New Legislators Change the Tempo of Normally Routine Rule-Making Process

The House Resources and Conservation Committee continued with the process of rule making last week, with several agencies presenting edits to existing rules having spent the summer collaborating on the shape of those possible changes.

The Idaho Department of Lands presented several rule changes, which were approved:

- Changes to the Idaho Forest Practices Act were precipitated by the Department's response to the Idaho Department of Environmental Quality following regular water quality assessments. The rule language was changed to provide flexibility for private landowners for timber sales after a wildfire or infestation, and revised the definition of "clearcut" to align with the scientifically accepted term.

- Grazing, Farming, Conservation, Noncommercial Recreation and Communication Leases - Proposed changes stipulated leasees must submit a grazing management plan, and clarified language for farming and grazing. The Department collaborated on these changes with members of a task force that included representatives from Simplot, Idaho Farm Bureau and Western Watersheds.

- The Issuance of Geothermal Resource Leases - These regarded leases for all state lands and focused on issues regarding shutdowns in the case of public safety, environmental concerns or fire; sampling by a leasee, use of byproducts by a third party, and a modification to the lease assignment section. Ben Otto with the Idaho Conservation League spoke in favor of the rule modifications.

Jake Howard of Idaho Outfitters and Guides presented a rule change regarding wolf trapping which sets guidelines on what outfitters and guides can and cannot do trapping for wolves. The rule has no impact on what the public can do without a guide, and was approved by the committee.

On Monday, the committee will meet for a joint senate/house presentation from the American Lands Council.

The House Environment, Energy & Technology Committee met on Wednesday afternoon to review a rule on public drinking water and three rules on control of air pollution.  Seven of the 17 committee members are newly elected legislators.  The questions were many and the discussion was lively.  The drinking water rule included a section on incorporation by reference adopting changes in federal regulations so that Idaho’s rule is consistent with the federal rule.  While this is usually a pretty standard procedure, some committee members asked why the section of the federal rule wasn’t included with the material they received so they could see exactly what they were being asked to approve.  A motion to adopt the rule failed by one vote. The chairman asked the DEQ staff to come back next week with copies of the federal changes that are to be incorporated so the committee has a complete picture.

Then came the three air pollution rules.  The first rulemaking was to make various “housekeeping” revisions such as updates for consistency with federal regulations, clarification, and typographical corrections to certain air quality permitting rule sections, related definitions, and the toxic air pollutant sections.  Again there were a lot of questions and discussion.  The rule was rejected.

The second rule included some changes to the auto emissions inspection rule – which resulted from the passage of a law in 2008 requiring emissions testing in both Ada and Canyon counties.  In discussion on this particular rule, some members asked if they could reject just the proposed changes or would they have to reject the entire rule—even those parts already in effect that were not changed.  More lively discussion ensued before the committee approved the proposed rule changes.

The final rule was to incorporate by reference so Idaho’s regulations would be consistent with the federal rule for regulation of green house gases.  It was approved by the committee.

Agriculture, grazing bills, take circuitous routes through legislature

Some bills start the legislative session as a concept that is discussed and revised in the first weeks until the draft is introduced.  Success for these early concepts is not always guaranteed.

H606, the Agriculture Value Added Income Tax Credit, was such a bill.

H606 was introduced on February 29.  The bill will act as incentive for farmers and ranchers to invest in additional facilities which would add value to agriculture in Idaho through additional processing.  For example: encouraging a dairyman to process his milk into cheese that can be sold, rather than send the milk out of state for processing.  This is a means of increasing jobs in rural areas as well as the amount of Idaho commodities being processed.  The bill provides a tax credit of up to 30% of the investment to build a plant or value added process, capping the amount of the credit at $500,000.  This credit may be utilized annually until the cap is reached or for 14 years.  The legislation has a sunset of 2017.

The concept was revised several times before its introduction.  It was introduced in the House and sent the Revenue & Taxation Committee which sent it to General Orders on the floor for amendment.  On March 30, it was passed as amended by a vote of 62-6-2.

It was sent to the Senate and assigned to the Local Government Committee on March 22.  It has not yet been scheduled for a hearing.

Other bills are printed earlier in the session but do not get heard in committee until later in the session, such as S1271, which deals with management plans for grazing leases.  The bill adds a new section to Idaho Code that requires applicants for grazing leases to submit a grazing management proposal as part of the application.  This lets the Department of Lands evaluate whether the proposal is consistent with the Department’s resource objectives and management expectations for those lands.  If the lease is granted, the proposal becomes the management plan for that lease.

