Only one of 31 BLM parcels sold at the lackluster auction Nov. 1, which was the worst this decade by BLM standards.

The auction placed 167.5 acres up for grabs in Henderson, the southwest and other areas.

Only the sale of one 15-acre site at Pollack Drive and Welpman Avenue kept the auction from being a shutout.

Juan Palma, BLM's Las Vegas field manager, said it would take a change in BLM policy to sell land below appraised value, and he's not suggesting that happen at this time.

The Southern Nevada Public Lands Management Act, approved by Congress in 1998, requires federal land be sold for fair market value and subsequent regulations defined fair market value as the appraised value.

Instead, he said it is possible that at the BLM's next auction, tentatively scheduled for April, it may for the first time, allow bidding to start below the appraised value.

Bidders would be required to meet the reserve price, which is the appraised value, Palma said, but the more open bidding process would give insights as to the level of interest in the federally owned land and its current market value.

That could ultimately lead to changes that would allow property to be sold for less than appraised value, he said.

Palma said that with a slowdown in the housing market and softened demand for land in the Las Vegas Valley, the appraisals lag behind the current market and tend to look at what the land was once worth.

The rule preventing the sale of land below its appraised value is intended to ensure that the American public "isn't ripped off" and there are "no sweetheart deals," Palma explained, but noted that with the housing slump and the appraisals' failure to capture declining values, auctioned land is priced to the point where there are no bidders, Palma said.

"When the market is in an upswing, the appraisal system works, but when the market is not going down, the appraisal system doesn't work," Palma said.

Palma said he would have to see the results of the more relaxed bidding process before he advocates any changes to how BLM lands are sold. Some have argued the BLM never knows the true market price, he said.

"We don't have to sell, but we can at least get a sense of what the market can bear," Palma. "The concept is what you see on eBay and you have a reserve. If the reserve is not met, you don't sell it."

The BLM met with Las Vegas Valley elected officials Monday to discuss nominations for a November 2008 land auction and Palma broached the subject of changing the auction process.

He said he will consult with BLM attorneys and continue discussions with elected officials.

The concept is an "interesting one" and something Henderson will take a look at, said Stephanie Garcia-Vause, Henderson's deputy director of community development.

"Before the auction we had a lot of interest," she said. "We kept a tally at our front counter and had a dozen or so inquiries. We don't know what happened."

The parcels auctioned are nominated by local governments and agreed to by the BLM. The lots chosen for sale are determined by the public going to local governments and asking they be auctioned, Palma said.

Craig Cherney, director of Western operations of the Philadelphia-based American Land Fund, a private equity and land acquisition group, said it is not surprising that parcels didn't sell at the auction in a market where prices continue to decline.

"There is no demand, and basically it is a supply and demand problem," Cherney said. "There is overhang in the private real estate market and until that is burned through, there is going to be little demand from public and private homebuilders."

Cherney said he doesn't believe going to a process of accepting bids lower than appraised value while setting a reserve price will generate more interest in the bidding process. If the buyers know they have to meet the reserve price, they're not going to take a half a day to go bid on properties they know they won't buy.

What would work, Cherney said, is an auction that starts at appraised value and ratchets down in increments to a point that bids are made. Then, the price can go up from there, he said.

The lack of success at the Nov. 1 auction may prompt the BLM to reduce the number of acres put on the block in April, Palma said.

There now are about 500 acres set to be auctioned, he said.

There are about 80 acres on the block for the November 2008 auction, he said.

Henderson, however, is eying land south of the Inspirada master planned community for the auction.

About 350 acres of 700 acres next to the Sloan Canyon National Conservation Area would be auctioned, Garcia-Vause said. The rest of the land is reserved for trails or otherwise undevelopable.

Henderson is considering a spring 2009 auction of land west of Inspirada. Of the 2,500 acres of federal land available for that auction, Henderson may nominate 1,000 acres near the Sloan interchange.