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First Substitute H.B. 324

Representative Kenneth W. Sumsion proposes the following substitute bill:


             1     
PUBLIC LANDS LITIGATION

             2     
2010 GENERAL SESSION

             3     
STATE OF UTAH

             4     
Chief Sponsor: Kenneth W. Sumsion

             5     
Senate Sponsor: Wayne L. Niederhauser

             6     
             7      LONG TITLE
             8      General Description:
             9          This bill amends and enacts provisions related to actions filed by the attorney general
             10      on property possessed by the federal government and the appropriation of funds for
             11      those actions.
             12      Highlighted Provisions:
             13          This bill:
             14          .    appropriates money from the Land Exchange Distribution Account to the
             15      Constitutional Defense Council Restricted Account for legal services and just
             16      compensation for property taken;
             17          .    directs the attorney general to file certain eminent domain or quiet title actions on
             18      property possessed by the federal government;
             19          .    authorizes the attorney general to file an action to enforce a section of the Utah
             20      Enabling Act; and
             21          .    makes technical changes.
             22      Monies Appropriated in this Bill:
             23          This bill appropriates $1,000,000 from the Land Exchange Distribution Account for
             24      fiscal years 2010-11, 2011-12, and 2012-13 only to the Constitutional Defense Council
             25      Restricted Account.


             26      Other Special Clauses:
             27          None
             28      Utah Code Sections Affected:
             29      AMENDS:
             30          53C-3-203, as last amended by Laws of Utah 2008, Chapter 216
             31          63C-4-102, as last amended by Laws of Utah 2009, Chapter 121
             32          63C-4-103, as last amended by Laws of Utah 2009, Chapter 121
             33      ENACTS:
             34          67-5-29, Utah Code Annotated 1953
             35     
             36      Be it enacted by the Legislature of the state of Utah:
             37          Section 1. Section 53C-3-203 is amended to read:
             38           53C-3-203. Land Exchange Distribution Account.
             39          (1) As used in this section, "account" means the Land Exchange Distribution Account
             40      created in Subsection (2)(a).
             41          (2) (a) There is created within the General Fund a restricted account known as the Land
             42      Exchange Distribution Account.
             43          (b) The account shall consist of all revenue deposited in the account as required by
             44      Subsections 53C-3-202 (2)(a)(ii) and (2)(b)(ii).
             45          (3) (a) The state treasurer shall invest monies in the account according to Title 51,
             46      Chapter 7, State Money Management Act.
             47          (b) The Division of Finance shall deposit interest or other earnings derived from
             48      investment of account monies into the General Fund.
             49          (4) [For fiscal years beginning on or after fiscal year 2007-08, because the revenue is
             50      not derived from taxes, the] The Legislature shall annually appropriate from the account in the
             51      following order:
             52          (a) $1,000,000 to the Constitutional Defense Council Restricted Account, created in
             53      63C-4-103 , to be used in accordance with Subsection 63C-4-103 (6) for:
             54          (i) fiscal year 2010-11;
             55          (ii) fiscal year 2011-12; and
             56          (iii) fiscal year 2012-13; and


             57          (b) from the deposits to the account remaining after the appropriation in Subsection
             58      (4)(a), the following amounts:
             59          [(a)] (i) 55% of [all] the deposits [made to the account] to counties in amounts
             60      proportionate to the amounts of mineral revenue generated from the acquired land, exchanged
             61      land, acquired mineral interests, or exchanged mineral interests located in each county, to be
             62      used to mitigate the impacts caused by mineral development;
             63          [(b)] (ii) 25% of [all] the deposits [made to the account] to counties in amounts
             64      proportionate to the total surface and mineral acreage within each county that was conveyed to
             65      the United States under the agreement or an exchange, to be used to mitigate the loss of
             66      mineral development opportunities resulting from the agreement or exchange;
             67          [(c)] (iii) 1.68% of [all] the deposits [made to the account] to the State Board of
             68      Education, to be used for education research and experimentation in the use of staff and
             69      facilities designed to improve the quality of education in Utah;
             70          [(d)] (iv) 1.66% of [all] the deposits [made to the account] to the Geological Survey, to
             71      be used for natural resources development in the state;
             72          [(e)] (v) 1.66% of [all] the deposits [made to the account] to the Water Research
             73      Laboratory at Utah State University, to be used for water development in the state; and
             74          [(f)] (vi) 7.5% of [all] the deposits [made to the account] to the Constitutional Defense
             75      Restricted Account created in Section 63C-4-103 .
             76          (5) For fiscal years 2007-08 and 2008-09, the Legislature shall annually appropriate
             77      [from the account] 7.5% of [all] the deposits [made to the account] remaining in the account
             78      after the appropriation is made in accordance with Subsection (4)(a) to the Geological Survey,
             79      to be used for test wells and other hydrologic studies in the West Desert.
             80          (6) For fiscal years beginning on or after fiscal year 2009-10, the Legislature shall
             81      annually appropriate [from the account] 7.5% of [all] the deposits [made to the account]
             82      remaining in the account after the appropriation is made in Subsection (4)(a) to the Permanent
             83      Community Impact Fund created in Section 9-4-303 , to be used for grants to political
             84      subdivisions of the state to mitigate the impacts resulting from the development or use of
             85      school and institutional trust lands.
             86          Section 2. Section 63C-4-102 is amended to read:
             87           63C-4-102. Duties.


