum of understanding among 

the U.S. Departments of Agriculture, Energy, 

and the Interior seeks to develop and apply 

consistent, complementary policies and 

procedures to encourage the use of woody 

biomass by-products harvested from forest, 

woodland, and rangeland restoration projects 

and fuel treatments.

Congress has enacted legislation expanding 

stewardship contracting authority with 

communities, the private sector, and others, 

allowing the BLM to enter into long-term 

contracts (up to 10 years) to meet land 

management objectives (for example, to reduce 

wildland fire risk and improve forest and 

rangeland health). Stewardship contracts focus 

on producing desirable results on the ground 

that improve forest and rangeland health and 

provide benefits to communities. Among 

other things, the new stewardship contracting 

authority allows forest products to be exchanged 

for ecological restoration services, which may 

include thinning and removing brush.
16 BLM 2005 Annual Report

Management‘s Discussion and Analysis

Helium Operations Program

The 1996 Helium Privatization Act directs 

the Secretary of the Interior to commence 

offering for sale 30.5 billion standard cubic feet 

(bscf) of the Federal Helium Reserve at any 

time after January 1, 2003, and to complete 

offering it for sale no later than January 1, 2015. 

The Act requires that the amount to be sold 

annually be determined by dividing the amount 

in storage as of the first sale by the number of 

years sales will be conducted and then adjusting 

the amount by expected Federal usage.

Using the Act’s formula, 2.1 bscf of helium 

is offered for sale annually. Ninety percent of 

that amount is allocated to the refiners along 

the crude helium pipeline, while 10 percent 

is apportioned to other qualified buyers. If 

the refiners do not request the full amount of 

helium allocated to them, the excess can be sold 

to other qualified buyers; conversely, if other 

qualified buyers do not request the full amount 

allocated to them, the refiners can purchase the 

excess. Purchasers obtain a bid right for $1,000 

and specify to the BLM the amount of helium 

they would like to buy for the year. The total 

purchase is distributed and paid for in quarterly 

increments. The first open-market helium sale 

was conducted during March 2003 and the total 

sold to date through these sales is 3.1 bscf.

The legislation also stipulates that all 

pure helium bought by government agencies 

must derive from government-owned crude 

helium. Since the BLM’s refining facilities have 

been dismantled in response to the Helium 

Privatization Act, suppliers of helium to Federal 

agencies are required to purchase an equivalent 

amount of helium from Federal storage. The 

BLM calls this type of sale an in-kind sale.

Studies have shown that because of the 

complexity of the helium storage field, the 

30-plus bscf of helium in storage cannot be 

completely recovered at helium concentration 

levels required by contract with private industry 

companies. By 1999, the helium concentrations 

from the injection wells were already showing 

deterioration. A private industry partnership 

in cooperation with the BLM decided that a 

helium enrichment unit (HEU) was needed at 

the Cliffside location to process gas from the 

field and enrich it to pipeline quality crude 

helium. The HEU was completed in 2003. As 

part of the enrichment process, hydrocarbon 

gases are extracted and sold.

The BLM has entered into agreements with 

El Paso Natural Gas to transport the gas and 

pays a small fee to the Minerals Management 

Service (MMS) to market the gas. Currently, 

the gas is sold to Cinergy Corporation. 

Additionally, the enrichment process produces 

some liquid hydrocarbons that are sold under 

a separate contract to SemCrude. The revenue 

from liquid hydrocarbons is about $750,000 per 

year.

In FY 2005, the BLM received 

approximately $88.7 million in total helium 

program revenue. These receipts consisted of 

storage and transmission fees, crude helium 

sales, natural gas sales, fee sales of helium rights, 

and royalties from Federal lands where helium is 

produced.

At current operating rates, the HEU 

processes approximately 9,000 thousand cubic 

feet per day (Mcf/d) of pipeline natural gas 

approximately 350 days per year. This translates 

into approximately 3.15 bscf per year. At 

$5.00 per Mcf, the BLM receives an average of 

approximately $15.75 million of gas revenues 

per year. The cost of the transportation 

agreement associated with these sales is 

approximately $500,000 per year, while the 

marketing agreement with the MMS costs about 

$.03 per Mcf (less than $100,000 per year).

The BLM also adjudicates helium 

ownership rights, collects fees and royalties from 

Federal lands where the helium is produced and 

sold, and audits those revenues for compliance. 

Federal oil and gas leases contain a clause that 

excludes helium from the lease. Therefore the 

BLM enters into an agreement, separate from 

the oil and gas lease, for the sale of helium 
BLM 2005 Annual Report 17

Management‘s Discussion and Analysis

from Federal lands and collects those revenues 

under 50 USC 167. The BLM is also in charge 

of tracking where helium reserves are located 

throughout the nation and to a lesser extent the 

world, quantifying those reserves, and keeping 

up with the status of the reserves (depleting or 

nondepleting).

Other Commercial Uses

Rights-of-way actions are processed and 

grants or leases are issued to companies so 

they can use public lands for roads, pipelines, 

transmission lines, and communication 

sites. Many of these provide for the basic 

infrastructure of society, meeting the needs of 

local cities and towns.

Table 2 presents goals/targets and actual 

accomplishments for the resource use mission 

area.

Table 3 summarizes the commercial 

activities that occurred on BLM-administered 

public lands during FY 2004, the most recent 

year for which data is available.

Table 2. Resource Use: Selected Goals and Accomplishments

FY 2005 Annual Goal Target Actual

Number of onshore acres available for energy mineral 

exploration/development

Surface: 224 million; 

sub-surface: 366 million

Total: 590 million

Surface: 224 million; 

sub-surface: 366 million

Total: 590 million

Number of pending permits/lease applications in backlog 

status for fluid energy minerals

2,040 2,461

Number of pending permits/lease applications in backlog 

status for solid energy minerals

28 35

Number of pending permits/lease applications in backlog 

status for rights-of-way

1,127 1,117

Number of acres available for non-energy mineral resource 

exploration and development

Establish new baseline New baseline being 

established

Number of acres reclaimed to appropriate land condition 

and water quality standards

8,000 12,131

Percent of acres with DOI range improvements resulting in 

sustainable grazing

9.0% 6.3%

Percent of permitted acres maintained at appropriate land 

conditions and water and air standards

100% 100%

Volume of wood products offered for sale in millions of 

board feet (MMBF)

223 257

Recreation

Recreation and leisure activities are major 

contributors to a healthy lifestyle for millions 

of Americans as well as international visitors. 

BLM-administered public lands play an 

important role in providing these outdoor 

recreational experiences. The Bureau expends 

about 13 percent of its funding to contribute 

to the Department of the Interior’s goals for 

recreation.

BLM-administered public lands and waters 

provide visitors with a vast array of recreational 

opportunities. While most of the visits to BLMmanaged public lands involve camping in either 

developed recreation sites or dispersed-use areas, 

many visitors come simply to view landscapes 

and other unique natural or cultural heritage 

features of public lands. Other important 

activities include hunting, fishing, wildlife 

viewing, hiking and backpacking, motorized 

and non-motorized boating, off-highway vehicle 

(OHV) driving, and mountain bicycling. 
18 BLM 2005 Annual Report

Management‘s Discussion and Analysis

The BLM’s recreation mission encompasses 

two primary areas of emphasis:

• Enhancing the quality of recreational 

opportunities and improving access.

• Providing value in recreation and promoting 

quality services.

Most recreational activity on public lands 

occurs in dispersed non-fee areas. While 

public lands represent a place to have quality 

recreational experiences at a relatively low 

cost to visitors, the economic impact is still 

significant, especially to gateway communities.

Recreation on BLM public lands provides 

significant benefits to local, regional, and state 

economies. The total economic impact of 

Table 3. Commercial Activities Summary

Public/Federal Land 

Commercial Activity

Value FY 2004 

(millions $)

Output Impact FY 

2004 (millions $)

Federal Revenue Generated1

FY 2004 (millions $)

Oil & Gas, Geothermal, and 

Helium2

14,217 26,159 1,620

Coal 3,645 9,478 545

Other Leasable3 and Salable 

Minerals

943 2,452 46

Grazing 62 267 9

Timber 33 111 22

Realty4 NA NA NA

Total5 18,900 38,467 2,242

Note: Table does not include the economic value of commercial and non-commercial recreation activities on the public lands. 

Recreation is discussed in another section. NA means data was not available at time of publication.

Special notes for the 2004 table:

1

 Leasable revenues are generated by the BLM through its land use planning, minerals leasing, permit approval, and inspection and 

enforcement programs, including production verification. However, most of these revenues are actually collected and distributed by a 

separate agency, the Minerals Management Service.

2

 Beginning in FY 1999, dollars from geothermal, CO2, and helium were added to oil and gas. Previously, geothermal and CO2 were 

included with other leasable minerals.

3

 Leasable minerals are those disposed under the Mineral Leasing Act of 1920, including oil and gas, coal, and other leasable minerals 

such as phosphate, sodium, potassium, gilsonite, and some hard rock minerals. Salable minerals are those disposed under the 

Materials Act of 1947 and include sand, gravel, stone, and clay.

4 Rental fees include rights-of-way and communication sites. In previous years, only right-of-way fees were shown.

5

 The BLM does not collect locatable minerals production data. In previous years, the production value shown was extrapolated 

from a 1995 estimate and adjusted for production on lands that left Federal ownership through the patent process. There have 

been dramatic changes in mineral prices and the amount of production taking place on Federal lands since the original estimate was 

prepared. This estimate is no longer thought to be reliable, so it has not been included this year. Locatable minerals include gold, 

silver, other metals, and some industrial commodities. The BLM has collected about $30 million in location and holding fees for 

locatable minerals in FY 2004. This is not shown in the table above.
BLM 2005 Annual Report 19

Management‘s Discussion and Analysis

travel-related expenditures for recreation on 

BLM lands is estimated to run into the billions 

of dollars. These travel-related expenditures 

for recreation on public lands support tens of 

thousands of jobs and contribute significantly 

to the viability of thousands of small businesses, 

especially outfitting, guiding, and tourismrelated companies and community service 

providers that depend on both access to, and the 

availability of, the public lands.

The BLM focuses on providing quality 

recreation opportunities and adventures on 

the Nation’s vast western landscapes. The 

public has the freedom to pursue unstructured 

recreation opportunities, but people are asked 

to respect other visitors and local cultures, and 

to practice stewardship principles and ethics, 

while using and enjoying the public lands. The 

BLM, in turn, focuses on preserving natural 

and cultural resources, resolving user conflicts, 

and providing for public health, education, and 

safety.

Leave No Trace is an outdoor ethics 

program centered on ways and means to 

minimize impacts on natural resources, wildlife, 

and other users. The BLM is a major supporter 

and sponsor of the program, which is one of the 

Bureau’s outdoor ethics education tools. BLM 

publications and staff taught the principles of 

Leave No Trace to numerous public land users 

during the year. The program has been adopted 

as the official outdoor ethic of the humanpowered outdoor recreation industry, with over 

300 manufacturers and retailers joining with 

Federal agencies to bring the message to the 

American public and international visitors.

The Leave No Trace program has been 

embraced by recreation users across the 

spectrum, from wilderness to OHV enthusiasts. 

It is the only program of its kind that has 

been universally adopted, administered, and 

used in a unified, joint effort by the BLM, 

U.S. Department of Agriculture Forest 

Service (USDA-FS), National Park Service 

(NPS), and U.S. Fish and Wildlife Service 

(USFWS). Whenever possible, it is taught by 

this interagency group with no differentiation 

among agencies or private partners. The BLM 

has teamed up with these partners to bring 

the message in recent years to such diverse 

groups, events, and venues as the National 

Trails Conference, Outdoor Writers of America 

Association (OWAA), Outdoor Retailers 

Show, Rocky Mountain Elk Expo, National 

Boy Scouts of America (BSA) Philmont Scout 

Camp, and Western Region BSA “Camp 

School.”

Tread Lightly! is another program supported 

by the BLM. Through education, restoration 

and research, this program aims to empower 

outdoor enthusiasts to recreate responsibly. The 

BLM is a major supporter and sponsor of the 

program, along with the USDA-FS, Bureau 

of Reclamation (BOR), NPS, and Corps of 

Engineers. Originally geared toward responsible 

use of motorized and mechanized use on public 

and private lands, the principles of the program 

have been expanded to provide an outdoor 

ethics message for a wide variety of user groups.

Activities related to comprehensive travel 

management have been a central focus for over 

85 percent of the Bureau’s field offices. Roads 

and trails found on public lands consist of 

multilane roads, primitive roads, or single-track 

trails. Many of these are “legacy” roads and 

trails, created incidentally over the last century 

(rather than designed and constructed) as a 

result of mining, grazing, or other public land 

activities. Today, these roads and trails are 

widely enjoyed by recreation enthusiasts. While 

the Bureau maintains approximately 80,000 

miles of roads and over 15,000 miles of trails 

in a systematic way, other primitive roads and 

most trails receive little or no maintenance or 

management attention. An estimated 600,000 

miles of these routes exist on BLM-managed 

public land.

To further address trails management, 

the Bureau continues to participate on the 

Federal Interagency Council on Trails and 
20 BLM 2005 Annual Report

Management‘s Discussion and Analysis

offers the Interagency Trails Management 

Course. In addition, the Bureau participated 

on an Interagency Trails Data Standards Team 

and used a BLM National Trails and Travel 

Management Team with participants from each 

state. Both the National Mountain Bicycling 

Strategic Action Plan and the National 

Management Strategy for Motorized OffHighway Vehicle Use on Public Lands are being 

implemented.

Beginning this fiscal year, the Bureau 

collected recreation fees under the authority of 

the recently passed Federal Lands Recreation 

Enhancement Act (REA), which allows public 

land visitors to be charged a fee to use many of 

the Bureau’s campgrounds, day-use areas, other 

developed recreation sites, and permitted special 

recreation uses. All of the money collected is 

reinvested at the site of collection to improve its 

physical infrastructure and enhance customer 

satisfaction, directly benefiting those who pay 

for and use the site.

The BLM Recreation Program also 

participates in National Trails Day activities and 

National Public Lands Day (NPLD) projects, 

which draw thousands of volunteers to BLM 

sites across the Nation. Each year, NPLD 

events promote environmental awareness and 

ethical outdoor behavior, as well as enhancing 

BLM recreation sites by providing needed 

maintenance and improvements. Volunteers 

typically build trails, transform sites into 

universally accessible areas, renovate buildings, 

and make numerous other contributions to 

recreation opportunities and amenities on 

the public lands. Leave No Trace, a national 

sponsor of NPLD, donates educational materials 

and other items and provides no-cost training to 

site coordinators.

The BLM’s interpretive program fosters 

an appreciation for public land resources and 

an understanding of the relationships between 

people and the public lands. Interpretation tells 

the story of how the BLM manages resources 

and provides opportunities for public use. 

The Bureau’s interpretive program gives the 

public the information they need to be more 

environmentally responsible while enjoying their 

public lands. 

The BLM has approximately 35 full-time 

interpreters. Most are located in the five major 

visitor centers: Nevada’s Red Rocks Canyon 

Visitor Center, Colorado’s Anasazi Heritage 

Center, Oregon’s National Historic Oregon 

Trail and Yaquina Head Interpretive Centers, 

and Wyoming’s National Historic Trails 

Interpretive Center. The Bureau also increased 

its interpretive staff in the National Landscape 

Conservation System areas. In June, the Bureau 

opened its fourth and final interpretive center 

at the Grand Staircase-Escalante National 

Monument.

The BLM expanded interpretive 

opportunities along nationally designated 

Byways through the use of brochures and 

wayside exhibits. BLM staff, volunteers, and 

partners (such as cooperating associations) 

involved both individual visitors and 

community groups through such activities as 

special events, tours, temporary exhibits, and 

interpretive planning.

One issue for the Bureau is finding 

opportunities to reach out to widely dispersed 

recreational visitors. To meet this challenge, 

the BLM has increased the number of wayside 

exhibits on public lands to provide interpretive 

information.

Table 4 portrays selected goals/targets and 

actual accomplishments for the recreation 

mission area.

Serving Communities

The BLM expends approximately 32 percent 

of its funding to serve the Nation’s citizens 

and communities, to ensure that people and 

property are protected from hazards associated 

with the BLM’s land management programs, 

and to fulfill the government’s Indian trust 

responsibilities. To achieve these goals, the 

BLM collaborates with many constituents, 
BLM 2005 Annual Report 21

Management‘s Discussion and Analysis

applying the Secretary of the Interior’s Four C’s 

Vision: “Conservation through Consultation, 

Cooperation, and Communication.” 

The BLM’s goals under this mission have 

been organized into three main areas:

• Improving fire management and safety.

• Improving public safety and security and 

protecting public resources.

• Improving information management.

Providing Fire Protection

The Bureau provides fire protection on 

388 million acres of public and state lands. 

The BLM’s fire and aviation program works 

cooperatively with its Federal and state land 

management partners to suppress and manage 

wildland fire, conduct prescribed fires, and 

promote fire safety awareness through education 

and prevention programs. The Bureau’s fire 

program also works closely with the BLM’s 

other resource programs to improve the health 

of the land, reduce the risks of hazardous 

buildup of fuels, protect communities at risk, 

and improve wildlife habitat.

The BLM’s National Office of Fire and 

Aviation is headquartered at the National 

Interagency Fire Center in Boise, Idaho, 

where fire experts develop policy, conduct 

wildland fire research, and coordinate with fire 

managers from other firefighting organizations, 

both nationally and internationally. Because 

wildland firefighting is a demanding and 

hazardous profession, the BLM takes every 

measure to ensure firefighter safety and protect 

life, property, and natural resources.

The public lands and their myriad 

resources—soil, vegetation, wildlife habitat, 

and human structures/improvements—are 

frequently at risk, particularly during a drought 

year. Much of the western United States is 

experiencing a multi-year drought, which has 

caused the fire danger to be much higher than 

normal.

Funding for the wildland fire program 

is managed centrally by the Department 

of the Interior, and performance measures 

and results are also reported centrally in the 

Department’s Annual Report on Performance 

and Accountability. The Department provides 

consolidated and integrated performance 

reporting, rather than having individual bureaus 

Table 4. Recreation: Selected Goals and Accomplishments

FY 2005 Annual Goal Target Actual

Percent of recreation users satisfied with the quality of their recreation 

experience on the public lands

94% 91%*

Number of acres made available for recreation through management actions 

and partnerships

260 million 260 million

Number of river and shoreline miles made available for recreation through 

management actions and partnerships

14,500 14,500

Percent of universally accessible facilities 9% 7%

Percent of recreation areas with community partnerships 21% 21%*

Number of visitors served by facilitated programs 83,500 13,397,902**

* Estimated.

** The initial target (83,500) for 2005 was developed based on the number of interpretive products and programs produced, not the 

number of participants at facilitated programs as shown in the “Actural” column above; data for 2006 will address both participants 

and products.
22 BLM 2005 Annual Report

Management‘s Discussion and Analysis

report their accomplishments. Accordingly, the 

wildland fire performance measures and results 

as reported in the Department’s Annual Report

are incorporated into this report by reference.

Reducing Threats to 

Public Health, Safety, and Property

The BLM addresses a wide range of 

public land situations posing risks to public 

land users. BLM-owned facilities represent a 

substantial public investment in roads, bridges, 

dams, administrative sites, campgrounds, 

and firefighting stations. Maintaining these 

facilities in a safe condition and operating 

them in compliance with all safety, health, and 

environmental requirements is a key goal.

Historic and documented public land uses 

such as mining and milling operations; oil and 

gas production; landfills; military operations; 

and rights-of-way for powerlines, pipelines, 

and other commercial activities have resulted 

in environmental contamination from spills, 

leachate, emissions, exposure to the elements, 

and other types of releases. More recently, toxic 

releases have come from unlawful activities such 

as wire burning, illegal dumping of highly toxic 

wastes from drug production, and intentional 

dumping of toxic materials. Collectively, these 

activities represent a substantial potential for 

soil, water, and air pollution as well as threats to 

public health, safety, and property.

The BLM works to reduce environmental 

threats and to protect employees, visitors, and 

other public land users in many ways. The 

Bureau evaluates safety concerns, identifies 

hazards and risks, studies past experiences and 

responses, trains employees, and educates the 

public. Regular inspections, maintenance, and 

repairs are completed for BLM-owned facilities, 

including administrative sites, campgrounds, 

other recreation sites, buildings, roads, bridges, 

trails, and dams. The BLM annually pursues 

funding for these response and cleanup activities 

through appropriate avenues.

The BLM conducts Compliance 

Assessment—Safety, Health, and the 

Environment (CASHE) audits at all of its 

facilities on a recurring basis to identify facility 

compliance issues and assist the field’s efforts 

to provide safe visits for the public. The last 

baseline audit was completed in FY 2005. 

Audits were completed at 36 organizational 

units in FY 2005, the vast majority of which 

were third-round audits. The audits have 

resulted in the BLM making significant 

improvements in drinking water systems and 

hazardous materials storage.

The CASHE Program, working with the 

BLM’s Space Leasing staff, provided revisions 

to the standard leasing contract to eliminate 

typical facility compliance issues identified in 

leased space. Approximately 90 percent of the 

BLM’s offices are in leased office space, so the 

root cause of many facility compliance issues has 

been addressed.

BLM law enforcement officers work with 

partners both inside and outside the Bureau 

to protect lives, resources, and property. 

Initiatives to protect delicate and irreplaceable 

resources, safeguard visitors and employees, 

and recover losses to the government have been 

implemented.

Improving Land, 

Resource, and Title Information

The BLM holds extensive historical records 

and maintains current land title information 

for determining land ownership, condition, 

location, rights, and authorized uses on most 

of the private, public, and tribal lands in the 

United States. The agency performs cadastral 

surveys and completes land transactions, 

producing voluminous amounts of information 

that supports land management and scientific 

activities for many government agencies, as 

well as the private sector. Historical data on 

patented lands, along with current information 

on the mineral estate, resource conditions, and 
BLM 2005 Annual Report 23

Management‘s Discussion and Analysis

permits or leases on Federal lands, is updated 

and provided on a daily basis. 

The BLM responds to thousands of requests 

for information every year and has improved 

customer access to and use of this information. 

Cadastral survey information for over 31,000 

townships and almost 4.2 million General 

Land Office (GLO) land title records has been 

converted to digital form; 3 million of these 

records have also been scanned and imaged for 

viewing on the GLO website. These records are 

now more readily accessible to decision makers 

as well as the public, thanks to Internet and GIS 

technologies.

In recent years, data for millions of 

townships have been downloaded into multiple 

databases across the country to support 

applications ranging from wilderness, open 

space, planning, recreation, and commercial 

activities (oil and gas, timber, coal, etc.), to 

tax assessment and 911 emergency dispatch. 

The BLM’s cadastral and land records provide 

a critical foundation for addressing energy 

development and urban growth throughout the 

United States.

Cadastral and land records are used to 

manage wildland fires. These records are used 

to determine the most efficient deployment of 

fire support personnel by sending them to areas 

that have real estate and real property requiring 

protection.

The BLM continues to integrate its 

boundary records with the USDA Forest 

Service, with other Federal agencies, and with 

tribes, states, counties, and the private sector to 

build a common cadastral/lands information 

base across the landscape that can serve multiple 

stakeholders. The BLM national website 

established for downloading Geographic 

Coordinate Data Base data has proven to be 

successful and is providing the most accurate 

digital portrayal of parcel boundaries.

The BLM is working hand-in-hand with 

states, counties, and other federal agencies to 

standardize digital data representing the Public 

Land Survey System (PLSS) in support of the 

Western Governors’ Association (WGA) policy, 

National Spatial Data Infrastructure, and 

Geospatial One Stop E-Gov initiative. This 

effort has been recognized and endorsed by 

the WGA as supporting livable communities, 

encouraging economic development, and 

enabling community leaders to better manage 

both. The WGA has also urged the BLM, 

in collaboration with states, counties, and 

tribal governments, to complete, enhance, and 

maintain the Geographic Coordinate Data Base 

(GCDB) as the standard representation of the 

Public Land Survey System in the western states. 

Using the GCDB to standardize the PLSS 

directly supports the BLM’s responsibilities as 

defined in Office of Management and Budget 

(OMB) Circular A-16. 

The public is performing on-line Internet 

searches for information and subsequently 

downloading digital data (counted as a 

“request”), or filing requests for historical 

information for historical information directly 

with BLM offices. One example is the Bureau’s 

General Land Office Records website, http://

www.glorecords.blm.gov. Since going on-line 

in May 1998, this site has filled more than 119 

million requests for land records. The site was 

disconnected from the Internet in April 2005 

to protect Indian Trust-related information 

currently in litigation. The demand for the 

Bureau’s land title records remains high, and 

despite the shutdown, the website filled 9.9 

requests in 2005. The website is currently 

closed pending reconnection and court 

notification.

The BLM has the lead responsibility for 

the National Integrated Land System (NILS). 

This system is a collaborative project with the 

USDA Forest Service, states, counties, tribes, 

and other Federal agencies to provide a business 

solution for land managers. These individuals 

face an increasingly complex environment of 

complicated transactions, legal challenges, 

deteriorating and difficult-to-access records, and 
24 BLM 2005 Annual Report

Management‘s Discussion and Analysis

a deteriorating system of property boundaries. 

NILS will provide the tools needed to collect, 

manage, and share survey data, cadastral data, 

and land records information.

Updating Land Use Plans

Accurate, up-to-date land use plans are 

integral to the effective management of the 

Nation’s public lands because planning decisions 

form the basis for most of the BLM’s on-theground management actions. Over the past 

two decades, the magnitude and the complexity 

of resource issues relating to the management of 

public lands have grown. Dramatic population 

growth in the West has resulted in increasing 

demands on the 261 million acres of surface 

lands and 700 million acres of mineral estate 

managed by the BLM. Changing demands and 

conditions have included a recent emphasis on 

the need to develop renewable and nonrenewable 

domestic energy supplies; additions to the 

National Landscape Conservation System; 

new Endangered Species Act listings; and new 

regulations and policies that require the BLM 

to invite other Federal, state, and local agencies 

to participate in the BLM’s land use planning 

activities. 

Land use planning helps the Department 

of the Interior achieve its mission of protecting 

and managing the Nation’s natural resources 

and cultural heritage, providing scientific and 

other information about those resources, and 

honoring its trust responsibilities or special 

commitments to American Indians and Alaska 

Natives. The land use planning process is 

community based and requires cooperation with 

Federal, state, tribal, and local governments; the 

general public; user and environmental groups; 

and industry. Through close collaboration and 

partnerships, the BLM determines how best to 

manage public lands to meet the needs both of 

local communities and of the Nation as a whole.

The BLM uses a cyclical planning process to 

ensure that land use plans and implementation 

decisions remain consistent with applicable laws, 

regulations, orders, and policies. In addition 

to public participation, the process involves 

resource assessment and analysis to make plan 

decisions, followed by plan implementation, 

monitoring, and evaluation. This process allows 

for continuous adjustments to respond to new 

issues and changed circumstances and to amend 

or revise plans based on ongoing monitoring 

and evaluation activities.

In February 2000, the BLM submitted 

its Report to the Congress: Land Use Planning 

for Sustainable Resource Decisions. This report 

provided the basis for increasing the land use 

planning budget to update or revise many 

of the BLM’s original 162 land use plans 

that were developed in the 1970s and 1980s. 

Beginning with the 2001 Appropriations for 

the Department of the Interior and Related 

Agencies, Congress increased funding to the 

BLM to develop new plans and amend or revise 

its existing land use plans, where appropriate, to 

address changing resource demands, growth in 

the West, and new laws.

The BLM has completed 33 land use plans 

and major amendments since the initiative 

started in 2001. In 2005 and 2006, the BLM is 

continuing to develop and amend land use plans 

and to address priority and emerging issues, 

such as conservation of sagebrush communities 

for sage grouse and other sagebrush-dependent 

wildlife and plant species, the Healthy Forests 

Initiative, recreation, and travel management 

(including off-highway vehicle use). The 

BLM anticipates that it will complete over 45 

additional land use plans through FY 2007.

Providing Economic and Technical Assistance

The BLM carries out the Secretary’s trust 

responsibility for several Indian programs, 

including approval and supervision of postlease mineral operations on Indian trust lands, 

cadastral survey of Indian lands, and the 

issuance of patents for trust allotments. 

The BLM provides technical assistance 

to Tribes by supervising post-lease mineral 
BLM 2005 Annual Report 25

Management‘s Discussion and Analysis

operations on 56 million acres of Indian trust 

lands. These operations generate royalty 

incomes for Indian mineral owners and 

economic impacts for communities, as well as 

providing local employment to Tribal members.

Under the Act of April 6, 1884 (25 USC 

§176), the BLM is charged with statutory 

responsibility to survey Indian lands and Indian 

Reservations held in Trust by the Federal 

government. In addition to conducting surveys, 

the Bureau provides other cadastral survey 

services, such as preparing or interpreting 

legal descriptions, consulting on boundary 

management issues, conducting field or 

records investigations, collecting Geographic 

Coordinate Data Base (GCDB) data, and 

providing support for appeals, protests, and 

litigation on Indian lands. 

In Fiscal Year 2005, the BLM provided 

essential cadastral surveys and services 

requested and funded by the Bureau of Indian 

Affairs (BIA) or tribal governments. These 

services included surveying 2,829 miles of 

land boundaries and setting 5,055 survey 

monuments. BLM surveyors worked with the 

BIA and tribal employees, as well as contractors, 

to enhance the Geographic Coordinate Data 

Base for Indian Trust lands. This benefits land 

management, land status depiction, mapping 

projects, GIS applications, and BIA and tribal 

cadastral coverage efforts.

In August 2004, the Secretary approved and 

initiated the Fiduciary Trust Model (FTM). 

The FTM is a business model created to provide 

a new and streamlined structure from which to 

accomplish specific trust objectives and provide 

reliable trust services for American Indian and 

Alaska Native beneficiaries. 

The BLM cadastral survey portion of the 

FTM has two key Phase 1 Survey Service 

Projects to be implemented and funded by 

September 30, 2006: 

1. Locate a BLM Cadastral Surveyor in each 

of the BIA Regions who will work directly 

on BIA boundary issues and facilitate the 

execution of cadastral survey services. 

