“The size of state trust land holdings is staggering,” says Economic and Policy Analyst Dan Hunting, the report’s author. “The Arizona State Land Department controls an area larger than the states of New Jersey and Connecticut combined, but the existing rules make it very hard to get full benefit from this land.”
The report imagines how a private owner of 9.3 million acres would maximize revenue, highlighting how the current legal restrictions limit the state’s land dealings. “The state land trust was set up in 1910 with rules to guard against shady land deals,” says Luther Propst, executive director of Sonoran Institute. “Rules that made good sense 100 years ago need to be updated to meet the needs of a modern economy, and our society’s changing values for land management and protection.”
Most state trust land is in rural areas of Arizona and is used primarily for ranching. However, there are extremely valuable parcels in and near our cities that can be leased for commercial use and could generate over 900 times the revenue per acre as grazing land. The report recommends maximizing the value of these urban lands by targeting suitable land for development and other land for conservation. “The value of developable land can be greatly enhanced by providing the transportation and utility infrastructure needed to steer future development into areas that are most suitable for growth,” says Hunting. “With 335,000 acres of Arizona state trust land located inside of existing city limits, and over two million acres within five miles of a city, there is enormous potential to generate additional revenue from state trust lands.”
The report also makes recommendations for easing Arizona’s ongoing budget crisis. Unlike many private trustees, the Arizona State Land Department cannot fund its operations from the revenue it generates. Instead, the Legislature must appropriate tax revenues to pay for the department’s annual operational expenses. A self-funding mechanism for the department would provide $10 million annually in relief to the state budget and provide an incentive for the department to maximize revenue.
“One of the major obstacles to passing reform has been the difficulty in understanding the state land trust,” says Propst. “This report cuts through complex history and legal background and explains the situation in a very readable way. When the facts are laid out this clearly, the need for broad reform becomes obvious.”
The report was funded by the Thomas R. Brown Family Foundation.
The Sonoran Institute inspires and enables community decisions and public policies that respect the land and people of western North America. Founded in 1990, the Institute is a nonprofit organization that is working to shape the future of the West. For more information and to download the full report, visit http://www.sonoraninstitute.org/where-we-work/southwest/sun-corridor-legacy.html.