The Bureau of Land Management (BLM), in the Department of the Interior (DOI), is authorized to exchange land or interests in land under the Federal Land Policy and Management Act of 1976 (FLPMA), as amended by the Federal Land Exchange Facilitation Act of 1988 (FLEFA), as well as under other authorities. Additional information is contained in BLM's Land Exchange Handbook and various agency instruction memoranda. Additionally, Congress sometimes enacts legislation authorizing and governing specific land exchanges. Legislated land exchanges generally follow the process and procedures outlined in this report, unless the statute provides otherwise. Pros and Cons of Land Exchanges

Exchanges can be used to change the "checkerboard" pattern of federal, state, and privately owned lands in the West that resulted from early land grants. Land consolidation can increase the efficiency of land management and decrease management costs. Audits were performed by GAO, the DOI Office of Inspector General (OIG), and the Appraisal Foundation (TAF). Public Interest

Land exchanges must be in the public interest. Equal Value

Under FLPMA, the values of the lands exchanged are to be equal or, if they are not equal, they are to be equalized by the payment of money up to 25% of the value of the federal lands conveyed in the exchange. Costs

Typically, BLM and other parties share equally in the administrative costs of an exchange, for instance, by sharing the cost of land appraisal, mineral examinations, and cultural resource surveys and by addressing deficiencies preventing highest and best use of the land. Assembled Land Exchanges

BLM regulations define an assembled land exchange as consolidation of multiple parcels of federal or nonfederal land for the purpose of one or more exchange transactions over a period of time. Management of Exchanged Lands

Lands acquired by BLM by exchange become public lands and are to be managed under existing law, regulations, and land-use plans. The exchange process typically occurs in five phases: (1) development of a land exchange proposal, (2) feasibility evaluation, (3) processing and documentation, (4) decision analysis and approval, and (5) title transfer. This phase includes title review; public notice and comment; identification and resolution of environmental issues under the National Environmental Policy Act of 1969 (NEPA); assessments of mineral, cultural, and other resources; Native American consultations; threatened and endangered species consultations; and preparation and review of appraisals. The environmental analysis under NEPA and the appraisal often are the most challenging and time-consuming activities. Prior to 2009, concerns centered on the benefits to the public, determinations of market value, and contradictions in policies and procedures. For instance, with regard to appraisals, a Secretarial Order signed on May 21, 2010, made changes in the organization and operation of the appraisal services function. Issues for Congress

A key issue for Congress is the extent to which the reorganization of the appraisal function and the implementation of other appraisal and exchange reforms addressed perceived problems and improved land transactions. Despite the reforms implemented by BLM and DOI, continuing questions include whether to amend the FLPMA exchange authority or to discontinue exchanges.
The Bureau of Land Management (BLM) conducts land exchanges with other land owners to acquire and dispose of land. The agency is authorized to conduct land exchanges under the Federal Land Policy and Management Act (FLPMA) of 1976. Additionally, Congress sometimes enacts legislation authorizing and governing specific land exchanges.
FLPMA governs how administrative exchanges are to occur. For instance, land exchanges must be in the public interest, and the federal and nonfederal lands in the exchange are to be in the same state. Further, the values of the lands exchanged are to be equal, although payments to equalize value may be made under specified terms. Typically, BLM and the other parties share equally in the administrative costs. While some exchanges involve single parcels, assembled land exchanges consist of a consolidation of multiple parcels for one or more exchanges over time. Lands acquired by BLM by exchange become public lands managed under existing authorities.
The land exchange process generally has five phases: development of an exchange proposal, feasibility evaluation, processing and documentation, decision analysis and approval, and title transfer. Each phase typically involves multiple actions. For example, processing and documentation includes title review; public notice and comment; identification and resolution of environmental issues; assessments of mineral, cultural, and other resources; Native American consultations; threatened and endangered species consultations; and preparation of land appraisals. The appraisal and environmental analysis often are the most challenging and time-consuming parts of the process. Legislated exchanges generally follow this process as well, unless otherwise directed by Congress.
In the past, some BLM land exchanges were controversial. Concerns during the 2000-2009 decade centered on benefits to the public, determinations of market value, contradictions in policies and procedures, delays in appraisals, and various aspects of the exchange process. These topics were the subject of various governmental and nongovernmental reports, for instance by the Government Accountability Office (2000, 2006, and 2009), the Appraisal Foundation (2002), Interior appropriators (2009), and the Office of Inspector General of the Department of the Interior (DOI, 2009). In response, BLM and DOI implemented changes to the appraisal and exchange processes. For instance, BLM formed and adopted the recommendations of the Appraisal and Exchange Workgroup. Later, BLM also issued instruction memoranda on land exchanges containing additional policies and guidance. As another example, the Secretary of the Interior changed the organization and operation of the appraisal services function.
A key issue for Congress is the extent to which the reforms to the exchange process and appraisal function addressed perceived problems and improved land transactions. Other issues for Congress are whether to amend BLM's exchange authority or to discontinue BLM's administrative exchanges. Opponents of exchanges view them as inherently difficult and thus favor other authorities to sell or exchange land. Supporters continue to view administrative exchanges as useful to change the "checkerboard" pattern of land ownership in the West and to increase the efficiency of land management while decreasing management costs.