As mentioned in the above description of HB 177A, considerable controversy has arisen in recent years over management of state trust lands. One issue is whether the state is obtaining fair market value for grazing leases.

SF 47 was an attempt to set a statutory formula for determining grazing fees on state lands, which have remained steady at $3.50/AUM (animal unit month) since 1995.

SF 47's original formula was modeled after one used in Colorado, based on 40% of the ten-year average AUM lease rate for private non-irrigated land in the same county. The bill also capped the grazing fee at the maximum AUM lease rate for the previous 10 years for private non-irrigated land in the same county.

Proponents of SF 47 argued that the formula was arrived at after lengthy interim committee work and should be adopted to see how it works. Furthermore, by setting a fee in statute, ranchers would know approximately what the fee would be every year, avoiding ups and downs.

Those opposing the formula argued that the proposed formula did not meet the statutory requirement for fair market value. Opponents also maintained that the cap on lease rates conflicted with trust principles and only served to keep the grazing fee at an artificially low rate.

After passing the Senate, 20-5 (5 conflicts), SF 47 was referred to the House Agriculture, Public Lands & Water Resources Committee, which rewrote the bill into SF 47A, with a completely new grazing fee formula.

The new formula (with the addition of a floor fee of $3.50/AUM) had previously appeared in HB 141 (State lands - grazing fees - 4), sponsored by Rep. Frank Philp (R-H34, Shoshoni) and co-sponsored by Rep. Roger Huckfeldt (R-H4, Torrington), Rep. Carolyn Paseneaux (R-H38, Casper), Sen. Curt Meier (R-S3, LaGrange), and Sen. Vince Picard (R-S9, Laramie). HB 141 was never offered for introduction, probably because of its fiscal note indicating substantial revenue losses.

The Senate’s notion of fair market value was based on the 10-year average AUM lease rate for private, non-irrigated land. The House version was tied to the price of beef (value of production) over a three-year period; this three-year average was then multiplied by 1/6 of the value of production, because mineral lessees pay a 1/6 royalty to the state.

Proponents of the House formula argued that state grazing fees should be contingent on the lessee’s ability to pay, as determined by the price of beef.

Opponents of the House formula argued that it was not based on private land lease rates and therefore failed to reflect fair market value. Opponents also pointed out that comparing mineral and grazing lessees was pointless, because grass is renewable and minerals are not.

An amendment to delete the new formula and return SF 47A to its introduced

version was defeated, 21-37 (2 conflicts), as shown below.

SF 47A failed on third reading in the House, 28-27 (3 excused, 2 conflicts). The vote was immediately reconsidered, and then SF 47A passed, 32-25 (1 excused, 2 conflicts). Representatives changing their votes were: Rick Badgett (R-H29, Sheridan) and Jack Steinbrech (R-H48, Rock Springs), no to yes. Two representatives who were excused during the first vote, Eli Bebout (R-H55, Riverton) and Peg Shreve (R-H24, Cody), voted yes the second time. Rep. Pat Nagel (R-H56, Casper) was excused from both votes and Reps. Bruce Burns (R-H51, Sheridan) and Marlene Simons (R-H1, Beulah) declared conflicts on both votes.

The Senate refused to concur with the House amendments and a joint conference committee (JCC) was appointed. JCC #1 deleted the House amendments, returning SF 47A to its original form. The House turned down the JCC #1 report, so a second JCC was appointed. It ran out of time, so SF 47A died.