S1271 was introduced on January 30^th and sent to the Senate Resources and Environment Committee.  It was not until March 6^th that committee sent it to the Senate floor where it was passed on a vote of 31-0-4.  The next day it was sent to the House and assigned to the Resources and Conservation Committee.  It was sent to the House floor with a do-pass recommendation.  On March 21^st, almost two months later, it passed and is on its way to the Governor.

Policy Makers Consider Sage Grouse

On Monday, a joint meeting of the Senate Resources & Environment Committee and the House Resources & Conservation Committee held a State and Federal Sage Grouse Oversight Hearing.

Virgil Moore, Director of Idaho Department of Fish & Game led off the hearing pointing out that  Idaho is trying to forge a state direction for recovery of sage grouse.

Sage grouse has a biology that is different than that of other ground birds.  They have a low reproductive rate.   They live a long time which presents a different management issue.  Their winter survival rate is very high for land birds and they are very migratory.  Sage grouse home range can often be over 200,000 acres which complicates management.  Total habitat is 15 million acres, of which 10 million is a priority.

Because hens and chicks are so well camouflaged, the males who are much more visible are counted and an estimated number is derived.  There has been downward trend of males returning to the communal breeding grounds known as leks.  Males have a high fidelity to strutting areas.

Currently, hunting for sage grouse is highly restrictive and limited hunting is allowed if an area’s population is sustainable.

Bill Meyers, an attorney with Holland and Hart discussed the litigation history of sage grouse.  In 2005, U.S. Fish & Wildlife Service (USFWS) determined that sage grouse did not warrant protection.  That decision was challenged in court by Western Watersheds.  A review led to a decision by the agency that sage grouse listing as endangered was “warranted but precluded” because of the number of species seeking listing and the danger of extinction was moderate.

Another lawsuit was settled giving the agency until 2015 to make a decision.  There are nine ESA cases pending that have been filed by Western Watersheds.

There are 11 states with sage grouse habitat.  The USFWS plus BLM and the Forest Service are putting pressure on the states to move forward on recovery efforts.  Sage grouse habitat recovery will impact all the other multiple uses on BLM land.  All other activities are second priority behind sage grouse.

Nate Fisher, Administrator of the Idaho Office on Species Conservation talked from the biological, legal and policy perspective and what the path forward might be.  This is not an issue just in Idaho but in 10 other Western states.  Idaho was one of the first states to organize local working groups—12 of them.  Congress did provide some funding for the groups but the work has all been voluntary.  USFWS feels there are inadequate regulatory mechanisms that could lead to recovery with Idaho’s efforts. 

Sage grouse could be the spotted owl of the sagebrush steppe.  There is now a sage grouse planning initiative which will cover 11 states.  BLM might move forward with greater restrictions on the entire area –not just the areas where there are birds.

Wyoming has put together a strategy that USFWS says may meet the regulatory requirements.

A continuing issue is how to reconcile a hunting season with the listing.  The question is who decides when there are sufficient numbers of sage grouse across the range of habitat.  Idaho has a huge amount of the best habitat.  The Governor is very interested in working with Wyoming.

Conservation Fund Raises Ire of Lawmakers

El Paso Western Pipeline Group president Jim Cleary presented to a joint session of the Senate Resources and Environment and House Resources and Conservation committees this week on a multi-million dollar conservation fund established to mitigate environmental impacts from the Ruby Pipeline. The project is a $3.5 billion, 680-mile buried pipeline that will conduct natural gas through Wyoming, Utah, Nevada and Oregon, serving roughly 4 million homes.

The Sagebrush Habitat Conservation Fund was established to address concerns of environmental groups that sued the company over anticipated impacts to the sage-steppe habitat through which it would be constructed. The fund’s board includes representation from Ruby Pipeline, the Western Watersheds Project – a party in one of the lawsuits against the project – and one independent member.

The fund will support conservation projects in the pipeline’s area of impact (which includes southern Idaho counties). It will also fund the purchase and retirement of grazing permits from willing sellers – a point which has caused a significant amount of anxiety among land users and policy makers throughout the western states impacted by the fund.

Lawmakers were quick to question assertions of the fund’s independence from the conservation groups who were a party to the settlement. The fund’s current president and executive director, Debra Ellers, negotiated the terms of the settlement of behalf of the environmental groups suing over the pipeline project and represents the Western Watershed Project’s interests.

There was also considerable consternation over what could be seen as a precedent for paying what lawmakers called “blood money” to appease environmental groups.

