SB 1238
Initials PAB Page 1 Transmitted
ARIZONA HOUSE OF REPRESENTATIVES
Fifty-fifth Legislature
Second Regular Session
Senate: NREW DP 9-0-0-0 | 3
rd
Read 28-0-2-0
House: NREW DP 11-0-0-0 | 57-0-3-0
SB 1238: state lands; appraisals; leases; rights-of-way
Sponsor: Senator Kerr, LD 13
Transmitted to the Governor
Overview
Amends state trust land statutes that require reappraisal before auction, mandates Board of
Appeals' approval of commercial leases and specifies how initial payments on recently purchased
lands are applied.
History
Appraising State Trust Lands
Before being offered for sale or lease (for periods longer than 10 years) at a public auction, state
trust lands must be appraised. These lands cannot be sold at less than the appraised value
(Constitution of Arizona, Article X, §§ 3 and 4).
The State Land Commissioner classifies and appraises all state trust lands for sale, lease or
granting rights-of-way and the Board of Appeals approves any sale or commercial leases of these
lands (A.R.S. § 37-132). The State Land Department must reappraise or update its original
appraisal if the Board of Appeals' approval of the lease or sale occurred more than 180 days
before the auction (A.R.S. § 37-102).
Leasing State Trust Lands
State trust lands can be leased for a variety of purposes, but the approval process varies based
on the type of lease. While leases for more than ten years require a public auction, those that are
for less than ten years simply require a person to apply to the State Land Department. The State
Land Commissioner has the authority to handle leases for non-commercial uses including
grazing, agriculture, and homesites. However, any commercial lease (regardless of its length)
must first be approved by the Board of Appeals (A.R.S. § 37-132).
Paying for State Trust Lands
When state trust lands are sold at auction, the buyer must pay 10% to 25% of the land's appraised
value, which will be applied to the principal. If the winning bid exceeds the appraised value, the
required additional payments will be allocated to the principle (A.R.S. § 37-241).
Provisions
1. Requires the State Land Department to reappraise or update its original appraisal of property
that will be leased, exchanged or sold if the Board of Appeals' approval of the lease or sale
occurred more than 240 days before the auction. (Sec. 1)
2. Exempts any commercial lease of state trust lands of less than 10 years from mandatory
approval by the Board of Appeals. (Sec. 2)
3. Requires the initial payment to apply to the associated rights-of-way of purchased state trust
land. (Sec. 3)
4. Makes technical changes. (Sec. 1 and 2)
☐ Prop 105 (45 votes) ☐ Prop 108 (40 votes) ☐ Emergency (40 votes) ☐ Fiscal Note