Provision will help area ranchers

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A provision extending the amount of time ranchers have to replenish their herds -- and avoid paying taxes -- passed in the U.S. House of Representatives last week, giving area ranchers some reason to be optimistic in the face of many challenges.

Rep. Scott McInnis drafted the provision, which passed 251 to 178, to aid ranchers during times of extended drought.

Under current tax laws, ranchers who sell livestock do not have to pay capital gains taxes on the sale if they replenish their herds within two years. McInnis' law would extend that period to four years if drought or other weather-related emergencies have caused ranchers to sell their herd.

"It would be very helpful because a lot of these people are afraid to buy back," said Oak Creek rancher Dan Craig, who is also with the Farm Bureau.

But the drought, which has lasted about five years and has been part of a larger pattern of declining water supplies since 1984, is just one of the many problems making ranching a tough business, he said.

"It's a big combination of things, not just drought," Craig said. "I wish that was the only problem we had."

The pressure to develop land and the possible listing of the sage grouse on the endangered species list -- which could limit grazing patterns on public and private land -- are among challenges facing area ranchers.

Questions over water rights, particularly rights to Colorado River water in the face of drought and burgeoning cities downstream, also have ranchers on edge about their future, he said.

While good for ranchers selling livestock, high prices of beef and cattle aren't so good for those trying to replenish their herds right now. The provision would give ranchers time to wait out the market before trying to buy, Phippsburg rancher Dean Rossi said.

But because the provision is aimed at drought-relief, it probably will help ranchers in eastern Colorado more than in Northwest Colorado, where some ranchers have been able to find pastures for their cattle.

"I don't think it really affects a whole lot of people," he said. "There are not a lot of people that have had to sell."

But every little bit counts, especially when you consider low commodity prices and the grasshopper infestations that have plagued area ranchers' fields -- and their pocketbooks.

"For people making their lives off of agriculture, everything happened at the same time," said Marsha Daughenbaugh, executive director of the Community Agricultural Alliance.

The grasshopper problem of the past few years has resulted in less grass for cows in the summer and less hay in the winter, forcing some ranchers to reduce their herds, she said.

And though beef prices have rebounded recently, there has been a general decline in the prices farmers and ranchers have received for cattle, sheep, wheat and oats in the past four years.

McInnis' livestock provisions were included in the American Jobs Creation Act, designed to resolve an ongoing trade dispute with the European Union, which has enacted retaliatory tariffs on American products. The impact has been particularly hard on agriculture products and livestock.

A House and Senate Conference committee now will consider the bill.

-- To reach Tamera Manzanares call 871-4204 or e-mail tmanzanares@steamboatpilot.com

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