These new positions will be physically 

located in BIA offices.

2. Create a Certified Federal Surveyor (CFedS) 

program where non-BLM surveyors can be 

certified to perform commercial activities 

under the direction and control of BLM 

cadastral survey. 

In Phase 2 the following Survey Service 

Projects will also be implemented and funded, 

starting in 2007.

1. Improve the maintenance of the Public 

Land Survey System (PLSS) within 

Indian Country by providing proactive 

improvements to boundaries, monuments, 

records, and services.

2. Create one standardized source of land 

status information based on cadastral 

data that delineates the official legal land 

descriptions.

The BLM has a long history of providing 

support for community and statewide economic 

needs through land disposal and conveyance 

for many purposes under several authorities and 

programs. During Fiscal Year 2005, the BLM 

conveyed over 3.4 million acres in Alaska and 

over 81,000 acres outside of Alaska.

One of the BLM’s most innovative land 

conveyance authorities is the Southern Nevada 

Public Land Management Act (SNPLMA), 

enacted in October 1998, as amended. This 

Act encourages the BLM to sell land in an open, 

competitive process, ensuring that the Federal 

government receives fair market value and 

generates the greatest return for the taxpayer.

Under SNPLMA, public land tracts within 

a congressionally designated disposal boundary 

that are interspersed with or adjacent to private 

land in the Las Vegas Valley (the fastest-growing 
26 BLM 2005 Annual Report

Management‘s Discussion and Analysis

urban area in the United States) are sold to the 

highest bidder and may not be sold for less than 

their appraised fair market value. A total of 

85 percent of the land sale revenue collected is 

deposited into the SNPLMA Special Account 

and then invested in interest-bearing Treasury 

securities. These land sale proceeds and 

interest revenues can be used for eight specified 

purposes:

• Acquisition of environmentally sensitive 

land in the State of Nevada, with priority 

given to lands in Clark County.

• Capital improvements at the National Park 

Service’s Lake Mead National Recreation 

Area; the U.S. Fish and Wildlife Service’s 

Desert National Wildlife Refuge; the BLM’s 

Red Rock Canyon National Conservation 

Area and other areas administered by the 

BLM in Clark and Lincoln Counties; and 

the USDA Forest Service’s Spring Mountain 

National Recreation Area.

• Development of a multi-species habitat 

conservation plan in Clark County, Nevada.

• Development of parks, trails, and natural 

areas in Clark and Lincoln Counties 

pursuant to cooperative agreements with 

units of local and regional government.

• Conservation initiatives on Federal land 

in Clark and Lincoln Counties, Nevada, 

administered by the Department of the 

Interior or the Department of Agriculture.

• Federal Environmental Restoration Projects 

under the Lake Tahoe Restoration Act, 

Environmental Improvement Payments 

under Public Law 96-586, and any Federal 

environmental restoration project included 

in the environmental improvement program 

adopted by the Tahoe Regional Planning 

Agency in February 1998 (as amended) 

“in an amount equal to the cumulative 

amounts authorized to be appropriated 

for such projects under those Acts”; these 

“cumulative amounts” equal $300 million.

• Up to $6 million for a Water Resources 

Study of the Basin and Range Carbonate 

Aquifer System (BARCAS) in White Pine 

County, Nevada, and adjacent areas in 

Nevada and Utah pursuant to provisions 

of the Lincoln County Conservation, 

Recreation, and Development Act of 2004 

(P.L. 108-424) and the SNPLMA.

• Costs associated with the disposal of lands 

and implementation of the Act.

Certain other revenues deposited into the 

SNPLMA Special Account are designated for 

specific purposes that are authorized by other 

laws. These include:

• Acquisition of inholdings within the 

Mojave National Preserve in California and 

protection and management of petroglyph 

resources in Clark County, utilizing 

revenues from the disposal of lands in the 

Ivanpah Valley for an airport under the 

Ivanpah Airport Act (P.L. 106-362). These 

revenues are not available until a final 

Record of Decision pursuant to the National 

Environmental Policy Act of 1969 has been 

issued that permits development of the 

airport at the Ivanpah site.

• Acquisition of environmentally sensitive 

land in the Lake Tahoe Basin pursuant to 

the Santini-Burton Act of 1980 (P.L. 96-

586), utilizing revenue from the conveyance 

of parcels within the SNPLMA disposal 

boundary that are also within the disposal 

boundary established by the Santini-Burton 

Act.
BLM 2005 Annual Report 27

Management‘s Discussion and Analysis

• Planning and management for the Sloan 

Canyon National Conservation Area 

with funds generated by the sale of a land 

parcel authorized by the Clark County 

Conservation of Public Lands and Natural 

Resources Act (P.L. 107-282).

• Development of a multi-species habitat 

conservation plan for the Virgin River 

and associated groundwater monitoring, 

utilizing revenue from the sale of certain 

lands to the City of Mesquite, as authorized 

by an amendment to the Mesquite Lands 

Act (P.L. 99-548).

The revenues generated under SNPLMA 

enable the BLM and other government entities 

to acquire and preserve environmentally 

sensitive lands and to build or maintain trails, 

day-use areas, campgrounds, or other facilities 

to benefit public land visitors. 

As of September 30, 2005, the BLM’s 

SNPLMA land sales Treasury account had 

$1.7 billion invested; interest earned during the 

year totaled $34 million. From the program’s 

inception, the BLM has conveyed almost 

31,000 acres under SNPLMA, with SNPLMA 

Special Account receipts of approximately 

$1.9 billion from all conveyances and interest 

earned. The Directors of the BLM, U.S. Fish 

and Wildlife Service, and National Park Service, 

in partnership with the Chief of the USDA 

Forest Service, have recommended and received 

approval from the Secretary of the Interior 

for the expenditure of almost $1.2 billion 

in the first six expenditure categories listed 

above, based both on revenues received and 

on revenues projected from land sales through 

September 30, 2005. 

Another recently enacted bill, the Federal 

Land Transaction Facilitation Act, provides 

the authority to sell public lands and use sale 

proceeds to purchase other lands to benefit 

the BLM or other Federal land management 

agencies. The Act also permits the BLM to 

retain exchange equalization payments (often 

made by land exchange proponents to equalize 

values between Federal and private lands). Lands 

sold or exchanged must already be identified 

for disposal in an existing Federal land use plan 

approved before July 25, 2000.

Under this Act, which applies nationally and 

not just to southern Nevada, 4 percent of sales or 

exchange receipts are distributed to the state in 

which the sale occurred. These are to be used for 

educational purposes or for the construction of 

public roads and improvements.

Of the remaining receipts, the BLM can 

retain up to 20 percent to cover administrative 

costs of sales and exchanges under the Act. 

The remainder (that is, at least 80 percent) 

must be used to purchase inholdings or lands 

with exceptional resources adjacent to federally 

designated areas. Inholdings are any non-Federal 

lands located within specially designated areas 

managed by the BLM, National Park Service, 

U.S. Fish and Wildlife Service, or USDA Forest 

Service, including the Wild and Scenic River 

System, the National Trail System, Wilderness 

Areas, or Wilderness Study Areas.

Not less than 80 percent of the acquisition 

funds must be used for land acquisitions in the 

same state in which sales occurred; the remaining 

20 percent of acquisition funds may be used in 

the same state or in the 11 western states and 

Alaska. The Act does not mandate any sales 

or establish quotas for sale or purchase. As of 

September 30, 2005, sales proceeds under the 

Federal Land Transaction Facilitation Act totaled 

approximately $29.2 million and exchange 

proceeds approximately $3.0 million, for a 

cumulative total of $32.2 million. 

A memorandum of understanding among 

the applicable Federal agencies to implement 

the Act was signed on May 5, 2003. This 

agreement provides the guidelines on how fund 

disbursements are to be determined in the future. 

As of June 30, 2005, a total of $5,236,000 had 

been approved for the purchase of two inholdings 

in the Toiyabe National Forest in Nevada.
28 BLM 2005 Annual Report

Management‘s Discussion and Analysis

Table 5 portrays selected goals/targets 

and actual accomplishments for the serving 

communities mission area.

Table 5. Serving Communities: Selected Goals and Accomplishments

FY 2005 Annual Goal Target Actual

Percent of buildings (for example, administrative sites and employee 

housing) in fair to good condition

TBD *

Percent of roads in fair to good condition TBD *

Percent of dams in fair to good condition TBD *

Percent of bridges in fair to good condition TBD *

Percent of trails in fair to good condition TBD *

Cumulative percent of Alaska lands conveyed to the State of Alaska and 

Alaska Native Corporations

87% 44%

Number of public land title records posted on the Internet to assist title, 

survey, historical, and genealogical research and retrieval

150,000 150,151

Number of acres of land disposals and conveyances completed outside of 

Alaska

105,000 121,046

TBD = To be determined.

* The BLM is transitioning to the Department of the Interior’s Facility Asset Management System and plans to report on the Facilities 

Condition Index measures.
BLM 2005 Annual Report 29

Management‘s Discussion and Analysis

Systems, Controls, And Legal Compliance

Managerial, Administrative, and Financial Controls

The Bureau of Land Management completed an assessment of 

its systems of managerial, administrative, and financial controls in 

September 2005 in accordance with the standards, objectives, and 

guidelines prescribed by the Federal Managers’ Financial Integrity 

Act (FMFIA) and the Office of Management and Budget (OMB). 

The objectives of this assessment were to ensure that:

• Programs achieved their intended results;

• Resources were used consistent with the agency’s mission;

• Resources were protected from waste, fraud, and mismanagement;

• Laws and regulations were followed; and

• Reliable and timely information was maintained, reported, and 

used for decision making.

In performing its assessment, the BLM management relied on 

its knowledge and experience gained from the daily operation of 

Bureau programs and systems of accounting and administrative 

controls. The BLM’s assessment was based on information obtained 

as of September 30, 2005, from sources such as internal management 

control assessments, Office of Inspector General (OIG) and 

Government Accountability Office (GAO) audits, KPMG’s prioryear audit of the Bureau’s financial statements, various program 

evaluations/studies, and performance plans and reports. 

Based on all of the above, as well as the results of the BLM’s 

independent financial statement audit for FY 2005, the Bureau can 

conclude the following:

• The BLM’s systems of management, administrative and financial 

controls provide reasonable assurance that the objectives of the 

FMFIA have been achieved;

• The BLM is in compliance with the U.S. Government Standard 

General Ledger at the transaction level, and with Federal 

accounting standards as required by the Federal Financial 

Management Improvement Act (FFMIA) with the exception of 

museum collections and stewardship land reporting; and
30 BLM 2005 Annual Report

Management‘s Discussion and Analysis

• The BLM’s information technology 

systems provide reasonable assurance that 

the objectives of OMB’s Circulars A-127, 

Financial Systems, and A-130, Management 

of Federal Information Resources, have been 

achieved. 

Table 6 outlines the specific management 

control assessments and audits on which the 

Bureau relied for its annual assurance statement.

Table 6: FY 2004 Assessments and Audits

Assessment /Audit Date 

Completed

Results

(material weakness or best practice)

Range Program May 2005 Some offices are attempting to minimize protests and appeals by sending 

draft evaluations and reports to interested groups, and by meeting 

personally with local representatives. For example, Battle Mountain Field 

Office is visiting with Western Watersheds Project at their Boise, Idaho, 

office before sending out draft evaluations in an attempt to help them 

understand the findings and to minimize protest and appeals. In BLM 

Idaho, permittees and interested parties are provided an opportunity to 

comment or contribute information to the land health evaluation report.

Soil, Water, and Air 

Program

May 2005 BLM California has implemented a state version of Activity or Riparian 

Program performance-based budgeting. It begins with the planned 

accomplishments in priority program elements only and allocates funds 

to field offices based partially on unit costs of accomplishments. The 

unit costs are regional, so theoretically they take into account costs for 

field offices in similar areas with similar issues. This avoids some of the 

national unit cost inaccuracies that plague the activity-based cost system.

Rights-of-Way September 2005 None identified. 

Quality Assurance 

Team Review of the 

Application for Permit 

to Drill (APD) Process

July 2005 Large oil and gas operators using remote monitoring of production 

have reduced travel to individual well site locations. These operators not 

only reduce travel to the field, but they also are able to submit required 

production data in an electronic format that is more efficient and accurate. 

The remote sensing ties in with the Bureau’s Remote Data Acquisition 

for Well Production, which will ultimately reduce inspection travel to 

individual well sites by Bureau inspectors and reduce required hard copy 

data requests back to the operator.

3809 Surface 

Management

September 2005 None identified.

Mineral Materials 

Program - Inspection 

and Enforcement (I&E)

September 2005 None identified.
BLM 2005 Annual Report 31

Management‘s Discussion and Analysis

Assessment /Audit Date 

Completed

Results

(material weakness or best practice)

Acquisition 

Management

July 2005 There are two “best practices” identified: (1) The Purchasing Agent in the 

Amarillo, Texas, Field Office provides a weekly acquisition update report 

to her management team. The managers use the report to not only keep 

track of upcoming contract awards, but also to aid them in the budget 

allocation process and to use as a workload management tool; and (2) 

The State Office and three field offices in New Mexico that were reviewed 

in 2005 use a checklist in the front of each charge card file. It documents 

on the checklist that a charge card statement has been received, the 

cardholder has signed and dated the statement, the approving official has 

approved and dated the statement, the cost coding has been included, 

and Remote Data Entry has initialed and dated the statement. Each 

month of the fiscal year has a separate line on the checklist.

Personal Property 

Program

July 2005 None identified. 

Improper Payments Risk 

Assessment June 2005 None identified.

General Management June 2005 None identified. 

GAO Audits:

• Hardrock Mining—BLM Needs to Better Manage Financial Assurances to Guarantee Coverage of Reclamation Costs 

(GAO-05-377) (June 2005)

• Oil and Gas Development—Increased Permitting Activity Has Lessened BLM’s Ability to Meet Its Environmental 

Protection Responsibilities (GAO-05-418) (June 2005)

• Natural Resources—Federal Agencies Are Engaged in Various Efforts to Promote the Utilization of Woody Biomass, 

but Significant Obstacles to Its Use Remain (GAO-05-373) (May 2005)

• Forest Service—Better Data Are Needed to Identify and Prioritize Reforestation and Timber Stand Improvement 

Needs (GAO-05-374) (April 2005)

• Cooperation and Coordination Are Important for Effective Management of Invasive Weeds (GAO-05-185) (February 

2005)

• Oil and Gas Development—Challenges to Agency Decisions and Opportunities for BLM to Standardize Data 

Collection (GAO-05-124) (November 2004)

OIG Audits:

• Framework Needed to Promote Accountability in Interior’s Grants Management (W-IN-MOA-0052-2004) 

(August 2005)

• Hazardous Materials Site Management (C-IN-MOA-0040-2004) (August 2005)

• Department of the Interior Concession Management (C-IN-MOA-0049-2004) ( June 2005)

Table 6: FY 2004 Assessments and Audits
32 BLM 2005 Annual Report

Management‘s Discussion and Analysis

The BLM completed its FY 2005 Improper 

Payments risk assessment as required by the 

Improper Payments Information Act of 2002, 

P.L. 107-300. The Bureau reassessed programs 

exceeding $100 million in annual outlays. This 

assessment did not identify any “high” risk 

programs based on the criteria defined by OMB. 

Additionally, none of the BLM’s programs and 

activities required reporting to the President and 

the Congress or required a progress report on 

actions to reduce improper payments.

The BLM completed all corrective actions 

in fiscal year 2005 to address the following 

material weaknesses and FFMIA noncompliance 

issues:

1. One material weakness: Accounting for 

Mineral Leases.

2. Four FFMIA noncompliance issues: (a) 

Reporting of Deferred Maintenance 

Amounts for Stewardship Land, (b) 

Accounting for Mineral Leases, (c) 

Reporting the Number of Museum Items 

Held in Non-Federal Facilities, and (d) 

Reporting the Condition of Stewardship 

Land.

3. One carryover noncompliance issue: 

Security and Internal Control over 

Information Technology Systems.

1. Accounting for Mineral Leases—This material 

weakness is summarized as follows: 

The BLM processes collections from 

mineral leasing activity on its public lands, 

which includes leases for oil, gas, and coal. The 

BLM collects the first-year rent and bonus bid 

deposits related to this activity. These amounts 

are initially recorded as a deposit liability 

awaiting adjudication. Once adjudicated, the 

collections are transferred to the Minerals 

Management Service (MMS). The audit found 

that the BLM did not have adequate procedures 

at the end of fiscal year 2004 to identify leases 

that were adjudicated but not transferred to the 

MMS.

The BLM should develop procedures for the 

end of the fiscal year to identify and accrue lease 

deposits at year-end that have been adjudicated 

and accepted but not transferred to the MMS. 

Procedures should include communication 

protocols to notify the MMS and the Bureau 

of Reclamation (BOR) of lease activity that 

impacts their respective financial statements.

In its response to the auditors, the BLM 

agreed with this finding.

The BLM’s National Business Center 

(NBC) created a report out of its Collections 

and Billings System that on a monthly basis 

provides the MMS with all lease deposit 

information for accrual purposes. The NBC 

also confirms with the MMS the amount 

transferred through the IPAC system on a 

monthly basis. The NBC issued procedures 

for field office implementation for the timely 

reporting of any adjudicated leases. 

2a. Reporting of Deferred Maintenance Amounts 

for Stewardship Land—This noncompliance 

issue is described as follows: 

Accounting standards for Federal entities 

establish minimum reporting requirements 

for stewardship land. These standards require 

the BLM to report, as required supplementary 

information in the stewardship section of its 

annual report, the condition of stewardship 

land. Federal accounting guidance defines 

deferred maintenance as maintenance that was 

not performed when it should have been or was 

scheduled to be and which, therefore, was put 

off or delayed for a future period. Maintenance 

is the act of keeping fixed assets in acceptable 

condition. It includes preventive maintenance, 

normal repairs, replacement of parts and 

structural components, and other activities 
BLM 2005 Annual Report 33

Management‘s Discussion and Analysis

needed to preserve the asset so that it continues 

to provide acceptable services.

The audit found that the BLM has not 

reported in its annual report any deferred 

maintenance costs related to stewardship land. 

Approximately 27 million acres (20 percent), of 

the 137 million acres of BLM stewardship land 

that has been assessed for condition are rated as 

needing intervention. This implies some form 

of maintenance is required to restore the land to 

its intended condition.

The BLM should develop a process 

consistent with accounting principles generally 

accepted in the United States of America 

for estimating deferred maintenance costs 

on stewardship land that is rated as needing 

intervention.

In its response to the auditors, the BLM 

disagreed with this audit finding.

In this FY 2005 Annual Report, in the 

Deferred Maintenance section of its Required 

Supplementary Information (RSI), the BLM 

reports no deferred maintenance on its 

stewardship lands.

Land and natural heritage assets are not 

subject to deferred maintenance. Instead, land 

and natural heritage assets are subject to the 

forces of nature. Humans have only limited 

ability to influence the results of natural forces 

and no ability to know in advance what the 

location and results of those natural forces 

will be. For these reasons, the concept of 

“maintenance” does not apply to land and 

natural heritage assets and the BLM does not 

schedule or defer maintenance activities on 

them.

2b. Accounting for Mineral Leases—This 

noncompliance issue is summarized as follows:

The BLM processes collections from 

mineral leasing activity on its public lands, 

which includes leases for oil, gas, and coal. The 

BLM collects the first-year rent and bonus bid 

deposits related to this activity. These amounts 

are initially recorded as a deposit liability 

awaiting adjudication. Once adjudicated, the 

collections are transferred to the Minerals 

Management Service (MMS). The audit found 

that the BLM did not have adequate procedures 

at the end of fiscal year 2004 to identify leases 

that were adjudicated but not transferred to the 

MMS.

The BLM should develop procedures for the 

end of the fiscal year to identify and accrue lease 

deposits at year-end that have been adjudicated 

and accepted but not transferred to the MMS. 

Procedures should include communication 

protocols to notify the MMS and Bureau 

of Reclamation (BOR) of lease activity that 

impacts their respective financial statements.

In its response to the auditors, the BLM 

agreed with this finding.

The BLM’s National Business Center 

(NBC) created a report out of its Collections 

and Billings System that on a monthly basis 

provides the MMS with all lease deposit 

information for accrual purposes. The NBC 

also confirms with the MMS the amount 

transferred through the IPAC system on a 

monthly basis. The NBC issued procedures 

for field office implementation for the timely 

reporting of any adjudicated leases.

2c. Reporting the Number of Museum Items Held 

on Non-Federal Facilities—This noncompliance 

issue is described as follows:

Acknowledging that it may be extremely 

difficult to identify all museum items taken 

from Federal lands in prior periods and now 

housed in non-Federal facilities, the BLM 

should develop a workable plan to address 

the reporting and tracking of such items to 

comply with applicable accounting standards. 

Specifically, the BLM should:
34 BLM 2005 Annual Report

Management‘s Discussion and Analysis

1. Work with the Department and the Federal 

Accounting Standards Advisory Board 

(FASAB) to develop a workable plan, on a 

go-forward basis, for reporting in the annual 

report museum items permanently housed 

in non-Federal facilities.

2. Develop a formal Bureauwide standardized 

tracking process, prospectively, to identify 

individual items taken from BLM lands. 

Such process should include the creation of 

a central database to account for BLM items 

housed in both Federal and non-Federal 

facilities.

In its response to the Auditors, the BLM 

disagreed with this audit finding and its 

recommendations.

In this FY 2005 Annual Report, the BLM 

reports museum collections in accordance with 

Federal Accounting Standards Advisory Board 

(FASAB) guidelines. In addition, the BLM has 

sent correspondence through the Department of 

the Interior to FASAB requesting clarification of 

this issue.

In its Statement of Federal Financial 

Accounting Standards No. 29, Heritage Assets 

and Stewardship Land: Reclassification from 

Required Supplementary Stewardship Information, 

the FASAB included latitude in the definition 

of “physical unit” for various categories of 

heritage assets. In paragraph 24.d. the draft 

states: “Heritage assets should be quantified in 

terms of physical units. The appropriate level of 

aggregation and physical units (footnote 11) of 

measure for each category should be meaningful 

and determined by the preparer based on the 

entity’s mission, types of heritage assets, and 

how it manages the assets.” Footnote 11 states: 

“Defining physical units as individual items to 

be counted is neither required nor prohibited. 

Particularly for collection-type heritage assets, it 

may be more appropriate to define the physical 

unit as a collection, or a group of assets located 

at one facility, and then count the number of 

collections or facilities.”

2d. Reporting the Condition of Stewardship 

Land—This noncompliance issue is described as 

follows: 

Accounting standards for Federal entities 

establish minimum reporting requirements for 

stewardship land. These standards require the 

BLM to report, as Required Supplementary 

Information in the stewardship section of its 

annual report, the condition of stewardship 

land. The BLM has not performed condition 

assessments on approximately 125 million 

acres (48 percent) of its 261 million acres 

of stewardship land. Further, many of the 

assessments that have been completed are 

outdated, given that some occurred 20 years 

ago. For example, the majority of the BLM’s 

stewardship land is classified as rangelands, and 

currently only approximately 1 million acres 

of 160 million acres of rangelands are being 

assessed on an annual basis.

1. The BLM, in coordination with the 

Department, should discuss with the 

Federal Accounting Standards Advisory 

Board (FASAB) the burden that the 

accounting standards place on the BLM for 

conducting timely condition assessments on 

stewardship land. 

2. Until FASAB provides new guidance, the 

BLM should develop a workable policy 

to address stewardship land condition 

assessments to comply with applicable 

accounting standards.

In its response to the Auditors, the BLM 

disagreed with this audit finding.

The BLM improved its Required 

Supplementary Stewardship Information 

(RSSI) relative to land condition and deferred 
BLM 2005 Annual Report 35

Management‘s Discussion and Analysis

maintenance estimates on land to incorporate 

more current program management practices. 

In this FY 2005 Annual Report, in the 

Stewardship Lands section of the RSSI, the 

BLM notes the following:

The condition of all of the BLMadministered public lands is categorized as 

“acceptable.” That is, the public lands are in 

adequate condition to sustain the multiple 

uses and use levels authorized during the 

current reporting period. This condition is 

evidenced by the vast resource production and 

revenues generated from the public lands. This 

information is available to the reader in the 

BLM publication Public Land Statistics, Part 3, 

“Commercial Uses and Revenues Generated,” 

which is available on the Internet at http://

www.blm.gov/nhp/browse.htm.

3. Security and Internal Control over Information 

Technology Systems (Carryover)—This 

noncompliance issue is a carryover from FY 

2004 and is described as follows:

Security and general controls over the 

BLM’s financial management systems have not 

been fully implemented. The BLM has not 

implemented certain procedural and technical 

access controls over financial applications to 

minimize the risks of unauthorized access to its 

systems and its data, and has not consistently 

implemented procedures for controlling changes 

to its financial applications.

The BLM needs to improve its security 

and internal control over information 

technology systems to a level at which the BLM 

substantially complies with the security and 

general EDP [electronic data processing] control 

requirements of OMB Circular A-130.

In its response to the auditors, the BLM 

agreed with this finding.

In FY 2005, the BLM’s National Business 

Center met with the Bureau Management 

Committee (BMC) to revise processes and 

procedures. The BLM re-educated change 

management personnel on proper processes and 

procedures through training and bulletins. The 

planning process on how to accomplish these 

goals was completed, costing about $23,000. In 

addition, refresher training for managers and 

supervisors has been conducted.

Business and Financial Systems 

Integration and Controls

The Bureau’s accounting system, the 

Federal Financial System (FFS), is composed 

of a number of interrelated subsystems that 

handle the BLM’s complex financial processing 

needs. FFS capabilities include recording 

the BLM’s budget authority at various levels 

(appropriations, apportionments, allotments, 

allocations, etc.) and tracking the execution of 

the budget at each of these levels. FFS records 

the amounts billed and collected for services 

rendered by the BLM; this information is used 

to prepare bills and dunning notices.

The system also supports buying goods 

and services and paying vendors, including 

complying with prompt payment requirements 

and maintaining relationships with various 

purchasing documents, such as commitments, 

obligations, requisitions, receiving reports, 

and payment vouchers. FFS supports travel 

document and payroll processing, cost 

allocation, and cost accumulation, as well as the 

application of indirect support rates to calculate 

the full costs of projects. All transactions 

recorded to various tables in each FFS subsystem 

support accounting functions that update the 

general ledger.

The system accounts for every type of 

Federal appropriated and nonappropriated fund 

within the BLM’s budget authority, including 

annual, multi-year, and no-year appropriations. 

Nonappropriated funds include revolving and 

working capital funds, budget clearing accounts, 

and deposit and receipt accounts.
36 BLM 2005 Annual Report

Management‘s Discussion and Analysis

Payments to commercial vendors are 

generally subject to the Prompt Payment Act, as 

implemented under OMB Circular A-125. FFS 

automatically determines if a payment is subject 

to prompt payment based on the type of vendor 

and the type of transaction. If a payment 

is subject to prompt payment, FFS ensures 

compliance in terms of scheduling the payment, 

automatically evaluating discount terms, paying 

any interest due if the payment is late, and 

taking into account any payment terms unique 

to the order or vendor.

FFS distinguishes numerous collection 

types: revenue (billed and unbilled), vendor 

refund, advance received from a customer, and 

repayment of a travel advance. Collections 

and disbursements can involve either a cash or 

noncash transaction.

Strict edits on all input data ensure the 

validity of data entered into the system. Editing 

logic includes a verification of valid accounting 

distribution and spending controls, along with 

the completion of required data elements. 

Once a transaction passes all edits, all relevant 

tables and the general ledger are simultaneously 

updated.

FFS also includes a number of processes 

to ensure the integrity of the database and to 

assist in administering the system. Processing 

routines include system assurance programs 

that verify the header and line tables are in 

agreement, all journal postings are in balance, 

and all budget records are properly posted. To 

detect any out-of-balance conditions that might 

occur due to equipment or system software 

failures, the system assurance programs verify 

that components of the online system (reference 

and inquiry tables, including the General 

Ledger and budget tables) balance with the 

historical sequential journal that is the official 

audit trail.

The Fixed Assets subsystem of FFS allows 

tracking of all capitalized real and personal 

property, as well as items designated as “Bureausensitive” or “Field-sensitive.” Bureau-sensitive 

items include personal computers, firearms, 

surveying equipment, and Global Positioning 

System (GPS) equipment valued at more than 

$500. Field-sensitive items include property 

that a BLM field office might want to track 

regardless of the acquisition cost, such as 

binoculars.

The Fixed Assets subsystem reconciles 

property items actually received and accounted 

for with items purchased. Once a property 

item is officially documented as “received,” 

a custodial officer and property number are 

assigned, and the item is then inventoried every 

year. The Fixed Assets subsystem also records 

when an item is disposed of through public 

sale, transfer to another agency, or donation to a 

school or college.

The Bureau was one of the first agencies 

in the Department of the Interior to establish 

an interface between the Interior Department 

Electronic Acquisition System (IDEAS) and 

FFS. With this interface, once an obligation 

document (a purchase order, task order, delivery 

order, contract, or modification) is created in 

IDEAS, the obligation can be electronically 

posted to FFS. If the obligation passes 

successfully to FFS, a confirmation is posted in 

IDEAS. In addition, IDEAS can pass a funding 

commitment document to FFS so that funds 

can be set aside pending actual obligation.

With the level of integration and crosschecking in place among the BLM’s acquisition, 

accounting, and property management/

accounting systems, the Bureau has fulfilled the 

requirement to establish sound management 

controls and ensure legal compliance.
BLM 2005 Annual Report 37

Management‘s Discussion and Analysis

Future Effects Of Existing, Currently Known Demands, 

Risks, Uncertainties, Events, Conditions, And Trends

Natural and Human-Caused Disasters

Most of the Bureau’s facilities are located in the western states and 

Alaska. These facilities are susceptible to typical risks for buildings 

and structures such as fire, power outages, and natural disaster threats 

resulting from local conditions such as flooding, tornados, winter 

storms, and earthquakes.

BLM facilities, personnel, and resources are also subject to 

security-related risks. The threats and acts of terrorism that occurred 

in 2001 reinforced the need for government agencies review and 

revise business continuity and related contingency plans to ensure 

that essential services can be provided during emergency conditions.