             88          (1) The Constitutional Defense Council is a council to assist the governor and the
             89      Legislature on the following types of issues:
             90          (a) the constitutionality of unfunded federal mandates;
             91          (b) when making recommendations to challenge the federal mandates and regulations
             92      described in Subsections (1)(e)(i) through (v), the rationale for and effectiveness of those
             93      federal mandates or regulations;
             94          (c) legal and policy issues surrounding state and local government rights under R.S.
             95      2477;
             96          (d) legal issues relating to the rights of the School and Institutional Trust Lands
             97      Administration and its beneficiaries; and
             98          (e) the advisability, feasibility, estimated cost, and likelihood of success of challenging:
             99          (i) federal court rulings that hinder the management of the state's prison system and
             100      place undue financial hardship on the state's taxpayers;
             101          (ii) federal laws or regulations that reduce or negate water rights or the rights of owners
             102      of private property, or the rights and interest of state and local governments, including
             103      sovereignty interests and the power to provide for the health, safety, and welfare, and promote
             104      the prosperity of their inhabitants;
             105          (iii) conflicting federal regulations or policies in land management on federal land;
             106          (iv) federal intervention that would damage the state's mining, timber, and ranching
             107      industries;
             108          (v) the authority of the Environmental Protection Agency and Congress to mandate
             109      local air quality standards and penalties; and
             110          (vi) other issues that are relevant to this Subsection (1).
             111          (2) The council shall:
             112          (a) provide advice to the governor, state planning coordinator, and the public lands
             113      policy coordinator concerning coordination of:
             114          (i) state and local government rights under R.S. 2477; and
             115          (ii) other public lands issues;
             116          (b) approve a plan for R.S. 2477 rights developed in accordance with Section
             117      63C-4-104 ; and
             118          (c) review, at least quarterly:


             119          (i) financial statements concerning implementation of the plan for R.S. 2477 rights;
             120      and
             121          (ii) financial and other reports from the Public Lands Policy Coordinating Office
             122      concerning its activities.
             123          (3) The council chair may require the attorney general or a designee to provide
             124      testimony on potential legal actions that would enhance the state's sovereignty or authority on
             125      issues affecting Utah and the well-being of its citizens.
             126          (4) The council chair may direct the attorney general to initiate and prosecute any
             127      action that the council determines will further its purposes, including an action described in
             128      Section 67-5-29 .
             129          (5) (a) Subject to the provisions of this section, the council may select and employ
             130      attorneys to implement the purposes and duties of the council.
             131          (b) The council chair may, in consultation with the council, direct any council attorney
             132      in any manner considered appropriate by the attorney general to best serve the purposes of the
             133      council.
             134          (c) The attorney general shall negotiate a contract for services with any attorney
             135      selected and approved for employment under this section.
             136          (6) The council chair shall, only with the concurrence of the council, review and
             137      approve all claims for payments for:
             138          (a) legal services that are submitted to the council[.]; and
             139          (b) an action filed in accordance with Section 67-5-29 .
             140          (7) Within five business days' notice, the council chair may, with the concurrence of
             141      the council, order the attorney general or an attorney employed by the council to cease work to
             142      be charged to the fund.
             143          (8) (a) At least 20 calendar days before the state submits comments on the draft
             144      environmental impact statement or environmental assessment for a proposed land management
             145      plan of any federal land management agency, the governor shall make those documents
             146      available to:
             147          (i) members of the council; and
             148          (ii) any county executive, county council member, or county commissioner of a county
             149      that is covered by the management plan and that has established formal cooperating agency


