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Land board increases grazing fees for state leases

HELENA, Mont. (AP)--The Montana Land Board agreed Nov. 21 to increase the amount it charges ranchers for grazing on state land, but only after it reduced the proposed increase amid criticism from ranchers.

Ranchers argued the increase of more than 50 percent, which will be phased in over five years, is still too high.

The land board, made up of five statewide elected officials from the governor on down, voted Nov. 21. It made several changes to the proposed increase that came as a result of a study commissioned by the board that found the state was charging far less than market value. The board argued that the sizable increase was needed because the amount had not been adjusted for inflation in years.

The rates would affect about 4 million acres of state land--and nearly 5,000 ranchers who lease the land from the state. Agency Director Mary Sexton said that every $1 increase in the average $6.50 price per animal unit currently charged would raise an extra $1 million a year for state coffers.

The land board agreed to increase that amount to $10.19 over five years, which will raise roughly an additional $3 million when fully implemented.

Sexton said that the amount charged ranchers was set to increase anyway next year to $7.30, based upon a factor tied to beef prices. After the vote, ranchers will be charged about $7.90 for state leases when bills are sent out in spring of 2012.

Gov. Brian Schweitzer said the state is under pressure from school advocates who argue the state needs to charge more for the resources it is constitutionally required to manage for maximum return to the school trust. The ranchers will still be paying far less than what the private market charges for similar leases, he said.

Schweitzer said he leases some land for cattle grazing and recently ran an advertisement and found people were very willing to pay $20 per animal for conditions very similar to state land.

"If the private is worth 20 bucks, and I don't think anyone would disagree with that, then where do we go with the state land?" Schweitzer asked a room full of ranchers who complained before the meeting about the proposed hike.

Ranchers argued that the leases on state land are not as valuable as leases on private land for a variety of reasons.

Glasgow rancher Steven Page said the state parcels are landlocked inside of his own holdings, and those state parcels are only made valuable by the water and infrastructure made available by his adjoining private land. He argued the land board was relying on incorrect information and urged it to postpone the decision.

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