Possible Future Effects: Natural and human-caused disasters 

could range from minor damage or disruption to large-scale 

catastrophes resulting in extensive employee injuries and destruction 

of property. The BLM’s contingency plans are designed to save lives, 

prevent damage, and minimize adverse consequences. However, 

no amount of planning and preparation can prevent disasters from 

striking. 

Wildland Fires

As noted in a previous section, the Bureau provides fire protection 

on 388 million acres of public and state lands. The BLM’s fire and 

aviation program works cooperatively with its Federal and state land 

management partners to suppress and manage wildland fire, conduct 

prescribed fires, and promote fire safety awareness through education 

and prevention programs. The Bureau’s fire program also works 

closely with the BLM’s other resource programs to improve the health 

of the land, reduce the risks of hazardous buildup of fuels, protect 

communities at risk, and improve wildlife habitat.

The BLM’s National Office of Fire and Aviation is headquartered 

at the National Interagency Fire Center in Boise, Idaho, where fire 

experts from the five Federal wildland fire agencies, the National 

Association of State Foresters, and the U.S. Fire Administration 

develop policy, conduct wildland fire research, develop equipment, 

and coordinate with state and local, as well as international, 

firefighting organizations. Because wildland firefighting is a 

demanding and hazardous profession, the BLM and its cooperators 

take every measure to ensure that firefighter safety and the protection 

of life are the top priorities while protecting property and natural 

resources.
38 BLM 2005 Annual Report

Management‘s Discussion and Analysis

The public lands and their myriad 

resources—soil, vegetation, wildlife habitat, 

human structures/improvements and more—are 

frequently at risk from wildfire, particularly 

during a drought year. Much of the western 

United States has been experiencing a multiyear drought, resulting in the fire danger being 

greater than normal.

Possible Future Effects: While the 

BLM is taking steps to reduce the number of 

human-caused fires, fires caused by natural 

events such as lightning strikes will always 

present a risk to public lands and resources. 

However, the Bureau’s professional, welltrained, and prepared firefighting workforce 

will continue to achieve a high rate of success in 

responding quickly to fire starts to keep them 

from becoming large, catastrophic events.

The BLM, along with its partners and 

cooperators, is working to mitigate the risks 

created by hazardous accumulations of fuel 

on our public lands and near communities. 

These efforts are having a positive effect on the 

landscape, but much remains to be done. In 

the meantime, the BLM will continue working 

toward reducing the risks while responding 

quickly, efficiently, and safely to new fire 

ignitions.

Crime and Unauthorized Use

Public lands are not immune from the 

criminal activities that threaten resources and 

the health and safety of visitors. With the 

growth of communities, especially in areas 

adjacent to public lands, illegal activities and 

unauthorized use will continue to flourish. 

These activities also occur on the most remote 

pieces of public land and include vandalism 

and theft of irreplaceable natural and cultural 

resources.

The designation of additional special 

management areas (national monuments, 

wilderness areas, areas of critical environmental 

concern, etc.) has led to a greater degree of 

regulated use and restrictions. The intent of 

these restrictions is to maintain the special 

values of these areas, but there are public 

land users who will deliberately violate the 

restrictions, damaging these unique areas and 

their resources.

Although the BLM issues permits for many 

commercial uses of public lands, numerous 

individuals use or take resources without 

obtaining the required authorizations. These 

individuals bypass the normal environmental 

review process and cause adverse impacts that 

would otherwise be avoided by prohibiting 

certain uses or attaching stipulations to protect 

resources and ensure public safety.

Other activities that negatively impact 

public lands include illegal drug cultivation and 

drug labs, hazardous waste dumping, illegal 

activities associated with our Nation’s borders, 

and other crimes.

To ensure that visitors have safe and positive 

experiences on the public lands, BLM rangers 

and special agents maintain a capability for 

providing public assistance and responding to 

illegal activities that compromise public safety 

or damage public lands or facilities. The BLM’s 

law enforcement program works cooperatively 

with state, county, and local law enforcement 

agencies to meet the growing workload.

Possible Future Effects: Crime and 

unauthorized use will continue to be a problem 

on the public lands, given the impossibility 

of keeping track of every activity occurring 

across the nearly 261 million acres managed by 

the BLM. Unauthorized use will continue to 

cause the loss of resources and cost significant 

sums of money to rehabilitate and restore 

public lands and resources to former levels of 

health and productivity. Perhaps the most 

dramatic examples are the looting of cultural 

and paleontological resources to be sold to 

overseas collectors and the millions of dollars 

in lost resources and funds expended for the 

suppression of human-caused fires.
BLM 2005 Annual Report 39

Management‘s Discussion and Analysis

Deferred Maintenance 

Deferred maintenance occurs when regularly 

scheduled repairs, preventive maintenance, 

and replacements of parts and components 

are not performed when they should have 

been and are, therefore, delayed until a future 

time. The problem is compounded by the fact 

that maintenance costs have increased, most 

significantly for work using petroleum-based 

products or involving extensive travel.

The trend has been for the BLM’s inventory 

of fixed, capital assets (buildings, roads, 

recreation sites, etc.) to increase over time. 

However, with implementation of the new 

Interior-wide Asset Management Plan (AMP), 

the BLM will streamline its portfolio of assets 

and optimize maintenance of those assets that 

contribute most significantly to its mission and 

strategic goals. The BLM expects to dispose of 

unneeded assets so it can affordably maintain 

and sustain its portfolio. Adequate funding 

and staffing for repairs and maintenance is 

essential if the Bureau is to maintain its facilities 

in good functioning condition and reduce its 

accumulated deferred maintenance workload.

The Deferred Maintenance section 

presented later in this document provides more 

detailed information on the extent of the BLM’s 

constructed assets (buildings, administrative 

sites, recreation sites, roads, bridges, trails, and 

dams) and accumulated deferred maintenance.

Possible Future Effects: Funding 

is needed for normal repairs, preventive 

maintenance, component renewal, and other 

activities needed to preserve the BLM’s portfolio 

of constructed assets so they continue to 

provide acceptable service, safety, and quality 

experiences for public users. The estimated and 

reported cost of regularly scheduled repairs and 

preventive maintenance must accurately reflect 

the BLM’s true annual maintenance needs.

Preservation of capital investments is 

contingent on the BLM’s ability to perform 

preventive maintenance and make timely 

repairs. Maintenance that is deferred becomes 

more costly over time. If delayed long enough, 

the result is severe deterioration or even a total 

loss of facilities. This, in turn, could result in 

resource damage. For example, not maintaining 

a hiking trail on steep terrain could result in 

soil erosion, the formation of gullies, loss of 

vegetation, sedimentation of nearby streams, 

and degradation of aquatic and riparian habitat. 

In some instances, critical health and safety 

problems could be created for both BLM 

employees and the public.

Contingent Liabilities: Judgments and 

Claims

The BLM is a party to a number of 

lawsuits where the plaintiff is seeking monetary 

damages. The lawsuits can involve a variety 

of issues, including lost revenues when 

timber contracts are suspended because of 

environmental issues; injuries or death that 

occur on BLM-managed public land or roads; 

issues regarding takings and suspension of 

mining claims; and other issues. 

Possible Future Effects: The outcomes 

of lawsuits will not materially affect the BLM’s 

future financial condition or operations. The 

U.S. Treasury’s judgment fund would likely bear 

most of the costs incurred to pay any judgments 

or settlements.

Contingent Liabilities: Environmental 

Cleanup

The Comprehensive Environmental 

Response, Compensation, and Liability Act of 

1980, the Clean Water Act of 1977, and the 

Resource Conservation and Recovery Act of 

1976 require Federal agencies to report sites 

where (1) hazardous substances have been 

released or (2) hazardous wastes are or have 

been stored, treated, or disposed of. These 

Acts also require responsible parties, including 

Federal agencies, to clean up releases of 
40 BLM 2005 Annual Report

Management‘s Discussion and Analysis

hazardous substances, to restore injured natural 

resources, and to manage hazardous wastes.

The BLM faces major challenges in 

cleaning up hazardous substance releases on 

the public lands. Virtually all of these releases 

arise from non-BLM uses of the lands, such as 

illegal dumping, transportation spills, landfills, 

mineral development operations, pipelines, and 

airstrips. Significant portions of the costs of 

cleanup will be incurred by or recovered from 

responsible parties external to the BLM.

Possible Future Effects: Undetected or 

unmitigated releases of hazardous substances 

on public lands could result in resource damage 

(soil or water contamination, vegetation loss, 

wildlife habitat destruction, etc.). Loss of 

human life, harm to human health, and damage 

to property are also possible, especially in 

the rapidly growing wildland-urban interface 

areas of the West and in the more heavily used 

recreation areas. On the other hand, the larger, 

undeveloped rural tracts of public land tend 

to minimize the odds of impacts to the public. 

The Bureau is working aggressively to identify 

and clean up sites posing a danger to humans or 

natural resources.

Contingent Liabilities: Abandoned Mine 

Lands

The Bureau maintains an inventory of 

known abandoned mine land (AML) sites that 

may pose an environmental or public safety 

hazard on the public lands. BLM personnel 

conduct targeted field validations of potential 

AML sites and hazards, with the primary focus 

on priority watersheds and high-use areas. State 

agencies and the public often identify AML 

hazards they encounter on public lands.

The BLM works in partnership with other 

government agencies and private landowners 

to target and leverage funding and coordinate 

projects. Watershed projects are typically 

complex, multi-year efforts.

The Bureau continued this past year to alert 

the public to the dangers of abandoned mines 

by providing web-based information on AML 

hazards and ongoing projects; distributing 

several thousand safety brochures; and giving 

AML safety presentations to classrooms, special 

interest groups, and local outreach venues. 

The BLM also continued to support the Mine 

Hazard Awareness Campaign, a Federal and 

state cooperative effort initiated by the U.S. 

Department of Labor’s Mine Safety and Health 

Administration to increase public awareness 

of the dangers posed by active and abandoned 

mines. This program emphasizes overall safety 

awareness, with a special emphasis on education 

for school-age children.

Possible Future Effects: Given the large 

number of abandoned mine sites believed to 

exist on BLM-administered public lands, there 

is a significant potential for serious injuries or 

death for people who wander across these sites 

or who explore old mine tunnels and buildings. 

The BLM faces exposure to lawsuits or claims 

for damages resulting from deaths or injuries 

at these sites. As population sprawl continues 

across the West, and as more visitors come to 

the public lands to enjoy recreation activities 

and experience open space, more people will 

come into contact with what once were remote 

abandoned mine sites. The BLM has no basis 

for estimating the future financial impact of 

abandoned mine hazards.
BLM 2005 Annual Report 41

Management‘s Discussion and Analysis

Discussion and Analysis of 

the Financial Statements

This Annual Report presents the BLM’s financial statements. 

There are four basic objectives for financial reporting in the Federal 

government:

• Budgetary integrity (accounting for resources obtained and 

resources spent),

• Operating performance (the cost of programs and the results 

achieved for the dollars spent),

• The government’s stewardship over government assets such as 

land and heritage assets (improvement or deterioration in these 

assets over the reporting period), and

• Systems and controls (the presence of cost-effective systems and 

controls to adequately safeguard assets).

To meet these reporting objectives, the BLM is presenting the 

following financial reports in this Annual Report:

• Consolidated Balance Sheets: These statements report on the 

operating assets and liabilities related to the delivery of goods 

and services. They display the dollar value of unspent funds, 

assets (such as accounts receivable; inventory; investments; and 

property, plant, and equipment), and liabilities (such as accounts 

payable and various accrued liabilities).

• Consolidated Statements of Net Cost of Operations and 

Consolidated Statements of Changes in Net Position: These 

statements report the costs of providing government goods, 

services, and benefits, and provide information on the changes in 

financial position from one year to the next. They contain the 

total cost of operations, revenue generated from operations, and 

appropriations (dollars) used to fund the net cost of operations.

• Combined Statements of Budgetary Resources and Consolidated 

Statements of Financing: The Combined Statements of 

Budgetary Resources show the budgetary resources made 

available through appropriations and other sources, obligations 

incurred against those resources, and the dollar amount of cash 

outlays. The Consolidated Statements of Financing explain and 
42 BLM 2005 Annual Report

Management‘s Discussion and Analysis

reconcile the relationship of budgetary 

obligations to the net cost of operations.

• Consolidated Statements of Custodial 

Activity: These statements report on the 

collection and disposition of custodial 

revenue for first-year rents and bonuses on 

lease agreements related to oil and gas, coal, 

and other leasable minerals.

• Supplementary Stewardship Report: This 

report displays the nature and condition 

(not dollar values) of stewardship assets. 

Stewardship assets are property entrusted 

to or owned by the Federal government 

for the long-term benefit of the Nation 

(such as public land). The government is 

charged with safeguarding and maintaining 

these assets. Valuation would be extremely 

difficult in most cases. Expenditures for 

stewardship assets are included as part of net 

cost on the Consolidated Statements of Net 

Cost of Operations.

• Supplementary Report on Deferred 

Maintenance: This report displays the 

estimated dollar value of maintenance 

that was not performed when scheduled, 

and that has been delayed to a future 

period, for general property, plant, and 

equipment and for stewardship assets. 

Deferred maintenance includes preventive 

maintenance, normal repairs, replacement of 

parts and structural components, and other 

activities needed to preserve the asset so that 

it continues to provide acceptable services 

and achieves its expected life.

The BLM believes the financial statements 

are a fair and accurate presentation of its 

financial position, net cost of operations, 

changes in net position, budgetary resources, 

and custodial activity, as well as details 

regarding financing. This is reflected in the 

unqualified (clean) audit opinion rendered 

on the BLM’s financial statements by its 

independent auditors. Sound financial 

management is a top priority for the BLM at all 

levels of the organization.

Limitations of the Financial Statements

The financial statements have been prepared 

pursuant to the requirements of the Chief 

Financial Officers Act of 1990. While the 

financial statements have been prepared from 

the BLM’s books and records in accordance 

with the guidance provided by the Office 

of Management and Budget, the financial 

statements may differ from financial reports 

used to monitor and control budgetary resources 

that are prepared from the same books and 

records.

The financial statements should be read with 

the realization that they are for a component 

of a sovereign entity, that liabilities not covered 

by budgetary resources cannot be liquidated 

without enactment of an appropriation, and that 

payment of all liabilities other than for contracts 

can be abrogated by the sovereign entity.

Significant Financial Statement Events 

The BLM was involved in financial 

transactions during the year that resulted in 

significant changes in various line items on the 

financial statements between FY 2005 and 

FY 2004:

• The Southern Nevada Public Land 

Management Act (SNPLMA), enacted in 

October 1998, authorizes the BLM to sell 

public land tracts that are interspersed with 

or adjacent to private land in the Las Vegas 

Valley. The BLM is authorized to invest 

85 percent of the sales in interest-bearing 

Treasury securities, while 10 percent of the 

proceeds are distributed to the Southern 

Nevada Water Authority and 5 percent 

to the State of Nevada’s Education Fund. 
BLM 2005 Annual Report 43

Management‘s Discussion and Analysis

The revenues generated from the land 

sales and investments enable the BLM 

and other government entities to acquire 

environmentally sensitive lands and build or 

maintain trails, day-use areas, campgrounds, 

etc., to benefit public land visitors. Each 

year, the revenue generated from these land 

sales has significantly increased. As of the 

end of FY 2004, the BLM maintained $793 

million in investments related to SNPLMA 

land sales. During FY 2005, the Bureau 

collected $1.2 billion in cash receipts related 

to land sales and interest revenue. These 

collections, less expenses within the fund, 

created a $1.7 billion investment balance 

related to the SNPLMA at the end of 

FY 2005.

• When the BLM conducts SNPLMA 

land sales, a 20 percent down payment is 

collected from each successful bidder to hold 

a land parcel. These collections are reported 

as deferred revenue until the sale becomes 

final. Successful bidders typically have 

180 days from the sale date to finalize the 

land transaction and pay the remaining 80 

percent. Land sales during the second half 

of FY 2004 resulted in the BLM reporting 

$136 million in deferred revenue as of 

September 30, 2004. All SNPLMA land 

sales during FY 2005 were finalized prior to 

the end of the fiscal year.

• The BLM sells oil and gas leases, coal 

leases, and other types of minerals leases. 

The BLM receives bid deposits on these 

lease sales and records them as a liability 

while they await adjudication. Once 

the adjudication process is complete, the 

deposits are either refunded or combined 

with additional receipts, which represents 

custodial activity, and transferred to the 

Minerals Management Service (MMS). 

During FY 2004, the BLM transferred 

$92 million to the MMS and as of 

September 30, 2004, had recorded a liability 

of $73 million for leases not yet adjudicated. 

During FY 2005, the BLM transferred 

$610 million to the MMS and as of 

September 30, 2005, had recorded a liability 

of $58 million for leases not yet adjudicated.

• The Department of the Interior’s FY 2004 

appropriation bill moved the Payments in 

Lieu of Taxes (PILT) program from the 

BLM to the Department of the Interior’s 

Office of the Secretary (OS). Since the 

PILT program was new to the OS and 

the BLM had extensive knowledge of the 

program, the OS entered into a reimbursable 

agreement with the BLM whereby the 

Bureau would make the FY 2004 PILT 

payments and subsequently be reimbursed 

by the OS. As a result of this agreement, 

the BLM recorded both revenue and 

expenses totaling $224 million during 

FY 2004. During FY 2005 the BLM was 

not involved with the PILT program because 

the OS performed all activity related to 

PILT.

The BLM’s Net Position at the end of 

FY 2005 was $1.8 billion, an increase of $1.1 

billion compared to FY 2004. The BLM’s 

Net Position consists of two components: (1) 

Unexpended Appropriations of $472 million 

and (2) Cumulative Results of Operations of 

$1.3 billion. The increase in BLM’s overall 

Net Position can be attributed mostly to the 

SNPLMA land sales, as noted above.
44 BLM 2005 Annual Report

FINANCIAL

STATEMENTS

2005 2004

Assets (Note 2):

 Intragovernmental:

 Fund Balance with Treasury (Note 3) $1,064,535 $1,252,381

 Investments, Net (Note 4) 1,749,803 829,445 

 Accounts Receivable (Note 5) 15,388 12,493

 Other:

 Advances and Prepayments 1,277 1,090

 Total Intragovernmental 2,831,003 2,095,409 

 Cash in Imprest Funds 56 55 

 Accounts Receivable, Net (Note 5) 10,367 20,691

 Inventory and Related Property (Note 6) 304,378 321,319 

 General Property, Plant, and Equipment, Net (Note 7) 388,933 355,621

 Other:

 Travel Advances 77 131

Total Assets (Note 8) $3,534,814 $2,793,226

Liabilities and Net Position:

Liabilities (Note 9):

 Intragovernmental:

 Accounts Payable $ 38,981 $ 24,895 

 Debt to Treasury (Note 10) 1,074,204 1,139,204 

 Other:

 Accrued Payroll and Benefits 3,208 2,780 

 Custodial Liabilities 57,519 73,376

 Undistributed Collections 93,802 84,783

 Deferred Revenue 9,949 16,221

 Unfunded Payroll Liabilities (Note 11) 22,129 22,217

 Due to Treasury Judgment Fund 12,253 12,224 

 Total Intragovernmental 1,312,045 1,375,700 

 Accounts Payable 37,365 31,436

 Environmental Cleanup Liabilities (Note 12) 3,491 6,330 

 Federal Employee Benefits - FECA Actuarial Liability 94,971 90,507

 Other:

 Accrued Payroll and Benefits 29,466 24,953

 Custodial Liabilities 65 –

 Secure Rural Schools Act Payable 106,810 102,387

 Deposit Funds (Note 13) 102,889 314,778

 Deferred Revenue – 136,390 

 Unfunded Annual Leave 57,466 56,260 

 Contingent Liabilities (Note 12) 1,465 3,650 

Total Liabilities 1,746,033 2,142,391

 Commitments and Contingencies (Notes 12 and 14)

Net Position:

 Unexpended Appropriations 471,557 461,141

 Cumulative Results of Operations 1,317,224 189,694 

 Net Position 1,788,781 650,835 

Total Liabilities and Net Position $3,534,814 $2,793,226

The accompanying notes are an integral part of these financial statements.

Consolidated Balance Sheets 

as of September 30, 2005 and 2004

(dollars in thousands)
BLM 2005 Annual Report 45

Financial Statements

Consolidated Statements of Net Cost of Operations 

for the Fiscal Years Ended September 30, 2005 and 2004

(dollars in thousands)

 2005 2004

Resource Protection

 Total Cost $ 363,292 $ 378,144 

 Total Earned Revenue 1,225,722 415,367

 Net Cost/(Revenue) (862,430) (37,223)

Resource Use

 Total Cost 346,186 318,717

 Total Earned Revenue 220,234 196,858 

 Net Cost 125,952 121,859 

Recreation

 Total Cost 184,000 130,651

 Total Earned Revenue 16,909 21,963

 Net Cost 167,091 108,688 

Serving Communities

 Total Cost 1,292,316 1,226,218 

 Total Earned Revenue 264,935 349,399 

 Net Cost 1,027,381 876,819 

Total

 Total Cost (Note 15) 2,185,794 2,053,730 

 Total Earned Revenue 1,727,800 983,587

 Net Cost of Operations (Notes 16 and 17) $ 457,994 $1,070,143

The accompanying notes are an integral part of these financial statements.
46 BLM 2005 Annual Report

Financial Statements

 2005 2004

Unexpended Appropriations

 Balances, Beginning of Year $ 461,141 $ 412,460 

 Change in PILT ownership (Note 17) – (660)

 Balances, Beginning of Year, as Adjusted 461,141 411,800 

 Budgetary Financing Sources:

 Appropriations Received, General Funds 1,931,631 2,002,596

 Appropriations Used (1,541,145) (1,505,149)

 Appropriations Transferred In/(Out), Net (354,432) (426,887)

 Other Adjustments (25,638) (21,219)

 Net Change in Unexpended Appropriations 10,416 49,341

 Balances, End of Year $ 471,557 $ 461,141

Cumulative Results of Operations

 Balances, Beginning of Year $ 189,694 $ (262,935)

 Budgetary Financing Sources:

 Appropriations Used 1,541,145 1,505,149 

 Royalties Retained 81,409 16,215 

 Transfers In/(Out) Without Reimbursement, Net (115,127) (71,693)

 Other Budgetary Financing Sources (152) 191

 Other Financing Sources:

 Imputed Financing From Costs Absorbed by Others (Note 18) 79,870 75,389 

 Transfers In/(Out) Without Reimbursement, Net (1,621) (2,479) 

 Total Financing Sources 1,585,524 1,522,772 

 Net Cost of Operations (457,994) (1,070,143)

 Net Change in Cumulative Results of Operations 1,127,530 452,629

 Balances, End of Year $ 1,317,224 $ 189,694

The accompanying notes are an integral part of these financial statements.

Consolidated Statements of Changes in Net Position 

for the Fiscal Years Ended September 30, 2005 and 2004

(dollars in thousands)
BLM 2005 Annual Report 47

Financial Statements

 2005 2004

(Note 19)

Budgetary Resources:

Budget Authority:

Appropriations Received $ 3,307,411 $2,764,526

Net Transfers, Current Year Authority (6,247) (119,214)

Unobligated Balance:

Beginning of Year 877,799 585,093

Change in PILT Ownership (Note 17) – (357)

Net Transfers, Prior Year Authority (716) 876

Spending Authority from Offsetting Collections:

Earned:

Collected 266,032 421,880 

Receivable from Federal Sources 3,765 2,580 

Change in Unfilled Customer Orders:

Advance Received (6,625) (667)

Without Advance from Federal Sources (5,113) 2,963

Total Spending Authority From Offsetting Collections 258,059 426,756

Recoveries of Prior Year Obligations 72,282 75,280 

Permanently Not Available Pursuant to Public Law (25,795) (21,449)

Total Budgetary Resources $ 4,482,793 $ 3,711,511

Status of Budgetary Resources:

Obligations Incurred:

Direct $ 3,175,597 $2,569,153

Reimbursable 83,108 264,559 

Total Obligations Incurred 3,258,705 2,833,712 

Unobligated Balance Apportioned 1,224,069 877,780 

Unobligated Balance Not Available 19 19 

Total Status of Budgetary Resources $ 4,482,793 $ 3,711,511

Relationship of Obligations to Outlays:

Obligations Incurred $ 3,258,705 $2,833,712 

Obligated Balance, Net, Beginning of Year 871,901 703,552 

Change in PILT Ownership (Note 17) – (298)

Obligated Balance, Net, End of Year:

Accounts Receivable 23,488 19,723

Unfilled Customer Orders from Federal Sources 18,146 23,260 

Undelivered Orders (1,375,036) (812,867)

Accounts Payable (131,701) (102,017)

Total Obligated Balance, Net, End of Year (1,465,103) (871,901)

Less: Spending Authority Adjustments (70,934) (80,823)

Outlays:

Disbursements 2,594,569 2,584,242 

Collections (259,407) (421,213)

Net Outlays Before Offsetting Receipts 2,335,162 2,163,029

Less: Offsetting Receipts (1,478,385) (801,330)

Net Outlays $ 856,777 $ 1,361,699 

The accompanying notes are an integral part of these financial statements.

Combined Statements of Budgetary Resources 

for the Fiscal Years Ended September 30, 2005 and 2004

(dollars in thousands)
48 BLM 2005 Annual Report

Financial Statements

Consolidated Statements of Financing 

for the Fiscal Years Ended September 30, 2005 and 2004

(dollars in thousands)

 2005 2004

Resources Used to Finance Activites:

Budgetary Resources Obligated:

Obligations Incurred $3,258,705 $2,833,712

Spending Authority from Offsetting Collections and Recoveries (330,341) (502,036)

Obligations Net of Offsetting Collections and Recoveries 2,928,364 2,331,676

Offsetting Receipts (1,478,385) (801,330)

Net Obligations 1,449,979 1,530,346

Other Resources:

Transfers In/(Out) Without Reimbursement, Net (1,621) (2,479)

Imputed Financing From Costs Absorbed by Others (Note 18) 79,870 75,389 

Net Other Resources Used to Finance Activities 78,249 72,910 

Total Resources Used to Finance Activities 1,528,228 1,603,256

Resources Used to Finance Items Not Part of the Net Cost of Operations:

Change in Budgetary Resources Obligated for Goods and

Services Ordered But Not Yet Provided (564,041) (192,300)

Change in Unfilled Customer Orders (11,739) 3,138

Resources That Fund Expenses Recognized in Prior Years (65,176) (77,615)

Offsetting Receipts Not Part of the Net Cost of Operations (54,624) 105,880

Resources That Finance the Acquisition of Assets (47,235) (36,866)

Allocation Transfer Reconciling Item, Parent Account (Note 20) (347,611) (358,004)

Other Resources That Do Not Affect Net Cost of Operations (24,705) (4,725)

Total Resources Used to Finance Items Not part of the Net Cost of Operations (1,115,131) (560,492)

Total Resources Used to Finance the Net Cost of Operations 413,097 1,042,764 

Components of the Net Cost of Operations That Did Not Require or

 Generate Resources in the Current Year:

Components Requiring or Generating Resources in Future Years:

Increase in Annual Leave Liability 1,206 1,251

Increase in Environmental Cleanup Liability 1,628 –

Increase in Other Unfunded Liabilities 6,643 –

(Increase)/Decrease in Exchange Revenue Receivable from the Public 6,732 (4,872)

Total Components Requiring or Generating Resources in Future Years 16,209 (3,621)

Components Not Requiring or Generating Resources:

Depreciation and Amortization 22,872 27,113

Allocation Transfer Reconciling Item, Child Account (Note 20) 2,855 2,774 

Bad Debt Expense 2,961 1,113

Total Components Not Requiring or Generating Resources 28,688 31,000 

Total Components of Net Cost of Operations That Did Not Require or

 Generate Resources in the Current Year 44,897 27,379 

Net Cost of Operations $ 457,994 $1,070,143

The accompanying notes are an integral part of these financial statements.
BLM 2005 Annual Report 49

Financial Statements

Consolidated Statements of Custodial Activity 

for the Fiscal Years Ended September 30, 2005 and 2004

(dollars in thousands)

2005 2004

Mineral Lease Revenue:

Rents and Bonuses $597,024 $ 165,360 

Total Revenue $597,024 $165,360

Disposition of Custodial Revenue:

Distribution to Department of the Interior

Minerals Management Service (Note 13) $610,078 $ 91,984 

Bureau of Reclamation 1,082 –

Distribution to Other Federal Agencies

Department of the Treasury 274 –

Distribution to States 1,382 –

Change to Untransferred Revenue (15,792) 73,376

Total Disposition of Revenue $597,024 $165,360

The accompanying notes are an integral part of these financial statements.
50 BLM 2005 Annual Report

Financial Statements

Note 1 - Summary of Significant Accounting Policies

A. Reporting Entity

The Bureau of Land Management (BLM or Bureau), a bureau of 

the Department of the Interior (DOI or Department), was established 

on July 16, 1946, through the consolidation of the General Land 

Office and the Grazing Service in accordance with the provisions of 

Sections 402 and 403 of the President’s Reorganization Plan No. 3 

of 1946 (60 Stat. 1097). The BLM’s functions are set forth in the 

Federal Land Policy and Management Act of 1976 (P.L. 94-579).

On March 12, 1996, the Department’s Helium Operations were 

transferred from the U.S. Bureau of Mines to the BLM. This was 

done under the authority of Section 2 of Reorganization Plan No. 3 

of 1950 (64 Stat. 1262), as amended. The helium production fund 

was established by the Helium Act (50 U.S.C. 10), enacted March 3, 

1925, and amended by the Helium Act Amendments of 1960 (P.L. 

86-777).

In fulfilling its mission, the BLM administers a variety of funds:

1. General Funds: These funds consist of expenditure accounts 

used to record financial transactions arising from Congressional 

appropriations as well as receipt accounts. The principal general fund 

expenditure accounts maintained are:

a. Management of Lands and Resources

b. Wildland Fire Management

c. Oregon and California Grant Lands

2. Special Funds: The BLM maintains both special fund 

receipt accounts and special fund expenditure accounts. Collections 

made into special fund expenditure accounts are available receipts 

and are considered to be the BLM’s revenue. Collections made into 

special fund receipt accounts are earmarked by law for a specific 

purpose but are not generated from a continuing cycle of operations. 

