After an investment of $700,000 and months of waiting, Utah lawmakers thought they’d finally nailed down the number they’d long needed to solidify their case that the federal government is dramatically shortchanging the state.
The figure was $534 million, the amount they believe the Interior Department should be paying Utah each year for the value of its federally-controlled public lands. Armed with this sum — churned out by pricey property appraisal software — state officials reasoned that they could confront the nation’s leaders and demand the money they believe they’re owed.
Now, though, some state lawmakers are worried the much-anticipated number might do more harm than good.
On Tuesday, a panel of legislators even voiced support for stripping the figure out of a resolution that calls on Congress and the president to boost the PILT, or payment in lieu of taxes, that flows annually into county coffers. Rep. Casey Snider, who led the charge to delete the number, worried that the state’s new public lands valuation might have the unintended consequence of driving up taxes for farmers and ranchers.
“I’m not necessarily believing that it’s good policy to pit our industries and our communities and our economies against each other,” the Paradise Republican said said.
Meanwhile, other lawmakers wondered why they spent six-figures on land appraisal software if they’re not going to use the estimates it generates.
“We spent four years trying to come up with a valuation of these properties so that we could do exactly what we’re doing today. How do you negotiate on a piece of property if you don’t have a value in there?” said Rep. Carl Albrecht, R-Richfield. “I think if we strip the numbers out, it guts the resolution.”
The resolution sponsored by Rep. Keven Stratton notes that the federal government last year provided $41 million to Utah’s counties to compensate them for the untaxable public lands within their jurisdictions. That’s less than 8% the $534 million that Utah leaders say they could reap in property taxes if that land was privately held.
Rural counties, which rely heavily on property taxes to cover education and basic services, often complain that the federal government’s annual payments don’t make up for the loss in potential revenue from property taxes, and state officials have been engaged in a years-long campaign to increase the PILT.
Last year, the Legislature’s Federalism Commission commissioned a Lehi software firm, Geomancer, to build an appraisal tool that could calculate the market value of the state’s public lands. The commission has paid $600,000 for the software and agreed to give the company another $100,000 over the next five years for training and upkeep.
Geomancer, which has been absorbed into a company called Aeon AI, delivered the software to state leaders earlier this year along with the estimate that the federal government was shortchanging Utah by some $500 million a year.
Stratton’s position statement, HCR601, would be the next step in the struggle for more PILT funding.
But Snider pointed out that the software tool doesn’t take into account the “greenbelt” tax breaks available to farms and ranches to encourage them to remain in agricultural use. Much of the Bureau of Land Management acreage in the state is used for grazing, potentially making it eligible for the relief even if it were privatized.
Snider contends that overlooking the “greenbelt” benefit in the resolution could influence the way county assessors view their local agricultural lands. Already, assessors in his county are pushing to take land out of this “greenbelt” category so their local governments can capture more tax revenue, he said, and the resolution could give them even more reason to demand changes to the state’s farmland assessment law.
And farmers and ranchers can’t afford a bump in their property taxes, he said.
“My fear is we’re putting a great deal of pressure on our counties and our budgets and maybe even a bit of incentive on our assessors to increase the charges and fees,” Snider said. “We have people who will frankly go out of business if we start talking the kind of numbers that we’re demanding of the federal government.”
Rep. Joel Ferry, R-Brigham City, raised a related but different concern — saying that if the Aeon AI model took “greenbelt” credits into account, it might actually yield a lower annual PILT recommendation than his county is currently receiving.
Following the discussion, the Natural Resources, Agriculture, and Environment Interim Committee voted to support Stratton’s resolution, so long as lawmakers amend it during this week’s special session to remove the $534 million figure.
Stratton’s resolution also urges the state’s congressional delegation to press for greater local control over 217,000 acres of federal land that fall within municipal limits, “a small fraction of the 33 million acres of nontaxable federally managed lands within the state of Utah.”
During a recent presentation to state officials, Geomancer representative Ken Ivory, a former state lawmaker, suggested targeting federal property inside city boundaries for privatization. He pointed to a law pushed through Congress by Nevada representatives more than two decades ago, enabling public land sales near Las Vegas.
The program authorized by this law allowed for the auctioning of public land within a specific boundary around the metropolis, with the proceeds used to fund public schools, parks, trails and conservation projects. Ivory encouraged state lawmakers to follow Nevada’s example, arguing that the federal lands in and around Utah’s cities are an untapped resource that could accelerate a recovery from the COVID-19 pandemic.
The software company that created Utah’s appraisal program has been marketing its services to other Western states, and Utah leaders have suggested sharing the tool and Utah’s findings with other state policymakers through the National Conference of State Legislatures, Council of State Governments West and American Legislative Exchange Council.
Stratton wants his resolution sent to the nation’s leaders and to state and county officials of every state with more than 20% federally controlled land.