Alternative grazing fee formula impacts on representative public land ranches

Abstract

The Farm Level Income Tax and Policy Simulation Model (FLIPSIM) was used to evaluate and quantify the impacts of alternative grazing fee formulas, discussed in the 1986 Grazing Review and Evaluation and its recent update. Economic viability (level of income and risk) was estimated for 4 representative ranches that lease public range lands in the western United States. Average annual net cash income is projected to be positive over the 1992-97 planning horizon although income is projected to decline for the first 4 years as cattle prices weaken. Average annual net cash income under the alternative grazing fee formulas falls by as much as 37% relative to the current Public Rangelands Improvement Act formula for all of the ranches studied. Real net worth of each ranch declines as much as 22% over the study period under the highest alternative grazing fee.