Follow the Money

Bankhead-Jones Act/National Grasslands Payments

Bankhead-Jones Act and National Grasslands lands are reclaimed farms the Forest Service and BLM now manage for extraction, recreation, and habitat. Some revenues are returned to western counties.

The 1920s are remembered as a time of economic boom, but the agricultural sector suffered from falling prices, too little or too much rainfall, insect plagues, isolation, and poverty. In 1929, Congress passed the Agricultural Marketing Act (PL 71-10) to investigate these problems. A major vexation of the era was glutted commodity markets, so one solution was to reduce “the acreage of unprofitable marginal lands.” In 1933, New Deal administrators established plans to retire millions of acres of poor lands, and the Agricultural Adjustment Act (PL 73-10), National Industrial Recovery Act (PL 73-67), Emergency Relief Appropriation Act of 1935 (PR 74-11), and other bills provided authority and funds to carry out the acquisitions. The policy remained ad hoc, however, until passage of the Bankhead-Jones Farm Tenant Act in July 1937 (PL 75-210).

The BJA formally combined a series of policies addressing the ongoing farm crisis. Titles I & II were loan programs. Title I enabled poor farmers, especially tenants and sharecroppers in the South, to purchase land on terms not available from private lenders. Title II helped these same farmers to modernize their farming equipment and to rehabilitate lands. Both programs had remarkable successes among some of the poorest farmers in the South. Title III had a very different aim. It gave the Secretary of Agriculture broad mandate to acquire “submarginal” lands by purchase or donation “to correct maladjustments in land use, and thus assist in controlling soil erosion, reforestation, preserving natural resources, mitigating floods, preventing impairment of dams and reservoirs, conserving surface and subsurface moisture, protecting the watersheds of navigable streams, and protecting the public lands, health, safety, and welfare.” Section 33 stipulated that the Secretary should return 25 percent of net revenues from grazing, forestry, mining, and—much later (PL 97-98)—energy development to the counties. Although the law never states explicitly that these are in-lieu payments, the BJA’s revenue-sharing formula mirrors the approach of other federal compensation programs on this website.

In all the program acquired 11.3 million acres, deemed Land Utilization Projects, and put them under the authority of the Soil Conservation Service to be managed as agricultural projects. The SCS had little interest in non-arable soils, however, and it lacked expertise in forestry. As a result, the Secretary of Agriculture sold or transferred 5.8 million acres, most of it to the Department of Interior for management by the Grazing Bureau, Bureau of Indian Affairs, National Park Service, and Fish and Wildlife Service. When the Grazing Bureau and General Land Office were combined in 1946, the new Bureau of Land Management inherited much of this acreage and managed it for grazing purposes. In 1954, the Department of Agriculture transferred the remaining 5.5 million acres to the Forest Service, which incorporated 1.5 million acres into existing national forests in the eastern United States and, in 1960, designated 3.8 million acres as national grasslands on the Great Plains.

During its first quarter century, the BJA lands were managed to stabilize soils and increase their productivity. By the 1960s, however, the lands were drawn into the broader shift toward multiple-use management. Congress added fish and wildlife protection in 1962 (PL 87-703), and in 1966 it made (PL 89-796) recreation an equal consideration in BJA lands management. Passage of the National Environmental Policy Act of 1969 (PL 91-190), Endangered Species Act of 1973 (PL 93-205), Forest and Rangeland Renewable Resources Planning Act of 1974 (PL 93-378), and National Forest Management Act (PL 94-588) also subjected BJA lands to greater environmental regulation, mandating environmental impact studies and greater attention to species at risk on these lands. As with other federal lands in the West, one consequence of altering management to accommodate multiple uses and environmental concerns is that counties have seen revenues decline from these untaxable federal lands.

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