Apparently, Utah is trying to do just that:
... as reported by the AP: Utah Governor Gary Herbert on Saturday authorized the use of eminent domain to take some of the U.S. government’s most valuable parcels.
Yes, LBers, you’ve read that correctly: a state has invoked eminent domain in order to take back land from the feds.
According to the AP, Herbert signed a pair of bills into law that supporters hope will spark similar legislation throughout the West. Many contend that federal ownership of wide parcels of land restricts economic development in an energy-rich part of the country. Many people in Utah are still angry that President Clinton designated a large area in Utah as a national monument in 1996, a move that stopped development on the land.
More than 60 percent of Utah is owned by the U.S. government, and policy makers here have long complained that federal ownership hinders their ability to generate tax revenue and adequately fund public schools.
I have no idea whether this could work either under the facts of the case at bar or, more generally, under any set of circumstances. But some quick Westlaw research kicked up a seemingly relevant case, which --oddly enough--also comes from Utah; namely, Utah Power & Light Co. v. U.S., 243 U.S. 389 (U.S. 1917), in which we find that:
The first position taken by the defendants is that their claims must be tested by the laws of the state in which the lands are situate rather than by the legislation of Congress, and in support of this position they say that lands of the United States within a state, when not used or needed for a fort or other governmental purpose of the *404 United States, are subject to the jurisdiction, powers, and laws of the state in the same way and to the same extent as are similar lands of others. To this we cannot assent. Not only does the Constitution (art. 4, § 3, cl. 2) commit to Congress the power ‘to dispose of and make all needful rules and regulations respecting’ the lands of the United States, but the settled course of legislation, congressional and state, and repeated decisions of this court, have gone upon the theory that the power of Congress is exclusive, and that only through its exercise in some form can rights in lands belonging to the United States be acquired. True, for many purposes a state has civil and criminal jurisdiction over lands within its limits belonging to the United States, but this jurisdiction does not extend to any matter that is not consistent with full power in the United States to protect its lands, to control their use, and to prescribe in what manner others may require rights in them. Thus, while the state may punish public offenses, such as murder or larceny, committed on such lands, and may tax private property, such as live stock, located thereon, it may not tax the lands themselves, or invest others with any right whatever in them. ... From the earliest times Congress by its legislation, applicable alike in the states and territories, has regulated in many particulars the use by others of the lands of the United States, has prohibited and made punishable various acts calculated to be injurious to them or to prevent their use in the way intended, and has provided for and controlled the acquisition of rights of way over them for highways, railroads, canals, ditches, telegraph lines, and the like. The states and the public have almost uniformly accepted this legislation as controlling, and in the instances where it has been questioned in this court its validity has been upheld and its supremacy over state enactments sustained. ... And so we are of opinion that the inclusion within a state of lands of the United States does not take from Congress the power to control their occupancy and use, to protect them from trespass and injury, and to prescribe the conditions upon which others may obtain rights in them, even though this may involve the exercise in some measure of what commonly is known as the police power. ‘A different rule,’ as was said in Camfield v. United States, 167 U. S. 518, ... ‘would place the public domain of the United States completely at the mercy of state legislation.’
It results that state laws, including those relating to the exercise of the power of eminent domain, have no bearing upon a controversy such as is here presented, save as they may have been adopted or made applicable by Congress.
That seems pretty dispositive, doesn't it?
But then there is dicta in US v Chicago, 48 US 185 (1849), opinion that "land within a State purchased by the United States as a mere proprietor, and not reserved or appropriated for any special purpose, may be liable to condemnation for streets or highways, like the land of other proprietors, under the rights of eminent domain.” So perhaps the question is more complex that the 1917 Utah case would have us believe.
Just thinking about the problem from a practical perspective, it strikes me that a state power to condemn federal land would inevitably lead to a cycling problem. Utah wants to promote economic development by allowing oil and gas development on federal land within Utah. So it takes the land from the feds via eminent domain. The fads then strike back, using its power of eminent domain to retake the land.
We can solve the cycling problem by drawing an analogy here to Garcia v. San Antonio Metropolitan Transit Authority, 469 U.S. 528 (1985),which held that Congress could impose federal wage laws on states without violating the constitution. States have political protections (equal representation in the Senate, state by state election of the President via the Electoral College and so on). Hence, they don't get constitutional protections.
If Utah doesn't like how the feds are using federal land within Utah, Utah's resort therefore should be to Congress (as that 1917 decision suggests) rather than the Courts.
But I only play a constitutional lawyer here on the blog. I'll pass the question on to some folks who really do it for a living.