Involvement of Grazing Permittee/Lessee with Solar and Wind Energy Right-of-Way Application Process

UNITED STATES DEPARTMENT OF THE INTERIOR

BUREAU OF LAND MANAGEMENT

Washington, DC 20240

http://www.blm.gov

September 21, 2011

In Reply Refer To:

4110 (220) P

EMS TRANSMISSION 10/13/2011

Instruction Memorandum No. 2011-181

Expires:  09/30/2012

To:                All Field Office Officials

From:            Assistant Director, Renewable Resources and Planning

Subject:        Involvement of Grazing Permittee/Lessee with Solar and Wind Energy Right-of-Way Application Process

Program Area:  Rangeland Management (1020) and Lands and Realty Management (1430).

Purpose:  This Instruction Memorandum (IM) clarifies when Bureau of Land Management (BLM) Field Offices (FO) will notify a grazing permittee/lessee that a solar or wind energy development application may affect a livestock grazing operation.  Specifically, Regulation 43 CFR 4110.4-2(b) (2005) requires that when public lands are disposed of or devoted to a public purpose that precludes livestock grazing, the permittee/lessee shall be given 2 years’ prior notification (except in cases of emergency) before the grazing permit/lease and grazing preference may be cancelled.  This IM also addresses potential mitigation and compensation strategies and the relationship of energy application steps/decisions with grazing administrative steps/decisions.

Any cancellations, in whole or in part, of grazing permits/leases (see 43 CFR 4110.4-2(b) (2005)) are more likely to occur with solar energy development right-of-way (ROW) authorizations due to their intensive land use requirements than wind energy development ROW authorizations.  With the limited land disturbance footprint of a wind energy development ROW authorization, there should be limited impacts on grazing permits/leases except during construction activities.

Policy/Action:  The Authorized Officer (AO) is encouraged to send this IM to renewable wind and solar energy applicants and potentially affected permittee(s)/lessee(s) with allotment(s) that may be impacted by energy proposals.  As discussed below and shown in the attached chart (Attachment 1-1), the AO will notify permittees/lessees in accordance with 43 C.F.R. 4110.4-2(b) and will encourage communications between the ROW applicant and permittees and lessees at the earliest possible time. 

1. As soon as a FO becomes aware of, or receives, a proposal for a solar or wind energy development project on lands used by a livestock permittee/lessee, and/or has participated in a pre-application meeting with the energy company, then the FO should inform the livestock permittee/lessee in writing about the proposed project (see Attachment 1-1, Step 1, Grazing).  The BLM should conduct an on-site visit with the ROW applicant and the permittee/lessee to: a) inform the permittee/lessee of the proposed solar/wind project; b) discuss how the proposed project may impact grazing operations and address possible alternatives; c) address mitigation and compensation strategies; and d) clarify and encourage participation in the BLM’s decision process under the National Environmental Policy Act (NEPA) to consider the environmental impact of the proposed project and present alternatives to the proposed project.  Early and transparent coordination among the ROW applicant and the permittee/lessee and the BLM should help to resolve or minimize potential impacts to grazing operations, reduce potential resource conflicts, and provide the permittee/lessee an understanding of the NEPA process, timeframes, and the relevant procedures (including the 2-year notification requirement at 43 CFR 4110.4-2(b) (2005)). 

The ROW applicant will then file a ROW application accompanied by a Plan of Development (POD) with the BLM.  The POD will address on-the-ground grazing mitigation, such as grazing practices, seasonal movements, range improvements (e.g., moving fences, water distribution), rerouting access, etc.  Incorporating these items in the POD better ensures they are covered in the NEPA analysis of the ROW project.

         Potential mitigation and compensation strategies

1. Regulation 43 CFR 4120.3-6(c) (2005) provides that if a grazing permittee/lessee has placed or constructed authorized permanent range improvements on lands within a permit/lease subsequently cancelled for another public purpose, the permittee/lessee is entitled to receive reasonable compensation from the United States for the adjusted value of his/her interest in such improvements (refer to H-4120-1.36C).  The ROW applicant and permittee/lessee should be strongly encouraged to enter into an agreement that addresses compensation for range improvements.  If such an agreement is reached to the satisfaction of the parties, the permittee/lessee must file the agreement in writing with the BLM AO.

