1     
SCHOOL AND INSTITUTIONAL TRUST LANDS

2     
ADMINISTRATION AMENDMENTS

3     
2024 GENERAL SESSION

4     
STATE OF UTAH

5     
Chief Sponsor: Phil Lyman

6     
Senate Sponsor: ____________

7     

8     LONG TITLE
9     General Description:
10          This bill modifies provisions related to the School and Institutional Trust Lands
11     Administration.
12     Highlighted Provisions:
13          This bill:
14          ▸     defines terms;
15          ▸     repeals rulemaking authority;
16          ▸     prohibits state employees or contractors from receiving a financial bonus for
17     overseeing the sale of trust lands;
18          ▸     creates requirements for the sale, exchange, lease or other disposition or conveyance
19     of trust lands;
20          ▸     requires a governmental entity to notify legislators of proposed land exchanges less
21     than 500 acres that impact public lands or trust lands within the legislator's district;
22     and
23          ▸     makes technical changes.
24     Money Appropriated in this Bill:
25          None
26     Other Special Clauses:
27          None
28     Utah Code Sections Affected:
29     AMENDS:
30          53C-4-101, as last amended by Laws of Utah 2011, Chapter 247
31          53C-4-102, as last amended by Laws of Utah 2018, Chapter 13
32          63L-2-201, as last amended by Laws of Utah 2019, Chapter 457
33     

