Logging, mining and drilling for oil make billions for businesses in Utah and across the country as they reap resources from private land and through leases on public land.
The importance of areas where these industries aren’t working — land with clean water, clean air, intact habitats and biodiversity — is undeniable. The existence of these landscapes around the world is worth $100 trillion per year, according to a study cited by the New York Stock Exchange.
Yet the stock market values only the extractive industries — not nature itself.
In a move to change that, the New York Stock Exchange last fall proposed a new type of business to the U.S. Securities and Exchange Commission: “natural asset companies” that would draw investors interested in increasing the value of land by maintaining, restoring and improving it.
Utah Republican leaders led the charge to kill the idea.
“Wall Street shouldn’t be allowed to control Utah’s land just to meet with ESG [environmental, social and governance] goals,” said Rep. John Curtis, who represents Utah’s 3rd Congressional District, in a January statement about his legislation that would bar natural asset companies in Utah.
“Western communities rely on public lands for their livelihoods, recreation, and more,” he said. “This rule, and any similar proposal to authorize Natural Asset Companies, is a direct threat to that way of life.”
Curtis introduced the legislation on Jan. 17, two weeks after announcing his campaign to replace Sen. Mitt Romney in the U.S. Senate. On the same day, the SEC withdrew a proposed rule creating natural asset companies.
(Bethany Baker | The Salt Lake Tribune) Rep. John Curtis speaks at his senate campaign kickoff in January. Curtis has introduced a bill in U.S. Congress that would bar natural asset companies from Utah.
About a month later, on Feb. 29, U.S. Senate Republicans introduced the “Protect America’s Lands Act,” which would prohibit the SEC from legitimizing natural asset companies. Utah’s Sen. Mike Lee co-sponsored the legislation and Curtis co-sponsored a companion House resolution.
Though the proposed SEC rule is dead, buried under a deluge of criticism from Western Republicans, supporters of natural asset companies say the idea isn’t.
How would natural asset companies work?
These businesses would gain control over a piece of land by entering into an agreement with the landowner; that landowner could be the federal government in the case of public lands.
The companies would hold the rights to the land’s natural features and would improve the property through conservation, restoration and other sustainable activities. Investors would provide the funds for that work, then would benefit as the area — and theoretically their shares — increase in value.
“What [natural asset companies] are looking to do is put a value on nature, and that is something we have to start doing, is acknowledging that land has value beyond just the value you get from selling it or the resources you can extract from it,” said Aaron Weiss, deputy director for the conservation organization Center for Western Priorities.
“There is an economic value to clean water, there’s an economic value to clean air, there’s an economic value to intact habitats and ecosystems,” he told The Salt Lake Tribune.
But Utah Treasurer Marlo Oakes sees such companies as “one of the greatest threats to rural communities in the history of our country.”
“Under the proposal, private interests, including foreign-controlled sovereign wealth funds, could use their capital to purchase or manage farmland, national and state parks, and other mineral-rich areas and stop essential economic activities like farming, grazing, and energy extraction,” Oakes said in a statement.
“Recreating on Utah’s incredible natural lands could also face significant curtailment,” he added. Oakes also penned an op-ed in the Wall Street Journal on the idea in November.
Federal rules don’t bar foreign-controlled companies from seeking leases to drill or extract resources from America’s public lands.
Not this free-market solution
Curtis started the Conservative Climate Caucus, a group of 50 House Republicans who believe that “practical and exportable answers can be found in innovation embraced by the free market,” in 2021. He has been vocal about wanting Republicans to be at the forefront of climate change solutions.
Weiss, with the Center for Western Priorities, observed that “everything John Curtis has written for two years prior to this has been saying that he wants free market climate solutions.”
Weiss added: “Here’s one that lands on his lap, and the first thing he tries to do is kill it in the state of Utah.”
But Curtis doesn’t see natural asset companies as a solution — charging that they could supplant existing uses and livelihoods. In a legislative hearing held by the Subcommittee on Federal Lands on March 20, Curtis emphasized that two-thirds of Utah’s land is public.
