U.S. GOVERNMENT PRINTING OFFICE

73–405 DTP WASHINGTON : 2001

S. HRG. 107–67

DESERT TORTOISE HABITAT CONSERVATION

HEARING

BEFORE THE

SUBCOMMITTEE ON

FORESTS AND PUBLIC LAND MANAGEMENT

OF THE

COMMITTEE ON

ENERGY AND NATURAL RESOURCES

UNITED STATES SENATE

ONE HUNDRED SEVENTH CONGRESS

FIRST SESSION

ON

H.R. 880

TO PROVIDE FOR THE ACQUISITION OF PROPERTY IN WASHINGTON

COUNTY, UTAH, FOR IMPLEMENTATION OF A DESERT TORTOISE

HABITAT CONSERVATION PLAN

MAY 10, 2001

(

Printed for the use of the

Committee on Energy and Natural Resources

For sale by the U.S. Government Printing Office

Superintendent of Documents, Congressional Sales Office, Washington, DC 20402

(II)

COMMITTEE ON ENERGY AND NATURAL RESOURCES

FRANK H. MURKOWSKI, Alaska, Chairman

PETE V. DOMENICI, New Mexico

DON NICKLES, Oklahoma

LARRY E. CRAIG, Idaho

BEN NIGHTHORSE CAMPBELL, Colorado

CRAIG THOMAS, Wyoming

RICHARD C. SHELBY, Alabama

CONRAD BURNS, Montana

JON KYL, Arizona

CHUCK HAGEL, Nebraska

GORDON SMITH, Oregon

JEFF BINGAMAN, New Mexico

DANIEL K. AKAKA, Hawaii

BYRON L. DORGAN, North Dakota

BOB GRAHAM, Florida

RON WYDEN, Oregon

TIM JOHNSON, South Dakota

MARY L. LANDRIEU, Louisiana

EVAN BAYH, Indiana

DIANNE FEINSTEIN, California

CHARLES E. SCHUMER, New York

MARIA CANTWELL, Washington

BRIAN P. MALNAK, Staff Director

DAVID G. DYE, Chief Counsel

JAMES P. BEIRNE, Deputy Chief Counsel

ROBERT M. SIMON, Democratic Staff Director

SAM E. FOWLER, Democratic Chief Counsel

SUBCOMMITTEE ON FORESTS AND PUBLIC LAND MANAGEMENT

LARRY E. CRAIG, Idaho, Chairman

CONRAD BURNS, Montana, Vice Chairman

PETE V. DOMENICI, New Mexico

DON NICKLES, Oklahoma

GORDON SMITH, Oregon

CRAIG THOMAS, Wyoming

JON KYL, Arizona

RICHARD C. SHELBY, Alabama

RON WYDEN, Oregon

DANIEL K. AKAKA, Hawaii

TIM JOHNSON, South Dakota

MARY L. LANDRIEU, Louisiana

EVAN BAYH, Indiana

DIANNE FEINSTEIN, California

CHARLES E. SCHUMER, New York

MARIA CANTWELL, Washington

FRANK H. MURKOWSKI and JEFF BINGAMAN are Ex Officio Members of the Subcommittee

MIKE MENGE, Professional Staff Member

DAVID BROOKS, Democratic Senior Counsel

(III)

C O N T E N T S

STATEMENTS

Page

Anderson, Robert, Deputy Assistant Director, Bureau of Land Management ... 1

Thomas, Hon. Craig, U.S. Senator from Wyoming ............................................... 1

APPENDIX

Additional material submitted for the record ........................................................ 5

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DESERT TORTOISE HABITAT CONSERVATION

THURSDAY, MAY 10, 2001

U.S. SENATE, SUBCOMMITTEE ON

FORESTS AND PUBLIC LAND MANAGEMENT, COMMITTEE ON ENERGY AND NATURAL RESOURCES, Washington, DC.

