Summary

In recent years, several proposals have been introduced in Congress that would boost the acreage designated as wilderness in Utah. A 1990 study by the Western Economic Analysis Center, done at the request of the Utah Association of Counties, projects that Utah's economy would lose more than $13 billion if one such proposal becomes law. In addition, some Utah ranchers and residents are concerned that designating an area as wilderness will reduce livestock grazing. GAO concludes that the center's study makes unreasonable assumptions and uses flawed methodology. The $13 billion figure cited is a loss equal to about half of Utah's 1988 or 1989 gross state product and assumes that all mining, grazing, and recreation would cease when the lands are designated as wilderness. The study's methodology is flawed because, among other things, it inflates the total effects of wilderness designation by not discounting future cash flows and by double-counting projected lost revenues. The limitations of this study led GAO to conclude that the effect on Utah's economy of designating more acreage as wilderness has not been adequately quantified. Likewise, the effect of wilderness designation on livestock grazing in Utah has not been quantified.

GAO found that: (1) the study projected that a wilderness designation of 3.2 million acres would cost Utah $9.2 billion annually in future earnings, a designation of 1.4 million acres would cost $1.4 billion, and a designation of 5 million acres would cost $13.2 billion; (2) the $13.2 billion loss would be the equivalent of about half of Utah's 1988 or 1989 gross state product, although the combined income from mining, all agriculture, and all services, including tourism, accounted for only about 21 percent of Utah's 1988 gross state product; (3) the disparity between the study's projected losses and the actual possible loss were due to the study's unreasonable assumptions and flawed methodology; (4) the study's assumption that no mining, grazing, or recreation would occur on the designated lands is incorrect since laws and regulations permit such continued use, and mineral resource development was improbable even without wilderness designation; (5) the study's methodology did not discount future cash flows, double-counted alternative measures of the same economic activity in determining lost revenues, and did not include intangible costs and benefits of wilderness designation; and (6) independent reviews of the study have also concluded that its assumptions and methodology were flawed. GAO also found that: (1) neither the Forest Service nor the Bureau of Land Management (BLM) had quantified the wilderness designation's effect on grazing; (2) although the Service and BLM keep overall statistics on grazing, they were not in a form that would permit measurement of the wilderness designation's effect; (3) in general, the agencies believed that wilderness designation did not affect grazing levels; and (4) a 1990 study of grazing in two national forests in Arizona showed that the Forest Service had not decreased grazing in wilderness areas, and the turnover and nonuse rates of grazing permits were unaffected by wilderness designation.