“If this land is not preserved and protected, then you don’t have the ability to ranch and use it, so your livelihoods are deeply dependent on conservation and protecting this land,” he said.
Curtis’ bill is still in the House Natural Resources Committee. The Protect America’s Lands Act has been referred to the House Committee on Financial Services and the Senate Committee on Banking, Housing, and Urban Affairs.
Other Utah Republicans also decry natural asset companies and accuse Wall Street of trying to lock up land out west.
Utah businesses and families depend on leases for public lands, Redge Johnson, executive director of the Utah Public Lands Policy Coordinating Office, told the SEC in an October letter.
“Because Utah is a ‘public land state’ the continued success of economic and recreational activities such as grazing, logging, and OHV use are critical to the State’s success,” his letter read. “Many of the small/family businesses and other business entities rely on these resources for a living, and this Proposed Rule has the potential to negatively affect the users of Utah’s working landscapes.”
In January, Utah Attorney General Sean Reyes joined the attorneys general of 23 other states in a letter accusing the SEC of trying to use natural asset companies to finance a controversial public lands rule.
Last year, the Biden administration’s Bureau of Land Management proposed a rule that would designate conservation as a “use” on public lands — alongside grazing, mining, recreation and other activities. Most contentiously, the proposed rule offers “conservation leases,” where conservation groups could lease BLM land to restore it.
(Rick Egan | The Salt Lake Tribune) Wild horses run free on BLM land northwest of Cedar City in 2014.
“The [SEC’s] proposed rule provides a mechanism for companies whose purpose is not to make money, but instead to lock up land to prohibit productive economic uses thereof, to find investors and capital so they can obtain conservation leases and other ‘ecological performance rights,’” the attorneys general’s letter read. “It functions in unison with the BLM rule.”
But BLM Principal Deputy Director Nada Wolff Culver said the BLM’s rule had nothing to do with the establishment of natural asset companies or the SEC’s proposed rule.
“Under the proposed public lands rule,” she said at a recent Subcommittee on Federal Lands hearing, “the BLM would issue leases for restoration or mitigation activities based on the terms and conditions that we would develop, and entities could apply for those leases, but they would not be guaranteed to be issued.”
U.S. Rep. Celeste Maloy, who represents Utah’s second congressional district, also objects to the control natural asset companies would have over land.
What Utah’s public lands need, she wrote to The Tribune in an email, “is more local input, not another distant landlord who dictates management decisions. Big corporations and environmental special interest groups have no right to swoop in, lock this land up, and destroy lives to meet ESG goals.”
U.S. Rep. Burgess Owens did not respond to The Tribune’s request for comment. A spokesperson for Sen. Mitt Romney said the senator did not have a comment.
Opposition from state lawmakers
The Utah Legislature also targeted natural asset companies during the 2024 session.
Rep. Carl Albrecht, R-Richfield, sponsored HB496: Public Land Use Amendments, which bans natural asset companies from buying or leasing public lands in the state.
In February, Albrecht warned that though the SEC had backed off natural asset companies for now, similar corporations could surface.
“We just have to be vigilant here in the state of Utah and say, ‘no,’” he said to the Utah House Natural Resources, Agriculture, and Environment Committee. “We don’t want natural asset companies. We don’t want anything like them.”
(Trent Nelson | The Salt Lake Tribune) Rep. Carl Albrecht, R-Richfield, at the Capitol in Salt Lake City on Tuesday, Feb. 7, 2023.
The Legislature also approved HB516: State Land Purchase Amendments, sponsored by Rep. Candice Pierucci, R-Herriman. The bill prohibits entities owned or controlled by the governments of China, Iran, North Korea or Russia from owning or purchasing land in Utah, addressing fears that natural asset companies owned by foreign governments could present a national security risk.
“To single out foreign companies that might be interested in conserving land while being fine with foreign companies trashing public land is the height of hypocrisy,” Weiss said. He referred to fossil fuel development and mining projects on public lands headed by companies outside the U.S.
Utah Gov. Spencer Cox signed HB496 into law on March 12 and HB516 on March 21. Both laws go into effect on May 1.
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