BLM Transferred 79,000 Acres Under Four Key Statutes

Four key statutes authorize BLM to transfer land. For example:   BLM field office staff inspected a 160-acre parcel in Idaho that had been transferred to a nonprofit group to develop and use as a trap-shooting and rifle range. Under R&PPA, BLM transferred about 42,000 acres during fiscal years 1991 through 2000 and received a total of about $2.6 million: about 22,000 acres were transferred to state or local governments for historic monument or recreation purposes (at no cost); about 17,000 acres to state or local governments for other government-controlled purposes that serve the general public (for the greater of $10 per acre or $50 total); and the remaining approximate 3,000 acres to state or local governments or nonprofit organizations for other public purposes (for a percentage of the appraised value). The Forest Service, in contrast, sold about 2,000 acres during this same 10-year period, and received about $5 million, under two key statutes: about 800 acres under the Townsite Act and about 1,200 acres under the Small Tracts Act. When BLM and the Forest Service sold land noncompetitively, the agencies generally used appraised values as sale prices; however, the appraisals sometimes underestimated the parcel’s fair market value because they did not reflect the buyer’s current or planned use of the land. BLM Usually Received Prices Higher Than Appraised Values in Competitive Sales

BLM offered land for sale competitively—either through public auctions or modified competitive sales—when agency personnel believed that there might be more than one potential buyer. At a minimum, these frontage acres might have been more appropriately offered for competitive sale. BLM and Forest Service Usually Received Prices Equal to Appraised Values in Direct Sales

When BLM and the Forest Service sold land directly (noncompetitively) to applicants—usually the current user of the land or the adjacent landowner who planned to use it for a specific purpose—the agencies generally used the appraised value as the sale price. Both BLM and the Forest Service sold several parcels directly to adjacent homeowners who had mistakenly built part of their residences on federal land. FLPMA requires that BLM receive at least fair market value when it sells land, but the agency has sold land for less than its appraised value—which estimates fair market value—in response to specific circumstances despite having no authority to do so.
What GAO Found

Since 1781, the federal government has transferred or sold about 1.1 billion acres to nonfederal entities--such as state and local governments, businesses, nonprofit groups, and individual citizens--under various initiatives that promoted general economic development, developed transportation systems, supported public schools, and encouraged settlement of the western frontier. Today, the Bureau of Land Management (BLM) and the Forest Service administer about seventy percent of the 657 million acres that remain in federal ownership. These agencies continue to transfer and sell federal land, but under more limited circumstances. For example, a community might want to develop a public park, a nonprofit group might want land for a shooting range, or a homeowner might want to obtain clear property title after mistakenly building part of his house on federal land. During fiscal years 1991 through 2000, BLM alone was authorized by law to transfer land. BLM transferred about 79,000 acres during this period under four key statutes and received about $3 million. BLM and the Forest Service are both authorized by law to sell land and are directed by law to receive at least fair market value when they do so; BLM has broader authority and has sold much more land, about 56, 000 acres, and received about $74 million. In contrast, the Forest Service sold only about 2,000 acres, all noncompetitively, and received about $5 million. When BLM and Forest Service sold land, they both generally received at least the appraised value. BLM generally offered land for competitive sale when agency personnel believed there was more than one potential buyer for the parcel; in these sales, the agency used appraised values as starting bids--that is, as minimum sale prices--and received prices that were, on average, about eighteen percent higher than appraised values. When BLM or the Forest Service sold land noncompetitively, they generally set the sale price at the appraised value. Some of the parcels the agencies sold noncompetitively might have been more appropriately offered for competitive sale, and in some of the noncompetitive sales, the appraised value underestimated the fair market value because it was not based on the land's current or planned use.