Receipts are deposited as collected. Funds deposited into special 

fund receipt accounts typically arise from sales of public lands and 

materials, sales of timber, fees and commissions, mineral leases, and 

other charges for services provided by the BLM to users of the public 

lands. Amounts deposited into special fund receipt accounts are 

subject to various distribution formulas as specified by law.

NOTES TO

PRINCIPAL

FINANCIAL

STATEMENTS
BLM 2005 Annual Report 51

Financial Statements

3. Revolving Funds: This type of fund 

is used to finance and manage a continuous 

cycle of business-type operations. The BLM 

maintains a Working Capital Fund (WCF) as a 

single administrative unit established to finance 

and account for services and commodities 

furnished to various program activities. The 

WCF was established in 1978 under Section 306 

of the Federal Land Policy and Management 

Act of 1976 (Public Law 94-579) with an 

initial investment of $2 million in appropriated 

funds. Since that time, additional equity has 

been provided through intragovernmental 

transfers or donations of inventories, capital 

equipment, and other assets. Transfers or 

donations are made without reimbursement to 

the donating activity. All additional income to 

the WCF has been generated through charges 

to the BLM’s programs or other government 

agencies. The services provided by the WCF 

include motor vehicles, stores, a sign shop, a 

Departmental forms center, and the collection 

and disbursement of receipts from surface 

management of the Naval Oil Shale Reserve 

under an October 2, 1987, memorandum of 

understanding with the Department of Energy. 

In addition, the WCF provides funding for 

travel advances and change-making funds held 

by imprest fund cashiers.

In addition to the WCF, Helium Operations 

are funded through a public enterprise revolving 

fund. This fund was established with monies 

from the U.S. Treasury to manage the Federal 

helium program, which includes helium 

production, storage, conservation, and sales 

activities. Funding for current management 

of this program is provided by sales of 

helium. Helium production and refining were 

discontinued on April 1, 1998, pursuant to the 

Helium Privatization Act of 1996 (P.L. 104-

273). However, crude helium storage and sales 

from the helium stockpile will continue through 

January 1, 2015.

4. Trust Funds: The BLM maintains two 

trust accounts to carry out specific programs 

under trust agreements and statutes. The 

Land and Resource Management Trust Fund 

contains monies contributed by non-Federal 

organizations for resource development, 

protection, and management; conveyance of 

lands omitted in original surveys; and public 

surveys requested by individuals. The Alaska 

Townsite Trustee Fund receives money from the 

sale of town lots to non-Natives and is available 

to cover the expenses involved in selling and 

maintaining town sites.

5. Deposit Funds: These funds are 

maintained to account for receipts awaiting 

proper classification or receipts held in escrow 

until ownership is established, at which time 

proper distribution can be made. Refer to 

Note 13.

B. Basis of Accounting and Presentation

These financial statements have been 

prepared to report the financial position, net 

cost of operations, changes in net position, 

budgetary resources, reconciliation of 

budgetary resources to net costs, and custodial 

activity of the BLM in accordance with the 

Chief Financial Officers Act of 1990 and the 

Government Management Reform Act of 1994. 

The financial statements have been prepared 

from BLM’s financial records in accordance 

with accounting principles generally accepted 

in the United States of America (GAAP) using 

guidance issued by the Federal Accounting 

Standards Advisory Board (FASAB) and the 

Office of Management and Budget (OMB); the 

BLM accounting policies that are summarized 

in this note have also been followed. These 

financial statements include all funds and 

accounts under the BLM’s control, as well 

as allocations from other Federal agency 

appropriations transferred to the BLM under 

specific legislative authority.
52 BLM 2005 Annual Report

Financial Statements

OMB reporting guidelines require that 

all of the financial statements, and the related 

footnotes, be presented on a comparative basis, 

including balances and amounts for the current 

year and prior year. Certain prior year amounts 

have been reclassified to conform to the currentyear presentation.

The accounting structure of Federal 

Government agencies is designed to reflect both 

accrual and budgetary accounting transactions. 

Under the accrual method of accounting, 

revenues are recognized when earned and 

expenses are recognized when incurred, without 

regard to the receipt or payment of cash. The 

budgetary accounting principles, on the other 

hand, are designed to recognize the obligation 

of funds according to legal requirements, which 

in many cases occurs before an accrual-based 

transaction takes place. The recognition of 

budgetary accounting transactions is essential 

for compliance with legal constraints and 

controls over the use of Federal funds. 

Intragovernmental assets and liabilities arise 

from transactions with other Federal agencies. 

Except for the Statements of Budgetary 

Resources and portions of the Statements of 

Financing, all statements are presented on a 

consolidated basis and use eliminating entries 

to avoid overstatement of balances caused 

by intrabureau transactions. Significant 

intrabureau balances and transactions have been 

eliminated in consolidation.

The financial statements should be read with 

the realization that they are for a component of 

the United States Government, a sovereign entity. 

One implication of this is that liabilities cannot 

be liquidated without legislation that provides 

the resources and legal authority to do so.

C. Revenues and 

Other Financing Sources

The BLM receives most of the funding 

needed to support its programs through 

appropriations authorized by Congress. The 

Bureau receives annual, multiyear, and noyear appropriations that may be used, within 

statutory limits, for operating and capital 

expenditures. Additional amounts are obtained 

through reimbursements for services performed 

for other Federal agencies, state and local 

governments, and the private sector. These 

revenues may be used to offset the cost of 

producing products or furnishing services, and 

to recover overhead costs. Finally, the BLM 

receives imputed financing from the Office of 

Personnel Management (OPM) for current and 

future pension and retirement benefits paid by 

OPM on behalf of the BLM; the DOI for costs 

incurred by it’s Solicitor’s Office; and the 

U.S. Department of Treasury (Treasury) 

Judgment Fund for payment of any settlements 

resulting form litigation against the BLM.

Receipts either are available to the BLM 

for expenditure or are received by the BLM on 

behalf of others and then passed on to Treasury 

or distributed to other governmental agencies. 

Transfers of receipts to Treasury and others are 

reported on the accrual basis. That portion 

of the transfers that will not be disbursed 

until subsequent fiscal years is included in 

undistributed collections.

Helium fund sales are authorized by Chapter 

10 of Title 50 of the United States Code, 

enacted March 3, 1925, as amended by Public 

Law 86-777, dated September 13, 1960, entitled 

“Helium Act Amendments of 1960.” Paragraph 

167a(4) authorizes the Secretary to “dispose 

of, by lease or sale, property, including wells, 

lands, or interest therein, not valuable for helium 

production, and oil, gas, and byproducts of 

helium operations not needed for Government 

use, except that property determined by the 

Secretary to be ‘excess’ within the meaning 

of section 3(e) of the Federal Property and 

Administrative Services Act of June 30, 1949, 

as amended (40 U.S.C. 471 et. seq.); and to 

issue leases to the surface of lands or structures 

thereon for grazing or other purposes when 

the same may be done without interfering 
BLM 2005 Annual Report 53

Financial Statements

with the production of helium;....” Amounts 

accumulating in the fund in excess of amounts 

the Secretary deems necessary to carry out the 

Helium Act and contracts negotiated thereunder 

are paid to Treasury and credited against any 

amounts borrowed from Treasury.

The Helium Privatization Act of 1996 

(Public Law 104-273), enacted October 9, 1996, 

directs the privatizing of the Department of the 

Interior’s Federal Helium Refining Program. 

Under this law, Interior ceased producing, 

refining, and marketing refined helium as of 

April 1, 1998. However, Interior is authorized 

to store, transport, and withdraw crude helium 

and maintain and operate crude helium storage 

facilities in existence on the date of enactment. 

The Department may also enter into agreements 

with private parties for the recovery and disposal 

of helium on Federal lands and may grant 

leasehold rights to this helium. The sale of 

stockpile crude helium began in March of 2003 

and will continue until January 1, 2015.

The helium fund is authorized to retain 

all receipts, which include, but are not limited 

to, the sale of inventory, penalties, interest, and 

administrative charges on past due receivables 

and proceeds from the sale of its assets. Fees, 

penalties, interest, and administrative charges 

are credited to a revenue account and are 

recorded as a financing source. Gains and 

losses are computed when assets are sold and are 

recorded as a financing source or use of finances, 

respectively.

D. Fund Balance with Treasury and Cash

The BLM’s receipts and disbursements 

are processed by Treasury. Fund balance with 

Treasury includes appropriated, revolving, and 

trust funds that are available to pay current 

liabilities and finance authorized purchase 

commitments. Also included are various other 

receipt and expenditure funds. Cash balances 

held outside of Treasury are imprest funds. 

No cash is held in commercial bank accounts. 

Further details on fund balance with Treasury 

are contained in Note 3.

E. Investments

The BLM is authorized to invest in special 

non-marketable par value and market-based 

book entry Treasury securities. These securities 

include U.S. Treasury bills, notes, bonds, and 

one-day certificates that may be purchased 

and sold as necessary to meet operating needs 

and legislated requirements. The BLM invests 

in securities of the U.S. Treasury pursuant to 

authorizing legislation for three accounts: the 

proceeds of certain land sales as authorized 

by either the Southern Nevada Public Land 

Management Act enacted in October 1998, 

or the Lincoln County Land Act enacted in 

October 2000; and the proceeds of certain oil 

and gas lease sales authorized by the Alaska 

Native Claims Settlement Act and the Alaska 

National Interest Lands Conservation Act, 

as amended July 17, 2000. Note 4 provides 

investment details.

F. Accounts Receivable

Accounts receivable consist of amounts owed 

to the BLM by other Federal agencies and the 

public. Amounts due from the public are stated 

net of an allowance for uncollectible accounts 

that is based on an analysis of outstanding 

receivable balances and past collection 

experience. No allowance is established for 

intragovernmental receivables, as they are 

considered fully collectible from other Federal 

agencies. See Note 5 for additional information 

concerning accounts receivable.
54 BLM 2005 Annual Report

Financial Statements

G. Inventory, Gas and Storage Rights, 

and Stockpile Materials

The helium stockpile inventory is stored 

in a partially depleted natural gas reservoir 

and is valued at cost. The cost to purchase 

the stockpile helium was $12.058 per mcf. 

The volume of helium is accounted for on 

a perpetual inventory basis. Each year, the 

amount of helium is verified by collecting 

reservoir data and using generally accepted 

petroleum engineering principles to calculate the 

volume. The calculated volumes support the 

volume carried in the inventory. At a reservoir 

abandonment pressure of 25 psia, 95 percent 

of the stockpile is deemed recoverable. The 

amount of helium that is eventually recovered 

will depend on the future price of helium and 

the ability to control the mixing of native 

gas and stockpile helium. The values shown 

for stockpile helium are net of the estimated 

unrecoverable amount, so no allowance is 

required. Gas and storage rights for the storage 

of helium are recorded at cost. 

The Working Capital Fund inventory 

consists of items that will be consumed in future 

operations. This inventory is held for use in 

BLM’s resource management programs and is 

also maintained for sign construction, employee 

uniforms, and the DOI forms function. 

Inventory is stated at cost using the weighted 

average cost method.

Except for Helium Operations, which 

includes helium and natural gas, the BLM’s 

inventory is not held for sale, nor is any of the 

inventory balance held in reserve for future 

use or sale. There is no excess, obsolete, or 

unserviceable inventory, nor is there any 

inventory held for repair. The BLM does not 

hold any other related property, including 

forfeited property, foreclosed property, seized 

property, commodities, or stockpile materials. 

Note 6 provides more information on the BLM’s 

inventory and related property.

H. General Property, Plant, and 

Equipment

This category consists of land and land 

improvements; buildings; other structures and 

facilities; leasehold improvements; construction 

in progress; equipment and vehicles; and 

internal use software.

SFFAS No. 6, Accounting for Property, 

Plant, and Equipment, and SFFAS No. 

8, Supplementary Stewardship Reporting, 

have been issued by the FASAB. These 

standards recommend different accounting 

treatments for different types of property, 

plant, and equipment (PP&E), and provide 

for a distinction between general PP&E and 

stewardship PP&E. The former are PP&E 

used to provide general government services or 

goods. The latter include stewardship land--

all land held by the Federal government that 

is not acquired for or in connection with an 

item of general PP&E--and heritage assets, 

including PP&E that have historical or natural 

significance.

SFFAS No. 10, Accounting for Internal Use 

Software, has been issued by the FASAB. This 

standard provides accounting standards for 

internal use software utilized by each agency. 

Internal use software includes purchased 

commercial off-the-shelf software, contractordeveloped software, and internally developed 

software using agency employees.

The standards provide for capitalized 

property to continue to be reported on 

the Balance Sheets. PP&E that are not 

capitalized—because they are under the 

capitalization threshold, or because they are 

stewardship PP&E—are expensed in the 

year of acquisition. The standards require a 

separate stewardship report to provide relevant 

information regarding stewardship PP&E. 

That report can be found following the section 

on Financial Statements.

Capitalized property and equipment are 

recorded as follows:
BLM 2005 Annual Report 55

Financial Statements

1. The Department of the Interior established 

a Department-wide capitalization threshold 

effective October 1, 2003. As a result, 

general PP&E real property is capitalized 

at cost if the aggregate cost of the 

building, structure, or facility is $100,000 

or more. Prior to FY 2004, the BLM’s 

capitalization threshold was $250,000 for 

each administrative site. An administrative 

site may contain more than one building, 

structure, or facility, but it is always bounded 

by a defined perimeter or an established 

boundary. The change in the capitalization 

threshold was applied prospectively and is 

not deemed to have a significant impact on 

the BLM’s financial data.

Acquired land associated with capitalized 

assets is recorded separately from the 

structures, facilities, and improvements. 

Structures such as buildings that are used by 

the BLM but administered by the General 

Services Administration or other Federal 

agencies are not recognized as BLM assets.

2. Leasehold improvements consist of costs 

incurred in building structures on land 

owned by third parties, subject to long-term 

lease arrangements. Facilities are capitalized 

at cost if the aggregate cost is $100,000 or 

more and the remaining term of the lease is 

2 years or more.

3. Costs are accumulated in a constructionin-progress account for capitalizable general 

PP&E under construction or being acquired 

in incremental stages until the property is 

completed or totally acquired. At that time, 

the property is transferred to the appropriate 

asset account(s).

4. Equipment and vehicles are capitalized at 

cost if the acquisition cost is $15,000 or 

more ($10,000 or more prior to FY 2004) 

and the estimated useful life is 2 years or 

more.

5. Software is capitalized at cost if the 

acquisition cost is $100,000 or more and the 

estimated useful life is 2 years or more.

Depreciation of general PP&E real property 

is based on a useful life of 15 to 30 years for 

land improvements, 30 years for buildings, 

and 20 years for structures. The salvage 

value of general PP&E real property is zero.

Amortization of leasehold improvements is 

calculated based on the remaining term of 

the lease, with zero salvage value.

Depreciation of WCF vehicles and heavy 

equipment is based on useful lives ranging 

from 2 to 20 years and a 20 to 60 percent 

salvage value.

Depreciation of non-WCF equipment is 

based on useful lives of up to 20 years, with 

a salvage value of 10 to 20 percent.

Amortization of software is based on a 

useful life of 5 years, with zero salvage value.

Depreciation and amortization of all general 

property, plant, and equipment is calculated 

on the straight-line method.

The basis for capitalization of donated 

property and equipment is the estimated fair 

market value.

Information on general property, plant, and 

equipment values is found in Note 7.

I. Liabilities

Liabilities represent the amount of monies 

or other resources that are likely to be paid 

by the BLM as the result of transactions or 

events that have already occurred. However, 

no liability can be paid by the BLM absent 

an appropriation. Liabilities for which an 

appropriation has not been enacted are, 
56 BLM 2005 Annual Report

Financial Statements

therefore, classified in these notes as liabilities 

not covered by budgetary resources, with 

no certainty that the appropriations will be 

enacted. See Note 9. In addition, BLM 

liabilities arising from sources other than 

contracts can be abrogated by the Government, 

acting in its sovereign capacity.

Accrued payroll and benefits represent 

salaries and benefits earned by employees but 

not yet paid at the close of the fiscal year. The 

portion of this liability representing accrued 

employer benefit and payroll tax expense payable 

to other governmental agencies is shown as an 

intragovernmental liability; the remainder is the 

amount owed to employees.

Undistributed collections are amounts 

held in unavailable special receipt funds 

at year-end. Amounts collected into these 

funds and reported as revenue are subject to 

distribution based on formulas specified in 

various authorizing pieces of legislation. The 

distributions occur at various times during the 

year or in subsequent years, in accordance with 

the terms of the legislation. The undistributed 

collections, which are principally due to 

Treasury, are considered a current liability.

Congress has established the Department 

of the Treasury Judgment Fund, a permanent, 

indefinite appropriation, to pay certain judicially 

and administratively ordered monetary awards 

against the United States. The Judgment Fund 

may also pay amounts owed under compromise 

agreements negotiated by the Department of 

Justice in settlement of claims arising under 

actual or imminent litigation. The Judgment 

Fund bills agencies for amounts paid under 

the Contract Disputes Act, while it pays other 

amounts without expectation of reimbursement. 

The BLM records a liability for the former and 

records an imputed cost and financing source 

for the latter. See Note 18 for further discussion 

of imputed amounts.

Debt to Treasury is a liability of the helium 

fund. Borrowings occurred at various dates. 

Amounts borrowed became due 25 years from 

the date the funds were borrowed and are now 

past due. The debt to Treasury was composed 

of two categories: net worth debt and additional 

borrowing from Treasury. Net worth debt 

was completely repaid in FY 2003; the only 

remaining principal due to Treasury is the 

additional borrowing from Treasury.

Net worth debt was the amount due for 

the net capital and retained earnings of the 

helium fund established under 50 U.S.C. 10, 

Section 164, enacted March 3, 1925 (prior to 

amendment by the Helium Act Amendments 

of 1960), as determined by the Secretary of 

the Interior as of September 13, 1960, plus any 

monies expended thereafter by the Department 

of the Interior from funds provided in the 

Supplemental Appropriation Act, 1959, for 

construction of a helium plant at Keyes, 

Oklahoma.

Additional borrowing from Treasury 

referred to funds borrowed under 50 U.S.C. 

10, Section 167j, which authorized borrowings 

to acquire and construct helium plants and 

facilities and for other related purposes 

including the purchase of helium. 

Interest on the helium debt that has not 

been repaid to Treasury is compounded. While 

the debt was current, interest was calculated 

annually at rates determined by the Secretary 

of the Treasury, taking into consideration the 

current average market yields of outstanding 

marketable obligations of the United States 

having maturities comparable to the investments 

authorized. The interest rate on the net capital 

and retained earnings was determined as of 

September 13, 1960, and the interest rate on 

additional borrowing was determined as of the 

time of each borrowing. The U.S. Treasury 

short-term borrowing rate was used to calculate 

the annual interest expense while the debt was 

past due. Since the passage of the Helium 

Privatization Act of 1996, Public Law 104-273, 

enacted October 9, 1996, no further interest 

expense has been incurred. The Act defines 

the amount repayable to the United States as 
BLM 2005 Annual Report 57

Financial Statements

all funds required to be repaid as of October 1, 

1995, with no further interest accruing on the 

debt.

Additional information on debt to Treasury 

appears in Note 10.

The Secure Rural Schools and Community 

Self Determination Act of 2000 was passed 

during FY 2001. The Act provides for increased 

payments to eligible states as compensation 

for the deprivation of revenue they would 

otherwise receive if BLM-owned lands were 

held in private ownership. Prior to this Act, 

payments to eligible states were based on a 

percentage of revenue that the BLM earned on 

these lands, which has been steadily decreasing. 

The difference between the new, increased 

payments and the prior legislated payments is 

compensated for by an appropriation from the 

Treasury General Fund. The BLM records 

an unfunded liability at each year-end for the 

amount to be appropriated in the following 

fiscal year for these payments.

Non-intragovernmental deferred revenue 

consists primarily of deposits received from 

prospective purchasers of land pursuant to the 

Southern Nevada Public Land Management 

Act. These deposits are classified as a liability 

until the sales are consummated. See Note 21 

for additional information on the Southern 

Nevada Public Land Management Act.

J. Accrued Leave

Amounts associated with the payment of 

annual leave are accrued while leave is being 

earned by employees, and this accrual is reduced 

as leave is taken. Each year the balance in 

the accrued annual leave account is adjusted 

to reflect current pay rates. To the extent 

that current or prior year appropriations are 

not available to finance annual leave, future 

financing sources will be used.

An accrual is also provided for the amount 

that would be due under the Federal Insurance 

Contributions Act (FICA) related to this annual 

leave. See Note 11.

Sick leave and other types of leave are 

expensed as taken because they are nonvesting 

in nature.

K. Contingent Liabilities

The BLM is a party to various 

administrative proceedings, legal actions, 

environmental suits, and claims brought by or 

against it. Contingent liabilities are recorded 

in the accounting records when losses are 

determined to be probable and a reasonable 

estimate of the scope of the potential liability 

is available. In accordance with Federal 

accounting guidance, the liability for future 

cleanup of environmental hazards is “probable” 

only when the government is legally responsible 

for creating the hazard or is otherwise related to 

it in such a way that it is legally liable to clean 

up the contamination. Thus, expected future 

payments for the cleanup of environmental 

hazards caused by others are government 

acknowledged, but they are not recognized 

as liabilities by the BLM. Instead, any BLM 

payments related to these environmental hazards 

are recognized in the financial statements 

as remediation work is performed. Further 

information on contingent liabilities is found in 

Note 12.

L. Federal Employee Benefits - FECA 

Actuarial Liability

The Federal Employees’ Compensation 

Act (FECA) provides income and medical 

cost protection to covered Federal civilian 

employees injured on the job, to employees 

who have incurred work-related occupational 

diseases, and to beneficiaries of employees whose 

deaths are attributable to job-related injuries 

or occupational diseases. The FECA program 
58 BLM 2005 Annual Report

Financial Statements

is administered by the Department of Labor 

(DOL).

The FECA actuarial liability is the 

estimated liability for future benefit payments 

resulting from past events. This liability 

includes death, disability, medical, and 

miscellaneous costs. The DOL determines 

this component annually, using a method that 

considers historical benefit payment patterns, 

wage inflation factors, medical inflation factors, 

and other variables. The projected annual 

benefit payments are discounted to present 

value using OMB’s economic assumptions for 

10-year Treasury notes and bonds. To provide 

for the effects of inflation on the liability, wage 

inflation factors (i.e., cost of living adjustments) 

and medical inflation factors (i.e., consumer 

price index medical adjustments) are applied 

to the calculation of projected future benefit 

payments. These factors are also used to 

adjust historical benefit payments to currentyear constant dollars. A discounting formula 

is also used to recognize the timing of benefit 

payments as 13 payments per year instead of one 

lump sum payment per year.

The DOL also evaluates the estimated 

projections to ensure that the estimated future 

benefit payments are appropriate. The analysis 

includes three tests: (1) a comparison of the 

current-year projections to the prior-year 

projections; (2) a comparison of the prior-year 

projected payments to the current-year actual 

payments, excluding any new case payments 

that had arisen during the current year; and 

(3) a comparison of the current-year actual 

payment data to the prior-year actual payment 

data. Based on the outcome of this analysis, 

adjustments may be made to the estimated 

future benefit payments.

M. Retirement Plan

The BLM’s employees participate in one 

of two retirement programs, either the Civil 

Service Retirement System (CSRS) or the 

Federal Employees Retirement Systems (FERS), 

which became effective on January 1, 1987. 

Most employees hired after December 31, 1983, 

are automatically covered by FERS and Social 

Security. Employees hired prior to January 

1, 1984, could elect to either join FERS and 

Social Security or remain in CSRS. Employees 

covered by CSRS are not subject to Social 

Security taxes, nor are they entitled to accrue 

Social Security benefits for wages subject to 

CSRS.

For FERS employees, the BLM contributes 

an amount equal to 1 percent of the employee’s 

basic pay to the tax-deferred Thrift Savings Plan 

and matches employee contributions up to an 

additional 4 percent of pay. FERS employees 

can contribute 15 percent of their gross earnings 

to the plan. CSRS employees are limited to 

a contribution of 10 percent of their gross 

earnings and receive no matching contributions 

from the BLM.

The Office of Personnel Management 

(OPM) is responsible for reporting assets, 

accumulated plan benefits, and unfunded 

liabilities applicable to CSRS participants and 

FERS employees governmentwide. The BLM 

has recognized an imputed cost and imputed 

financing source for the difference between the 

estimated service cost and the contributions 

made by the BLM and covered CSRS 

employees. Further information on imputed 

financing is available in Note 18.

N. Net Position

The components of Net Position are defined 

as follows:

1. Unexpended appropriations include 

undelivered orders and unobligated 

balances; the latter may include both 

available and unavailable amounts.

2. Cumulative results of operations are 

composed of (1) the difference between 
BLM 2005 Annual Report 59

Financial Statements

September 30, 2005 (dollars in thousands): Entity Non-Entity Total

Intragovernmental:

 Fund Balance with Treasury $ 834,224 $ 230,311 $ 1,064,535 

 Investments, Net 1,712,719 37,084 1,749,803

 Accounts Receivable 15,388 – 15,388

 Other:

 Advances and Prepayments 1,277 – 1,277

Total Intragovernmental 2,563,608 267,395 2,831,003

Cash in Imprest Funds 56 – 56

Accounts Receivable, Net 8,802 1,565 10,367

Inventory and Related Property 304,378 – 304,378

General Property, Plant, and Equipment, Net 388,933 – 388,933

Other:

 Travel Advances 77 – 77

Total Assets $3,265,854 $ 268,960 $ 3,534,814

September 30, 2004 (dollars in thousands): Entity Non-Entity Total

Intragovernmental:

 Fund Balance with Treasury $ 823,106 $ 429,275 $ 1,252,381

 Investments, Net 793,821 35,624 829,445

 Accounts Receivable 12,493 – 12,493

 Other:

 Advances and Prepayments 1,090 – 1,090

Total Intragovernmental 1,630,510 464,899 2,095,409

Cash in Imprest Funds 55 – 55

Accounts Receivable, Net 12,658 8,033 20,691

Inventory and Related Property 321,319 – 321,319

General Property, Plant, and Equipment, Net 355,621 – 355,621

Other:

 Travel Advances 131 – 131

Total Assets $2,320,294 $ 472,932 $ 2,793,226

revenues and expenses, (2) the net amount 

of transfers of assets in and out without 

reimbursement, and (3) donations, all since 

inception of the fund(s).

O. Budgetary Collections and Offsetting 

Receipts

The BLM’s offsetting receipts are collections 

that are credited to general funds or special 

funds and that offset gross outlays. Unlike 

offsetting collections, which are credited to 

expenditure funds and offset outlays at the 

fund level, offsetting receipts are credited to 

receipt funds and offset outlays at the agency 

or governmentwide level. Offsetting receipts 

may be either distributed or undistributed to 

agencies. Distributed offsetting receipts offset 

the outlays of the BLM, while undistributed 

offsetting receipts offset governmentwide 

outlays.

P. Use of Estimates

The preparation of financial statements in 

accordance with GAAP requires management to 

make estimates and assumptions that affect the 

reported amounts of assets and liabilities and 

disclosure of contingent liabilities at the date of 

the financial statements, as well as the reported 

amounts of revenue and expenses during the 

reporting period. Actual results could differ 

from those estimates.

Note 2 - Entity and Non-Entity Assets

Entity assets are those that the BLM has 

the authority to use in its operations and are 

considered unrestricted. Non-entity assets are 

currently held by, but not available to, the BLM 

and will be forwarded to Treasury, other Federal 

agencies, or the public at a future date. Nonentity assets are considered restricted.
60 BLM 2005 Annual Report

Financial Statements

Note 3 - Fund Balance with Treasury

U.S. Government cash is accounted for on 

an overall consolidated basis by Treasury. The 

amounts shown on the Balance Sheets represent 

the BLM’s right to draw on Treasury for valid 

expenditures. The amounts consist of general 

fund receipt accounts, general fund expenditure 

accounts, trust funds, revolving funds, special 

fund receipt accounts, special fund expenditure 

accounts, and deposit funds. Refer to Note 

1(A). The fund balance as shown on the BLM’s 

records is reconciled monthly with Treasury’s 

records.

 Fund Balances:

 (dollars in thousands) 2005 2004

General Funds $ 583,934 $ 582,001

Special Funds 242,344 214,385

Deposit Funds 121,491 350,343

Revolving Funds 90,201 80,987

Trust Funds 26,565 24,665

Total Fund Balance with Treasury $1,064,535 $1,252,381

 Status of Fund Balance with Treasury:

 (dollars in thousands) 2005 2004

Fund Balance with Treasury Covered by Budgetary Resources: 

 Unobligated: 

 Available $ 357,356 $ 332,497

 Unavailable 20 20

 Obligated Balance Not Yet Disbursed 478,653 493,843

Total Fund Balance with Treasury Covered by Budgetary Resources 836,029 826,360

Fund Balance with Treasury Not Covered by Budgetary Resources:

 Unavailable Special Receipts 108,397 76,805

 Clearing and Deposit Accounts 120,109 349,216

Total Fund Balance with Treasury Not Covered by Budgetary Resources 228,506 426,021

Total Fund Balance with Treasury $1,064,535 $1,252,381

Additional discussion of Fund Balance with Treasury is presented in Note 1(D).

Obligated and unobligated balances 

reported for the status of Fund Balance with 

Treasury do not agree with obligated and 

unobligated balances reported on the Statement 

of Budgetary Resources because (1) the 

budgetary balances include amounts supported 

by other than Fund Balance with Treasury, 

such as investments and allocation transfers 

(providing agency), and (2) the Fund Balance 

with Treasury amounts include items for which 

budgetary resources are not recorded, such 

as deposit funds, unavailable collections, and 

allocation transfers (receiving agency).
BLM 2005 Annual Report 61

Financial Statements

Note 4—Investments, Net

Investments consist of U.S. Treasury 

Bills that mature within six months and U.S. 