34     Be it enacted by the Legislature of the state of Utah:
35          Section 1. Section 53C-4-101 is amended to read:
36          53C-4-101. Criteria for sale, lease, exchange, or other disposition of trust lands.
37          (1) [(a) The] Before executing a sale, exchange, lease, or other disposition or
38     conveyance of trust lands, the director shall [establish criteria by rule for the sale, exchange,
39     lease, or other disposition or conveyance of trust lands, including procedures for determining
40     fair market value of those lands.]:
41          (a) determine the fair market value of the land by:
42          (i) an appraisal;
43          (ii) a market analysis, including evaluation of real estate trends, market demand,
44     opportunity costs of the sale, and the management costs of retention; and
45          (iii) other relevant information; and
46          (b) submit a report to the Natural Resources, Agriculture, and Environmental Quality
47     Appropriations Subcommittee stating how the proposed transfer:
48          (i) reflects the value intrinsic to the dispersed pattern of school and institutional trust
49     lands that are surrounded by federal lands;
50          (ii) reflects the Legislature's prioritization of energy and natural resource development;
51     and
52          (iii) conforms, to the maximum extent possible, with an affected county's resource
53     management plan.
54          [(b)] (2) [(i) Nothing in this title or in the administration's rules and procedures shall be
55     considered to require the director or the administration to execute]
56          (a) The director may not recommend any transaction for the disposition of trust lands
57     on terms that the director determines by a written finding to be unfavorable to the beneficiaries.
58          (b) The director shall send a copy of the written finding described in Subsection (2)(a)
59     to each board member for review and comment.
60          [(ii) The director shall send a copy of the written finding to each board member for
61     review and comment.]
62          [(2)] (3) The governor, with the consent of the board, may participate in efforts and
63     initiatives related to school and institutional trust lands inholdings.
64          Section 2. Section 53C-4-102 is amended to read:
65          53C-4-102. Sale of trust lands -- Fair market value -- Incentives for sale --
66     Determination of sale -- Advertising proposed sales -- Sale procedures -- Defaults.
67          (1) Trust lands may not be sold for less than the fair market value.
68          (2) (a) The director shall determine whether disposal or retention of all or a portion of a
69     property interest in trust lands is in the best interest of the trust.
70          (b) When it is determined that the disposal of an interest in trust lands is in the best
71     interest of the applicable trust, the transaction shall be accomplished in an orderly and timely
72     manner.
73          (3) The director may not provide a financial incentive in addition to regular salary to
74     trust employees or contractors for services related to the sale or transfer of trust lands.
75          [(3)] (4) The director shall advertise any proposed sale, lease, or exchange of an
76     interest in trust lands in a reasonable manner consistent with the director's fiduciary
77     responsibilities.
78          [(4)] (5) (a) Any tract of trust land may be subdivided and sold, leased, or exchanged in
79     accordance with a plan, contract, or other action designating the land to be subdivided that is
80     approved by the director.
81          (b) The director may survey the tract and direct its subdivision.
82          (c) A plat of the survey shall be filed with the county recorder of the county in which
83     the land is located and with the administration.
84          [(5)] (6) Sale conditions, including qualification of prospective purchasers, shall be in
85     accordance with accepted mortgage lending and real estate practices.
86          [(6)] (7) Upon the sale of land, the director shall issue to the purchaser a certificate of
87     sale which describes the land purchased and states the amount paid, the amount due, and the
88     time when the principal and interest will become due.
89          [(7)] (8) Upon payment in full of principal and interest, payment in full of any amounts
90     required to be paid for the partial release of property, or acceptance of appropriate conveyance
91     documents in satisfaction of a land exchange, the governor, or the governor's designee, shall
92     issue a patent to the purchaser, heir, assignee, successor in interest, or other grantee as
93     determined by the director.
94          [(8)] (9) (a) If a purchaser of trust lands defaults in the payment of any installment of
95     principal or interest due under the terms of the contract of sale, the director shall notify the
96     purchaser that if the default is not corrected within 30 days after issuance of the notice the
97     director shall proceed with any remedy which the administration may pursue under law or the
98     contract of sale.
99          (b) The notice shall be sent by registered or certified mail to the purchaser at the latest
100     address as shown by the records of the administration.
101          (c) If the default is not corrected by compliance with the requirements of the notice of
102     default within the time provided by the notice, the director may pursue any available remedy
103     under the contract of sale, including forfeiture.
104          (d) If forfeited lands are sold again to the same purchaser, the sale may be made by a
105     new and independent contract without regard to the forfeited agreement.
106          Section 3. Section 63L-2-201 is amended to read:
107          63L-2-201. Federal government acquisition of real property in the state.
108          (1) As used in this section:
109          (a) "Federal land" means:
110          (i) land owned by the federal government; or
111          (ii) mineral rights, water rights, or similar rights owned by the federal government.
112          [(a)] (b) "Governmental entity" means:
113          (i) an agency, as that term is defined in Subsection 63G-10-102(2);
114          (ii) the School and Institutional Trust Lands Administration created in Section
115     53C-1-201;
116          (iii) the School and Institutional Trust Lands Board of Trustees created in Section
117     53C-1-202; or
118          (iv) a county.
119          [(b)] (c) "Governmentally controlled land" means land owned or managed by a
120     governmental entity.
121          (d) "Public lands county" means a county that has less private land ownership than the
122     state average, by percentage of land area, as determined by the Utah Geospatial Resource
123     Center.
124          (2) [(a)] Before legally binding the state by executing an agreement to sell or transfer to
125     the [United States] federal government 500 or more acres of governmentally controlled land or
126     school and institutional trust lands, a governmental entity shall submit the [agreement or]
127     proposal:
128          [(i)] (a) to the Legislature for [its] approval or rejection; or
129          [(ii)] (b) in the interim, to the Legislative Management Committee [for review of the
130     agreement or proposal.], which may:
131          (i) review the proposal described in this Subsection (2) for constitutional authority to
132     execute the sale or transfer of land to the federal government;
133          (ii) recommend that the governmental entity reject the proposal; or
134          (iii) recommend to the governor that the governor call a special session of the
135     Legislature to review and approve or reject the proposal.
136          [(b) The Legislative Management Committee may:]
137          [(i) recommend that the governmental entity execute the agreement or proposal;]
138          [(ii) recommend that the governmental entity reject the agreement or proposal; or]
139          [(iii) recommend to the governor that the governor call a special session of the
140     Legislature to review and approve or reject the agreement or proposal.]
141          (3) Before legally binding the state by executing an agreement to sell or transfer to the
142     [United States] federal government less than 500 acres of any governmentally controlled land
143     or school and institutional trust lands, a governmental entity shall notify:
144          (a) each legislator whose legislative district is located partially or wholly within the
145     geographic borders of the proposed land exchanged; and
146          (b) the Natural Resources, Agriculture, and Environment Interim Committee.
147          [(4) Notwithstanding Subsections (2) and (3), the Legislature approves all conveyances
148     of school trust lands to the United States government made for the purpose of completing the
149     Red Cliffs National Conservation Area in Washington County.]
150          [(5)] (4) A governmental entity may, in the governmental entity's discretion, give
151     written notice to the Legislative Management Committee of formal negotiations the
152     governmental entity enters into with a federal agent or entity intended or likely to result in:
153          (a) the sale, exchange, or transfer of specific governmentally controlled land or school
154     and institutional trust lands to the federal government; or
155          (b) designation of specific governmentally controlled land or school and institutional
156     trust lands as a federal park, monument, or wilderness area.
157          (5) The School and Institutional Trust Lands Administration may not execute an
158     agreement to sell or transfer school and institutional trust lands in a public lands county to the
159     federal government unless the result of the negotiated transaction is a net decrease in the
160     percentage of federally owned land in the county.
161          Section 4. Effective date.
162          This bill takes effect on May 1, 2024.