Land Sale of The Century

When people first came to the West, particularly from the owned and fought-over farmlets of Europe, and saw so much land to be had for the signing of a paper and the building of a foundation, an itching land-greed seemed to come over them. They wanted more and more land—good land if possible, but land anyway . . . The early settlers took up land they didn’t need and couldn’t use; they took up worthless land just to own it. —John Steinbeck, East of Eden

The advertisements are not conspicuous. They do not cover billboards or blare from the television set. They appear instead as small-print public notices in local newspapers or obscure items in official Government publications. Taken together, though, their import is unmistakable: the U.S. Government is about to hold its biggest real estate sale since the opening of Oklahoma.

From amber waves of grain to purple mountain majesties, America is selling a little bit of almost everything under its beautiful for spacious skies. Want a lighthouse overlooking one of the most spectacular stretches of California’s rugged coastline? Just such a property is going on the block. A piece of prime bottom land in the Midwest? The Government is prepared to part with several hundred acres worth. Looking for privacy? Uncle Sam is offering mountaintops and ranger stations in Montana and New Hampshire.

Nor is this all. Uncle Sam is selling off prime property in the heart of New York City and on the outskirts of Philadelphia, a piece near the Las Vegas Strip and a chunk of Waikiki Beach. It is unloading Air Force bases, military ammunition plants, and dozens of dams and water projects. For those who might want to acquire apparently useless land for the simple satisfaction of owning it, the Government is offering—at bottom dollar, if necessary—watersheds, flood plains and deserts.

The scope of the proposed sales is enormous. By the beginning of next year, the Reagan Administration hopes to dispose of 307 parcels totaling 60,000 acres. And this is only a sampler. Within the next five years, the Administration intends to get rid of 35 million acres by Executive Order. This is 5% of the Government’s land holdings and constitutes an area the size of Maine, New Hampshire, Vermont and Massachusetts combined. If the first five-year plan is successful, the Government may decide to sell more in the future. Both President Reagan and his Interior Secretary James Watt are convinced that the U.S. owns far more land than it needs or can manage. And both believe that unneeded land should be turned over to private owners.

The Government should find no shortage of buyers. Land has always been an important part of the American dream. The settlers began by clearing the forests around Jamestown, Va., 350 years ago. Then they crossed the continent like a slow but inexorable army, laying claim to property to build homes, to grow food, to graze cattle, to protect water supplies. Their eagerness was understandable. Never mind how large and grand the continent of North America was, the amount of land was finite. Once it was occupied, there was no way to create any more.

By the end of its second century, the U.S. had disposed of 1.14 billion acres of public land, either to raise money or encourage settlement. When the going rate of $2 an acre proved too steep for many pioneers, Congress passed the Homestead Act of 1862. It gave 160 acres to any pioneer who would live on them for five years, build a house and clear a portion. But with the closing of the frontier, Government policy changed. Justifiably concerned by Americans’ penchant for overgrazing, overcutting and generally misusing their land, the Government began to emphasize conservation. Around the turn of the century, it created a system of National Parks and established regulations for the management and protection of grasslands and forests. Occasionally, the Government reverted to the old ways. But for the most part, Republican and Democratic Administrations alike have viewed land as a form of capital and attempted to live off the interest, both actual and aesthetic, without touching the principal.

It is this public policy, and this philosophy, which are now undergoing dramatic change. With Watt leading the way, the Reagan Administration is putting the Government back into the business of selling its real estate. The Administration’s decision has raised fundamental questions about how America should manage its land, and it has touched off a bitter battle between two rival and possibly irreconcilable forces.

The leading figure on one side of the debate is Watt, a contentious conservative who has created waves of controversy across the country in his zeal to open up public lands for development. The Government, Watt maintains, is an inept landlord; it neither manages property well nor puts it to its best use. “I want to open up as much land as I can,” Watt says. “If you are interested in the consumer-taxpayer American, as we are, you want to make the land more beneficial to the individual taxpayer. That might mean just managing the land better in some cases; it might mean selling it off in others.” Developers, real estate speculators and many fellow conservatives wholeheartedly support Watt’s view. Indeed it is impossible to argue that the Government does not have too much land or that it does not mismanage some of what it has.

On the other side of the debate is a loose, inchoate confederation of conservationists, farmers and ranchers. The history of land in America, they say, has too often been one of pell-mell exploitation. It has been overgrazed, strip-mined, cut clear of timber and paved for shopping malls. Such ravages, they insist, must be prevented in the future. “We believe in the public lands,” says Geoffrey Webb of the 25,000-member Friends of the Earth. “We strongly believe that they should remain public and should be maintained and managed for the public, not for the narrow interests of those who might want to mine coal or explore for oil, gas or minerals.” Other opponents, while willing to concede that the sale of some surplus land is justified, fear that the Government may not act responsibly in the future. Their bugbear is that once the process of selling has begun, there is no way to guarantee that a hard-pressed or politically motivated Government might not deed to private owners what is so rightfully the public’s.

The irony is that both Watt and his opponents are right. There are strong arguments for conserving unspoiled tracts. There are equally compelling reasons why the U.S. should dispose of lands for which it has little or no use, particularly if these parcels can be put to better use by private owners.

Foremost among the Administration’s justifications for the land sell-off is its revenue-producing potential. By White House estimates, the five-year program will yield $17 billion. Says Watt: “What better way to raise some of the revenues that we so badly need than by selling some of the land and buildings that we don’t need?” Bruce Selfon, acting executive director of the Property Review Board, which is preparing the list of parcels for sale, says, “It is the best way we can think of to relieve the debt because it doesn’t hurt anyone. It doesn’t raise taxes. It doesn’t cut anyone’s budget. It just raises money.”

The sale, boosters claim, might even suggest to other countries that the U.S. is serious about putting its economic house in order. “Companies in a situation like this have often turned to liquidating assets,” says Republican Senator Charles Percy of Illinois, a leading supporter of the plan on Capitol Hill. “Why should the U.S. Government be any different?”

The Administration believes that a significant portion of Government-owned land, excluding parks and wilderness areas, would be more productive if privately owned. The Government currently owns 740 million acres, or 32.7% of the land in the U.S. Most of this land is west of the Mississippi. It also owns 405,147 buildings and $52.3 billion worth of structures such as dams, bridges, roads, irrigation projects and monuments. Much of this property is used little or not at all, and costs the Government far more to keep and maintain than it is worth. Steven Hanke, a former member of the President’s Council of Economic Advisers, notes that grazing permits, which last year produced $24.9 million in revenues, came nowhere near meeting the $58.5 million it cost the U.S. to manage the grassland and cover payments to local governments in lieu of taxes. The result, in effect, was a taxpayer subsidy to ranchers of $33.6 million. “With public ownership,” Hanke says, “politicians and bureaucrats are never directly and solely responsible for the consequences of their decisions.”

Finally, the sell-off is appealing to the Administration because it is a way of scaling back the influence of the Federal Government, which is a philosophic objective of President Reagan. Says Annelise Anderson of the Office of Management and Budget: “We want to sell properties as a way of coming to grips with exactly what size the Federal Government ought to be.”

The criteria for determining what can be sold are straightforward. Lands in the National Park and National Wildlife Refuge systems are exempt from consideration. So are Indian Trust lands and Wilderness areas, Wild and Scenic Rivers, National Trails, national conservation areas and certain other lands designated by Congress. This adds up to 400 million acres. Everything else can be put on the block. The surplus lands first will be assessed to determine their market value. Next they will be offered to other federal agencies, which may want to use them for different purposes. If there are no federal takers, the lands will be offered to state and local governments. Only after all government agencies have been given an opportunity to bid will the tracts be offered to the general public.

Exactly how the lands will be sold to the public remains to be determined. The White House has not decided whether to do it by sealed bids, public auction or some other method. “It is clear that we’ll have to go beyond what’s been done in the past,” says Edwin Harper, the President’s assistant for policy development and chairman of the Property Review Board. “We can’t just put an ad in the newspaper and see what responses come in.”

Such ads would certainly be interesting. In the first batch of 307 parcels, there is something for everyone. Care for a piece of out-of-the-way America? An abandoned Air Force radar installation station on an acre at Cottonwood, Idaho, could be just the ticket. Prefer something in the East? The 105 acres adjacent to the Saint Albans Air Force Station in northwest Vermont might be worth a look. Feeling urban? The Frankford Arsenal, an 87.7-acre complex of 167 buildings, sheds and loading docks in Philadelphia, has all kinds of possibilities. The sale will offer property in every state but Alaska. Real estate dealers with a bankroll and real estate dreamers without one are sure to be enthusiastic over the choicer parcels. Some enticing examples:

Point Sur Light Station. Perched on a gumdrop-shaped rock on the spectacularly scenic northern California coast, this is one of the most exciting pieces being offered. Often shrouded by fog, and surrounded on three sides by surging seas, the gray stone lighthouse looms like a medieval keep above the 33-acre site. The Coast Guard, which runs the station, is keeping the lighthouse, but the Interior Department is putting the surrounding property on the block anyway. The State of California would like to lease the site for use as a park or youth hostel, but does not want to buy it. Whoever does buy it will need to negotiate a right of way with a local rancher whose land abuts the lighthouse property. But anyone who can afford the price, estimated to be at least $1 million, can probably afford to pay for an easement as well.

Fort DeRussy. Most of this military installation, which occupies 72 acres in Honolulu, will remain in Government hands. But the 17 acres that are for sale constitute one of the last bits of open space along Waikiki Beach, where high-rise hotels and condominiums have sprouted like goldenrod along a highway. Back in 1905, the military bought the entire 72-acre tract for $200,000. David Stockman, the President’s Director of the Office of Management and Budget, values the parcel today at upwards of $220 million. There is one drawback for potential buyers: the beachfront property is not zoned for development, and many Hawaiians would like to keep it that way.

Union Village Dam. Five miles north of where Vermont’s Ompompanoosuc River empties into the Connecticut, the dam was completed by the U.S. Army Corps of Engineers in 1950 to control flooding. The dam itself will remain in federal hands, but 259 acres of surrounding land, most of it steeply sloped and heavily forested, are for sale. The site, which is not very accessible, is now used by hikers, hunters and fishermen. But its covering of pine trees might prove attractive to loggers, and this could push its price to $100,000.

Keyhole Unit. When the Bureau of Reclamation constructed the Keyhole Reservoir in 1952, it acquired a large amount of land near eastern Wyoming’s Belle Fourche River. Now the bureau proposes to sell off 280 acres, most of it in scattered parcels near, not directly abutting, the reservoir. Dry and covered with sagebrush, the land might interest cattlemen looking for grazing areas, especially if it can be acquired at a bargain price. Property in the area is currently fetching $125 to $225 per acre.

Westover Air Force Base. The only place in the East north of Cape Canaveral with a runway capable of handling the space shuttle, this western Massachusetts facility has been doled out a parcel at a time since the Strategic Air Command left it in 1974. The base golf course was given to the neighboring town of Ludlow; an electric utility consortium purchased the vaults once used to store nuclear warheads. A private developer is currently converting onetime servicemen’s residences into one, two-and three-bedroom units that will sell for $25,000 to $35,000. Now the base hospital and 45 adjacent acres are up for sale. The property is valued in the range of $340,000.

Bald Mountain Lookout. Located above the timberline atop a 6,000-ft. peak in eastern Oregon, this five-acre site was once an observation point for rangers trying to spot forest fires. It is too small to interest developers, but its remoteness and breathtaking views will charm fugitives from city life. Land in the area is going for $300 to $500 per acre.

Bucks Harbor Air Force Station. Sitting at the base of 260-ft.-high Howard Mountain on the scenic coast of Maine 160 miles northeast of Portland, the base was abandoned by the Air Force last February and turned over to the Federal Aviation Administration and the Defense Department. The Government intends to sell off 48 acres containing 27 three-and four-bedroom ranch houses built in 1959, a barracks, a dining hall facing the ocean, a former noncommissioned officers’ club and a recreation hall with a lounge, bowling alley and small indoor track. A local group known as Howard Mountain Associates wants to turn the facility into a housing development for senior citizens. Washington County commissioners are interested in using the site for a prison. Whoever buys it will have to come up with a good deal of cash, since the property is valuable, especially by the standards of this economically depressed county. Undeveloped land in the area is currently bringing $300 to $500 per acre.

Joliet Army Ammunition Plant. The Government hopes to sell 1,300 acres of this 23,000-acre compound 50 miles southwest of Chicago. Last year the expendable acreage was leased to local farmers for $750,000; they used it to grow corn, hay, soybeans and other crops, and to graze livestock. Farmers like John Nugent of Manhattan, Ill., who now rents some of the land for $95 per acre, are interested in buying “if the price is right.” Harold Holz, who manages the land for the Uniroyal Corp. under a federal contract, says that the grazing land is worth around $1,500 per acre, while the more fertile land may fetch as much as $2,400 an acre. Potential bidders need not worry about the tons of explosives stored elsewhere on arsenal property; the nearest are more than half a mile away.

Myrtle Beach Air Force Base. On the block are two parcels, one within the base perimeter on busy U.S. Highway 17, the other on a bypass behind the base. The 51 acres are not eye pleasing, but local officials believe the land fronting Highway 17, across from a state park, could be worth as much as $750,000 to a commercial developer. The other parcel has already been used for a highway; 18 acres suitable for housing or commercial development remain.

Camp Lucas. Located on the edge of town, in the wooded country of Michigan’s Upper Peninsula, where some of Ernest Hemingway’s Nick Adams stories are set, this nine-acre National Guard camp has piqued the attention of at least two potential users. Lake Superior State College is interested in adding the parcel to its 114-acre campus. The city of Sault Sainte Marie believes it has a legal claim to the land as well. The land is believed to be worth $3,000 per acre.

Point Arena Air Force Station. Perched on a mountain 100 miles north of San Francisco and five miles from the coast, Point Arena covers 765/2 acres and includes barracks, a post exchange and several other structures. Once manned by 200 Air Force personnel, the station is now run by 45 civilians. Half the acreage is for sale. The property offers a stunning view of the Pacific and a thick carpet of redwood and pine trees. The Government has not yet determined its price, but land in the area is currently going for $1,500 to $2,000 per acre.

The New York Assay Office. Built in 1932, the five-story, steel-and-concrete building has been vacant for more than a year. It sits in the heart of Manhattan’s financial district and contains more than 88,000 sq. ft. of office space. A year ago, the building was assessed at $8.3 million. Today, in a city where developers buy buildings for the right to tear them down, the land alone may be worth that much.

Environmentalists have few objections to the sale of many of the lands included in the Administration’s first offering. Much of the property consists of small tracts, of little use to anyone but the owners of adjacent lands. Some parcels are located in flood plains, which make them unsuited for development; others, like unused military installations, are clearly going to waste. Concedes Jack Lorenz, executive director of the 53,000-member Izaak Walton League of America, a leading conservation group: “Certain outlying units too small to be efficiently managed should be disposed of; lands having little value as parks or wildlife refuges and needed for the growth of urban areas should be sold at fair market value.”

But opponents do object to the way in which the decision to sell off chunks of America was reached. “What the Administration is doing is trying to transfer as much of the publicly owned land and resources as possible to the private sector in as short a time as possible,” says Geoff Webb of Friends of the Earth. “But none of this has been debated in a public forum. It is simply being done.”

There is concern too that these initial land sales augur an indiscriminate clearing of federal property books. “As long as they come out here and talk about selling a little bit of surplus land, a lot of people don’t get excited,” says Ken Robison, a spokesman for Save Our Public Lands, an Idaho conservation group. “I’m concerned that, as the Administration proceeds, they’re going to move on to this larger land-sale program, and they will interpret the lack of any real strong reaction to the initial inventory as consent.”

Opponents also argue that the sell-off is unlikely to bring in anywhere near the amount of revenue projected by the Federal Government. William Turnage, executive director of the 50,000-member Wilderness Society, considers it “ludicrous” to sell land “when the U.S. real estate market is going through one of its most depressed periods in history.” Agrees Webb: “In a soft market, the land will inevitably be underpriced, and the public, which, after all, is the owner of the land, will end up getting ripped off.”

Even if the Administration reaches its revenue target, opponents argue that the public will still lose. They point out that $17 billion is a mere 1.5% of the $1 trillion national debt, and that there is no guarantee the money will ever be used for any form of debt retirement. By law, proceeds from land sales in 16 Western states must go into a fund for building and maintaining irrigation projects; proceeds from the dispersal of certain other federal lands must go into a fund for the acquisition of parks, wildlife preserves and similar properties. Senator Percy has proposed a bill that would let the Administration use the money to pay off part of the national debt, but passage is by no means assured.

Beyond these objections, environmentalists oppose the sales on principle, insisting that the Government should hold and manage these lands for the benefit of all Americans, not just those who can afford to buy and develop them. As a position paper prepared by the Wilderness Society puts it: “American history has demonstrated that the public is not well served, in the long run, by turning over commodity lands to private interests. The aim of business is short-run profits, not long-run preservation—and experience has shown that conservation of resources is critical to sustaining a high standard of living—or living at all.”