Treasury Notes that mature within two years. 

Amounts shown on the Balance Sheets are at 

cost, net of discounts and premiums that are 

amortized using the effective interest method. 

Additionally, accrued interest receivable is 

included in the net investment amount. All 

of the BLM’s investments consist of nonmarketable market based Treasury securities. 

(dollars in thousands) 2005 2004

Cost $1,734,975 $826,076

Amortized Discounts/ 

 (Premiums), Net

 

10,791

 

 2,620 

Net Book Value 1,745,766 828,696

Accrued Interest 4,037 749

Investments, Net $1,749,803 $829,445

The market value of investments was 

$1,739,828 as of September 30, 2005, and 

$828,465 as of September 30, 2004. Additional 

information regarding investments may be 

found in Note 1(E).

Note 5 - Accounts Receivable, Net

The reported amount for accounts receivable 

consists of amounts owed to the BLM by other 

Federal agencies (intragovernmental), or by the 

public. All of the BLM’s intragovernmental 

accounts receivable consist of amounts that have 

not yet been billed. Accounts receivable from 

the public are summarized in the following 

table.

 (dollars in thousands) 2005 2004

Accounts Receivable from 

 the Public: Billed:

 Current $ 7,020 $ 5,426

 1-180 Days Past Due 1,630 1,742

 181-365 Days Past Due 766 9,543

 1 to 2 Years Past Due 712 4,274

 Over 2 Years Past Due 258 372

Total Billed Accounts 

 Receivable 10,386 21,357

Unbilled Accounts 

 Receivable 750 1,692

Total Accounts Receivable 11,136 23,049

Allowance for 

 Uncollectible Accounts (769) (2,358)

Accounts Receivable from 

 the Public, Net $10,367 $20,691

 (dollars in thousands) 2005 2004 

Change in Allowance for 

 Uncollectible Accounts:

Beginning Balance $2,358 $ 1,154

Additions 622 1,907

Deletions (2,211) (703)

Ending Balance $ 769 $2,358

See Note 1(F) for additional discussion 

regarding accounts receivable.
62 BLM 2005 Annual Report

Financial Statements

Note 6 - Inventory and Related Property

(dollars in thousands) 2005 2004

Stockpile Materials: 

 Recoverable Below-Ground Crude 

 Helium, Held for Sale $303,017 $319,820

Inventory:

 Gas and Storage Rights, Held for Sale 1,055 1,055

Operating Materials:

 Working Capital Fund Inventory, Held for Use 306 444

Total Inventory and Related Property $304,378 $321,319

Valuation methods and other information regarding inventories are presented in Note 1(G).

Note 7 - General Property, Plant, and Equipment, Net

Acquisition

Value

Accumulated

Depreciation

Net Book

Value

September 30, 2005:

(dollars in thousands)

Land and Land Improvements $ 94,766 $ (37,622) $ 57,144

Buildings 178,475 (66,775) 111,700

Other Structures and Facilities 41,595 (28,003) 13,592

Leasehold Improvements 6,270 (798) 5,472

Construction in Progress 52,565 – 52,565

Equipment and Vehicles 263,387 (126,603) 136,784

Internal Use Software:

 In Use 8,471 (4,317) 4,154

 In Development 7,522 – 7,522

Total $653,051 $ (264,118) $388,933

September 30, 2004:

(dollars in thousands)

Acquisition

Value

Accumulated

Depreciation

Net Book

Value

Land and Land Improvements $ 89,855 $ (34,711) $ 55,144

Buildings 153,857 (61,307) 92,550

Other Structures and Facilities 40,095 (27,076) 13,019

Leasehold Improvements 5,428 (508) 4,920

Construction in Progress 39,053 – 39,053

Equipment and Vehicles 257,735 (123,069) 134,666

Internal Use Software:

 In Use 11,179 (3,544) 7,635

 In Development 8,634 – 8,634

Total $ 605,836 $(250,215) $355,621

Capitalization criteria and other information regarding property, plant, and equipment are 

discussed in Note 1(H). 
BLM 2005 Annual Report 63

Financial Statements

Note 8 - Total Assets

For financial reporting purposes, the BLM 

has not recognized the value of negotiable 

securities or certificates of deposit pledged to 

guarantee performance of contracts. These 

instruments are accepted in lieu of bond 

coverage in the following programs: solid 

or fluid energy minerals extraction (oil, gas, 

coal, etc.), rights-of-way on the public or other 

lands, and certain contracts (performance 

bonds). Interest earned is paid to the owner of 

the security or certificate of deposit and is not 

available to the BLM. At September 30, 2005, 

the value of these securities was $102 million; 

at September 30, 2004, the value was $179 

million. Since these instruments are not available 

to the BLM unless a customer defaults on an 

agreement, they are not recognized as BLM’s 

assets or liabilities.

Covered by Budgetary 

Resources

Not Covered by Budgetary

Resources

September 30, 2005:

(dollars in thousands) Current Non-Current Current Non-Current Total

Intragovernmental:

 Accounts Payable $ 38,981 $ – $ – $ – $ 38,981

 Debt to Treasury 50,000 1,024,204 – – 1,074,204

 Other: 

 Accrued Payroll and Benefits 3,208 – – – 3,208

 Custodial Liabilities – – 57,519 – 57,519

 Undistributed Collections – – 93,802 – 93,802

 Deferred Revenue 9,949 – – – 9,949

 Unfunded Payroll Liabilities – – 7,200 14,929 22,129

 Due to Treasury Judgment Fund – – – 12,253 12,253

Total Intragovernmental 102,138 1,024,204 158,521 27,182 1,312,045

Accounts Payable 37,365 – – – 37,365

Environmental Cleanup Liabilities – 1,540 – 1,951 3,491

Federal Employee Benefits - FECA 

 Actuarial Liability – – – 94,971 94,971

Other:

 Accrued Payroll and Benefits 29,466 – – – 29,466

 Custodial Liabilities – – 65 – 65

 Secure Rural Schools Act Payable – – 106,810 – 106,810

 Deposit Funds – – 102,889 – 102,889

 Unfunded Annual Leave – – – 57,466 57,466

 Contingent Liabilities – – – 1,465 1,465

Total Liabilities $168,969 $1,025,744 $368,285 $183,035 $1,746,033

Note 9 - Liabilities Covered or Not 

Covered by Budgetary Resources

Liabilities covered by budgetary resources 

and liabilities not covered by budgetary 

resources are combined in the Balance Sheets 

presentation. Liabilities covered by budgetary 

resources are liabilities to be paid with existing 

appropriation authority. Liabilities not covered 

by budgetary resources represent those liabilities 

for which Congressional action is needed 

before budgetary resources can be provided. 

Current liabilities are expected to be liquidated 

during the subsequent fiscal year. Additional 

information regarding liabilities may be found 

in Note 1(I). 

 
64 BLM 2005 Annual Report

Financial Statements

Covered by

Budgetary

Resources

Not Covered by

Budgetary

Resources

September 30, 2004:

(dollars in thousands) Current Non-Current Current Non-Current Total

Intragovernmental:

 Accounts Payable $ 24,895 $ – $ – $ – $ 24,895

 Debt to Treasury 50,000 1,089,204 – – 1,139,204

 Other:

 Accrued Payroll and Benefits 2,780 – – – 2,780

 Custodial Liabilities – – 73,376 – 73,376

 Undistributed Collections – – 84,783 – 84,783

 Deferred Revenue 16,221 – – – 16,221

 Unfunded Payroll Liabilities – – 7,312 14,905 22,217

 Due to Treasury Judgment Fund – – – 12,224 12,224

Total Intragovernmental 93,896 1,089,204 165,471 27,129 1,375,700

Accounts Payable 31,436 – – – 31,436

Environmental Cleanup Liabilities – 6,007 – 323 6,330

Federal Employees Benefits-FECA 

 Actuarial Liability – – – 90,507 90,507

Other:

 Accrued Payroll and Benefits 24,953 – – – 24,953

 Secure Rural Schools Act Payable – – 102,387 – 102,387

 Deposit Funds – – 314,778 – 314,778

 Deferred Revenue 136,390 – – – 136,390

 Unfunded Annual Leave – – – 56,260 56,260

 Contingent Liabilities – – – 3,650 3,650

Total Liabilities $286,675 $ 1,095,211 $582,636 $177,869 $2,142,391

Note 10 - Debt to Treasury

The Helium fund’s debt to Treasury is as 

follows:

(dollars in thousands) 2005 2004

Principal $ 251,650 $ 251,650

Interest:

 Balance, Beginning 

 of Year 887,554­ 947,554

 Repayments (65,000) (60,000)

 Balance, End of Year 822,554 887,554

Total Debt to Treasury $1,074,204 $1,139,204

The sale of stockpile crude helium began in 

March 2003 and will continue until January 1, 

2015. These sales have significantly increased 

the BLM’s helium fund revenue. Given this 

increased revenue, the BLM is planning to 

repay at least $50 million each year, with 

exact amounts depending on annual revenues 

collected. The repayments will continue until 

the debt is repaid or until the stockpile crude 

helium sales cease, in which case the repayment 

plan may be revised.

Refer to Note 1(I) for additional 

information about debt to Treasury.
BLM 2005 Annual Report 65

Financial Statements

Note 11 - Intragovernmental 

Unfunded Payroll Liabilities

Liabilities for workers’ compensation and 

unemployment compensation are amounts that 

will be paid to the Department of Labor, when 

billed, through the Department of the Interior’s 

Office of the Secretary. An accrual is also 

provided for the amount which would be due 

under the Federal Insurance Contributions Act 

(FICA) related to unfunded annual leave. See 

Note 1(J).

(dollars in thousands) 2005 2004

Workers’ Compensation Payable $18,000 $18,279

Unemployment Compensation 

 Payable 1,312 1,131

Accrued FICA on Unfunded 

 Annual Leave 2,817 2,807

Total Intragovernmental 

 Unfunded Payroll Liabilities $22,129 $22,217

Note 12—Environmental Cleanup 

Liabilities and Other Contingent 

Liabilities

Environmental Cleanup. The 

Comprehensive Environmental Response, 

Compensation, and Liability Act of 1980, 

the Clean Water Act, and the Resource 

Conservation and Recovery Act require Federal 

agencies to identify sites where (1) hazardous 

substances have been released or (2) hazardous 

wastes are or have been stored, treated, or 

disposed of. These Acts also require responsible 

parties, including Federal agencies, to clean up 

releases of hazardous substances and to manage 

hazardous wastes.

The BLM faces major challenges in 

cleaning up hazardous substance releases on 

the public lands. Virtually all of these releases 

arise from non-BLM uses of the lands, such as 

illegal dumping, transportation spills, landfills, 

mineral development operations, pipelines, and 

airports. Significant portions of the costs of 

cleanup will be incurred by, or recovered from, 

responsible parties external to the BLM.

The BLM typically has a number of 

time-critical removal actions in progress as 

of the end of the fiscal year that will require 

future funding. This type of action is usually 

mitigated using only a preliminary engineering 

study and, generally, no viable responsible party 

is found, which results in the BLM bearing the 

expense.

Larger sites require one or more studies to 

determine the scope of the contamination and 

the cleanup strategy and techniques. Cleanup 

costs cannot be estimated until these studies 

are completed. Several cleanup options are 

generally suggested, along with the approximate 

range of cost of each, and BLM management 

determines the most appropriate course of 

action.

For these larger sites, commensurately 

greater efforts are made to identify and locate 

potentially responsible parties who can be held 

liable for the cost of the studies and cleanup. 

Litigation or enforcement is usually required 

to obtain payment or cleanup from potentially 

responsible parties.

The BLM has recognized an estimated 

liability of $3.5 million and $6.3 million for 

FY 2005 and FY 2004, respectively, for sites 

where the BLM either caused contamination 

or is otherwise involved in such a way that it 

may be legally liable for some portion of the 

cleanup, and the environmental cleanup liability 

is probable and reasonably estimable. These 

estimates include the expected future cleanup 

costs and, for those sites where future liability 

is unknown, the cost of a study necessary to 

evaluate cleanup requirements.

In accordance with Federal accounting 

guidance, if an estimated liability is a range of 

amounts and no amount within the range is 

a better estimate than any other amount, the 

minimum amount in the range is recognized. 

The amounts recognized in the previous 
66 BLM 2005 Annual Report

Financial Statements

 September 30,2005 Total Range of 

 Potential Liabilities

(dollars in 

thousands)

Accrued 

Liabilities

Lower 

End of 

Range

Upper 

End of 

Range

Environmental 

 Cleanup Liabilities:

 Probable $3,491 $ 3,491 $ 7,441

 Reasonably

 Possible – 22,940 61,735

Contingent 

 Liabilities:

 Probable 1,465 1,465 1,680

 Reasonably

 Possible – 70 909,091

paragraph are the minimum amounts within 

the range noted for these estimated liabilities. 

The upper limits on the ranges of these 

liabilities are $7.4 million and $9.4 million for 

FY 2005 and FY 2004, respectively.

In addition to the limited number of 

cases discussed above where the BLM may be 

involved, other hazardous conditions exist on 

public lands for which the BLM might fund 

cleanup. Those cases where the BLM has at 

least a reasonable possibility of incurring a 

liability, but where the liability does not meet 

the criteria to be recognized, range from $22.9 

million to $61.7 million for FY 2005 and $46.9 

million to $82.4 million for FY 2004.

Judgments and Claims. The BLM is a 

party to a number of lawsuits where the plaintiff 

is seeking monetary damages. The lawsuits 

can involve a variety of issues, including lost 

revenues when timber contracts are suspended 

because of environmental issues, injuries or 

death that occur on BLM-managed land or 

roads, issues regarding takings and suspension 

of mining claims, and other issues. In the 

opinion of the BLM’s management and legal 

counsel, a reasonable estimate of the potential 

outcome or liability of most of these claims 

cannot be made. The resultant outcomes will 

not materially affect BLM’s future financial 

condition. The U.S. Treasury’s Judgment Fund 

would likely bear most of the costs incurred to 

pay any judgments or settlements.

At the end of FY 2005, eight cases which 

were probable had reasonably estimable 

liabilities of $1.5 million; at the end of FY 

2004 there were seven cases totaling $3.7 

million. These liabilities have been accrued in 

the accompanying financial statements as of 

September 30, 2005, and September 30, 2004.

In accordance with Federal accounting 

guidance, if an estimated liability is a range of 

amounts and no amount within the range is 

a better estimate than any other amount, the 

minimum amount in the range is recognized. 

The amounts recognized in the previous 

paragraph are the minimum amounts within 

the range noted for these estimated liabilities. 

The upper limits on the ranges of these 

liabilities are $1.7 million and $4.7 million for 

FY 2005 and FY 2004, respectively.

In addition to these probable cases, at the 

end of FY 2005 there were 20 other cases where 

the likelihood of an outcome unfavorable to 

the BLM was reasonably possible. Of these 20 

cases, those with reasonably estimable liabilities 

ranged from $70,000 to $909.1 million. At 

the end of FY 2004 there were 22 such cases 

ranging from $27.6 million to $959.4 million.

Additional discussion of contingent 

liabilities is presented in Note 1(K).

The accrued and potential environmental 

cleanup costs and contingent liabilities as of 

September 30, 2005 and 2004, are summarized 

in the following table:

 September 30,2004 Total Range of 

 Potential Liabilities

(dollars in 

thousands)

Accrued 

Liabilities

Lower 

End of 

Range

Upper 

End of 

Range

Environmental 

 Cleanup Liabilities:

 Probable $6,330 $ 6,330 $ 9,381

 Reasonably

 Possible – 46,879 82,410

Contingent 

 Liabilities:

 Probable 3,650 3,650 4,650

 Reasonably

 Possible – 27,605 959,410
BLM 2005 Annual Report 67

Financial Statements

Note 13 - Deposit Funds

The BLM processes collections from 

various sources for activities related to public 

land administration. These collections 

include mining claim fees, natural resource 

sales, and various other fees and payments. 

These amounts are held as deposits pending 

adjudication, resolution, or further classification. 

Deposit funds are considered a current liability.

Oil and Gas Leases, as well as Coal and 

Other Leasable Minerals, consist primarily of 

lease deposits awaiting adjudication, but they 

can also include lease security deposits. Alaska 

Mineral Leases consist of money for the Kuukpik 

Village Corporation and interest on the 

investment of those funds. Mining and Other 

Mineral Materials include locatable minerals, 

leasable minerals, coal, and various leasing fees. 

Lands and Realty Management includes, but is 

not limited to, land sales, leases, timber sales, 

and vegetative material sales. Other includes 

overpayments waiting for refund, declining 

deposit accounts, recreation, geothermal leases, 

and all other miscellaneous categories.

The BLM, on behalf of the Minerals 

Management Service (MMS), collects first-year 

rent and bonus deposits on lease agreements 

related to oil and gas, coal, and other leasable 

minerals. The BLM also collects lease security 

deposits related to this activity. These deposits 

are recorded not as revenue but as liabilities. 

Once the adjudication process is completed, 

the deposits are either refunded, or they are 

combined with additional receipts (which 

represents custodial activity) and transferred to 

the MMS. Lease security deposits are generally 

returned to the lessor upon the expiration of 

a lease. However, in certain circumstances, 

particularly if contamination cleanup is 

necessary, the BLM will keep a portion of the 

security deposit and record it as revenue.

(dollars in thousands) 2005 2004

Oil and Gas Leases $ 39,096 $122,458

Coal and Other Leasable 

 Minerals 3,092 124,898

Alaska Mineral Leases 37,084 35,625

Mining and Other Mineral 

 Materials 16,558 25,156

Lands and Realty 

 Management 6,553 6,378

Other 506 263

Total Deposit Funds $102,889 $314,778

Note 14 - Leases

The BLM has operating leases for various 

types of space (real property) acquired through 

the General Services Administration (GSA) and 

directly from commercial sources, as well as 

operating leases for vehicles and miscellaneous 

equipment (personal property).

GSA charges rent that is intended to 

approximate commercial rental rates. For 

federally owned property, the Bureau generally 

does not execute an agreement with GSA, nor 

is there a formal expiration date. These leases 

typically have terms up to 20 years, and most 

contain provisions for cancellation prior to the 

full term of the lease. GSA space leases are 

cancellable with 120 days notice. The Bureau 

is normally required to give notice to vacate, 

and the amount of these leases remains constant 

from year to year.

For non-federally owned property, an 

occupancy agreement is executed, and again the 

Bureau may normally cancel these agreements 

with 120 days notice.

Both the Federal and Non-Federal Real 

Property amounts for 2006 are based on the 

actual annual rent for all property within these 

categories. For 2007 and subsequent years, the 

amounts are inflated each year at 2.4 percent 

over the previous year. As leases expire, they are 

not included in the following years’ calculations.
68 BLM 2005 Annual Report

Financial Statements

Government vehicle and equipment rentals 

are included in personal property. Government 

vehicles are leased from GSA for indefinite 

periods of time, frequently exceeding one 

year. The Personal Property amounts for 2006 

are based on a 1.5 percent increase over the 

actual personal property expense amounts for 

2005. For 2007 through 2010, the amounts are 

inflated at 2.4 percent over the previous year. 

The Thereafter amounts are indeterminable 

through this process.

The aggregate of the Bureau’s estimated real 

property rent payments to GSA for FY 2006 

through FY 2010 and future years and the 

Bureau’s future payments due to other parties 

under operating leases for real property and 

personal property is as follows:

Real Property Personal Property

Total

Fiscal Year Ending

September 30:

(dollars in thousands) Federal

NonFederal FederalNonFederal

2006 $ 19,459 $ 19,056 $ 12,110 $ 3,027 $ 53,652

2007 16,035 16,965 12,400 3,100 48,500

2008 16,186 14,054 12,698 3,174 46,112

2009 16,134 13,676 13,003 3,251 46,064

2010 14,619 13,257 13,314 3,329 44,519

Thereafter 32,812 82,744 – – 115,556

Total Future Lease Payments $115,245 $159,752 $63,525 $15,881 $354,403

Note 15 - Gross Cost

Total cost as reported in the Statements of Net Cost is detailed as follows:

(dollars in thousands) 2005 2004

Personnel Services and Benefits $ 962,727 $ 919,816

Contributions to States 474,316 206,489

Contractual Services 387,515 608,919

Supplies, Materials, and Nondepreciable Assets 85,562 119,074

Rental, Communication, and Utilities 70,779 69,932

Stewardship Asset Costs 67,210 22,508

Travel and Transportation 64,901 62,617

Depreciation and Amortization 30,864 28,484

Cost of Goods Sold 17,058 14,572

Settlement of Claims 11,187 7,553

Printing and Reproduction 2,981 3,302

Bad Debt Expense 2,961 1,113

Heritage Asset Costs 2,457 1,418

Loss on Disposition of Assets, Net 187 50

Interest Expense 35 31

Change in Unfunded Liabilities: 

 Federal Employee Benefits - FECA Actuarial Liability 4,464 (4,838)

 Environmental Cleanup 1,628 (12,738)

 Unfunded Annual Leave 1,206 1,251

 Unemployment Compensation 181 161

 Treasury Judgment Fund 29 –

 FICA on Unfunded Annual Leave 10 131

 Workers’ Compensation (279) 885

 Contingent Liabilities (2,185) 3,000

Total Cost $2,185,794 $2,053,730
BLM 2005 Annual Report 69

Financial Statements

Note 16 - Net Cost of Operations by 

Responsibility Segment

Statement of Federal Financial Accounting 

Standards No. 4, Managerial Cost Accounting 

Concepts and Standards for the Federal 

Government, requires agencies to report 

the full cost of programs, activities, and 

outputs. This standard includes requirements 

for accumulating and reporting costs on a 

regular basis for management use, establishing 

responsibility segments to match costs 

with outputs, determining the full cost of 

government goods and services, recognizing 

the costs of services provided between agencies 

within the government, and using appropriate 

costing methodologies to accumulate and assign 

costs to outputs.

In FY 1998, the BLM selected Activity 

Based Costing (ABC) as the agency’s 

methodology to accumulate cost data for 

effective management use and to assign costs 

to outputs. The accumulated cost data is 

aggregated by program activity to reflect the 

following four Departmental Government 

Performance and Results Act (GPRA) Mission 

Areas:

Resource Protection—Protect the Nation’s 

natural, cultural, and heritage resources.

Resource Use—Manage resources to 

promote responsible use and sustain a 

dynamic economy.

Recreation—Provide recreation 

opportunities for America.

Serving Communities—Safeguard lives, 

property, and assets, advance scientific 

knowledge, and improve the quality of life 

for communities we serve.

Direct costs are reported under the 

appropriate GPRA program activity, while 

administrative costs and various indirect costs 

are allocated to program activities in a manner 

appropriate for each type of cost.

In addition to reporting costs and revenue 

by the Departmental GPRA Mission Areas, 

the BLM aggregates program costs and revenue 

by responsibility segment. In FY 2005, the 

reporting of programs was realigned so that the 

responsibility segments more closely correspond 

with the Bureau’s programs as set forth in the 

Budget of the United States Government.

OMB Circular A-136 provides guidance for 

financial reporting by governmental agencies. 

This Circular was revised in FY 2005, resulting 

in changed disclosure requirements for certain 

transactions between Federal entities and 

with the public. As a result of these changed 

requirements, the aggregation of costs as 

intragovernmental or public has been revised. 

In prior years, intragovernmental costs were 

defined as those costs incurred in the process of 

producing intragovernmental earned revenue, 

while the remaining costs were deemed to 

be with the public. Beginning in FY 2005, 

intragovernmental costs are now defined as 

those costs incurred in transactions with other 

Federal governmental entities, while public costs 

are those incurred in transactions with nonFederal (public) entities. Total costs remain 

unchanged. According to Circular 

A-136, the purpose of this redefinition of costs 

is “to enable the Federal government to provide 

consolidated financial statements, and not to 

match public and intragovernmental revenue 

with costs that are incurred to produce public 

and intragovernmental revenue.”

The tables on the following pages 

present the BLM’s net cost of operations by 

responsibility segment and GPRA Mission 

Area. The FY 2004 data has been reclassified to 

correspond with the revised guidance provided 

by OMB.
70 BLM 2005 Annual Report

Financial Statements

(dollars in thousands)

Management 

of Lands and 

Resources

Wildland Fire 

Management

Miscellaneous 

Permanent Payment 

Accounts

Resource Protection

Intragovernmental Cost $ 54,615 $ 18,591 $ 217 

Public Cost 174,161 57,236 4,094 

Total Cost 228,776 75,827 4,311 

Intragovernmental Earned Revenue 5,742 430 330 

Public Earned Revenue – 11 42,834 

Total Earned Revenue 5,742 441 43,164 

Net Cost /(Revenue) 223,034 75,386 (38,853) 

Resource Use

Intragovernmental Cost 65,769 484 75 

Public Cost 182,693 2,087 339 

Total Cost 248,462 2,571 414 

Intragovernmental Earned Revenue 2,468 – – 

Public Earned Revenue 51,893 – 10,256 

Total Earned Revenue 54,361 – 10,256 

Net Cost /(Revenue) 194,101 2,571 (9,842) 

Recreation

Intragovernmental Cost 22,112 1,046 62 

Public Cost 70,757 3,547 515 

Total Cost 92,869 4,593 577 

Intragovernmental Earned Revenue 5,512 – – 

Public Earned Revenue – – – 

Total Earned Revenue 5,512 – – 

Net Cost 87,357 4,593 577 

Serving Communities

Intragovernmental Cost 68,100 181,641 5,355 

Public Cost 234,031 348,669 351,187 

Total Cost 302,131 530,310 356,542 

Intragovernmental Earned Revenue 55,094 13,361 – 

Public Earned Revenue – 23,128 198,519 

Total Earned Revenue 55,094 36,489 198,519 

Net Cost 247,037 493,821 158,023 

Totals

Intragovernmental Cost 210,596 201,762 5,709 

Public Cost 661,642 411,539 356,135 

Total Cost 872,238 613,301 361,844 

Intragovernmental Earned Revenue 68,816 13,791 330 

Public Earned Revenue 51,893 23,139 251,609 

Total Earned Revenue 120,709 36,930 251,939 

Net Cost/(Revenue) of Operations $751,529 $576,371 $109,905 
BLM 2005 Annual Report 71

Financial Statements

Permanent 

Operating Funds

Oregon and 

California Grant 

Lands Other

Elimination of 

Intra-Bureau Activity FY 2005

$ 3,599 $ 7,680 $ 2,038 $ (880) $ 85,860 

11,398 24,126 6,417 – 277,432 

14,997 31,806 8,455 (880) 363,292 

34,016 – – (880) 39,638 

1,097,175 – 46,064 – 1,186,084 

1,131,191 – 46,064 (880) 1,225,722 

 (1,116,194) 31,806 (37,609) – (862,430)

796 11,025 4,894 – 83,043

2,001 35,139 40,884 – 263,143

2,797 46,164 45,778 – 346,186

– – – – 2,468 

– – 155,617 – 217,766

– – 155,617 – 220,234 

 2,797 46,164 (109,839) – 125,952 

3,325 2,397 1,385 (3,783) 26,544 

67,679 6,987 7,971 – 157,456

71,004 9,384 9,356 (3,783) 184,000 

– – – (3,783) 1,729 

13,251 – 1,929 – 15,180 

13,251 – 1,929 (3,783) 16,909 

 57,753 9,384 7,427 – 167,091

39,578 5,724 8,152 (65,416) 243,134 

13,909 16,868 84,518 – 1,049,182 

53,487 22,592 92,670 (65,416) 1,292,316

– – 34,081 (65,416) 37,120 

3,235 – 2,933 – 227,815 

3,235 – 37,014 (65,416) 264,935 

 50,252 22,592 55,656 – 1,027,381

47,298 26,826 16,469 (70,079) 438,581

94,987 83,120 139,790 – 1,747,213

142,285 109,946 156,259 (70,079) 2,185,794 

34,016 – 34,081 (70,079) 80,955 

1,113,661 – 206,543 – 1,646,845 

1,147,677 – 240,624 (70,079) 1,727,800 

$(1,005,392) $109,946 $ (84,365) $ – $ 457,994 
72 BLM 2005 Annual Report

Financial Statements

(dollars in thousands)

Public Land 

Management

Construction, Cleanup, 

and Land Acquisition

Resource Protection

Intragovernmental Cost $ 89,335 $ 8 

Public Cost 288,953 22 

Total Cost 378,288 30 

Intragovernmental Earned Revenue 13,032 – 

Public Earned Revenue 402,509 – 

Total Earned Revenue 415,541 – 

Net Cost /(Revenue) (37,253) 30 

Resource Use

Intragovernmental Cost 72,628 – 

Public Cost 212,936 – 

Total Cost 285,564 – 

Intragovernmental Earned Revenue 1,587 – 

Public Earned Revenue 98,855 – 

Total Earned Revenue 100,442 – 

Net Cost /(Revenue) 185,122 – 

Recreation

Intragovernmental Cost 33,662 319 

Public Cost 96,272 1,527 

Total Cost 129,934 1,846 

Intragovernmental Earned Revenue 1,941 – 

Public Earned Revenue 21,151 – 

Total Earned Revenue 23,092 – 

Net Cost 106,842 1,846 

Serving Communities

Intragovernmental Cost 241,569 2,572 

Public Cost 795,188 24,810 

Total Cost 1,036,757 27,382 

Intragovernmental Earned Revenue 256,224 – 

Public Earned Revenue 36,492 701 

Total Earned Revenue 292,716 701 

Net Cost /(Revenue) 744,041 26,681 

Totals

Intragovernmental Cost 437,194 2,899 

Public Cost 1,393,349 26,359 

Total Cost 1,830,543 29,258 

Intragovernmental Earned Revenue 272,784 – 

Public Earned Revenue 559,007 701 

Total Earned Revenue 831,791 701 

Net Cost/(Revenue) of Operations $ 998,752 $28,557 
BLM 2005 Annual Report 73

Financial Statements

Helium and Working 

Capital

Payments to 

Entitled States and 

Organizations

Elimination of 

Intra-Bureau Activity FY 2004

$ – $ – $ (174) $ 89,169 

– – – 288,975 

– – (174) 378,144 

– – (174) 12,858 

– – – 402,509 

– – (174) 415,367

– – – (37,223)

 2,295 – – 74,923

30,858 – – 243,794 

33,153 – – 318,717

– – – 1,587

 96,416 – – 195,271

 96,416 – – 196,858 

 (63,263) – – 121,859 

– – (1,129) 32,852 

– – – 97,799 

– – (1,129) 130,651

– – (1,129) 812 

– – – 21,151

– – (1,129) 21,963

– – – 108,688 

903 5,001 (29,346) 220,699 

23,665 161,856 – 1,005,519 

24,568 166,857 (29,346) 1,226,218 

 29,604 – (29,346) 256,482 

– 55,724 – 92,917

 29,604 55,724 (29,346) 349,399 

(5,036) 111,133 – 876,819 

3,198 5,001 (30,649) 417,643

54,523 161,856 – 1,636,087

57,721 166,857 (30,649) 2,053,730 

29,604 – (30,649) 271,739 

96,416 55,724 – 711,848 

126,020 55,724 (30,649) 983,587

$ (68,299) $111,133 $ – $1,070,143
74 BLM 2005 Annual Report

Financial Statements

Note 17—Change in PILT Ownership

The Department of the Interior’s FY 2004 

appropriation bill moved the Payments in Lieu 

of Taxes (PILT) program from the BLM to 

the Department of the Interior’s Office of the 

Secretary (OS), effective October 1, 2003. 