In the event the applicant and permittee/lessee do not come to an agreement on compensation for such authorized permanent range improvements and the permit/lease is subsequently cancelled for the solar or wind energy project, the permittee/lessee is entitled to receive, from the United States, reasonable compensation for the adjusted value of his/her interest in such improvements.  The adjusted value is to be determined by the AO.  Compensation (by the BLM) must not exceed the fair market value of the terminated portion of the permittee’s/lessee’s interest in such improvements (see 43 CFR 4120.3-6(c) (2005)).

2. Where a range improvement is authorized by a range improvement permit, the livestock operator may elect to salvage the materials and perform rehabilitation measures rather than be compensated for the adjusted value (see 43 CFR 4120.3-6(c) (2005)).  Salvage and rehabilitation measures may trigger the need for a NEPA analysis of the impacts of those measures, and must be coordinated with, and approved by, the BLM prior to any action taking place.

3. Discussion of mitigation and compensation strategies may address loss of forage, water rights owned by the permittee/lessee, access for management purposes, or other items, as necessary, to provide for expeditious processing of the ROW application for solar or wind development.  The ROW applicant and the permittee/lessee should be strongly encouraged to enter into an agreement that addresses mitigation and compensation strategies to be submitted concurrent with the POD, but the BLM will not directly participate in these discussions.  The United States is not responsible for any mitigation or compensation agreed upon by the parties in these agreements.

2. If the BLM concludes that the proposed development will likely adversely impact the current livestock operation and accepts the POD, the AO will send a certified letter to the permittee/lessee to serve as the 2-year notification of the BLM’s potential decision to cancel the permit/lease, in whole or in part, and devote the public lands to a public purpose that may preclude livestock grazing, as required by 43 CFR 4110.4-2(b) (2005)[1].  The intent of the 2-year notification is to provide the grazing permittee/lessee time to make any necessary financial, business, or management adjustments should the permit/lease be cancelled (in whole or in part).  The letter will also inform the permittee/lessee of his/her ability to unconditionally waive the 2-year prior notification.  Any waiver must be in writing (see Attachment 1-1, Step 2, Grazing; Attachment 2-1, Sample Grazing Notification to Permittee/Lessee; Attachment 2-3, Sample Grazing Cancellation Waiver).  Providing the two-year notification at the time the BLM accepts the POD (Step 2, IM Flow Chart Attachment 1-1), is supported by IBLA decisions[2] and the FLPMA Conference Report[3].  Moreover, the BLM’s sales regulations at 43 C.F.R. § 2711.1-3 similarly provide that the publication of a notice of realty action as provided in 43 C.F.R. § 2711.1-2(c) satisfies the two-year notification requirement of 43 C.F.R. § 4110.4-2(b), if notice was not already given prior to its publication.

The NEPA analysis for a solar or wind energy project proposed to be sited on land within a grazing permit/lease must consider the environmental impacts from two actions: 1) the grant/denial of the ROW, and 2) the cancellation/continuation of the grazing permit/lease, and issuance of a new grazing permit/lease, if appropriate.  One of the alternatives in the NEPA document should address livestock management during the time between issuance of any Notice to Proceed (NTP) and the end of the 2-year period, if the 2-year notification is not waived.  Under this alternative, the BLM would address the potential for issuing a NTP while still allowing the permittee/lessee to graze livestock during the time remaining under the 2-year period.  This alternative is intended to protect and manage resources in the allotment in a manner that does not preclude grazing, but allows the NTP to be issued, if possible.  This alternative should also address the possible situation where the NEPA analysis determines that livestock grazing can be accommodated, but later unexpectedly becomes incompatible with the development of the approved solar/wind energy project.

3. Once the BLM completes and issues the EA or Draft Environmental Impact Statement (EIS) addressing the ROW application and the grazing management, the BLM will then issue a proposed grazing decision that will:  a) state that the effective date of the permit/lease cancellation, and issuance of any new permit/lease for any remaining permitted use, will be 2 years from the permittee’s/lessee’s receipt of the certified letter sent in Step 2 above, b) address compensation for range improvements (see 43 CFR 4110.4-2 (2005)), c) address grazing management changes for the new permit/lease, as well as interim grazing adjustments as appropriate, and d) state that in the absence of a protest the final decision will be issued concurrent with the EA/Decision Record or Final EIS/ROD (see Attachment 1-1, Step 3, Grazing).  The BLM will send the proposed grazing decision to the affected ROW applicant, grazing permittees/lessees, any agent and lienholder of record, who is affected by the proposed action, terms and conditions, or modifications relating to applications, permits and agreements by certified mail or personal delivery.  Copies of proposed decisions shall also be sent to the interested public (see 43 C.F.R. 4160.1 (2005)). 