The subcommittee met, pursuant to notice, at 3:45 p.m., in room

SD–366, Dirksen Senate Office Building, Hon. Craig Thomas presiding.

OPENING STATEMENT OF HON. CRAIG THOMAS,

U.S. SENATOR FROM WYOMING

Senator THOMAS. Senator Larry Craig, chairman of the Forest &

Public Land Subcommittee, asked if at the close of this oversight

hearing the Park Service would consent to a short hearing on this

subcommittee to take testimony on H.R. 880. In the spirit of Senatorial efficiency, of course we agreed to do that.

Forest & Public Land Subcommittee held a hearing on a similar

piece in the 106th Congress and consequently reported the bill favorably to the full Senate. H.R. 880 is an act to provide for the acquisition of property in Washington County, Utah, for the implementation of a desert tortoise habitat conservation plan.

The bill also provides for compensation to be paid to the owners

of the property. We’re delighted today to have witness from BLM,

Mr. Anderson.

Mr. ANDERSON. Appreciate that.

Senator THOMAS. And if you would go ahead with your testimony, sir.

STATEMENT OF ROBERT ANDERSON, DEPUTY ASSISTANT

DIRECTOR, BUREAU OF LAND MANAGEMENT

Mr. ANDERSON. Okay, thank you very much, Senator Thomas.

I appreciate the opportunity to appear before you today to testify

on H.R. 880 which provides for all right, title, and interest to certain property in Washington County, Utah, to be vested in the

United States.

The administration supports the land transfer as provided for in

H.R. 880 but cannot support some of the factors and procedures

outlined in the bill to be used in determining compensation. The

administration would be pleased to work with the committee to revise these provisions so that the administration could support the

bill.

2

H.R. 880 seeks to accomplish the Federal Government’s long

awaited and much desired acquisition of the last major block of private lands within the Washington County Habitat Conservation

Plan area near St. George, Utah.

At issue is the area known as the Red Cliffs Desert Reserve

which provides critical habitat for the threatened desert tortoise.

H.R. 880 provides for the acquisition by the BLM of 1,516 acres

of private property within the Red Cliffs Desert Reserve, and 34

acres of private property adjacent to the reserve.

Since 1996, BLM has coordinated the acquisition of nearly 4,400

acres of desert tortoise habitat worth about $35 million within this

reserve. These Federal, State, and private acquisitions have included land exchanges, direct purchases at market value, and one

donation.

The administration has concerns regarding the language requiring the United States to take title 30 days after enactment. 30 days

is not adequate time to ensure clear title, release of potential liens,

and to satisfy property taxes that may be due on the property. We

suggest the legislation be amended to state that the United States

take title 60 days after the enactment.

In addition, the administration objects to those provisions of H.R.

880 that deviate from standard land acquisition practices that provide compensation beyond that received by other landowners in

previous acquisitions in this area.

The administration supports the goal of acquiring this property

for the Federal Government but not in the manner stated in the

bill.

The administration stands ready to work with the committee to

amend the bill to effect a legislative taking without these objectionable provisions.

In closing, Senator Thomas, the acquisition of these lands within

the reserve is a high priority for the BLM and the Fish & Wildlife

Service because there is no question this area is critical to the protection and recovery of the desert tortoise.

We thank Senator Bennett for his efforts to resolve this difficult

issue.

This concludes my statement, and I would be pleased to answer

questions that you may have.

[The prepared statement of Mr. Anderson follows:]

PREPARED STATEMENT OF ROBERT ANDERSON, DEPUTY ASSISTANT DIRECTOR,

BUREAU OF LAND MANAGEMENT

Mr. Chairman and members of the subcommittee, I appreciate the opportunity to

appear before you today to testify on H.R. 880, to provide for all right, title, and

interest in and to certain property in Washington County, Utah, to be vested in the

United States.