             150      status with the relevant federal land management agency regarding the proposed plan .
             151          (b) (i) Council members or local government officials receiving the documents may
             152      make recommendations to the governor or the governor's designee concerning changes to the
             153      documents before they are submitted to the federal land management agency.
             154          (ii) Council members or local government officials shall submit recommendations to
             155      the governor or the governor's designee no later than 10 calendar days after receiving the
             156      documents under Subsection (8)(a).
             157          (c) Documents transmitted or received under this Subsection (8) are drafts and are
             158      protected records pursuant to Subsection 63G-2-305 (22).
             159          (9) The council shall submit a report on December 1 of each year to the speaker of the
             160      House of Representatives and the president of the Senate that summarizes the council's
             161      activities.
             162          Section 3. Section 63C-4-103 is amended to read:
             163           63C-4-103. Creation of Constitutional Defense Restricted Account -- Sources of
             164      funds -- Uses of funds -- Reports.
             165          (1) There is created a restricted account within the General Fund known as the
             166      Constitutional Defense Restricted Account.
             167          (2) The account consists of monies from the following revenue sources:
             168          (a) monies deposited to the account as required by Section 53C-3-203 ;
             169          (b) voluntary contributions;
             170          (c) monies received by the Constitutional Defense Council from other state agencies;
             171      and
             172          (d) appropriations made by the Legislature.
             173          (3) Funds in the account shall be nonlapsing.
             174          (4) The account balance may not exceed [$2,000,000] $5,000,000.
             175          (5) [The] Subject to Subsection (6), the Legislature may annually appropriate [monies]
             176      money from the Constitutional Defense Restricted Account to one or more of the following:
             177          (a) the Constitutional Defense Council to carry out its duties in Section 63C-4-102 ;
             178          (b) the Public Lands Policy Coordinating Office to carry out its duties in Section
             179      63J-4-603 ;
             180          (c) the Office of the Governor, to be used only for the purpose of asserting, defending,


             181      or litigating state and local government rights under R.S. 2477, in accordance with a plan
             182      developed and approved as provided in Section 63C-4-104 ;
             183          (d) a county or association of counties to assist counties, consistent with the purposes
             184      of the council, in pursuing issues affecting the counties; or
             185          (e) the Office of the Attorney General, to be used only for:
             186          (i) public lands counsel and assistance and litigation to the state or local governments
             187      including asserting, defending, or litigating state and local government rights under R.S. 2477
             188      in accordance with a plan developed and approved as provided in Section 63C-4-104 [.]; or
             189          (ii) an action filed in accordance with Section 67-5-29 .
             190          (6) Money appropriated to the Constitutional Defense Restricted Account in
             191      accordance with Subsection 53C-3-203 (4)(a), if appropriated by the Legislature, may only be
             192      expended by the agency to which it was appropriated to pay the costs of an action filed in
             193      accordance with Section 67-5-29 .
             194          [(6)] (7) (a) The Constitutional Defense Council shall require that any entity that
             195      receives monies from the Constitutional Defense Restricted Account provide financial reports
             196      and litigation reports to the Council.
             197          (b) Nothing in this Subsection [(6)] (7) prohibits the council from closing a meeting
             198      under Title 52, Chapter 4, Open and Public Meetings Act, or prohibits the council from
             199      complying with Title 63G, Chapter 2, Government Records Access and Management Act.
             200          Section 4. Section 67-5-29 is enacted to read:
             201          67-5-29. Duty to legal actions.
             202          (1) The attorney general may file an action to enforce the Utah Enabling Act, Section
             203      9.
             204          (2) In accordance with Title 78B, Chapter 6, Particular Proceedings, the attorney
             205      general shall file an eminent domain action or quiet title action on property possessed by the
             206      federal government:
             207          (a) (i) that facilitates the state's ability to manage the school and institutional trust lands
             208      consistent with the state's fiduciary responsibilities towards the beneficiaries of the trust lands;
             209      and
             210          (i) (A) that provides access to school and institutional trust lands; or
             211          (B) that increases the profitability of the school and institutional trust lands; or


             212          (b) for a public use that increases the ability of the state to generate revenue.
             213          (3) The attorney general shall file, by no later than July 1, 2011, an eminent domain
             214      action or quiet title action described in Subsection (2) on property possessed by the federal
             215      government for:
             216          (a) a highway on Spring Creek Road located in the western half of section 3, township
             217      38 south, range 12 west to provide access to section 2, township 38 south, range 12 west;
             218          (b) a highway off of Old Canyon Road located in the northeast quarter of the southeast
             219      quarter of section 5, township 10 north, range 5 east to provide access to the southeast quarter
             220      of the southeast quarter of section 32, township 11 north, range 5 east; or
             221          (c) the purposes described in Subsection (2).