4. The applicant, permittee, lessee, or other interested member of the public may protest the proposed decision (see 43 C.F.R. 4160.1) in person or in writing to the AO within 15 days after receipt of such decision (see Attachment 1-1, Step 4, Grazing). 

1. If no protest is received, the BLM will issue the EA/Decision Record or Final EIS/ROD for the final grazing decision (see 43 CFR 4160.3(a) (2005)) (see Attachment 1-1, Steps 4a and 5, Grazing).
2. If the proposed decision is protested, the AO will issue a final grazing decision concurrent with the EA/ Decision Record or Final EIS/ ROD after completing the review process described in 43 CFR 4160.3(b) (2005) (see Attachment 1-1, Steps 4b and 5, Grazing).  At the conclusion of his or her review of the protest, the AO shall serve his/her final grazing decision on the ROW applicant and permittee/lessee, or his/her agent, or both, and the interested public.

5. The final grazing decision takes effect (see Attachment 1-1, Step 5, Grazing).

6. If the AO receives a written waiver of the 2-year notification requirement, it will be documented and filed in the lands case file, grazing case file, and allotment file (see Attachment 1-1, Step 6, Grazing, and Attachment 2-3).  With a written waiver, the BLM may issue a decision on the ROW application following issuance of a final grazing decision any time prior to the 2-year period.  Appropriate NTPs may also be issued.  The existing grazing permit/lease will be cancelled and a new permit/lease issued, supported by appropriate NEPA, if permitted use remains available within the allotment or on other allotments on the former permit/lease.

7. If the AO does not receive a written waiver of the 2-year notification requirement, and the NEPA analysis supports a conclusion that livestock grazing can be accommodated with energy project development during the 2-year notification period, then the AO may issue the ROW grant and any NTP when agreement is reached.  Interim grazing can be adjusted as necessary with the annual application/billing statement, or as described in the proposed grazing decision for the interim livestock management (see Attachment 1-1, Step 7, Grazing).  At the end of the 2-year period, the existing grazing permit will be cancelled, and a new permit issued, supported by appropriate NEPA, if permitted use remains available within the allotment or on other allotments on the former permit/lease.

8. If the AO does not receive a written waiver of the 2-year notification requirement, and the NEPA analysis does not support a conclusion that livestock grazing can be accommodated with energy project development during the 2-year notification period (see Attachment, Step 2, Grazing), then the AO may issue the ROW grant and any NTP after the 2-year period has ended (see Attachment 1-1, Step 8, Grazing). 

This policy will apply to permits or leases that authorize grazing use on both perennial range and ephemeral range allotments.

Timeframe:  This policy is effective immediately.

Budget Impact:  There may be a budget impact to the United States if the Federal Government is responsible for the range improvement compensation.  The impact could range from a hundred dollars to several thousand dollars depending on the type and condition of range improvements.

Background:  Several FOs have received solar and wind energy development applications.  FOs are involving the grazing permittee/lessee and issuing the 2-year notification required under 43 CFR 4110.4-2(b) (2005) at different stages in the energy application process.  Clarification is needed to ensure consistency on when to notify the permittee/lessee and issue the 2-year notification, clarify timing issuance of the ROW grant, NTP, and grazing permit/lease, and address other mitigation and compensation issues. 

Manual/Handbook Sections Affected:  Handbook 4110 - Qualifications and Preference will be affected.  The above guidance will be included in the pending revised Handbook 4110 - Qualifications and Preference.

Coordination:  This IM was coordinated with the Renewable Resources and Planning, and the Minerals and Realty Management BLM directorates, the Solicitor’s Office, and the Deputy State Directors for Resources. 

Contact:  Any questions may be directed to Bob Bolton, Senior Rangeland Management Specialist, at 202-912-7204; or Ray Brady, Energy Team Leader, at 202-912-7312.

Signed by:                                                                   Authenticated by:

Edwin L. Roberson                                                     Robert M. Williams

Assistant Director                                                       Division of IRM Governance,WO-560

Renewable Resources and Planning

2 Attachments

   1 – Renewable Energy Process Steps Related to Grazing Administration Steps (2 pp)

   2 – Sample Grazing Notification to Permittee/Lessee and Sample Grazing Cancellation Waiver (3 pp)