“You have set a template for a group that has as its mission to remove livestock from public lands,” said Senator Siddoway, a sheep rancher from eastern Idaho. “How is removing livestock going to alleviate the scars from construction on this project?”

“Traditionally, multiple land users stick together,” added Representative Bedke, “now we’re left with one of those multiple users setting the terms for the rest of us.”
Cleary disagreed that a precedent had been set.

“Typically such settlements involve writing a check to the organization bringing the suit,” he said. “We set up a fund with conservation at its center, but that funds projects aimed at conservation. Our mission is very different from that of Western Watersheds.” He gave lawmakers his word that no one would be coerced into selling grazing permits.

Department of Lands proposes new rules

In June, 2007, the State Land Board directed the Department of Lands (IDL) to study problems with current lease rules and involve the stakeholders in the process of negotiated rulemaking. The Land Board wanted to avoid continued lawsuits and reduce costs to IDL.

On Wednesday, IDL representatives presented rules on new procedures to award leases on state endowment lands and to govern conflict auctions. About 45 people attended the joint presentation to the Senate Resources & Environment Committee and the House Resources and Conservation Committee in the spacious Senate auditorium.

IDL’s proposed changes include:
- Expanding the scope of the rules to include grazing, farming, conservation, communications and non-commercial recreation
- Requiring applicants in conflict auctions to agree to lease provisions, including management plans for the land. If agreement on provisions cannot be reached, the application will be denied.
- Allocating credit for improvements to the land based on the value of the improvements, including appreciation- over the length of the lease.

IDL representatives fielded a number of questions from the joint committee:

If a lease was put up for bid because of delinquent payments, would a person who was behind on something like child care payments, and owed the state, be ineligible to bid on a lease? Current processes wouldn’t pick up on this delinquency, but only on delinquencies on money due to the Department of Lands.

How do you monitor such disparate entities who could have leases under this expanded scope? Changes in the rule would require a meeting with the department to discuss proposed uses of the lands. Financial considerations to the proposed use and monitoring would be taken into account as well as potential conflicts between multiple leases.

How often would you monitor how agreed upon criteria is being met? The department manages 2.5 million acres of endowment lands, they would weigh, on a case by case basis, whether and how they would monitor this based upon the use and the subsequent costs to monitor. In some cases, they would require self monitoring and reporting back to the department.

Some of these leases have multiple purposes, some have timber and also grazing. How do you determine that one use is not in conflict with the other? What’s the criteria you’re going to use to evaluate that? IDL would determine what resource values or revenues would be at risk when reviewing the application. Area staff, based upon its knowledge of those lands, would perform this risk assessment based upon site specific conditions. For example, a lease would have to mitigate for fire prevention, if necessary, in the area.

If that’s the case, are you prepared to manage to that level? Are you going to go back every year, or once every 10 years? Depending upon the type of mitigation, it would be necessary to provide more oversight and cost recovery for additional inspections or administrative costs incurred by certain uses.

What is meant by the “valuation of improvements” and how is that different from current language? The term replaces the definition of “appraisal” clarifying that the department in conducting reviews is not serving as qualified appraisers. Regarding “permanent improvements” and how they’re handled in the lease contract itself, the language is not specifically related to the valuation process but the disposition of improvements if the lease is terminated.

Is this a change from the way it was handled before in considering whether to approve or disapprove the lease? Improvement credit is allowed in certain cases either through land sale or through conflict auction. The value of such improvements would be determined in the contract if, in the future, the holder were to lose the lease.

What about the time frame for lease to go through mitigation measures? Those appeals that go to the State Land Board have no time frames associated with them but would be handled on a case-by-case basis.

What would be an example of a cause to give notice of 180 days to terminate a contract? What if the department were approached for a “higher and better” use that would generate more revenue on the existing endowed land? Change of land-use would be a cause to terminate an existing lease.

Is there any compensation for the lease for improvements? Compensation is covered in the improvement section.

If you are leasing land to graze cattle at a cost of $5 per unit, can you change that price during the time the lease is in effect? Yes, those figures are recalculated and adjusted every year.

Public testimony included support for the rules with some suggestions for changes by the Idaho Cattle Association:

· Grazing Management Plans are a useful tool, but will have little or no effect on the department’s ability to manage the lease
· Idaho Department of Lands should not shift the cost of noxious weeds on the backs of the grazers.
· The IDL and the leasees need to continue to work together to manage for the long term needs of the endowment lands.

Both committees voted to accept the rules but rejected certain sections.