Legislative Review Note
    as of 2-26-10 9:21 AM


As required by legislative rule and practice, the Office of Legislative Research and General
Counsel provides the following legislative review note to assist the Legislature in making its
own determination as to the constitutionality of the bill. The note is based on an analysis of
relevant state and federal constitutional law as applied to the bill. The note is not written for the
purpose of influencing whether the bill should become law, but is written to provide
information relevant to legislators' consideration of this bill. The note is not a substitute for the
judgment of the judiciary, which has authority to determine the constitutionality of a law in the
context of a specific case.

This bill authorizes the state to exercise eminent domain authority on property possessed by the
federal government unless the property is owned by the federal government in accordance with
the U.S. Constitution article I, section 8, clause 17, also known as the "Enclave Clause." The
U.S. Supreme Court has held that eminent domain authority, or the right to take and dispose
land for public use and necessity, belongs to the sovereign government of the land (i.e. federal
or state government). See Pollard v. Hagan, 44 U.S. 212, 223 (1845). This bill contests the U.S.
Supreme Court's opinion that the federal government is the sovereign of public land or property
acquired by the federal government in accordance with federal constitutional authority other
than the Enclave Clause.

In 1894 the U.S. Congress passed the Utah Enabling Act. Act Cong. July 16, 1894, ch. 138, 28
Stat. 107. The Act declared that as a condition of Utah's acceptance into the Union, the people
of Utah "agree[d] that they forever disclaim[ed] all right and title to the unappropriated public
lands lying within the boundaries thereof; and to all lands lying within said limits owned or
held by any Indian or Indian tribes; and that until the title thereto shall have been extinguished
by the United States, the same shall be and remain subject to the disposition of the United
States . . . ." Id. at § 3. At this time, Utah also adopted the U.S. Constitution as a condition to


joining the Union. Id.

Two clauses in the U.S. Constitution empower the federal government to own and retain land.
The first, the Enclave Clause, authorizes the federal government to "purchas[e] by the Consent
of the Legislature of the State" land for specific and enumerated purposes like military
structures "and other needful Buildings." U.S. Const. art. I, sec. 8, cl. 17. This bill would not
affect lands acquired by the federal government in accordance with the Enclave Clause.

The second, the "Property Clause," authorizes Congress "to dispose of and make all needful
Rules and Regulations respecting the Territory or other Property belonging to the United
States.." U.S. Const. art. IV, sec. 3, cl. 2. Unlike the Enclave Clause, the Property Clause
does not require that the federal government receive a state legislature's consent to own land.
The U.S. Supreme Court has held that "Congress has the same power over [territory] as over
any other property belonging to the United States; and this power is vested in Congress without
limitation.." United States v. Gratiot, 39 U.S. 526, 537 (1840). See also Kleppe v. New
Mexico
, 426 U.S. 529, 539 (1976). Pursuant to its broad authority under the Property Clause,
Congress may enact legislation to manage or sell federal land, and any legislation Congress
enacts "necessarily overrides conflicting state laws under the Supremacy Clause." Kleppe, 426
U.S. at 543. See U.S. Const. art. VI, cl. 2.

Parties contesting federal control or ownership of public lands under the Property Clause have
argued that the equal footing doctrine requires Congress' recognition of a state's sovereignty
over public lands. "The equal footing doctrine is grounded in the idea that new states enter the
Union with the same rights as the original states." Koch v. United States, DOI, Interior Bd. of
Land Appeals, BLM
, 47 F.3d 1015, 1018 (10th Cir. 1995) (citations omitted). The courts,
however, have limited the equal footing doctrine to apply only to the title of land underlying
navigable waters: "The equal footing doctrine simply does not cause land in non-navigable
waters to pass from the federal government to the state." Id. at 1019. See also Texas v.
Louisiana
,
410 U.S. 702, 713 (1973). Furthermore, the equal footing doctrine requires
political, not economic or geographic, equality between the states. United States v. Texas, 339
U.S. 707, 716 (1950). See also Texas v. Louisiana, 410 U.S. at 713.

Based on the courts' previous application of the Property Clause, there is a high probability that
a court would hold that the federal government is the sovereign of public lands surrendered to
or withheld by the federal government at the time of Utah's acceptance into the Union. See
generally United States v. Nye County
, 920 F. Supp. 1108, 1109 (D. Nev. 1996); Gibson v.
Chouteau
, 80 U.S. 92 (1872). In short, the state has no standing as sovereign to exercise
eminent domain or assert any other state law that is contrary to federal law on land or property
that the federal government holds under the Property Clause.

Office of Legislative Research and General Counsel


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