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Environment Parks

Systems to Manage Grazing Leases

 

SUMMARY

Approximately 60 per cent of Alberta’s land is owned by the Crown on behalf of Albertans. The various surface uses of this public land fall under the administration of the Department of Environment and Parks through the Public Lands Act. The department oversees some 5,700 grazing leases on more than five million acres of public land. The province receives about $4 million annually from these leases.

Grazing leases are intended for leaseholders to graze livestock on public land. Albertans benefit by having leaseholders who help ensure long-term sustainability of the land and protect animals and plants at risk where needed.

The Public Lands Act allows the department to let some Albertans use public land in this way. However, as a general principle, no Albertan should derive personal benefits from Alberta public assets beyond uses the assets are intended to provide.

What we examined

We examined the department’s systems to:

  • identify objectives for and benefits expected from grazing leases on public land
  • ensure all Albertans benefit from its management of grazing leases
  • analyze and report on whether grazing leases are meeting objectives or what is needed to improve how the department manages leases

Overall conclusion

The department’s processes ensure that, overall, public land in Alberta used for grazing is in good health. However, the department cannot demonstrate that the grazing lease program is meeting defined objectives. Further, current legislation allows an unquantified amount of personal financial benefit to some leaseholders over and above the benefits of grazing livestock on public land.

What we found

Some leaseholders receive significant compensation for allowing operators onto leased public land, or from selling or transferring their lease to another leaseholder. In some cases the amount of surface compensation paid to leaseholders as required under the Surface Rights Act is many times the amount of the rent they pay on a grazing lease. We were told by the department that the Surface Rights Act provides for compensation, which is intended to offset the costs of damage and disruptions to the leaseholder’s grazing operations.

The department told us it does not have the regulatory or legal authority to collect information on surface access compensation. Therefore, the department had no way to confirm whether the fees paid to leaseholders simply cover the costs as intended or are greater than the actual costs incurred, providing a personal financial benefit for the leaseholder.

We found unproclaimed legislation, Bill 31, from 1999 that would have allowed the province to collect a portion of the surface access compensation fees from industry operators that are currently paid to leaseholders.

The department requires leaseholders to keep the land under lease in good health and to keep other requirements such as fencing, record keeping, and taxes in good shape and up to date. Other than these requirements, the department has not clearly identified, defined and communicated its objectives for grazing leases, set relevant performance metrics associated to those objectives, or collected the information necessary to analyze and ensure grazing leases provide expected benefits to all Albertans.

Why this is important to Albertans

Public land is set aside for the benefit of all Albertans, who rely on the department to make sure they benefit from the various uses of public land. To protect these benefits and the land itself, the department must consider the needs of everyone who has an interest in how the land is used and then set clear objectives for uses such as grazing cattle or other livestock.

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