The Administration supports the land transfer as provided for in H.R. 880, but

cannot support some of the factors and procedures, outlined in the bill, to be used

in determining compensation. The Administration would be pleased to work with

the Committee to revise these provisions so that the Administration could support

H.R. 880.

H.R. 880 seeks to accomplish the Federal government’s long-awaited and muchdesired acquisition of the last major block of private lands within the Washington

County Habitat Conservation Plan (HCP) area near St. George, Utah. Specifically

at issue is the area known as the Red Cliffs Desert Reserve which provides critical

habitat for the threatened desert tortoise. The Bureau of Land Management (BLM)

3

supports the important goal and desire to consummate the final, critical acquisitions

in this unique and special place.

H.R. 880 provides for the acquisition by the BLM of all right, title and interest

to 1,516 acres of private property within the Red Cliffs Desert Reserve and 34 acres

of private property adjacent to the Reserve. The Red Cliffs Desert Reserve was established in 1996 as part of the Desert Tortoise Habitat Conservation Plan (HCP)

for Washington County, Utah. The County developed the HCP, with technical advice

from the Fish and Wildlife Service, in order to receive a permit to allow for the incidental take (acceptable level of loss) of desert tortoises on about 12,000 acres of privately-held desert tortoise habitat and to mitigate that take by developing the Reserve to ensure the protection and recovery of the threatened Desert Tortoise and

other listed species in the area. H.R. 880 provides compensation to the private landowner, Environmental Land Technology, Ltd. (ELT), as of the date of the approval

of the HCP, with an initial payment of $15 million and any remaining judgment

backed by the full faith and credit of the United States. Compensation by a judgment action would also include interest, reasonable costs, expenses of holding the

property and attorney fees from February 1990 to the date of final payment.

Since 1996, BLM has coordinated the acquisition of nearly 4,400 acres of Desert

Tortoise habitat, worth approximately $35 million, within the Red Cliffs Desert Reserve. These State and private acquisitions have included land exchanges, direct

purchases at fair market value and one donation. BLM has expended $10.5 million

in Land and Water Conservation Fund (LWCF) monies to date in completing land

purchases and has an additional $1.5 million available to purchase high value habitat. BLM has completed five separate transactions with ELT, for a total of approximately 383 acres, including both exchanges and LWCF purchases.

In addition, since 1997, the Fish and Wildlife Service has provided approximately

$4.7 million in grants to the State of Utah for land acquisitions associated with the

Washington County HCP; and the Service has obligated $6 million for the same purpose on FY 2001. These grants were provided through the Service’s HCP Land Acquisition Program under the Endangered Species Act Section 6 Cooperative Endangered Species Conservation Fund. These transactions demonstrate a long-term

record of successful accomplishments in meeting the goals and objectives of the HCP

despite widely varying expectations by many landowners.

The Administration has concerns regarding the language requiring the United

States to take title 30 days after enactment. Thirty days is not adequate time to

ensure clear title, release of potential liens, and to satisfy property taxes that may

be due on the property. We suggest that the legislation be amended to state that

the United States take title 60 days after enactment.

In addition, the Administration objects to those provisions of H.R. 880 that deviate from standard land acquisition practices and substitute procedures that provide

compensation beyond that received by other landowners in previous acquisitions in

this area. The Administration supports the goal of acquiring this property for the

federal government, but not in this manner. The Administration stands ready to

work with the Committee to amend the bill to effect a legislative taking without

these objectionable provisions.

In closing, Mr. Chairman, the acquisition of these lands within the Reserve is a

high priority for the BLM and the Fish and Wildlife Service because there is no

question this area is critical to the protection and recovery of the Desert Tortoise.

The HCP has provided a mechanism to protect listed species and allow for continued

economic opportunities in Washington County, Utah. Completion of the land acquisition goals within the Reserve is supported by State and local officials, the Utah

Congressional delegation and the Administration. We fully support the concept of

transferring title to the land inside the reserve to the BLM in a manner that compensates the landowner in accordance with existing Federal law. We thank Mr. Bennett for his efforts to resolve this difficult issue. This concludes my statement. I

would be pleased to answer any questions at this time.

