ARIZONA STATE LAND DEPARTMENT

Annual Report
2005 - 2006

Janet Napolitano
Governor
Mark Winkleman
State Land Commissioner

“Serving Arizona’s Schools and Public Institutions Since 1915”

Superstition Mountains

Contents

Message From the Commissioner........................................................................................ 1
Historic Revenue Year.......................................................................................................... 3
Permanent Fund ................................................................................................................... 5
Expendable Fund.................................................................................................................. 6
Program Accomplishments
Real Estate....................................................................................................................... 7
Natural Resources ......................................................................................................... 11
Forestry .......................................................................................................................... 13
Land Information ............................................................................................................ 15
Board of Appeals ........................................................................................................... 16
State Trust Land Uses ........................................................................................................ 17
Land Ownership and Management .................................................................................... 18
Original Land Grant ............................................................................................................ 20
Management Team............................................................................................................. 21
Fund and Beneficiary Summary ......................................................................................... 22
Schools K - 12................................................................................................................ 23
University Grants ........................................................................................................... 25
Other Grants .................................................................................................................. 29
Financial Schedules............................................................................................................ 32
Receipts by Category.....................................................................................................33
Rental Acreage and Receipts ........................................................................................ 34
Treasurer’s Formula Distribution.................................................................................... 35
State Trust land Acreage by Beneficiary ....................................................................... 36
Auctions of Leases with and without Preferred Right .................................................... 37

Please visit our website at www.land.state.az.us

Janet Napolitano
Governor
State of Arizona

Message From the Commissioner

September 1, 2006
A Written Report to
Governor Janet Napolitano
by the Arizona State Land
Commissioner

The Honorable Janet Napolitano
Governor of Arizona
1700 W. Washington Street
Phoenix, Arizona 85007
Dear Governor Napolitano:
It is my privilege to deliver to you the State Land Department’s Annual Report for fiscal year 2005-2006 as required by
A.R.S. §37-132. The report contains a summary of the Department’s management activities and, more importantly, recordbreaking revenue that the Land Department earned during the fiscal year.
It is my primary and continuing goal to increase our ability to generate revenue for the beneficiaries of the State Trust. In
this fiscal year, Land Department staff continued their diligent work and sincere dedication to support the Trust. As you
are aware, we were extremely successful in generating more revenue for the beneficiaries.
Fiscal year 2005-2006 was the most productive year in the history of the Land Department. Several revenue records were
broken. The Department had record receipts of $374.7 million. The Department had a record year completing 21 auctions,
resulting in gross sales of approximately $544.3 million. In many of these auctions there was intense, competitive bidding
that raised the sale price significantly above the appraised value of the land.

Mark Winkleman
Arizona State Land
Commissioner

Of the total $544.3 million, $82.4 million was from cash sales and was directly deposited into the Permanent Fund. The
balance of just over $461.9 million was financed through the Department and will be paid off over time. The beneficiaries
will earn interest on the balance at a rate averaging from 8% to 10% for an average term of 7 years. These interest rates are
generally higher than market and the total outstanding receivable balance from term sales is a record $732.2 million, earning interest daily. The money earned on this balance will be paid to our beneficiaries over the next several years. In addition, the remaining principal payments on the sales price for the land will be deposited in the Permanent Fund in future
years.
This year the Department generated $78.5 million in expendable revenue that was sent to beneficiaries for their immediate
use. An impressive $32.2 million was generated from sales interest. Records were set in several other areas of expendable
revenues: commercial leasing, $22.2 million; agriculture, $4.1 million and natural products, $6.5 million.

1

About the Commissioner
The record $409.1 million revenue generated this year by the Trust has been allocated as follows: $284.2 million from the
sale of land, rights-of-ways and minerals was deposited into the Trust Permanent Fund, increasing the Fund to
$1,775,522,000; the public schools and institutions received $69.6 million from land rents and interest income, school
leases of $8.9 million as well as $34.3 million from the Treasurer’s formula distributions; the Treasurer’s Office also received $1.5 million in commercial prepayments that the Land Department will receive back over time as expendable revenue for the beneficiaries; and a record $10.6 million was deposited in the General Fund. Of the $99 million in expendable
earning for the schools (K-12), $72.3 was distributed through the School Aid Formula, $17.8 million went to the Classroom
Site Fund and $8.9 million was used for school leases.
FY 2006 was the first full year of operation of the newly created Southern Arizona Real Estate Office, located in Tucson.
This office has been well received by elected officials, government officials and business entities and has completed several
successful auctions. The Office has definitely contributed to my goal to improve our management of State Trust lands in
Southern Arizona. I also continued to focus on the manner of preparing State Trust land for auction. This is a continuation
of the process I began in January of 2003 for improving operations. We are also improving the procedures for our five year
plan, conceptual planning, engineering and the terms allowed for financing purchases of State Trust land. I am sure you
would agree, the record sales and leases that occurred this year show the success of our actions.
The Forestry Division was challenged by the earliest onset of fire season ever this year. Exceptionally severe drought
through the fall and winter months set the stage for a potentially devastating wildfire season and the agency responded with
an aggressive prevention and preparedness strategy that included the addition of three new inmate fire fighting crews. With
the help of an early monsoon and an extraordinary effort, the number of fires and acres burned was held to statistically normal values, and no serious losses or injuries were suffered. The foresters also assisted 18 rural communities with hazardous fuel reduction projects on nearly 6,000 acres, 60 local fire departments with equipment, and helped train over a 1,000
firefighters from across the state in wildland firefighting tactics.
Thank you for the opportunity to serve Arizona and the Trust beneficiaries as State Land Commissioner. The possibilities
that exist for the Land Department over the next year are exciting. We intend to continue to prepare and market State Trust
land for public auction in a manner to ensure as much competition as possible so as to generate greater revenue for the
beneficiaries of the Trust. We will also strive to fulfill the additional and important responsibilities contained in our mission such as fire suppression, mapping, title and conservation for the benefit of the citizens of Arizona.
Sincerely,

Mark Winkleman
Arizona State Land Commissioner

2

On January 6, 2003, Arizona Governor Janet Napolitano appointed Mark
Winkleman as the Arizona State Land
Commissioner. Mark has the responsibility to act as a trustee in the management of over 9 million acres of
State Trust land throughout all of Arizona, including over 500,000 acres in
major Arizona cities.
Mark brings over 23 years of commercial real estate experience to the
Land Department. When Mark came
to the Land Department, his initial
goal was to maximize the revenues
from the disposition of urban lands
through the auction process. After
implementing new strategies through
the Land Department staff, the intensity of bidders and the prices achieved
were unprecedented.
Mark has been a leader in the effort to
reform the laws under which the Trust
lands are managed. His goal is to encourage reform that will increase
revenues to the beneficiaries, primarily public education. He hopes to promote better planning of lands directly
in the path of growth and reduce urban sprawl while also providing for
better management of the vast rural
lands held by the Trust.

Fiscal Year 2006 - A Historic Revenue Year

Total Trust Revenue
$450

Record Revenues

$400

• FY 2006 was a record year for Trust revenues. The
Department produced $374.7 million and the
Treasurer’s formula distribution generated $34.3
million for a grand total of $409.1 million.

(Millions)

$350

• Educational institutions (universities, schools (K-12)
and the School for the Deaf & Blind) received 93.1% of
all beneficiary receipts in FY 2006.

$300
$250
$200
$150
$100
$50

• The Department completed 21 land sale auctions
resulting in gross sales of approximately $544.3
million.
• FY 2006 Trust revenues were $15.5 million higher
than FY 2005 revenues and $176.3 higher than FY
2004 revenues.

19
97
19
98
19
99
20
00
20
01
20
02
20
03
20
04
20
05
20
06

19
96

19
95

19
94

$0

Fiscal Year

Treasurer's Distribution

Land Department Earnings

FUNDS
Expendable

1,450,785.54

School Leases

8,946,088.81
10,557,638.70

Permanent

284,200,951.41

TOTAL LAND DEPARTMENT

374,740,936.84

Treasurer’s Formula Distribution
GRAND TOTAL - FY 2006

3

69,585,472.38

Commercial Prepayment
General

Deputy State Land Commissioner
Jamie L. Hogue

FY 2006 TOTAL

34,334,560.00
409,075,496.84

REVENUES BY BENEFICIARY
FY 2006

TRUST
ACRES

STATE LAND
EXPENDABLE
EARNINGS

TREASURER'S
FORMULA
DISTRIBUTION

TOTAL
PERMANENT
FUND RECEIPTS

TOTAL
RECEIPTS

8,105,550

67,605,995.23

31,437,534.00

99,043,529.23

264,273,649.75

363,317,178.98

Normal Schools

174.798

185,561.95

41,740.00

227,301.95

118,908.44

346,210.39

Agricultural & Mechanical
Colleges

124,944

129,929.46

180,233.00

310,162.46

10,012.01

320,174.47

Military Institutes

80,168

73,897.79

9,173.00

83,070.79

3,024.45

86,095.24

School of Mines

123,254

111,284.10

104,439.00

215,723.10

15,663.97

231,387.07

University Land Code

137,908

421,248.34

213,276.00

634,524.34

405,174.85

1,039,699.19

University of Arizona
(Act 0f 2/18/1881)

54,218

270,407.35

551,950.00

822,357.35

3,218,353.55

4,040,710.90

School for the Deaf
& Blind

82,560

162,179.54

77,139.00

239,318.54

43,927.43

283,245.97

8,883,400

$68,960,503.76

$32,615,484.00

$101,575,987.76

$268,088,714.45

$369,664,702.21

Legislative, Executive
& