By TIM HEARDEN
Cattle groups say an increase in federal lands grazing fees that's included in President Barack Obama's proposed budget would put many family ranchers out of business.
They also oppose an increase in the federal estate tax that he included in his plan.
The National Cattlemen's Beef Association and Public Lands Council oppose calls for the U.S. Bureau of Land Management and Forest Service to impose a $1 per animal unit month increase above normal grazing fees to cover administrative costs.
Dustin Van Liew, the PLC's executive director and the NCBA's director of federal lands, said the increase would amount to a 74 percent tax on the grazing fee, which is currently $1.35 per animal unit month. An animal unit is normally defined as a 1,000-pound cow and her calf.
He said the proposed tax shows the Obama administration is out of touch with production agriculture and the rural economies of the West.
"Adding 74 percent to a cost of doing business is likely to put people out of business," Van Liew said. "With a new 74 percent tax overnight, producers who realize that additional cost will have to make decision on how to account for that and pay the additional tax."
About 22,000 ranchers across the western United States rely on some federal land for their operations, Van Liew said. These ranchers shouldn't have to bear the burden of paying for "bureaucratic administrative costs" that are out of their control, such as attorney fees paid to environmental groups, he said.
The proposed grazing fee increases were among nearly $1 trillion in new taxes identified in the $3.8 trillion spending plan that Obama put forth on April 10. Among the president's other targets for taxation would be smokers, corporate foreign earnings, banks and the trading of financial instruments known as derivatives.
Obama also wants the estate tax to revert in 2018 to its 2009 levels -- an exemption of $3.5 million for an individual or $7 million for a married couple at a maximum tax rate of 45 percent.
This proposal comes despite Congress' approving the "fiscal cliff" deal in January, which set the estate tax permanently at 40 percent for amounts above $5.12 million.
"That's something we're very concerned about," Van Liew said. "Congress recently in the agreement at the beginning of the year made the estate tax levels permanent. A few months later, the president is now saying he didn't support the agreement he signed to make them permanent and he wants to increase the levels of estate tax.
"Again, that is a problem for our industry and (ranchers') ability to pass on their operations to future generations," he said.
Van Liew said the NCBA and PLC are contacting members of Congress to lobby against the increases.
"I can probably safely say the president's budget in any administration has never been enacted exactly as written," he said. "At the end of the day, Congress holds the purse strings."
National Cattlemen's Beef Association: http://www.beefusa.org/
Public Lands Council: http://publiclandscouncil.org/