Senator THOMAS. Thank you very much. Just as a question, this

is—where is this generally in Utah?

Mr. ANDERSON. This is southwestern Utah just outside of the

town of St. George.

Senator THOMAS. And this thing then finally what do you call it,

a reserve?

Mr. ANDERSON. Yes.

Senator THOMAS. Will be 12,000 acres?

4

Mr. ANDERSON. Well, actually, the whole reserve is about 61,000

acres, the total reserve.

Senator THOMAS. What kind of reserve?

Mr. ANDERSON. It’s a desert tortoise reserve, and the desert tortoise is an endangered species.

Senator THOMAS. There’s 16,000 acres for desert tortoises to frolic in?

Mr. ANDERSON. It’s a very important reserve because it’s one of

the most dense and healthiest areas in the whole world for the

desert tortoise. As you might know, this desert tortoise encumbers

Utah, Arizona, California, Nevada. So we have quite a habitat, but

this is one of the best.

Senator THOMAS. Is it endanger listed?

Mr. ANDERSON. Yes, it’s listed.

Senator THOMAS. Where else is there protection for it, do you

know?

Mr. ANDERSON. Well, in California, Arizona, and Nevada.

Senator THOMAS. And there’s spots there as well?

Mr. ANDERSON. Yes. In fact, much of the desert, the California

desert conservation area has desert tortoise.

Senator THOMAS. What, just generally, what other activities do

they allow on the 16,000 acres?

Mr. ANDERSON. Well, in the reserve they’re not going to allow

any development at all.

Senator THOMAS. Can you ride your horse out there?

Mr. ANDERSON. Yes, there will be recreation opportunities, and,

as I understand it, in this reserve they’ll be studying that. There

is a State park within the reserve too.

Senator THOMAS. I see. Do they hunt whatever there is to hunt

out there, or maybe there isn’t anything?

Mr. ANDERSON. Generally they can hunt in these areas. It’s

mostly BLM land, and we, of course, allow hunting on BLM land.

Senator THOMAS. Thank you, sir. I understand that I said 16. It’s

61,000, I’m sorry. I’m sure this will be discussed some before the

committee mark up next week, and we appreciate very much your

being here, sir. Mr. ANDERSON. You’re welcome. Thank you.

Senator THOMAS. There are, I think, 6 days for open record, if

someone wants to submit a statement for the record. We are adjourned.

[Whereupon, at 3:50 p.m., the hearing was adjourned.]

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APPENDIX

ADDITIONAL MATERIAL SUBMITTED FOR THE RECORD

WESTERN LAND EXCHANGE PROJECT,

Seattle, WA, May 8, 2001.

HONORABLE MEMBERS,

Senate Energy and Natural Resources Committee, Dirksen Senate Office Building,

Washington, DC.

Subject: Testimony in opposition to H.R. 880, federal buy-out of lands in Washington

County, Utah

DEAR COMMITTEE MEMBERS: I write as director of the Western Land Exchange

Project, a non-profit, public interest organization that monitors federal land exchanges and transactions. We strongly oppose H.R. 880, which would effect an inflated ‘‘down payment’’ on private lands within the desert tortoise reserve in Washington County, Utah. This bill is ultimately intended to hand over tens of millions

of dollars to James Doyle, a land speculator operating as Environmental Land Technologies who owns land within the reserve.

The bill was referred to your committee on March 14, 2001 after having passed

in the House. We opposed this bill last year (then H.R. 4721), and were grateful

that it did not move in the Senate. We hope that you will again refrain from advancing this proposal.

The Western Land Exchange Project is a non-profit organization that monitors

federal land exchanges and is working for long-term, substantive reform in the exchange process. We have had grave concern about land exchanges and other transactions within Washington County, Utah that appear to yield huge profits to private

landowners while costing the American public millions of dollars. H.R. 880 continues in that tradition.