As a result, the BLM removed all financial 

records related to PILT from its accounting 

system, including FY 2004 beginning balances. 

Conversely, the Office of the Secretary placed 

these records into their accounting system and 

began accounting for all PILT transactions 

beginning October 1, 2003.

Since the PILT program was new to the OS 

and the BLM had extensive knowledge of the 

program, the OS entered into a reimbursable 

agreement with the BLM whereby the BLM 

would make the FY 2004 PILT payments and 

subsequently be reimbursed by the OS. As a 

result of this agreement, the BLM recorded both 

revenue and expenses totaling $224 million in 

FY 2004, all within the Serving Communities 

GPRA segment. The OS managed the PILT 

program in FY 2005 and had no reimbursable 

agreement with the BLM.

Note 18 - Imputed Financing from 

Costs Absorbed by Others

SFFAS No. 5, Accounting for Liabilities of the 

Federal Government, establishes accounting and 

reporting standards for liabilities relating to the 

Federal employee benefit programs, including 

retirement, health benefits, and life insurance. 

The Office of Personnel Management (OPM) is 

responsible for paying the cost of these benefits.

Under the provisions of SFFAS No. 5, 

employer agencies must recognize the cost of 

pensions and other retirement benefits during 

their employees’ active years of service. Agencies 

must also recognize the current annual cost of 

the Federal Employee Health Benefit (FEHB) 

program and the Federal Employee Group Life 

Insurance (FEGLI) program.

OPM actuaries have provided the employer 

agencies with rates for calculating the estimated 

cost of pension and other retirement benefits. 

They have also provided rates for use in 

calculating the cost of FEHB and FEGLI. 

The Department provided labor cost data for 

the BLM to use in applying the OPM rates to 

calculate the total imputed cost of these benefits. 

While the BLM’s funds are not used to pay 

the cost of these personnel benefits, they are a 

BLM operating expense that must be reported 

to accurately reflect the cost of doing business. 

The use of OPM funds for this purpose is an 

imputed source of financing for the BLM.

The Solicitor’s Office of the Department 

of the Interior incurs costs for attorneys’ time 

and related non-attorney costs on behalf of all 

DOI bureaus. The Department provided a 

calculation of the amount of imputed financing 

source for each bureau, based on the number 

of hours of attorney time incurred. The 

imputed source of financing amount from 

the Solicitor’s Office of the Department of 

the Interior was zero for FY 2004 because the 

guidance requiring incorporation of full costs 

(FASAB’s Interpretation Number 6, Accounting 

for Imputed Intradepartmental Costs: An 

Interpretation of SFFAS No. 4) was not effective 

until October 1, 2004 (FY 2005).

The Department of the Treasury Judgment 

Fund is another imputed source of financing. 

The BLM is a party to numerous lawsuits where 

the plaintiff is seeking monetary damages. In 

many cases, when the BLM is required to pay 

the plaintiff, either as a result of settlement or 

adjudication, payment is actually made from 

the Judgment Fund rather than the BLM’s 

appropriations. Treasury provides agencies with 
BLM 2005 Annual Report 75

Financial Statements

information regarding the month and amount 

of payments actually made, at which time the 

BLM recognizes the imputed financing source 

and cost.

(dollars in thousands) 2005 2004

Imputed Financing from OPM:

 Retirement Benefits $ 24,651 $ 27,447

 Health Benefit and 

 Life Insurance 44,732 40,975

Total Imputed Financing 

 from OPM 69,383 68,422

Imputed Financing from DOI 

 Solicitor’s Office 10,012 –

Imputed Financing from 

 Treasury Department’s 

 Judgment Fund 475 6,967

Total Imputed Financing From 

 Costs Absorbed by Others $79,870 $75,389

Note 19 - Combined Statements of 

Budgetary Resources

Apportionment Categories of 

Obligations Incurred

All of the BLM’s FY 2005 and FY 2004 

funds were appropriated under Category B and 

were subject to annual apportionment by OMB.

Permanent Indefinite Appropriations

Permanent indefinite appropriations 

result from provisions in permanent public 

laws that authorize the BLM to retain certain 

receipts. These funds do not require annual 

appropriation action by Congress; they are 

subject to the authorities of permanent public 

law and are available until expended. As 

of September 30, 2005, the Bureau had 23 

permanent indefinite appropriations, which 

are primarily used for special programs and 

projects. Some examples include the Southern 

Nevada Public Land Management Act, Federal 

Land Transaction Facilitation Act, Recreation 

Fee Demonstration Program, and Timber 

Pipeline Restoration fund.

Appropriations Received

The Appropriations Received line item on 

the Consolidated Statements of Changes in 

Net Position differs from that reported on the 

Combined Statements of Budgetary Resources 

because Appropriations Received on the 

Consolidated Statements of Changes in Net 

Position do not include appropriated dedicated 

and earmarked receipts. Dedicated and 

earmarked receipts are accounted for as either 

exchange or non-exchange revenue.

Legal Arrangements Affecting the Use 

of Unobligated Balances of Budget 

Authority

The BLM’s FY 2005 operating programs 

were financed under 68 distinct Treasury fund 

symbols. All of the Bureau’s funding needs 

are authorized in a number of appropriation 

laws, which are a combination of current 

and permanent authority. Current authority 

includes funding that is legislatively reauthorized each fiscal year, while permanent 

authority is issued once and remains in 

effect in future fiscal years until revised or 

rescinded. Most of the BLM’s 68 Treasury 

funds are classified as no-year, which signifies 

that the Bureau may utilize its fiscal year-end 

unobligated resources to execute its operating 

programs in subsequent fiscal years. 
76 BLM 2005 Annual Report

Financial Statements

All appropriation language contains 

specific and/or general authorizations. These 

authorizations may be defined as legislative 

parameters that frame the funding and Federal 

agency policy for executing programs. For 

example, Public Law 108-447, the appropriation 

law that was the major source of funding for 

the BLM’s operating programs in FY 2005, 

directs that a definite sum of the Bureau’s 

wildland firefighting authority be applied 

to the construction of fire facilities. These 

authorizations also direct how the Bureau 

must treat other assets it may acquire as a 

result of executing its operating programs. 

As an example, a specific authorization in 

Public Law 108-447 that refers to the Bureau’s 

Central HAZMAT fund directs that monies 

collected from a party for remedial action 

may be recorded as a reimbursement to its 

appropriation. Since both specific and general 

authorizations are integral components of 

all legislation, the BLM does not view them 

as restrictions or legal encumbrances on its 

available funding. 

Differences between Amounts Reported 

in the Statements of Budgetary 

Resources and Amounts Reported in the 

Budget of the U.S. Government

The Combined Statements of Budgetary 

Resources have been prepared to coincide with 

the amounts shown in the Budget of the United 

States Government (President’s Budget). 

The actual amounts for FY 2005 in the 

President’s Budget had not been published at 

the time these financial statements were 

prepared. The President’s Budget containing 

the actual FY 2004 amounts was released in 

February 2005, and the FY 2005 amounts are 

estimated to be released in February 2006. The 

President’s Budget can be located at the OMB 

website (http://www.whitehouse.gov/omb). 

Budgetary resources and the status of 

budgetary resources presented in the Combined 

Statement of Budgetary Resources for the 

fiscal year ended September 30, 2004, differ 

from the amounts presented in the FY 2004 

column of the FY 2006 Budget of the United 

States Government because of rounding and 

publication timing differences. Rounding 

differences are the result of the President’s 

Budget being rounded in millions of dollars 

while the Statement of Budgetary Resources 

is rounded in thousands of dollars. A 

publication timing difference occurred when 

an adjustment was made to the Wildland Fire 

Management appropriation and was included 

in the President’s Budget but did not appear in 

the BLM’s FY 2004 Annual Report because 

the BLM’s report was published prior to the 

adjustment being made. The specific line 

items affected by this adjustment are annotated 

with asterisks and presented in the following 

table. The unannotated differences are due to 

rounding. 
BLM 2005 Annual Report 77

Financial Statements

September 30, 2004

(dollars in millions)

Amount per Statement

of Budgetary Resources

Amount per 

President’s Budget Difference

Budgetary Resources:

Budget Authority:

 Appropriations Received $2,765 $2,762 3

 Net Transfers, Current Year Authority (119) (117) (2)

Unobligated Balance:

 Beginning of Year 585 599 (14)*

 Net Transfers, Prior Year Authority 1 1 -

Spending Authority From Offsetting Collections 427 428 (1)

Recoveries of Prior Year Obligations 75 75 -

Permanently Not Available (21) (20) (1)

Status of Budgetary Resources:

Obligations Incurred 2,834 2,846 (12)*

Unobligated Balance 878 889 (11)*

Relationship of Obligations to Outlays:

Obligated Balance, Net, Beginning of Year 704 692 12*

Obligated Balance, Net, End of Year (872) (881) 9*

Outlays:

 Disbursements 2,584 2,576 8

 Collections (421) (421) –
78 BLM 2005 Annual Report

Financial Statements

created on the Statements of Financing are not 

generated solely by the current year transfers, 

but also consist of current year activity related 

to prior year transfers. Therefore, the amounts 

in the table below reflect the amounts included 

in cost of operations for FY 2005 and FY 2004, 

not the actual dollars transferred during the 

year.

(dollars in thousands) 2005 2004

The BLM as the Providing 

 Agency (Parent):

 Wildland Fire 

 Management Fund $(339,618) $(347,476)

 Central Hazardous 

 Material Fund (7,993) (10,528)

Allocation Transfer 

 Reconciling Item $(347,611) $(358,004)

2005 2004

The BLM as the Recipient 

 Agency (Child):

 Department of 

 Agriculture $2,469 $1,986

 Department of the 

 Interior 228 353

 Department of 

 Transportation 158 435

Allocation Transfer 

 Reconciling Item $2,855 $2,774

Note 20 - Allocation Transfer 

Reconciling Item

Allocation transfers are the amounts of 

budgetary resources transferred between 

agencies or bureaus to carry out the purposes of 

the parent account. The BLM is both a parent 

agency and a recipient, or child, agency of 

allocation transfers. 

OMB requires parent agencies to report 

their child agencies’ transactions as part of their 

Statements of Budgetary Resources, while the 

child agencies report the proprietary activity on 

their Balance Sheets, Statements of Net Cost 

of Operations, and Statements of Changes in 

Net Position. This process creates a reconciling 

difference on the Statements of Financing.

The BLM is the parent agency for the 

Wildland Fire Management Fund and the 

Central Hazardous Material Fund. All 

allocation transfers made from these funds are 

distributed to other Department of the Interior 

bureaus. The BLM is a child agency of the 

Department of Agriculture’s National Forest 

System Fund, the Department of the Interior’s 

Natural Resources Damage Assessment and 

Restoration Fund, and the Department of 

Transportation’s Highway Trust Fund.

The recipient of allocation transfers is not 

generally required to obligate or spend those 

funds in the year of transfer and in many cases 

uses a portion of that funding in subsequent 

years. As a result, the reconciling items 
BLM 2005 Annual Report 79

Financial Statements

 (dollars in thousands) 2005 2004

Assets:

 Fund Balance with Treasury $ 1,271 $ 841

 Investments, Net 1,670,193 793,693

 General Property, Plant, and Equipment, Net 6,571 675

Total Assets $ 1,678,035 $795,209

Liabilities:

 Accounts Payable $ 20,362 $ 7,532

 Accrued Payroll and Benefits 135 158

 Deferred Revenue – 136,049

Total Liabilities 20,497 143,739

Total Net Position 1,657,538 651,470

Total Liabilities and Net Position $ 1,678,035 $795,209

Net Position, Beginning of Year $ 651,470 $283,190

Change in Net Position:

 Transfers In/(Out) Without Reimbursement, Net (22,719) (100)

 Imputed Financing From Costs Absorbed by Others 415 395

 Exchange Revenue 1,329,695 447,507

 Program Expenses (301,323) (79,522)

Net Position, End of Year $ 1,657,538 $651,470

while 10 percent of the proceeds are forwarded 

to the Southern Nevada Water Authority and 

5 percent to the State of Nevada’s Education 

Fund. The revenues generated from the land 

sales and investments enable the BLM and other 

government entities to acquire environmentally 

sensitive lands and build or maintain trails, dayuse areas, campgrounds, etc., to benefit public 

land visitors. 

The following table discloses dedicated 

collection activity related to these receipts.

Note 21—Dedicated Collections

The BLM has collection activity related to 

the Southern Nevada Public Land Management 

Act (SNPLMA) that resembles dedicated 

collections. SNPLMA, enacted in October 

1998, authorizes the BLM to sell public land 

tracts that are interspersed with or adjacent 

to private land in the Las Vegas Valley. The 

BLM is authorized to invest 85 percent of the 

sales in interest-bearing Treasury securities, 

Note 22—Subsequent Event 

Disclosure

On November 16, 2005, the BLM 

conducted a Southern Nevada Public Land 

Management Act land sale in Nevada totaling 

$762,855,000. As a result, the BLM collected 

$152,571,000 as the 20 percent down payment 

to hold the land parcels for the successful 

bidders.
80 BLM 2005 Annual Report

Financial Statements

Supplementary Statement of Budgetary Resources by Major Budget Accounts 

for the Fiscal Year Ended September 30, 2005

 (dollars in thousands)

Wildland Fire 

Management

Management 

of Land and 

Resources

Budgetary Resources:

Budget Authority:

Appropriations Received $843,099 $ 848,939 

Net Transfers, Current Year Authority 716 7,500 

Unobligated Balance:

Beginning of Year 89,403 34,750 

Net Transfers, Prior Year Authority (716) – 

Spending Authority From Offsetting Collections:

Earned

Collected 42,320 97,434 

Receivable From Federal Sources (3,642) 6,916 

Change in Unfilled Customer Orders

Advance Received (8,599) 4 

Without Advance From Federal Sources (6,727) 1,614 

Total Spending Authority From Offsetting Collections 23,352 105,968 

Recoveries of Prior Year Obligations 27,983 21,979 

Permanently Not Available Pursuant to Public Law (11,804) (12,113) 

Total Budgetary Resources $972,033 $1,007,023 

Status of Budgetary Resources:

Obligations Incurred:

Direct $ 831,011 $ 903,436 

Reimbursable 12,711 70,397 

Total Obligations Incurred 843,722 973,833 

Unobligated Balance Apportioned 128,311 33,171 

Unobligated Balance not Available – 19 

Total Status of Budgetary Resources $972,033 $1,007,023 

Relationship of Obligations to Outlays:

Obligations Incurred $843,722 $ 973,833 

Obligated Balance, Net, Beginning of Year 272,014 224,856 

Obligated Balance, Net, End of Year:

Accounts Receivable 5,705 11,591 

Unfilled Customer Orders From Federal Sources 6,000 11,387 

Undelivered Orders (255,870) (179,518) 

Accounts Payable (42,344) (57,778) 

Total Obligated Balance, Net, End of Year (286,509) (214,318) 

Less: Spending Authority Adjustments (17,614) (30,509) 

Outlays:

Disbursements 811,613 953,862 

Collections (33,722) (97,438) 

Subtotal 777,891 856,424 

Less: Offsetting Receipts – – 

Net Outlays $777,891 $ 856,424 

Unaudited — see accompanying independent auditors’ report
BLM 2005 Annual Report 81

Financial Statements

Miscellaneous 

Permanent

Payment Account

Permanent

Operating Funds

Oregon and 

California

Grant Lands Other Combined

$399,441 $1,025,739 $109,057 $ 81,136 $ 3,307,411

– 36 – (14,499) (6,247)

5,645 565,764 2,615 179,622 877,799 

– – – – (716) 

– – – 126,278 266,032 

– – – 491 3,765 

– – – 1,970 (6,625)

– – – – (5,113)

– – – 128,739 258,059 

119 15,840 1,453 4,908 72,282 

– – (1,560) (318) (25,795)

$405,205 $1,607,379 $ 111,565 $ 379,588 $4,482,793

$356,062 $ 757,509 $109,846 $ 217,733 $ 3,175,597

– – – – 83,108 

356,062 757,509 109,846 217,733 3,258,705 

49,143 849,870 1,719 161,855 1,224,069 

– – – – 19 

$405,205 $1,607,379 $ 111,565 $ 379,588 $4,482,793

$356,062 $ 757,509 $109,846 $ 217,733 $3,258,705

5,248 277,759 27,778 64,246 871,901

– – – 6,192 23,488 

– – – 759 18,146

(5,363) (856,500) (23,354) (54,431) (1,375,036)

(56) (21,385) (5,107) (5,031) (131,701)

(5,419) (877,885) (28,461) (52,511) (1,465,103)

(119) (15,840) (1,453) (5,399) (70,934)

355,772 141,543 107,710 224,069 2,594,569 

– – – (128,247) (259,407)

355,772 141,543 107,710 95,822 2,335,162 

(323,015) (1,000,343) – (155,027) (1,478,385)

$ 32,757 $ (858,800) $ 107,710 $ (59,205) $ 856,777
82 BLM 2005 Annual Report

Financial Statements

Supplementary Statement of Budgetary Resources by Major Budget Accounts 

for the Fiscal Year Ended September 30, 2004

 (dollars in thousands)

Wildland Fire 

Management

Management 

of Land and 

Resources

Budgetary Resources:

Budget Authority:

Appropriations Received $ 892,725 $ 865,743 

Net Transfers, Current Year Authority (126,625) 15 

Unobligated Balance:

Beginning of Year 101,691 36,763 

Change in PILT Ownership – – 

Net Transfers, Prior Year Authority – – 

Spending Authority From Offsetting Collections:

Earned

Collected 16,499 274,026 

Receivable From Federal Sources 6,017 (1,816) 

Change in Unfilled Customer Orders

Advance Received 908 (12) 

Without Advance From Federal Sources (285) 3,332 

Total Spending Authority From Offsetting Collections 23,139 275,530 

Recoveries of Prior Year Obligations 25,758 24,534 

Permanently Not Available Pursuant to Public Law (9,132) (10,478) 

Total Budgetary Resources $ 907,556 $ 1,192,107 

Status of Budgetary Resources:

Obligations Incurred:

Direct $808,505 $ 902,363 

Reimbursable 9,648 254,994 

Total Obligations Incurred 818,153 1,157,357 

Unobligated Balance Apportioned 89,403 34,731 

Unobligated Balance not Available – 19 

Total Status of Budgetary Resources $ 907,556 $ 1,192,107 

Relationship of Obligations to Outlays:

Obligations Incurred $ 818,153 $1,157,357 

Obligated Balance, Net, Beginning of Year 314,243 218,149 

Change in PILT Ownership – – 

Obligated Balance, Net, End of Year:

Accounts Receivable 9,347 4,675 

Unfilled Customer Orders From Federal Sources 12,727 9,773 

Undelivered Orders (264,649) (188,347) 

Accounts Payable (29,439) (50,957) 

Total Obligated Balance, Net, End of Year (272,014) (224,856) 

Less: Spending Authority Adjustments (31,490) (26,049) 

Outlays:

Disbursements 828,892 1,124,601 

Collections (17,407) (274,014) 

Subtotal 811,485 850,587 

Less: Offsetting Receipts – – 

Net Outlays $ 811,485 $ 850,587 

Unaudited — see accompanying independent auditors’ report
BLM 2005 Annual Report 83

Financial Statements

Miscellaneous 

Permanent

Payment Account

Permanent

Operating Funds

Oregon and 

California

Grant Lands Other Combined

$284,077 $ 523,719 $106,672 $ 91,590 $2,764,526

– – – 7,396 (119,214)

5,926 288,798 2,571 149,344 585,093

– – – (357) (357)

– 926 – (50) 876

– – – 131,355 421,880 

– – – (1,621) 2,580 

– – – (1,563) (667)

– – – (84) 2,963

– – – 128,087 426,756

419 14,803 2,255 7,511 75,280 

– – (1,315) (524) (21,449)

$290,422 $ 828,246 $ 110,183 $382,997 $ 3,711,511

$284,777 $ 262,482 $ 107,568 $203,458 $ 2,569,153

– – – (83) 264,559 

284,777 262,482 107,568 203,375 2,833,712 

5,645 565,764 2,615 179,622 877,780 

– – – – 19 

$290,422 $ 828,246 $ 110,183 $382,997 $ 3,711,511

$284,777 $ 262,482 $ 107,568 $ 203,375 $ 2,833,712 

4,333 75,068 28,638 63,121 703,552 

– – – (298) (298)

– – – 5,701 19,723

– – – 760 23,260 

(5,159) (269,274) (22,889) (62,549) (812,867)

(89) (8,485) (4,889) (8,158) (102,017)

(5,248) (277,759) (27,778) (64,246) (871,901)

(419) (14,803) (2,256) (5,806) (80,823)

283,443 44,988 106,172 196,146 2,584,242 

– – – (129,792) (421,213)

283,443 44,988 106,172 66,354 2,163,029 

(180,932) (496,118) – (124,280) (801,330)

$ 102,511 $(451,130) $ 106,172 $ (57,926) $ 1,361,699 
84 BLM 2005 Annual Report

NV

Legend

Zero

< 1

1 - 10

10 - 25

25 - 50

> 50

WA

MI

ND

FL

MS AL

AR

MN

SD

OK

NE

IL

MO

IA

WI

VA

MD

TX LA

WY

UT

NM

CO

AZ

ID

OR

CA

MT

AK

Figure 1 - Percentage of Each State’s Surface Acreage Managed by the BLM

STEWARDSHIP

ASSETS

Stewardship Lands 1

Location of Stewardship Lands

The BLM has been entrusted with stewardship responsibility for 

the multiple-use management of natural resources on and beneath 

millions of acres of America’s “public lands.” The Federal Land 

Policy and Management Act (FLPMA) of 1976 (43 U.S.C. 1701 

et seq., Public Law 94-579, Sec.103(e)) defines public lands as “... 

any land and interest in land owned by the United States within 

the several States and administered by the Secretary of the Interior 

through the Bureau of Land Management, without regard to how 

the United States acquired ownership, except: (1) lands located on 

the Outer Continental Shelf; and (2) lands held for the benefit of 

Indians, Aleuts, and Eskimos.” 

Most of the public lands for which the BLM serves as steward 

were once a part of the approximately 1.8 billion acres of “public 

domain” lands acquired by the Nation between 1781 and 1867. 

Lands managed by the BLM represent about one-eighth of America’s 

land surface, or approximately 42 percent of the lands under Federal 

ownership. The BLM manages lands in 30 states, but most of 

the public lands are located in Alaska and the 11 western states, 

encompassing Arizona, California, Colorado, Idaho, Montana, New 

Mexico, Nevada, Oregon, Utah, Washington, and Wyoming.

Figure 1 shows the percentage of each state’s surface acreage that 

is managed by the BLM.

1 The Federal Accounting Standards Advisory Board (FASAB) defines “Stewardship Land” as “land 

and land rights owned by the Federal Government but not acquired for or in connection with items of 

general PP&E [Property, Plant, and Equipment].” “Acquired for or in connection with” means “land 

acquired with the intent to construct general PP&E and land acquired in combination with general 

PP&E, including not only land used as the foundation but also adjacent land considered to be the 

general PP&E’s common grounds.”
BLM 2005 Annual Report 85

Stewardship Assets 

Table 1 below provides acreage, change in acreage, condition, and a description of the physical 

units of the public lands.

Table 1—Stewardship Lands Managed by the BLM

Category by Type

Federal Acres

Total NonFederal

Acres

Condition –

Acceptable or

Needs

Intervention 2

Number

of

Physical

Units

2004

Balance

2005

Additions 1

2005

Withdrawals 1

2005

Net Change

2005

Balance

Public Lands 261,848,120 72,272 (157,480) (85,208) 261,762,912 0 Acceptable 12 3

1

 The overall decrease of 85,208 acres during the fiscal year 2005 resulted from the net effect of acquisitions of privately owned lands through 

purchase, donation, or exchange offset by the disposal of lands through exchange and various public land laws (including sales). Periodic audits and/

or reviews of BLM records may also result in decreases or increases in BLM’s acreage data. 

2

 Land condition is categorized as “acceptable” when it is adequate for the uses authorized during the period of the report. Land condition is

categorized as “needs intervention” when the condition is such that it will not support any of the uses authorized during the period of the report.

3

 The BLM manages 12 physical units of public lands that are defined as follows and typically referred to as “states,” which usually follow legal state 

boundaries but sometimes extend into an adjoining state when necessary for BLM management purposes:

- Units 1 through 4: Land managed by the BLM within the legal boundaries of the states of (1) Alaska; (2); Wyoming and Nebraska; 

(3) New Mexico, Texas, Oklahoma, and Kansas; and (4) Montana, North Dakota, and South Dakota;

- Unit 5: The legal boundaries of Washington and Oregon except 21 square miles (13,731 acres) in Malheur County, Oregon.

- Unit 6: The legal boundaries of the state of Utah except 47 square miles (29,937 acres) in Grand County. 

- Unit 7: The legal boundaries of the state of Colorado plus 47 square miles (29,937 acres) in Grand County, Utah.

- Unit 8: The legal boundaries of the state of Idaho plus 74 square miles (47,057 acres) in Elko County, Nevada, and 21 square miles (13,731 acres) in 

Malheur County, Oregon.

- Unit 9: The legal boundaries of the state of California except 28 square miles (18,000 acres) in Alpine County, 43 square miles (27,250 acres) in 

Lassen County, 1 square mile (800 acres) in Sierra County, 45 square miles (28,752 acres) in Imperial County, 28 square miles (18,141 acres) in 

Riverside County, and 88 square miles (56,662 acres) in San Bernardino County; plus 30 square miles (20,000 acres) in Humboldt County, Nevada, 

and 2,470 square miles (1,580,000 acres) in Washoe County, Nevada.

 - Unit 10: The legal boundaries of the state of Nevada, except 30 square miles (20,000 acres) in Humboldt County, 2,470 square miles (1,580,000 

acres) in Washoe County, and 74 square miles (47,057 acres) in Elko County; plus 28 square miles (18,000 acres) in Alpine County, 43 square miles 

(27,250 acres) in Lassen County, and 1 square mile (800 acres) in Sierra County, California.

- Unit 11: The legal boundaries of the state of Arizona plus 45 square miles (28,752 acres) in Imperial County, 28 square miles (18,141 acres) in 

Riverside County, and 88 square miles (56,662 acres) in San Bernardino County, California.

- Unit 12 : The legal boundaries of Alabama, Arkansas, Florida, Illinois, Indiana, Iowa, Louisiana, Michigan, Minnesota, Missouri, Mississippi, Ohio, 

and Wisconsin; plus 1 square mile (548 acres) in Charles County, Maryland, and 1 square mile (805 acres) in Fairfax County, Virginia.

Relationship of Stewardship Lands 2

to BLM’s Mission

It is the mission of the BLM to sustain the 

health, diversity, and productivity of the public 

lands for the use and enjoyment of present and 

future generations. These public lands are all 

stewardship lands3, the management of which is 

the essence of the BLM’s mission.

2

 “Land is defined as a solid part of the surface of the earth. Excluded from the definition are the natural resources (that is, depletable resources, 

such as mineral deposits and petroleum; renewable resources, such as timber; and the outer-continental shelf resources) related to land.”

3

 The FASAB presently has an active project to address standards for natural resources, for which they are considering developing individual 

standards for each type of natural resources separately. To begin the project, FASAB will be addressing oil and gas resources. The framework for the 

oil and gas resource phase of the project will be used as a model when addressing the other types or logical sets of natural resources (e.g., timber, 

grazing land, and solid leasable minerals) in subsequent phases of the project.
86 BLM 2005 Annual Report

Stewardship Assets

Goals and Principles for Managing 

Stewardship Lands

The overarching goals and principles 

by which the public lands are managed are 

contained in FLPMA, which provides the basis 

for planning and managing the uses of resources 

on the public lands for the American people. In 

Sec. 102, FLPMA declares that the policy of the 

United States is as follows:

• [G]oals and objectives be established by law 

as guidelines for public land use planning, 

and that management be on the basis of 

multiple use and sustained yield unless 

otherwise specified by law . . . ;

• [T]he public lands be managed in a manner 

that will protect the quality of scientific, 

scenic, historical, ecological, environmental, 

air and atmospheric, water resources, 

and archeological values; that, where 

appropriate, will preserve and protect certain 

public lands in their natural condition; that 

will provide food and habitat for fish and 

wildlife and domestic animals; and that will 

provide for outdoor recreation and human 

occupancy and use . . . ;

• [T]he public lands be managed in a manner 

which recognizes the Nation’s need for 

domestic sources of minerals, food, timber, 

and fiber from the public lands including 

implementation of the Mining and Minerals 

Policy Act of 1970 . . . as it pertains to the 

public lands . . . .

Other laws and Executive Orders that 

provide guidance on how specific uses are 

managed include, but are not limited to, those 

shown in Table 2 below.

