What is grass banking?

Grass Bank Investments Paid Out in Green

Prairie dogs are just one species that benefit from the agreements between ranchers and conservationists.
Prairie dogs are just one species that benefit from the agreements between ranchers and conservationists.
Jeff Foott/Discovery Channel Images/­Getty Images

One visible proponent of grass banking is the Nature Conservancy. The environmental group has entered into several successful grass banking agreements throughout the western United States, finding it a valuable tool in its mis­sion to preserve wildlife by conserving the land. One such grass bank in Montana at the Matador Ranch is helping to protect vital habitat for dozens of species of native animals.

­Started in 2000, this particular grass bank agreement allows ranchers to graze their herds on the 60,000-acre (24,281-hectare) ranch at a reduced price in exchange for agreeing to conservation practices like weed prevention, a ban on plowing and habitat protection. In just one year, the grass bank protected 24,500 acres (9,915 hectares) of sage grouse habitat, prevented 70,000 acres (28,328 hectares) of native range from being plowed under and replanted 50 acres (20 hectares) of cropland back to native grasses [source: The Nature Conservancy].

Successful grass banks don't require a big name like the Nature Conservancy. Another project in Montana, the Rocky Mountain Front Grass Bank, consists of 360 acres (146 hectares) rented out by private landowners. Ranchers agree to perform a combination of fence repair, weed control and monitoring on the leased property in exchange for temporary grazing rights, while their fields get a chance to rest and undergo similar restoration efforts. Similar grass banks exist everywhere from California and Oregon to New Mexico and Iowa.

Despite such successes, the concept has its detractors. Like financial institutions Lehman Brothers and AIG, grass banks, too, can fail. One of the primary complaints is cost. Operation expenses, such as irrigation, range from $5,000 to $260,000 a year and are usually split among the grass bank partners [source: Reese]. Unless they receive grants or government funding, many participants find such a price prohibitive.

Purchasing or leasing the land in the first place can be just as problematic. The Bureau of Land Management and other federal land managers think the idea has promise and sometimes participate as partners, but have yet to set up any grass banks of their own due to a lack of vacant land [source: Reese].

Besides the cost, some detractors also cite the fact that grass banks are merely a temporary solution to a long-term problem. Unless the ranchers sign permanent easements protecting their land, the conservation is good only for as long as they participate. What's to say they won't cash in all their chips one day, sending all the acquired capital down the drain?

A final complaint stems from the ranchers-versus-environmentalists conundrum. Some people believe ranching is impossible to sustain under any circumstance and that providing more land to ranchers -- called "welfare ranching" -- simply encourages poor grazing practices and is a waste of money [source: Batdorff]. Alternatively, some ranchers are hesitant to enter into an agreement with conservation groups.

­For those who've shed their prejudices, though, the gamble has paid off. Not only are the ranchers and landowners happy, but the cows are happy, too. And full.

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