In the early 1990s, after the desert tortoise had been declared a threatened species, planning began for the preservation of critical habitat in the Washington County Habitat Conservation Area (HCA), and the BLM began a series of land exchanges

to acquire private inholdings within the HCA. Private lands within the HCA were

valued under the established appraisal conventions long accepted as the standards

for these transactions.

However, some Washington County landowners were not satisfied with these

standards, because—as would occur with any type of zoning or constraint on development—limits on development within the HCA lowered the market value of their

lands. Utah Rep. Hansen accommodated this handful of citizens by placing a special

provision in the Omnibus Parks Bill of 1996 (P.L. 104-333) mandating that lands

within Washington County acquired through federal trade be appraised ‘‘without regard to the presence of a species listed as threatened or endangered.’’ This provision

has been applied to every land transaction in Washington County since passage of

the 1996 Omnibus Parks bill.

This is entirely counter to the established standards of land valuation, and is flagrantly unfair. As outlined in a series of news articles published in the Deseret News

last year, Washington County landowners have been handed a huge windfall, funded by the American taxpayer.

Jim Doyle, the beneficiary of H.R. 880, has already completed 5 land exchanges

in Washington County, trading to the government 383 acres valued at $5.6 million.

He now seeks as much as $50 million for his remaining 1,550 acres in the desert

tortoise preserve. Mr. Doyle claims to have been victimized by the federal government because the presence of the desert tortoise has reduced the development potential (and thus the value) of his land.

Mr. Doyle began leasing this land from the State of Utah in 1983 and bought it

from the State in 1990. Mr. Doyle was the beneficiary of a preferential sale by the

State of Utah that was later declared illegal.

6

The desert tortoise was first listed as a threatened species in 1980; it received

emergency endangered listing in August of 1989, and final listing as threatened in

April 1990.

Mr. Doyle did not make a down payment to the State on his land purchase until

June 1990, well after the tortoise was first listed. The listing of the Mojave population of the desert tortoise had been anticipated for years—it did not occur in a

vacuum or without ample warning. Mr. Doyle did not go blindfolded into this land

purchase, and for him to portray himself as an innocent victim of federal regulation

is grossly misleading.

It seems clear that by the time he made his first payment to the State, he had

long understood the potential impact the tortoise’s listing would have on that land. Mr. Doyle originally bought the property from the State for about $330 an acre. Because the original preferential sale was later declared illegal, he reached a settlement with the State requiring that he pay the State a percentage of his proceeds

from selling or exchanging the land. It was estimated that his final purchase price

would end up at about $6 million, or $2,500 per acre. H.R. 880 proposes to make an initial payment of $15 million to Doyle—about

$9,600 per acre, or nearly four times his purchase price. The ultimate payment to Mr. Doyle would consist of any balance beyond $15 million ‘‘owed’’ him based on the determination of the land value and costs. If Mr.

Doyle’s claims regarding the value of his land are upheld, he could eventually re- ceive a total of up to $50 million. Not only would he make a huge windfall profit

from the passage of H.R. 880, but the State of Utah also stands to benefit mightily

by the inflated federal purchase price—again, at huge cost to American taxpayers.

Because of his trouble with the State of Utah, Mr. Doyle was not even able to

present clear title to the land until 1997, so it was not until that year that the BLM

began negotiating with him over the land value. Since then, disagreement over the

value has delayed the purchase. Doyle claims the value should be based on the potential for maximum development and the presence of adequate infrastructure—neither of which exists. He has also threatened to sue Washington County for ‘‘inverse

takings.’’ Under H.R. 880, Mr. Doyle would be paid ‘‘just compensation’’ for the land based

on its value at the time it vests in the United States (upon the bill’s passage). He

would also receive compensation for the costs and expenses of having held the property since February 1996, plus other costs and attorney fees.