For ranchers, profits and conservation go hand in hand. Preservation of federal lands means continued access to vast grazing areas. The sell-off threatens this arrangement, since ranchers may not be able to afford to buy the acreage for which they now hold federal grazing permits. Says Paul Bottari, executive secretary of the Nevada Cattlemen’s Association: “Cattlemen would have supported the sale of public lands if there had been provisions built into the proposals to ensure that they would be able to utilize their present rights.”

In effect, the ranchers want protection against themselves. One of the reasons that they are so dependent on public grazing lands is that private ranges have been grossly overgrazed. Environmentalists cite this as proof of their contention that commercial interests are often concerned only with profits. The timber industry has been another offender: it wants to buy national forests, in part because private lands have been overcut. Indeed, environmentalists note, the whole purpose of creating the national forest system was to prevent loggers from stripping the woods bare. “Two-thirds of the timber in this country comes from private land, and private timber industries can overcut or do whatever they want with that land and the timber on it,” says Turnage. “But we want to make sure that the other third is managed properly so that we will all have timber into the 21st century.”

Perhaps most important of all, opponents argue that the worth of land simply cannot be measured in dollars and cents. “The idea that man can assess the value of a piece of land doesn’t take into account what we’ve learned about ecology in the last 40 years,” says Maitland Sharp, conservation director of the Izaak Walton League. To be sure, there is no way to calculate the dollar value of the view from a mountaintop, the solitude of a forest or the airy freedom provided by a piece of open land near a crowded city. There is no way to put a price on an ecosystem that is destroyed to make way for a shopping center or a high-rise apartment.

At the same time, however, who is to say that a scenic view is worth more than housing for the elderly? The environmental movement has performed a valuable function during the past two decades, making Americans aware of the problems of pollution and lobbying for cleaner air and water. But the movement has also indulged in some knee-jerk opposition to almost any change, tying up some construction projects with endless legal maneuverings, or seizing upon spurious excuses to stymie others. It delayed the Tellico Dam for years, for example, only to discover that the tiny fish called the snail darter lived nicely elsewhere with no help from man. In Maine, construction of the Dickey-Lincoln Dam was almost held up because of environmentalists’ concern for a plant called the Furbish lousewort.

Environmentalists must remember that the areas they seek to preserve intact are often of interest to only a relatively small segment of the public. America’s land belongs just as much to those who want fuel, timber and highways as it does to those who want unspoiled mountains and virgin forests.

It is clear that land-use policy in the U.S. must be brought into line with changing conditions. What was an appropriate way for the nation to use land a century ago—or for that matter, a decade ago—may not be appropriate today. Many present holdings may be unnecessary. No one would seriously argue that 18 miles of the western shore of Chesapeake Bay, located in one of the country’s most populated corridors, should be a military reservation and gunnery range. But that is where Aberdeen Proving Ground and Edgewood Arsenal are. Nor in 1982 is it logical for the Government to own 17 miles of invaluable Southern California coastline between Los Angeles and San Diego. Surely there are more appropriate places to teach Marines to wade ashore than at Camp Pendleton. Is the Government the most logical owner of Governors Island, a beautiful 173 acres at the entrance to New York harbor? The days when a fort could defend a harbor vanished many a war ago.

What is needed is a cool and rational balancing between competing interests. The Government should weigh each proposed sale to determine if the property is in fact surplus, and whether it might be put to better use. Decisions should be made on a parcel-by-parcel basis, with time for all interested parties, from environmentalists to would-be buyers, to make their views heard. Such a policy would slow the Administration’s attempts to reduce the Government’s holdings. It would probably cost the country a few tons of coal, some board feet of timber. But it would reassure Americans that their land is not being squandered or abused. The nation’s land is too valuable to be peddled off precipitately. Managing and preserving it is, as Historian Bernard De Voto wrote three decades ago, the only Government responsibility besides atomic energy in which a mistake made today cannot be corrected tomorrow.

His warning is well founded. The U.S. should not hoard land; to do so in a changing nation does not serve the society’s best interests. But it should heed the lesson of the biblical Esau and not sell America’s birthright for “a mess of pottage.” Esau cared little for his birthright. Future generations of Americans may be more interested in theirs.

— By Peter Staler.

Reported by Gary Lee/ Washington, with other bureaus