Here’s your penny. Actually, government does not own the land but manages the land for the public. The rancher and his family have been grazing on this land for what about 150 years. The federal law here may need to be modified. That’s how it works.
The government holds legal title to the land, read post 32.
There is nothing wrong with people paying rent to use something they don’t own. In fact that is the *right* thing to do.