H.R. 880 is just the latest in a long series of dubious land deals and taxpayer ripoffs to have come out of St. George and Washington County, Utah. The Department

of Interior Inspector General has recently finished an investigation of land exchanges in Washington County, prompted by evidence that the appraisal process for

land trades in that area has been flagrantly manipulated by private landowners like

Mr. Doyle. The General Accounting Office, too, has targeted St. George as a problem

area in the Bureau of Land Management’s exchange program.

This bill amounts to a scandalous bilking of American taxpayers for the benefit

of one landowner and the State of Utah. Not only is the public being asked to pay

a hugely inflated price for Mr. Doyle’s land, but in doing so we would be rewarding

him for his sharp land deals, cynical manipulation of the system, and posturing over

‘‘inverse takings.’’

There are far better ways to spend taxpayers’ money than to subsidize and encourage land speculators like Mr. Doyle. We strongly urge the Committee to once

again reject this bill.

Thank you for your consideration.

JANINE BLAELOCH,

Director.

ENVIRONMENTAL POLICY PROJECT,

Washington, DC, May 15, 2001.

Hon. LARRY E. CRAIG,

Chairman, Subcommittee on Forests and Public Lands, Senate Energy and Natural

Resource Committee, Dirksen Building, U.S. Senate, Washington, DC.

Re: H.R. 880, An Act to Provide for the Acquisition of Property in Washington County, Utah

DEAR CHAIRMAN CRAIG: Please accept the following comments for inclusion in the

hearing record for the above-referenced bill. The Environmental Policy Project takes

no position either in support of or in opposition to this legislation. The following

comments are provided to assist the Subcommittee in assessing (1) whether and to

what extent the bill departs from the usual procedures and standards for acquisition

7

1The bill as passed by the House uses a 1990 date; the date should probably be 1996.

2 Apparently as a result of litigation between the company and the State of Utah, the company

would be required to share some portion of any eventual payment with the State. While not

reducing the burden on the federal taxpayer, this might reduce the size of the actual windfall

received by Environmental Land Technology, Inc.

of interests in land for conservation purposes, and (2) whether and to what extent

the amount to be paid by the public for the property may exceed fair market value

as conventionally understood.

I. The proposed legislation departs from the usual procedures and standards for

acquisition of land for conservation purposes in a number of respects.

First, a legislative taking for land conservation purposes is itself quite unusual.

Congress has pursued this approach to the acquisition of conservation lands in

fewer than half a dozen cases over the last several decades. The effect of this approach is to remove a particular acquisition from the agency priority-setting process

and the congressional appropriations process, making it more difficult to ensure that

limited financial resources are dedicated to the highest priority projects.

Second, the proposed legislative taking would require the public to pay for the

property without regard to the effect on the property’s value of restrictions on the

use of the property imposed by the Endangered Species Act. See bill section 1(b),

referencing section 309(f) of the Omnibus Parks and Public Lands Management Act

of 1996. So far as we are aware, this valuation approach has not been adopted in

any other legislative taking bill. This valuation approach also departs from the

usual standards of the appraisal profession, which require an appraiser to consider

existing legal constraints on the permitted use of the property in estimating fair

market value. See Appraisal Standards Board, Uniform Standards of Professional

Appraisal Practice, Standard Rule 1.3(b) (2000 Edition).

Third, the proposed legislation provides for payment of several items not ordinarily including in legislation authorizing a legislative taking. Section 1(b)(2) of the

bill provides that the public, in addition to paying ‘‘just compensation’’ for the actual

taking, would pay the owner’s ‘‘reasonable costs and expenses of holding . . . [the]

property from [the date of creation of the Red Cliffs Desert Reserve] 1 to the date

of final payment, including damages, if any, and reasonable costs and attorneys

fees.’’ Compare P.L. 104-333, section 817 (mandating a legislative taking, but without requiring payment of these items). Payment of these additional items, the cost

of which could potentially run into many millions of dollars, is ostensibly justified

by the long delay in government acquisition of the property. However, according to

testimony on the bill, questions concerning Environmental Land Technology, Inc.’s title to the property precluded acquisition of the property for a number of years. In

any event, if the ‘‘fair market value’’ of the property has increased over the last several years, as seems probable (see below), appreciation in the property’s value may

already have compensated the owner for its ‘‘holding costs.’’

