RENO - After a dozen years of court battles, rancher Wayne Hage's claim the federal government destroyed his ranching business is now in the hands of a judge.
Final arguments in Hage v. United States were heard Friday before Judge Loren Smith of the U.S. Court of Federal Claims.
Hage lawyer Ladd Bedford of San Francisco told the court the U.S. Forest Service systematically reduced the value of Hage's Pine Creek Ranch in central Nevada by reducing his grazing rights and denying him use of springs and other water sources on public lands.
The government barred Hage from maintaining ditches that brought water for which he has legal rights to the ranch, the lawyer said, rendering most of the ranch unproductive.
Bedford said when Hage bought the ranch for $1.3 million in 1978, he also bought some 17,000 acre-feet of water rights, access to grazing allotments on more than 700,000 acres and use of the springs, wells and improvements on the range. He said Hage and his family were able to make an average of $300,000 a year selling cattle through the 1980s.
Over the course of the battle between Hage and the Forest Service and Bureau of Land Management, some of Hage's cattle were impounded and his grazing allotments were reduced. He has accused the government of deliberately trying to run him out of business and of violating his property rights in the process.
The government has responded that it managed the land for multiple use - including elk grazing and recreation - and that Hage violated the rules for using the land and maintaining his grazing permits.
Bedford said Hage was forced to sell his herd because of the harassment and restrictions imposed by the government. According to Bedford, the ranch's income dropped to $6,745 in 1992.
"The Hages no longer have an economically viable ranch," he said. "They can't sell it. They can't lease it. They can't make a living off of it."
The reason, according to Bedford, is that the government actions and policies took away the Hage's private property rights.
According to Bedford and attorney Michael Van Zandt, Hage should be compensated for the value of the ranch, its water rights, those grazing allotments and improvements both on private and public lands. They said the value could be as high as $24 million.
But attorney David Spohr of the U.S. Justice Department said that argument is based on a false premise: that the Hages' owned property rights to use of the public lands.
"The issue is not whether actual property rights were taken," he told Judge Smith. "Instead, the issue is whether the rights they wish they had were taken."
He said courts have repeatedly held that Congress has never granted a property right to those who hold grazing permits on public land, despite attempts by Hage's lawyers to "back door a property right to graze on federal lands."
He said that means the Hage's estimates of the value of the ranch are "vastly overstated" because most of the 2,900 animal units they claim the land will support require the use of federal lands.
"There was never a right to graze federal lands, only an implied license."
Judge Smith asked about Hage's complaints federal authorities barred him from maintenance work on ditches across public lands that supplied his ranch with water. Spohr said Hage applied for permits to work on those ditches several times and received them without problems.
He said the Hages got into trouble by "deciding unilaterally they didn't need them."
He said the requirement he get a permit to clear trees and use heavy equipment and do other major work on public lands is reasonable, and that it was Hage, not the government, who chose not to.
He also challenged Hage's claims he could have made $696,000 a year just by leasing grazing rights on the land, saying that is double what Hage was able to make ranching the land himself and more proof that any claim is greatly exaggerated.
That estimate was based on $20 per "animal unit month." The government charges ranchers $1.36 per AUM to graze on public lands.
Judge Smith took the case under submission and is expected to rule before the end of the year.
Contact reporter Geoff Dornan at nevadaappeal@sbcglobal.net or 687-8750.
