It’s common knowledge that nearly 90 percent of Nevada is federally controlled and the majority of that land is public domain. In order for the state to grow, it’s imperative that developers have access to and can legally purchase land from the government. Furthermore, it’s important that land which has already been purchased isn’t restricted in its use and developers aren’t retroactively charged fees on those properties.
And so enters the Bureau of Land Management or BLM. In April of 2014, the BLM was taken to task by a report form the Inspector General of the Department of the Interior. The report found the BLM wasn’t taking full advantage of their mineral material programs and made recommendations to enhance the agency’s management of those materials. One of those recommendations was to address loss of revenue from what the BLM deemed “unauthorized” use. And, like any good government agency, the BLM jumped right on it and began an all out pursuit of mineral material trespass claims in the Silver State.
One industry that has been particularly affected by this new and aggressive pursuit of BLM’s mineral violations in Nevada is homebuilders. An industry that was already beleaguered from the housing crisis, homebuilders have just recently begun to make a comeback only to be hit with mineral materials fees on land they’re trying to develop. In fact, nearly any type of dirt movement on land that was previously owned by the BLM can be considered a violation of the agency’s mineral use and is subject to fines. The rule applies to everything from moving dirt on a parcel to use of land materials in construction and has already cost Nevada companies hundreds of thousands of dollars. In addition, even if the developer was several sales removed from a BLM purchase, those mineral rights could still apply and that developer could end up owing fees on land they didn’t even realize had any kind of materials restrictions.
This issue is far reaching. In addition to making development difficult and land purchasing even riskier it adds fees for homebuilders, many of whom are small businesses, that are both unsustainable and impossible to account for as the rules on what constitutes “unauthorized” use are so unclear. Additionally, as Nevadans begin to purchase homes again and the market sees an uptick in home sales, that resurgence could be short lived as additional fees are passed on to consumers and potential homebuyers are priced out of the market. The Southern Nevada Homebuilder’s Association (SNHBA) estimates over $50,000 in goverment fees are included in the purchase price of a new home.
Furthermore, according to the SNHBA, every new single family home creates 3.2 jobs to the local economy and the industry itself employs over 15,000 people in Clark County. David Jennings, division counsel for D.R. Horton, Inc. and a past member of the executive board for SNHBA testified before the US House of Representatives, Committee on Natural Resources on this matter. The hearing was called for by U.S. Representative Cresent Hardy in late July. In his remarks, Jennings summed up the issue saying, “These restrictions on use of the material on land conveyed or purchased from the federal government are arbitrary and unfair. Moreover, the BLM Policy as a practical matter punishes developers who purchased land prior to its adoption or without knowledge of it.”
Call to Action: Get in touch with your state and federal representatives to let them know that the BLM owns enough of Nevada; we can’t allow that agency to retroactively charge future development into nonexistence.
2 Chronicles 7:14 (NKJV) “If my people who are called by My name will humble themselves, and pray and seek My face, and turn from their wicked ways, then I will hear from heaven, and will forgive their sin and heal their land.”
By Whose Authority?
For more information on my Commentary and to see some of my backup research, or if you wonder why I take the position I take, go to www.LyleBrennan.com