Fourth, testimony on the proposed legislation suggests there may be some outstanding questions about the scope of the property interests held by Environmental

Land Technology, Inc. and about whether the State of Utah or other third parties

may hold separate interests in the property which could potentially conflict with the

management of the property for species conservation purposes. A legislative taking

of the interests of one owner will obviously fail in its intended conservation purpose

if other owners continue to hold interests that are inconsistent with conservation

objectives.

II. The proposed legislation would require taxpayers to confer a large windfall on

Environmental Land Technology, Inc., perhaps 50-plus times what the company

originally paid for the property. According to testimony on the bill and newspaper

accounts, the company paid approximately $1 million for the property, apparently

with full knowledge that the presence of the desert tortoise imposed constraints on

the development of the property. The BLM has reportedly made an offer of $28 million for the property, which the owner has rejected. The proposed legislation provides for the immediate payment of $15 million to Environmental Land Technology,

Inc, which the bill characterizes as an ‘‘initial payment’’ for the property. The bill

envisions that the balance of the acquisition price would be determined through negotiation or in judicial proceedings.2

There are several factors contributing to this potential windfall at taxpayer expense. First, the provision in the legislation requiring that the effect of the ESA on

land value be disregarded would require the public to pay in excess of fair market

value as that term is normally defined. It is well recognized that legal constraints

on the permissible uses of property are a major consideration influencing the valuation of property in the marketplace. In this instance, the company, apparently

knowing of the constraints the ESA placed on development opportunities, purchased

8

3The study has been retained in subcommittee files.

the property at a price that reflected the ESA constraints. Under the proposed legislation, however, the government would be required to disregard the effects of the

ESA on value in purchasing the property. Successful investment proceeds according

to the familiar maxim: buy low; sell high. The twist in this case is that the swing

in price has been brought about largely if not entirely by a change in government

policies applicable to the property.

Second, basic economic reasoning indicates that the owner is likely to reap a financial reward from the already large federal investments in land conservation in

the St. George area. The St. George area is subject to heavy development pressures,

which explains why ESA conflicts and the need for conservation action arose in the

first place. The BLM has already acquired thousands of acres in the St. George area

for conservation purposes. The effect of these acquisitions has been to limit the supply of developable land in the area and, in turn, to increase the market value of

land in the St. George area that remains available for development. (See the attached EPP study, explaining how government policies creating a scarcity of development opportunities increase the value of development opportunities which remain.) 3 In this case, the federal acquisition of thousands of acres of conservation

lands, together with a congressional mandate to value the property as if there were

no ESA constraints, apparently have combined to create a severely inflated ‘‘fair

market value’’ for the property.

Third, newspaper accounts of this proposed transaction (and other land purchases

and exchanges in the St. George area) suggest that BLM appraisers, in addition to

disregarding the effects of ESA constraints on land value (in accord with the 1996

parks bill), may have produced inflated appraisals of property values in order to expedite the completion of the Red Cliffs Desert Reserve. A former BLM appraiser

with responsibility for the St. George area has charged that his superiors at the

agency overrode his appraisals and disregarded established appraisal methods.

These charges have in turn prompted ongoing investigations of land acquisitions in

the St. George area by the Department of the Interior Inspector General. A draft

of the IG’s report in public circulation appears to reveal systematic violations of appraisal standards in the St. George area.

Thank you for the opportunity to submit these comments.

Sincerely,

JOHN D. ECHEVERRIA,

Director.

Æ