Table 2—Guidance for the Management and Use of Resources on the Public Lands

- The Oregon and California Grant Lands Act of 1937 (43 U.S.C. 1181)

- The Alaska National Interest Lands Conservation Act of 1980, (16

U.S.C. 3101 et seq.),

- The Naval Petroleum Reserves Production Act

- The Reindeer Act

- The Taylor Grazing Act of 1934, as amended, (43 U.S.C. 315 et seq.), 

- The Public Rangelands Improvement Act of 1978, (43 U.S.C. 1901 et 

seq.) 

- The National Environmental Policy Act of 1969 (NEPA) (42 U.S.C. 4321

et seq.)

- The Endangered Species Act of 1973, as amended (16 U.S.C. 1531 et 

seq.), 

- The Wild and Scenic Rivers Act of 1968 as amended (16 U.S.C. 1271 et 

seq.), 

- The National Historic Preservation Act of 1966, as amended (16 U.S.C. 

470 et seq.), 

- The Safe Drinking Water Act (42 U.S.C. 300f), 

- The Soil and Water Resources Conservation Act of 1977 (16 U.S.C. 

2001), 

- The Clean Air Act of 1990 as amended (42 U.S.C. 7401 et seq.), 

- The Clean Water Act of 1987 as amended (33 U.S.C. 1251), 

- The American Indian Religious Freedom Act, 1966 (42 U.S.C 1996 et 

seq.), 

- Executive Order 13007 (“Indian Sacred Sites”), (61 FR 104, May 29, 

1966),

- Executive Order 11990, Protection of Wetlands, May 25, 1977 (42 

F.R.26961), 

- Executive Order 12088, Federal Compliance with Pollution Control 

Standards, October 17, 1978 (43 F.R. 47707), 

- Executive Orders 10046, 10175, 10234, 10322, 10787, 10890, 

- The Migratory Bird Conservation Act of 1929, as amended (16 U.S.C. 

715) and treaties pertaining thereto, 

- The Mineral Leasing Act for Acquired Lands of 1947 as amended 

(30 U.S.C. 351-359 et seq.),

- The Mineral Leasing Act of 1920, as amended (30 U.S.C. 181 et 

seq.)

- The Federal Oil and Gas Royalty Management Act of 1982,

- The Federal Onshore Oil and Gas Leasing Reform Act of 1987,

- The Surface Mining Control and Reclamation Act of 1977 (30 

U.S.C. 1201 et seq.),

- The Multiple Mineral Development Act of 1954 (30 U.S.C. 521-531

et seq.),

- The Materials Act of July 31, 1947, as amended (30 U.S.C. 601 et 

seq.),

- The Federal Coal Leasing Amendments Act of 1976, as amended 

(90 Stat. 1083-1092),

- Section 402 of Reorganization Plan No. 3 of 1946 (5 U.S.C. 

Appendix),

- The Mining and Minerals Policy Act of 1970,

- The National Materials and Minerals Policy, Research and 

Development Act of 1980,

- The National Energy Policy report of May 2001,

- Executive Order 13211, Actions Concerning Regulations that 

Significantly Affect Energy Supply, May 2001,

- Executive Order 13212, Actions to Expedite Energy-Related 

Projects, May 2001,

- The Land and Water Conservation Fund Act of 1965, as amended, 

(16U.S.C. 460 (1-6a) et seq.),

- The Wilderness Act of 1964 (16 U.S.C. 1131),

- The National Trails System Act of 1968, as amended (16 U.S.C. 

1241 et seq.),

- The Sikes Act of 1974 (16 U.S.C. 670 et seq.),

- The Federal Lands Recreation Enhancement Act of 2004 (16 U.S.C. 

6803(c)).
BLM 2005 Annual Report 87

Stewardship Assets 

The BLM develops policy and guidance 

based on the above-listed laws and Executive 

Orders, and reviews the adequacy of policy 

through Program Evaluations, Technical 

Reviews, and General Management Evaluations. 

These evaluations and reviews are performed to 

ensure that the BLM at all levels (Field Office, 

State Office, and National Office) is operating 

in compliance with law, regulation, and policy. 

Evaluations also allow the BLM to identify 

where policy needs to be amended to achieve 

the intended purposes of those laws.

Use of Stewardship Lands 

The BLM is guided by the principles of 

multiple use and sustained yield in managing 

the public lands. All of the public lands, 

including those described in the Natural 

Heritage Assets section of this report, are 

managed for multiple use and are, in fact, used 

for multiple (more than one) resource values. 

With the exception of approximately 2.2 million 

acres of Oregon and California Grant Lands 

and Coos Bay Wagon Road lands in western 

Oregon, where timber production subordinates 

other uses, there is no “predominant” or single 

use that overrides or overshadows this multipleuse concept on any of the lands managed by the 

BLM. Section 103(c) of FLPMA defines the 

term “multiple use” as follows:

. . . the management of the public lands 

and their various resource values so that 

they are utilized in the combination that 

will best meet the present and future needs 

of the American people; making the most 

judicious use of the land for some or all 

of the resources or related services over 

areas large enough to provide sufficient 

latitude for periodic adjustments in use to 

conform to changing needs and conditions; 

the use of some land for less than all of the 

resources; a combination of balanced and 

diverse resource uses that takes into account 

the long-term needs of future generations 

for renewable and nonrenewable resources, 

including, but not limited to, recreation, 

range, timber, minerals, watershed, fish 

and wildlife, and natural scenic, scientific 

and historical values; and harmonious 

and coordinated management of the 

various resources without permanent 

impairment of the productivity of the land 

and the quality of the environment with 

consideration being given to the relative 

values of the resources and not necessarily 

to the combination of uses that will give the 

greatest economic return or the greatest 

unit output.

As stated above, there is no “predominant” 

or single use that overrides or overshadows 

the multiple-use concept on any of the lands 

managed by the BLM. FLPMA even discusses 

the concept of “predominant” in terms of 

multiple uses to be achieved or authorized 

simultaneously on the same tracts of land. 

Section 103(l) defines “principal or major 

uses” (having the same basic meaning as 

predominant) in the following manner:

The term “principal or major uses” includes, 

and is limited to, domestic livestock 

grazing, fish and wildlife development 

and utilization, mineral exploration 

and production, rights-of-way, outdoor 

recreation, and timber production.

Comparing the uses defined as “multiple 

use” and those defined as “principal or major 

uses,” we find similarity but not exactness as 

shown in Table 3 below.

Table 3 - Comparison of Multiple Uses 

to Principal or Major Uses

Multiple Uses:

“includes, but is not

limited to”

Principal or Major Uses:

“includes, and is

limited to”

Recreation Outdoor recreation

Range Domestic livestock grazing

Timber Timber production

Minerals Mineral exploration and 

production

Watershed

Fish and wildlife Fish and wildlife development 

and utilization

Natural scenic, scientific, 

and historical values

Rights-of-way
88 BLM 2005 Annual Report

Stewardship Assets

Land use plans, developed with public 

involvement, are the mechanism by which the 

multiple-use concept is put into practice. The 

BLM is required to develop, maintain, and, 

when appropriate, revise land use plans that 

provide by tracts or areas for the use of the 

public lands. The BLM is also required to “use 

and observe the principles of multiple use and 

sustained yield” in the development and revision 

of land use plans. Although the BLM is given 

some latitude in determining the appropriate 

uses, there are also limitations that are designed 

to assure that the multiple use/sustained yield 

concepts are, in fact, followed. For example, 

when a management decision excludes (i.e., 

totally eliminates) one or more of the principal 

or major uses for two or more years with respect 

to a tract of land of 100,000 acres or more, 

the decision must be reported to the House of 

Representatives and the Senate for their approval 

or disapproval (FLPMA, Sec. 202(e)(2)).

Multiple Uses of BLM-Managed Lands 

(Resources)

Domestic Livestock Grazing: The BLM 

issues grazing permits and leases primarily for 

cattle and sheep, but also issues permits for 

domestic horses, goats, bison, and reindeer. 

Livestock grazing is managed on millions of 

acres of the public lands—about 90 percent 

of the public lands in the 11 western states 

and about 6 percent in Alaska. Livestock 

grazing is managed in a way that allows the 

harvest of forage resources while maintaining 

wildlife habitat, meeting the requirements of 

the Clean Water Act, and providing for scenic 

values and recreational activities. Permits and 

leases are issued that authorize appropriate 

grazing levels, season of use, and duration of 

use by livestock in the multiple-use context. 

A permit or lease is issued when the effects of 

the proposed management and levels of use 

have been analyzed in accordance with the 

National Environmental Policy Act (NEPA), 

appropriate consultation with the U.S. Fish and 

Wildlife Service in accordance with Section 

7 of the Endangered Species Act has been 

completed, and consultation with affected 

Tribes has been conducted. Affected publics 

are given the opportunity to participate during 

the NEPA analysis and in the decision process 

when the analysis and consultation processes 

are completed. After the permits or leases are 

issued, the BLM monitors compliance with 

the terms and conditions of the permit or 

lease. The BLM also monitors the effects of 

the grazing use on the condition of the land 

on the highest priority allotments to assure 

that multiple-use objectives and land health 

standards are achieved.

Fish and Wildlife Development and 

Utilization: Fish and wildlife habitat spans all 

of the public lands and waterways. The BLM’s 

fisheries and wildlife management program 

works to maintain and restore fish and wildlife 

and their habitats by conserving and monitoring 

habitat conditions, conducting inventories of 

fish and wildlife resources, and developing 

cooperative management plans, while providing 

for environmentally responsible recreation and 

commercial uses. The BLM works closely 

with state wildlife management agencies that 

are responsible for managing fish and wildlife 

populations that occur on BLM lands. BLMadministered public lands support habitat for all 

North American big game species, waterfowl, 

shorebirds, and upland game birds, as well as 

a large number of non-game birds, mammals, 

reptiles, amphibians, and fish. 

The National Fish and Wildlife 

Foundation’s Challenge Grants, the BLM’s 

Challenge Cost Share program, and the 

Department of the Interior’s Cooperative 

Conservation Initiative fund many fish- and 

wildlife-related projects annually. These 

programs play a central role in developing 

and implementing conservation plans for atrisk species such as the inland cutthroat and 
BLM 2005 Annual Report 89

Stewardship Assets 

steelhead trout, salmon, sage grouse, prairie 

dogs, and lesser prairie chickens. 

Mineral Exploration and Production: 

Energy and mineral resources generate the 

highest economic production values among 

commercial uses of both BLM-administered 

public lands (surface) and Federal minerals 

(subsurface) estates. The BLM provides for the 

American people’s use of the minerals that reside 

on or under the surface area of the public lands, 

including both fluid and solid minerals.

Fluid Minerals: The BLM is the Federal 

agency responsible for regulating the extraction 

of oil and gas from the Federal mineral estate. 

This includes the approval of geophysical 

operations, leasing of lands for oil and gas 

development, the drilling of oil and gas wells, 

issuance of rights-of-way for oil and gas 

pipelines, and the abandonment of oil and gas 

wells. After approval of an operation is granted, 

the BLM inspects all aspects of the operation to 

ensure compliance with all laws and approved 

requirements. The BLM is also responsible 

for ensuring that oil and gas resources are not 

drained from Federal lands. 

The recovery of oil and natural gas begins 

when an operator who has obtained an oil and 

gas lease submits an Application for Permit 

to Drill (APD). The BLM then initiates a 

process to determine whether the APD satisfies 

administrative and technical requirements. At 

the same time, the BLM analyzes the effects of 

the proposed drilling plan in accordance with 

NEPA, completes appropriate consultation with 

the U.S. Fish and Wildlife Service in accordance 

with Section 7 of the Endangered Species Act, 

and conducts consultation with affected Tribes. 

Affected publics are given the opportunity 

to participate during the NEPA analysis and 

in the decision process when the analysis and 

consultation processes are completed.

Solid Minerals: There are three basic types 

of minerals on Federal lands: (1) locatable 

(subject to the General Mining Law of 1872, 

as amended); (2) leasable (subject to various 

mineral leasing acts, such as the Mineral 

Leasing Act of 1920, as amended); and (3) 

salable (subject to disposal under the Materials 

Act of 1947, as amended).

• Locatable Minerals: Under the General 

Mining Law of 1872, as amended, citizens 

of the United States are allowed the 

opportunity to explore for, discover, and 

purchase certain valuable mineral deposits 

on Federal lands that are open for mining 

claim location and patent (open to mineral 

entry). Locatable minerals, which include 

both metallic minerals (gold silver, lead, 

etc.) and nonmetallic minerals (gemstones, 

fluorspar, asbestos, mica, etc.), can be 

obtained by locating a mining claim. A 

mining claim is a particular parcel of 

Federal land that is valuable for a specific 

mineral deposit or deposits. The rights 

granted by a mining claim protect against 

a challenge by the United States and other 

claimants only after the discovery of a 

valuable mineral deposit.

• Leasable Minerals 

– Coal: The Mineral Leasing Act of 

1920 and the Mineral Leasing Act for 

Acquired Lands of 1947, as amended, 

give the BLM responsibility for coal 

leasing on about 570 million acres of 

BLM, national forest, and other Federal 

lands, as well as private lands where the 

mineral rights have been retained by 

the Federal Government. The Federal 

Coal Leasing Amendments Act of 1976 

amended Section 2 of the Mineral 

Leasing Act of 1920 to require that all 

public lands available for coal leasing 

be offered competitively. Competitive 

leasing provides an opportunity for an 

interested party to competitively bid 

for a Federal coal lease. A lease can be 

issued only if the competitive bid for 

the lease meets or exceeds the BLM’s 
90 BLM 2005 Annual Report

Stewardship Assets

estimate of fair market value. There are 

several specific requirements that are 

part of every competitively issued coal 

lease, including royalty rate and diligent 

development.

– Non-energy: Minerals included in 

this category (sodium, phosphate, 

potassium, etc.) are generally used to 

make fertilizer or used as feedstock for 

other industrial processes. The BLM 

issues either competitive leases through 

a bidding process or preference right 

leases to a holder of a prospecting permit 

who, during the term of the permit, has 

demonstrated the discovery of a valuable 

deposit of the leasable mineral for which 

the BLM issued the permit. In areas 

where it is not known that a mineral 

deposit exists, the BLM will issue a 

prospecting permit allowing a permittee 

to explore for leasable mineral deposits.

• Salable Minerals (Mineral Materials): 

Mineral materials include some of our most 

basic natural resources, such as sand, gravel, 

dirt, and rock, used in everyday building 

and other construction uses. The BLM 

sells mineral materials to the public at fair 

market value through competitive and 

noncompetitive sales. The BLM also issues 

free use permits to give mineral materials 

free to states, counties, or other government 

entities for public projects. A limited 

amount of mineral materials may also be 

provided free to non-profit groups.

Rights-of-Way: A right-of-way consists 

of an easement, lease, permit, or license to 

occupy, use, or traverse public lands. The BLM 

has been granted the authority to grant, issue, 

or renew rights-of-way over, upon, under, or 

through the public lands for various purposes 

using the following authorities:

FLPMA

• reservoirs, canals, ditches, flumes, 

laterals, pipes, pipelines, tunnels, and 

other facilities and systems for the 

impoundment, storage, transportation, 

or distribution of water;

• pipelines and other systems for the 

transportation or distribution of liquids 

and gases, other than water and other 

than oil, natural gas, synthetic liquid 

or gaseous fuels, or any refined product 

produced therefrom, and for storage 

and terminal facilities in connection 

therewith;

• pipelines, slurry and emulsion systems, 

and conveyor belts for the transportation 

and distribution of solid materials, and 

facilities for the storage of such materials 

in connection therewith;

• systems for the generation, transmission, 

and distribution of electric energy;

• systems for transmission or reception of 

radio, television, telephone, telegraph, 

and other electronic signals, and other 

means of communication;

• roads, trails, highways, railroads, 

canals, tunnels, tramways, airways, 

livestock driveways, or other means of 

transportation; or

• such other necessary transportation or 

other systems or facilities that are in the 

public interest and that require rights-of 

way over, upon, under, or through such 

lands.

Mineral Leasing Act of 1920

• Oil and gas pipelines over BLM lands or 

other Federal lands. The BLM will issue 

the authorization for land it administers, 

or when the pipeline crosses two or more 

Federal agencies’ land.

Outdoor Recreation: Although the BLM 

manages lands for many different uses, the vast 
BLM 2005 Annual Report 91

Stewardship Assets 

majority of the American public’s interaction 

with the BLM and their public lands is through 

outdoor recreation pursuits. Over 70 million 

visitors come to raft the rivers, hike the trails, 

and ride the back roads and trails. They fish, 

hunt, hike, ride, float, and camp. They visit 

heritage sites, national monuments, wild and 

scenic rivers, wilderness, national trails, and 

national conservation areas. They travel to 

every corner of BLM-administered public lands.

Since the passage of FLPMA, major strides 

have been made to incorporate responsible 

outdoor recreation use of the public lands. The 

BLM has accomplished this by implementing 

a series of Executive Orders, regulations, and 

policies that provide for environmentally 

responsible outdoor recreation uses through 

both authorized (permitted) and casual 

recreation use of the public lands.

The BLM administers a recreation 

permitting system that is designed to satisfy 

recreational demand within allowable use levels 

in an equitable, safe, and enjoyable manner 

while minimizing adverse resource impacts and 

user conflicts. Using public lands and/or related 

waters is a privilege that is subject to the terms 

and conditions of the permits. 

Timber Production: Timber production 

is the art and science of culturing (cultivating, 

planting, fertilizing, protecting, thinning, and 

ultimately harvesting) trees to utilize them for 

the production of lumber or paper. Timber 

production is just one aspect of the BLM’s 

overall forest management program. It is 

practiced only on those lands deemed suitable 

to produce timber on a sustained yield basis 

(i.e., commercial forest lands) and where it 

is compatible with other land management 

objectives as outlined in the applicable land use 

plan.

In addition to timber production, all BLM 

forests and woodlands are managed under 

the principles of multiple use and sustained 

yield. Management of values and uses such as 

recreation, aesthetics, water quality, wildlife 

habitat, and wilderness, as well as timber and 

other forest biomass production, is accomplished 

through an ecologically based program that 

emphasizes biological diversity, sustainability, 

and the long-term health of forests and 

woodlands.

Condition of Stewardship Lands

The condition of all of the BLMadministered public lands is categorized as 

“acceptable.” That is, the public lands are in 

adequate condition to sustain the multiple 

uses and use levels authorized during the 

current reporting period. This condition is 

evidenced by the vast resource production and 

revenues generated from the public lands. This 

information is available to the reader in the 

BLM publication Public Land Statistics, 

Part 3, “Commercial Uses and Revenues 

Generated,” which is available on the Internet 

at http://www.blm.gov/nhp/browse.htm.

Natural Heritage Assets

Protecting and Enhancing the Natural 

and Human Environment

Guided by the principles of multiple use 

and sustained yield in managing the public 

lands, the BLM has recognized the need to 

protect and enhance the natural and human 

environment. Special management areas have 

been designated by Presidential, Congressional, 

and administrative action. Presidential 

action has established fourteen BLM national 

monuments. Congress has established one BLM 

national monument and numerous national 

conservation and protection areas, wilderness 

areas, wild and scenic rivers, national trails, 

and other designations. Areas administratively 

designated by the BLM and other Departmental 

entities include recreation areas, primitive areas, 

natural areas, resource conservation areas, areas 

of critical environmental concern, and others.
92 BLM 2005 Annual Report

Stewardship Assets

Figure 2 - BLM-Managed Public Lands, including National Monuments and National Conservation Areas
BLM 2005 Annual Report 93

Stewardship Assets 

Types of Special Management Areas

Although the BLM manages natural 

heritage assets that are not in specifically 

designated areas, significant portions of 

the public lands have been congressionally 

or administratively designated as special 

management areas. These special management 

areas have been designated to preserve their 

natural heritage values. Table 5 provides a 

summary of the number of designated special 

management areas, including any changes in 

fiscal year 2005. These special management 

areas are found on the BLM-managed 

stewardship lands described above. The first 

ten types of special management areas largely 

constitute the BLM National Landscape 

Conservation System, which was created 

in fiscal year 2000 to increase the public’s 

awareness and appreciation for these public land 

treasures as well as to focus more management 

attention and resources on them.

Table 5 - Designated Special Management Areas

Special Management

Area Type 1

Number

Condition

2004

Balance

2005

Increase

2005

Decrease

2005

Net 

Change

2005

Balance

National Landscape Conservation System Areas

National Monuments [p -14 and c-1] 15 - - - 15 Acceptable

National Conservation Areas [c] 13 - - - 13 Acceptable

Cooperative Management and 

Protection Area [c] 1 - - - 1 Acceptable

White Mountains National Recreation 

Area [c] 1 - - - 1 Acceptable

Yaquina Head Outstanding Natural 

Area [c] 1 - - - 1 Acceptable

Wilderness Areas [c] 161 14 - 14 175 Acceptable

National Wild and Scenic Rivers [c] 38 - - - 38 Acceptable

Headwaters Forest Reserve [c] 1 - - - 1 Acceptable

National Historic Trails [c] 10 - - - 10 Acceptable

National Scenic Trails [c] 2 - - - 2 Acceptable

Other Special Management Areas

National Recreation Trails [a] 31 2 - 2 33 Acceptable

National Back Country Byways [a]2 55 - (1) (1) 54 Acceptable

Lake Todatonten Special Management 

Area [c] 1 - - - 1 Acceptable

National Natural Landmarks [a] 45 - - - 45 Acceptable

Globally Important Bird Areas [a] 2 - - - 2 Acceptable

1 Congressional designations are identified by [c], Presidential proclamation designations are identified by [p], and Administrative designations are 

identified by [a].

2 This Special Management Area type includes only those byways administratively designated under the BLM’s Back Country Byway Program. In 

addition, the BLM is involved in the cooperative management of an additional 17 byways on public lands that have been recognized by state or 

national designation.
94 BLM 2005 Annual Report

Stewardship Assets

National Monuments: National 

monuments can be designated by Congress 

to protect historic landmarks, historic and 

prehistoric structures, or other objects of 

historic or scientific interest on the public 

lands. Monuments can also be designated by 

Presidential proclamation under the Antiquities 

Act of 1906 to protect objects of scientific or 

historic interest. The BLM manages 15 national 

monuments. 

National Conservation Areas: Congress 

designates national conservation areas (NCAs) 

so that present and future generations of 

Americans can benefit from the conservation, 

protection, enhancement, use, and management 

of these areas and enjoy their natural, 

recreational, cultural, wildlife, aquatic, 

archeological, paleontological, historical, 

educational, and/or scientific resources and 

values. The BLM manages 13 NCAs. 

Cooperative Management and Protection 

Area: The BLM manages one cooperative 

management and protection area, the Steens 

Mountain Cooperative Management and 

Protection Area, located in southeastern 

Oregon. Cooperative and innovative 

management projects will be maintained and 

enhanced by the BLM, private landowners, 

tribes, and other public interests.

National Recreation Area: A national 

recreation area is an area designated by Congress 

to assure the conservation and protection of 

natural, scenic, historic, pastoral, and fish 

and wildlife values and to provide for the 

enhancement of recreational values. The BLM 

manages one such area, the White Mountains 

National Recreation Area in Alaska, which is 

named for its unusual, jagged, white limestone 

ridgeline.

Outstanding Natural Area: An 

outstanding natural area consists of protected 

lands designated either by Congress or 

administratively by an agency to preserve 

exceptional, rare, or unusual natural 

characteristics and to provide for the protection 

or enhancement of natural, educational, or 

scientific values. These areas are protected 

by allowing physical and biological processes 

to operate, usually without direct human 

intervention. The BLM manages one such area, 

the Yaquina Head Outstanding Natural Area, 

located in Newport, Oregon. Yaquina Head 

also has been designated as a Globally Important 

Bird Area by the American Bird Conservancy 

and the National Audubon Society.

Wilderness Areas: The BLM administers 

175 wilderness areas. The locations of these 

wilderness areas ensure that these lands 

represent the wide diversity of resources found 

on the public lands. Protective management 

helps ensure the protection and integrity of 

natural and biological processes on all public 

lands. 

Wilderness areas are designated by 

Congress and are defined by the Wilderness 

Act of 1964 as a place “where the earth and its 

community of life are untrammeled by man, 

where man himself is a visitor who does not 

remain.” Designation is aimed at ensuring 

that these lands are preserved and protected 

in their natural condition. Wilderness areas, 

which are generally at least 5,000 acres in size, 

offer outstanding opportunities for solitude or 

a primitive and unconfined type of recreation; 

such areas may also contain ecological, 

geological, or other features that have scientific, 

scenic, or historical value.

National Wild and Scenic Rivers: The 

BLM administers some 20 percent of all 

rivers in the National Wild and Scenic Rivers 

System, a total of 38 rivers in five states. 

These nationally recognized rivers encompass 

some of the Nation’s greatest diversity and 

concentrations of recreational, natural, and 

cultural resources. Included among the BLMmanaged wild and scenic rivers is the Fortymile 

River in Alaska, which is the longest designated 

river in the National Wild and Scenic Rivers 

System.
BLM 2005 Annual Report 95

Stewardship Assets 

Rivers designated in the National Wild and 

Scenic Rivers System are classified in one of 

three categories (wild, scenic, and recreational), 

depending on the extent of development and 

accessibility along each section. In addition 

to being free flowing, these rivers and their 

immediate environments must possess at least 

one outstandingly remarkable value—scenic, 

recreational, geologic, fish and wildlife, historic, 

cultural, or other similar values.

Headwaters Forest Reserve: The 

Headwaters Forest Reserve, located in central 

Humboldt County, California, was acquired 

from private owners by the BLM and the State 

of California. While title is held by BLM, this 

area is co-managed by the BLM and the State 

of California to protect the stands of old-growth 

redwoods that provide habitat for a threatened 

seabird, the marbled murrelet, as well as the 

headwaters that serve as a habitat for the 

threatened coho salmon and other fisheries. 

National Trails System: Since the passage 

of the National Trail System Act in 1968, the 

BLM has assumed responsibility for twelve 

national historic or scenic trails designated 

by Congress. These long-distance trails are 

among BLM’s “Great American Landscapes,” 

showcasing the exploration, westward 

migration, historic events, and scenic splendor 

of our country. The BLM manages well over 

85 percent of all of the Federal miles along 

national historic trails. National recreation 

trails, while not part of the National Landscape 

Conservation System, are a part of the National 

Trail System Act and are designated each 

year by the Departmental Secretary having 

jurisdiction over the particular trail area.

The BLM’s national trails program includes 

signing, maintenance, protection, coordination 

of volunteers, planning, interagency coordination, patrol, monitoring, visitor information, 

and interpretation. Partnerships with many trail 

organizations enhance the BLM’s management 

efforts. The BLM works closely with the 

Partnership for the National Trails System 

and affiliated organizations on many volunteer 

projects and related conferences.

The BLM manages sections of ten National 

Historic Trails. These ten trails are the 

Iditarod, Juan Bautista De Anza, California, 

Nez Perce, Lewis and Clark, El Camino Real de 

Tierra Adentro, Oregon, Mormon Pioneer, Pony 

Express, and the Old Spanish National Historic 

Trail. 

The BLM manages sections of two 

National Scenic Trails—the Continental 

Divide National Scenic Trail and the Pacific 

Crest National Scenic Trail, both of which 

stretch from Canada to Mexico.

National Recreation Trails do not require 

congressional approval; they are established 

administratively by the Secretary of the Interior. 

These trails provide a variety of outdoor 

recreation uses and opportunities in both remote 

and urban areas. The BLM manages sections of 

33 national recreation trails. 

National Back Country Byways: The 

National Back Country Byway program was 

developed by the BLM to complement the 

The Lake Valley Back Country Byway

is nestled between the Mimbres and

Caballo Mountains near Las Cruces.
96 BLM 2005 Annual Report

Stewardship Assets

National Scenic Byway program. Most of these 

byways are native surface or gravel base roads 

tracing across vast stretches of land. However, 

Back Country Byways can fall into one of four 

category types, ranging from paved all-weather 

roads suitable for normal passenger vehicles to 

single-track trails suitable only for dirt bikes, 

mountain bikes, or snowmobiles during the 

winter season. The BLM currently manages 54 

designated National Back Country Byways.

Lake Todatonten Special Management 

Area: The U.S. Congress authorized the 

creation of the Lake Todatonten Special 

Management Area located in the interior of 

Alaska. Lake Todatonten, the central feature 

of this special management area, is particularly 

important to waterfowl, which use the area for 

migration, staging, molting, and nesting. The 

lake and its surrounding hills are also home to 

moose, bear, and furbearers.

National Natural Landmarks: The BLM 

manages 45 national natural landmarks, which 

are designated by the Secretary of the Interior. 

To qualify as a national natural landmark, the 

area must contain an outstanding representative 

example(s) of the Nation’s natural heritage, 

including terrestrial communities, aquatic 

communities, landforms, geological features, 

habitats of native plant and animal species, or 

fossil evidence of the development of life on 

earth.

Globally Important Bird Areas: Globally 

important bird areas (IBAs) consist of a network 

of sites and areas in North America identified 

and protected to maintain naturally occurring 

bird populations across the ranges of those 

species. IBAs are important for maintaining 

critical habitats and ecosystems. This network 

of areas encompasses lands critical to the 

conservation of some bird species and may 

include the best examples of the species’ habitat. 

IBAs help ensure species’ survival.

The BLM manages two Global IBAs: the 

San Pedro Riparian National Conservation Area 

in Arizona and the Yaquina Head Outstanding 

Natural Area in Oregon.

Change in Natural Heritage Assets 

Properties from 2004 to 2005

New designations increased wilderness 

areas by 14 and natural recreation trails by 2. 

Administrative correction of records decreased 

national back country byways by 1. Reporting 

of the Santa Rosa Mountains National Scenic 

Area has been discontinued because it has been 

incorporated into the Santa Rosa/San Jacinto 

Mountains National Monument. Wilderness 

study areas, herd management areas, areas of 

critical environmental concern, and research 

natural areas are no longer reported for purposes 

of this report. All of these special management 

types are designated by BLM administrative 

action rather than by Presidential, 

Congressional, or Secretarial action. Several 

of these special management areas are also 

intended to be of limited duration.

Condition of Natural Heritage Assets

The condition of natural heritage assets 

is categorized as “acceptable” as they are an 

integral component of stewardship lands. 

Further information is found under Condition 

of Stewardship Lands above. The historic Yaquina Head Lighthouse looks out over 

the Pacific Ocean near Newport, Oregon.
BLM 2005 Annual Report 97

Stewardship Assets 

Paleontological and 

Cultural Heritage Properties

Lands administered by the BLM are some 

of the most culturally diverse and scientifically 

important lands managed by any Federal 

agency. The Bureau is responsible for protecting 

and preserving paleontological localities and 

archaeological and historical sites, as well as 

the museum objects excavated or collected. 

Table 6 summarizes the number and condition 

of the paleontological and cultural properties 

under BLM’s stewardship.

Table 6 - Number and Condition of Paleontological and Cultural Properties

Type of 

Property

Number 

Condition 1/

2004

Balance

2005

Increase

2005

Decrease

2005

Net 

Change

2005

Balance

Paleontological 61 - - - 61 Acceptable

National Register 

of Historic Places

403 Listings 

(consisting 

of 4,248 

Contributing 

Properties)

3 - 3

406 Listings 

(consisting 

of 4,473

Contributing 

Properties)

Unknown

Included in the National Register of Historic Places

National Historic 

Landmarks 21 - - - 21 Unknown

World Heritage 

Properties 5 - - - 5 Unknown

1 Refer to the “Condition of Paleontological and Cultural Properties” section of this report.

2 Effective in fiscal year 2005, recorded archaeological and historic sites are no longer reported in the BLM Stewardship Assets Report.

Paleontological Properties

The BLM manages fossils as a natural 

heritage resource on the lands it administers 

under the general guidance of the Federal 

Land Policy and Management Act (FLPMA) 

and the National Environmental Policy 

Act (NEPA). Fossils are managed to 

promote their use in research, education, 

and recreation. Paleontological localities are 

an important consideration in developing 

land use management decisions. Currently 

61 areas are managed either wholly or in 

part for paleontological values, or contain 

paleontological values that may require special 

management strategies in the future.

Almost all other public lands are accessible 

to the public for the recreational collection of 

common invertebrate and plant fossils, as well 

as limited amounts of petrified wood. However, 

a BLM permit is required for the collection 

of vertebrate fossils. BLM permits are issued 

only to qualified paleontologists for scientific 

research, education, and display or exhibit at a 

university or museum.
98 BLM 2005 Annual Report

Stewardship Assets

Cultural Properties

The BLM manages the largest, most varied, 

and scientifically most important body of 

cultural resources of any Federal land managing 

agency. The BLM’s archaeological and historic 

resources range in age from 13,000-year-old 

mammoth kill sites associated with America’s 

earliest hunters to more recent historic sites 

documenting westward migration, mining, 

ranching, railroading, and even World War 

II and Cold War military sites. Because so 

much of western history was played out on the 

public lands, the BLM is the only Federal land 

managing agency that can tell the complete 

story of people on these western lands.

Unfortunately, many of the archaeological 

and historic sites have already been intentionally 

looted or inadvertently disturbed. Changing 

land use patterns, increased urbanization, and 

demographic shifts are transforming public 

expectations and attitudes about how BLM 

should manage its public lands, including 

its cultural resources. Remote areas, once 

protected by their distance from populated 

areas, are now within easy reach of the hardy 

and well-equipped hiker, off-highway vehicle 

user, or encroaching urban and suburban 

resident. Increasingly, public land use is 

concentrated on significant cultural resources 

such as archaeological resources, rock art 

panels, emigrant trails, abandoned homesteads, 

“ghost” towns, and similar places evocative of 

the American West. These fragile resources are 

easily and negatively impacted by both natural 

processes (e.g., erosion, natural deterioration, 

weathering, and arroyo cutting) and human 

agents (e.g., looting, vandalism, recreational 

activities, and development).

The BLM’s national historic preservation 

program is founded in part on the following 

policy statements contained in Section 2 of 

the National Historic Preservation Act: “It 

shall be the policy of the Federal Government, 

in cooperation with other nations and in 

partnership with the states, local governments, 

Indian Tribes, and private organizations and 

individuals to . . . administer federally owned, 

administered, or controlled prehistoric and 

historic resources in a spirit of stewardship for 

the inspiration and benefit of present and future 

generations.”

Currently, the BLM has 406 listings on 

the National Register of Historic Places that 

encompass 4,473 contributing properties, as 

well as 21 national historic landmarks and 5 

world heritage properties. Standing structures, 

very conservatively estimated at 1,500, include 

prehistoric pueblos; cliff dwellings; antelope, 

bighorn sheep, and fish traps; agricultural 

features; historic-period mining structures (such 

as smelters, mill sites, arrastras, and charcoal 

kilns); ranch buildings; adobe forts; stage stops; 

townsites; lighthouses; cabins; a salt tram; and 

depression-era schoolhouses. Portions of 10 

national historic trails also cross the public lands 

(see above under Natural Heritage Assets).

Change in Paleontological and Cultural 

Heritage Properties from 2004 to 2005

During fiscal year 2005, the number 

of National Register of Historic Places 

listings increased by 3, while the number of 

contributing properties increased by 225. This 

was a result of new designations. A generic 

category called Recorded Archaeological and 

Historic Sites is no longer reported for purposes 

of this report. National Register of Historic 

Places properties, as well as national historic 

landmarks and world heritage properties, were 

included in this generic category. However, 

the remaining sites, which constituted the vast 

majority of the sites listed in this category, were 

not officially designated sites, and many are no 

longer in existence.
BLM 2005 Annual Report 99

Stewardship Assets 

Condition of Paleontological and 

Cultural Properties

The condition of paleontological properties 

is acceptable, as they are a part of the 

stewardship lands upon which they are located.

The BLM’s cultural resource management 

program was developed in the 1970s to respond 

to the National Historic Preservation Act of 

1966 and Executive Order 11593 of 1971. The 

most important known properties, including 

national historic landmarks, are afforded the 

highest attention.

Each year the Secretary provides the 

Congress with a listing of damaged or 

threatened national historic landmarks, as 

required by Section 8 of Public Law 94-458. 

This listing does not differentiate according 

to ownership when any portion of a landmark 

is judged to be subject to threat. Of the 

landmarks identified in the current listing where 

there are some BLM-managed lands involved, 

the BLM-managed portions of the landmarks 

are not actively at risk. Landmark condition 

is carefully monitored by BLM field offices. 

When active threats are present, appropriate 

physical or administrative protective measures 

are applied promptly.

The BLM’s cultural resource management 

program does not specifically include an 

element called “condition assessment survey.” 

However, historic properties are evaluated 

continuously. In the past two years, the cultural 

resource management program has worked 

with the BLM’s Protection and Response 

Staff to obtain funding to conduct condition 

assessments at specifically threatened historic 

properties. Monitoring the rate of natural and 

human-caused deterioration, and adjusting 

protection methods and priorities accordingly, is 

the most commonly applied protection measure 

where significant properties are known to exist.

Museum Collections

Museum collections under BLM’s 

stewardship consist principally of archaeological, 

historical, and paleontological materials that 

are managed to professional standards in 

compliance with applicable laws, and that are 

accessible to the public.

• Archaeological and Historical Collections: 

Millions of museum objects have originated 

from the BLM’s archaeological and 

historical resources. Resources include 

trails, sites, buildings, structures, and objects 

from past human life and activities that are 

significant to American history, architecture, 

archaeology, engineering, and culture, and 

that contribute to our understanding of the 

historical and cultural foundations of our 

Nation.

• Paleontological Collections: Paleontological 

materials—the fossilized remains or traces 

of dinosaurs, extinct plants, mammals, 

fish, insects, and other organisms from the 

distant past—are another important source 

of museum collections that originate from 

BLM-managed lands. Many of the earliest 

described and most widely known dinosaurs 

were excavated from BLM-managed lands. 

Dinosaur bones were discovered

on public lands near Malta, Montana.
100 BLM 2005 Annual Report

Stewardship Assets

Public lands continue to yield new fossil 

finds and exciting discoveries that shed light 

on the history of life.

Collections are used to teach museum 

visitors about life in the past. Researchers value 

the collections from public lands as a source 

of material for scientific data that becomes a 

permanent part of study and display collections. 

Scientific publications, textbooks, and articles 

for the general public are based on information 

taken from these collections.

Table 7 summarizes the number of facilities 

holding collections from BLM public lands and 

the condition of these heritage assets.

Collections in Non-Federal Facilities

Since Europeans first inhabited America, 

cultural and paleontological objects have been 

collected from the vast acreage of Federal land. 

However, it was not until 1906, when the 

Antiquities Act mandated that permits be issued 

for excavations, that any control was exercised 

by the Federal government over the excavation 

of these materials. In the Department of the 

Interior, permitting authority was delegated to 

the Departmental Consulting Archaeologist of 

the National Park Service, the Department’s 

lead for cultural resource issues. The BLM was 

created in 1946, but it was not until the mid-70s 

that the first Bureau archaeologists were hired. 

Permitting authority was not delegated to the 

BLM until September 28, 1984, by Secretarial 

Order 3104.

Most collections originating from BLMmanaged land are housed in non-Federal 

facilities throughout the country. To date, the 

Bureau has identified 155 professional facilities 

in 33 states and Canada where millions of 

objects originating from the public lands reside.

These cultural and paleontological objects 

have been gathered not for the Bureau’s use but 

for the benefit of the public. The BLM has 

gathered data for all of the non-Federal facilities 

(type of collection, location, website, year 

established, attendance figures, collection type, 

professional organization membership, academic 

accreditation, museum accreditation and 

assessments, etc.). This data demonstrates that 

the facilities are professional institutions capable 

of caring for Federal collections; however, the 

BLM does not directly manage the material in 

the collections.

Because most of the collections originating 

from BLM-managed land are housed in nonFederal facilities, the BLM’s relationship 

with these curatorial facilities is crucial to the 

continued management and protection of these 

collections. Non-Federal facilities provide access 

to researchers and scientists, and develop public 

displays utilizing the collections. Collections 

in external repositories thus fulfill their mission 

and are being curated and fully used for public 

benefit, all at little or no cost to the American 

public.

Table 7 - Number of Facilities and Condition of Museum Collections

Location

Number

Condition

2004

Balance

2005

Increase

2005

Decrease

2005

Net 

Change

2005

Balance

Non-Federal 

(External)

Facilities

154 3 (2) 1 155

Good—12

Fair—42

Unknown - 101

BLM Facilities 3 – – – 3 Good - 3
BLM 2005 Annual Report 101

Stewardship Assets 

Collections in Federal Facilities

Outside of the millions of objects residing in 

non-Federal facilities, the BLM curates objects 

in three BLM facilities: the Anasazi Heritage 

Center (AHC) in Dolores, Colorado, transferred 

to BLM management in 1988; the Billings 

Curation Center (BCC) in Billings, Montana, 

established in 1984; and the National Historic 

Oregon Trail Interpretive Center (NHOTIC) 

on Flagstaff Hill, Oregon, opened in 1992. It is 

the BLM’s policy that museum collections will 

not be housed in the Bureau’s field offices.

Anasazi Heritage Center (AHC)

The AHC is the Bureau’s only collections 

facility and museum. It features the Anasazi 

(ancestral Puebloan) culture as well as other 

cultures of the Four Corners region. The 

museum has permanent exhibits, archaeological 

sites, special exhibits and events, traveling 

exhibits, educational resources for teachers, 

archaeological research collections, and an 

excellent interactive website (www.co.blm.

gov/ahc/index.htm). AHC collections are 

principally archaeological materials, along with 

some historic and paleontological materials.

Billings Curation Center (BCC)

A much smaller entity, the BCC was 

established to curate artifacts collected from 

public lands in Montana and North and South 

Dakota. The primary objectives of the BCC are 

to assist these three BLM states in complying 

with the Native American Graves Protection 

and Repatriation Act (NAGPRA), and to ensure 

that collections (which are representative of 

nearly 12,000 years of prehistory and history 

in the Northern Plains) and associated records 

serve scientific researchers, the BLM, and other 

Federal agency personnel. The center has no 

gallery spaces, but it does host researchers and 

interns. This year the interactive website for the 

center was once again expanded (www.mt.blm.

gov/bcc/). BCC collections are principally 

archaeological materials, along with some 

historic materials. The center is valued as an 

important research and resource management 

tool.

National Historic Oregon Trail 

Interpretive Center (NHOTIC)

The NHOTIC features exhibits, living 

history areas (including pioneer encampment 

and mining), a theater, an outdoor 

amphitheater, interpretive trails, and a picnic 

area. It provides majestic scenery and unique 

vistas of the historic ruts of the Oregon Trail. 

The center’s goal is to interpret the story of 

the Oregon Trail and its impact on western 

American history. This is achieved, in great 

part, through the use of artifacts. Artifacts, 

along with artwork, text, videos, sound effects, 

and dioramas, present well-rounded, factfilled exhibits and programs. The Center 

also provides research for mail and telephone 

requests and maintains an excellent interactive 

website (oregontrail.blm.gov/). NHOTIC 

collections are principally archaeological 

materials, along with historic materials and 

some natural history materials.

Change in Museum Collections Facilities 

from 2004 TO 2005

The number of BLM curation facilities 

was unchanged in FY 2005, while the net 

The Powers-Yonkee Site at the

Billings Curation Center in Montana.
102 BLM 2005 Annual Report

Stewardship Assets

number of non-Federal facilities identified as 

holding BLM collections increased from 154 to 

155. Additional research into facility holdings 

resulted in two facilities being deleted, while 

the creation of new collections resulted in an 

additional three facilities.

Condition of Museum Collections

Background

The museum collections and the associated 

records under the BLM’s stewardship are stored 

in professional facilities whose mission, among 

other things, is to preserve them. Generally, 

museums and facilities preserve museum 

objects in a manner that is appropriate to the 

nature of the materials; that protects them from 

breakage and possible deterioration from diverse 

temperatures and relative humidity, visible light, 

ultraviolet radiation, dust, soot, gases, mold, 

fungus, insects, rodents, and general neglect; 

that preserves data so it can be studied in future 

analyses; and that protects collections from fire 

and theft. It is unavoidable that all museum 

objects will ultimately deteriorate over time 

with use. The goal of safeguarding museum 

objects is to preserve them for as long as possible 

and to manage their condition during their 

intended use so as not to unduly hasten their 

deterioration.

Condition Assessment

The condition of museum collections in 

BLM facilities is good. These three internal 

facilities have management and accountability 

policies, procedures, and systems in place (i.e., 

governance, finance, security, interpretation, 

outreach, care or “curation,” scope of collections, 

acquisitions, deaccessioning, legal and safety 

issues, documentation, and risk management).

The BLM has not conducted formal 

inspections of the 155 non-Federal facilities. 

The Department of the Interior has created a 

scheme for facility-level condition standards in 

which one of three standards may be used to 

assess facility condition. Only one standard is 

necessary to rate any one particular facility.

• American Association of Museums (AAM) 

Accreditation: If the facility has received 

accreditation by the AAM, a “fair” rating 

may be assessed for facility condition.

• A Department of the Interior Manual (411 

DM) checklist that may be used to assess 

condition.

– Good Facility Condition: 70% or more 

of the applicable DOI standards are met 

at a facility. 

– Fair Facility Condition: between 

50% and 70% of the applicable DOI 

standards are met at a facility. 

– Poor Facility Condition: less than 50% 

of the applicable DOI standards are met 

at a facility

• Army Corps of Engineers (COE) scores: 

The U.S. Army Corps of Engineers 

Mandatory Center of Expertise for the 

Curation and Management of Archeological 

Collections scores may be used if one was 

performed for the facility in question.

– Good Facility Condition: 70% or higher 

score assigned by COE for a facility. 

– Fair Facility Condition: between 50% 

and 70% score assigned by COE for a 

facility. 

– Poor Facility Condition: less than 50% 

score assigned by COE for a facility

Using a combination of the standards above, 

the BLM can state that 12 facilities are in good 

condition and 42 facilities are in fair condition. 

The remaining 101 facilities are deemed to 

be in unknown condition since they have not 

been rated according to the above standards. 

However, no problems are known to exist.

Table 1—Investment in Research and Development
BLM 2005 Annual Report 103

(Outlays in Millions of Dollars)

Category 2001 2002 2003 2004 2005 1 Total

 Applied Research 11.1 12.0 10.9 14.0 16.5 64.5

 Development 1.4 .4 1.5 2.6 1.3 7.2

 Total 12.5 12.4 12.4 16.6 17.8 71.7

1

 Outlays are estimated for 2005.

Program Overview

The primary objective of the BLM’s research and development 

program is to make better use of new data, information, and 

knowledge to improve the management of our Nation’s public lands 

and resources. The BLM’s research and development program 

focuses on working with partners to identify scientific information 

needs and then communicating these needs to research agencies, 

universities, and other non-governmental organizations. Outlays 

for BLM’s research and development program are shown above in 

Table 1. Applied research refers to a study to gain the knowledge or 

understanding needed to determine how a recognized and specific 

need can be met. Development refers to using knowledge and 

understanding gained from research to produce useful materials, 

devices, systems, or methods, including the design and development 

of prototypes and processes.

The Applications of Science program was established by Congress 

in 2002 in order to assure that scientific information is current and 

can be made available to BLM managers. The Application of Science 

program is now an important component of the BLM’s research and 

development program, assisting the BLM in expanding its capacity to 

collect and use natural resource information.

The BLM has developed a formal science strategy that includes a 

process for identifying high-priority science needs and then meeting 

these needs either internally or in collaboration with science partners, 

such as the United States Geological Survey (USGS), other agency 

science providers, and universities. The strategy also includes 

identifying and cataloging scientific opportunities on the public 

lands, such as those found within national monuments, national 

conservation areas, and research natural areas. The BLM is currently 

preparing management plans for several national monuments and 

national conservation areas that will highlight science opportunities 

and research needs.

The USGS serves as the primary research science bureau for the 

Department of the Interior, addressing the scientific questions and 

research needs of the land management bureaus. The BLM relies 

INVESTMENT

IN

RESEARCH

AND

DEVELOPMENT
104 BLM 2005 Annual Report

Investment in Research and Development

on the science capabilities within the USGS 

as its largest single source of scientific research 

support, although the BLM also works with 

other Federal agencies, state agencies, and 

other organizations to meet its overall science 

needs. The USGS geologic, water resources, 

and geography disciplines support the BLM’s 

mineral assessment, mining-related hydrologic 

studies, and abandoned mine land efforts. The 

USGS biological resources discipline addresses 

most of the BLM’s science needs relating to the 

management of biological resources.

The BLM is a founding partner in the 

network of Cooperative Ecosystem Studies 

Units (CESUs) that has been established 

recently at several of the Nation’s leading 

universities by a number of Federal agencies. 

The BLM is increasingly making use of these 

CESU partnerships both to meet its own science 

needs and to involve U.S. universities and 

colleges to a greater extent in providing sound 

science for managing the public lands and 

resources.

2005 Program Performance Estimates

In 2005, the BLM began new and 

continued past research and development 

efforts, including:

• Initiating studies on salt loading into the 

Colorado River, a major concern since 

Colorado River water is a primary source of 

irrigation and drinking water for the Lower 

Basin states.

• Investigating the effectiveness of selected 

plants in removing toxic metals from 

mine wastes as part of the Kerber Creek 

abandoned mining permits.

• Continuing studies in the Cooperative 

Forest Ecosystem Research Program, 

emphasizing the influences of landscape 

patterns and management on the 

composition of terrestrial and aquatic 

species, a study of riparian linkage, an 

analysis of riparian management and 

conservation strategies, and post-fire 

rehabilitation and ecology.

• Continuing studies on the juniper invasion 

of shrub-steppe ecosystems in the northern 

Great Basin and Pacific Northwest.

• Concluding a four-year study in Utah of 

the symbiotic relationships between soil 

mycorrhizae and vegetative communities, 

and the importance of these relationships 

to the success of ecosystem restoration and 

rehabilitation efforts.

• Continuing the mapping of infestations 

and accurately monitoring the spread of 

invasive species on western rangelands, 

improving methods for predicting areas 

most vulnerable to invasions, and assessing 

the effects of management practices and 

natural disturbances on invasions.

• Continuing studies at the Grand StaircaseEscalante National Monument that focus on 

developing sustainable grazing and livestock 

management techniques compatible with 

the area's arid environment; characterizing 

the area's hydrology; monitoring changes 

in terrestrial and aquatic insects and 

invertebrates related to the cessation of 

grazing in the Escalante River corridor; and 

studying the distribution and ecology of 

Escalante River fishes.

• Continuing research efforts on wild 

horses that focus on population modeling 

and fertility control on herd dynamics, 

and working to refine multiple-year 

contraceptive vaccines.

• Continuing studies of the effects of livestock 

grazing on a community of species at risk of 

extinction in the San Joaquin Valley.
BLM 2005 Annual Report 105

DEFERRED

MAINTENANCE

This report displays the estimated dollar value of maintenance 

that was not performed when scheduled, and that has been delayed 

to a future period, for general property, plant, and equipment items 

and for stewardship assets. For this section, stewardship assets 

consist of constructed infrastructure such as roads, trails, bridges, 

major culverts, and dams on BLM land, but do not include land and 

the natural resources on the land or collectable and noncollectable 

heritage assets. Deferred maintenance includes preventive 

maintenance, normal repairs, replacement of parts and structural 

components, and other activities needed to preserve the asset so that it 

continues to provide acceptable services and achieves its expected life.

The BLM’s capital assets include administrative facilities, 

recreation sites, and fire control facilities and buildings. Roads, 

trails, bridges, and associated improvements constitute the BLM’s 

transportation system. Currently, the BLM maintains 4,300 

buildings, 710 administrative sites, 2,498 recreation sites, 83,987 

miles of roads, 859 bridges, 18,929 miles of trails, and 515 hazard 

rated dams. These assets support the management, use, and 

enjoyment of the public lands for commercial, recreational, and other 

purposes.

The trend has been for the BLM’s inventory of fixed, capital 

assets (buildings, roads, recreation sites, etc.) to increase over time. 

However, with the implementation of the new Interior-wide Asset 

Management Plan (AMP), the BLM will streamline its portfolio of 

assets and optimize maintenance of those assets that contribute most 

significantly to its mission and strategic goals. The BLM expects 

to dispose of unneeded assets so it can affordably maintain and 

sustain its portfolio. Adequate funding and staffing for repairs and 

maintenance is essential if the Bureau is to maintain its facilities in 

good functioning condition and reduce its accumulated deferred 

maintenance workload.

The BLM is using the methodology developed for the 2004 

Annual Report and Financial Statements to determine the 2005 

deferred maintenance information. This methodology was devised to 

provide a reasonable, consistent, and auditable process based on the 

most current information available.

The methodology groups capital assets into major asset classes 

and uses recent baseline comprehensive condition assessment surveys 

performed by expert inspection teams composed of government 

and contractor personnel. The methodology consists of using fieldcollected data to (1) develop conceptual cost estimates based on 

square footage or other units of measure for corrective actions noted 

in the comprehensive condition assessments, and (2) extrapolate 

estimates for assets that have not yet had baseline condition 
106 BLM 2005 Annual Report

Deferred Maintenance

assessments. The combination of fieldcollected data and extrapolation provides the 

methodology for measuring the total deferred 

maintenance for each major asset class.

The BLM also reconfigured its asset 

categories in 2005 to correspond to the 

“roll up” format in the Department of the 

Interior’s Annual Report on Performance 

and Accountability. The reconfigured 

asset categories capture the same deferred 

maintenance data as before, but the major asset 

classes are grouped differently within each asset 

category.

For example, administrative sites and 

recreation sites were two of the major asset 

classes. The BLM is now reporting deferred 

maintenance for buildings on administrative 

and recreation sites and other structures on 

administrative and recreation sites. Baseline 

comprehensive condition assessments have been 

completed for all administrative and recreation 

sites, including on-site buildings and structures.

The BLM determines an asset’s current 

replacement value as part of the comprehensive 

condition assessments of administrative sites 

and recreation sites. Knowing the replacement 

value allows the BLM to use the industry 

standard Facilities Condition Index (FCI) as a 

method of measuring the condition and change 

of condition of facilities. The FCI is the ratio 

of accumulated deferred maintenance to the 

current replacement value (FCI = Deferred 

Maintenance/Current Replacement Value). It 

is an indicator of the depleted value of capital 

assets. The general rule is that FCI should be 

below 0.10 for a facility to be considered in 

good condition. These comprehensive baseline 

condition assessments will eventually establish 

a performance-based annual maintenance 

management program.

Unlike buildings, structures, or machinery, 

land and the natural resources it contains, 

including natural heritage assets and 

paleontological properties, are not subject to 

periodic and/or recurring maintenance. As 

such, there is no deferred maintenance to be 

reported for these categories. Land is defined 

as the solid part of the earth, i.e., rocks and 

sediment.

As of August 15, 2005, the total 

accumulated deferred maintenance was 

estimated to range from $387 million to $473 

million. The first accompanying table shows 

deferred maintenance by asset category.

A portion of the maintenance backlog 

has been developed into specific projects and 

included in the BLM’s Five-Year Deferred 

Maintenance and Capital Improvement Plan. 

The total deferred maintenance component 

in the FY 2006–2010 Plan is $165 million, 

as shown in the second accompanying table 

by future funding year and subactivity 

(funding source). The $165 million includes 

project-specific work, along with project and 

contract management, condition assessments, 

information technology, and other work directly 

related to deferred maintenance.
BLM 2005 Annual Report 107

Deferred Maintenance

Estimated Range of Deferred Maintenance by Asset Category

(dollars in thousands)

Estimated Range of Deferred Maintenance for 2005

General PP&E Stewardship PP&E Total

Asset Category

Items 

Covered

Note (1)

Condition 

Category

Note (2) Low High Low High Low High

Roads, Bridges, 

Major Culverts,

and Trails A,B,C,D G, F, P - - $219,525 $268,308 $219,525 $268,308

Dams A,B,C,D G, F, P - - $22,451 $27,440 $22,451 $27,440

Buildings on 

Administrative

and Recreation 

Sites A,B,C,D G, F, P $59,771 $73,053 - - $59,771 $73,053

Other 

Structures on 

Administrative

and Recreation 

Sites A,B,C,D G, F, P $85,222 $104,160 - - $85,222 $104,160

Total $144,993 $177,213 $241,976 $295,748 $386,969 $472,961

Note (1) Items Covered:

A—Critical Health and Safety Deferred Maintenance: A facility deferred maintenance need that poses a serious threat to public or employee safety.

B—Critical Resource Protection Deferred Maintenance: A facility deferred maintenance need that poses a serious threat to natural or cultural resources.

C—Critical Mission Deferred Maintenance: A facility deferred maintenance need that poses a serious threat to a bureau’s ability to carry out its assigned 

mission.

D—Compliance and other Deferred Maintenance: A facility deferred maintenance need that will improve public or employee safety, health, or 

accessibility; compliance with codes, standards, laws, complete unmet programmatic needs and mandated programs; and protection of natural or 

cultural resources to enhance a bureau’s ability to carry out its assigned mission.

Note (2) Condition Assessment:

Good—Facility/equipment condition meets established maintenance standards, operates efficiently, and has a normal life.

Fair—Facility/equipment condition meets minimum standards but requires additional maintenance or repair to prevent further deterioration, increase 

operating efficiency, and achieve normal life expectancy.

Poor—Facility/equipment does not meet most maintenance standards and requires frequent repairs to prevent accelerated deterioration and provide a 

minimal level of operating function. In some cases that includes condemned or failed facilities.

Based on periodic condition assessments, an indicator of condition is the percent of facilities and items of equipment in each of the good, fair, or poor 

categories.
108 BLM 2005 Annual Report

Deferred Maintenance

Deferred Maintenance by Future Funding Year and Subactivity (Funding Source)

(dollars in thousands)

Funding Source

Planned Deferred Maintenance Work 1

FY 2006 FY 2007 FY 2008 FY 2009 FY 2010 Total

MLR Deferred Maintenance 2 3 28,463 29,112 29,991 30,258 30,781 148,605

O&C Deferred Maintenance 4 1,075 1,044 1,075 1,075 1,075 5,344

Construction 561 729 523 744 425 2,982

Wildland Fire 5 1,370 1,970 680 1,428 2,544 7,992

Total $31,469 $32,855 $32,269 $32,430 $34,825 $164,923

1

 This table shows the deferred maintenance that has been developed into specific projects and included in the BLM’s Five-Year 

Deferred Maintenance and Capital Improvement Plan. The $165 million total for FY 2006–2010 includes other costs for project and 

contract management, condition assessments, information technology, and other work directly related to managing and reducing the 

maintenance backlog. The table does not include the capital improvement work associated with the projects.

2

 Management of Lands and Resources (MLR) is the major appropriation category in the BLM’s annual budget.

3

 The table does not include $7 million set aside each year in MLR Deferred Maintenance for projects and improvements to benefit 

rangeland resources, as proposed in the President’s 2006 Budget. The President’s 2006 Budget zeroed out the Range Improvement 

program and, as an offset, the Department directed BLM to reserve $7 million within the MLR Deferred Maintenance subactivity 

(1653) for use on projects and improvements to benefit rangeland resources. From the Project Data Sheet (PDS): “The rangeland 

improvements to be implemented with this funding will involve a variety of activities which will include rehabilitation of riparian 

areas, improvement and protection of fish and wildlife habitat, stabilization and enhancement of soil and water resources, expansion 

of habitat improvements related to wild horse and burro needs, and livestock management structures which provide for improved 

vegetation and livestock grazing capabilities.”

4

 Oregon and California Grant Lands (O&C) is a minor appropriation category that covers certain counties in western Oregon.

5

 BLM projects only. The BLM’s Five-Year Plan includes Wildland Fire projects for the Bureau of Indian Affairs, Fish and Wildlife 

Service, and National Park Service. Wildland Fire funding for these other bureaus comes through the BLM’s appropriation for Wildland 

Fire Management.
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BLM/BC/GI-05/002+1300

Cover photo:

The BLM works with other agencies,

groups, and local communities

to manage the public lands.

Design and production by Jennifer Kapus, BLM’s National Science and Technology Center Publishing Staff.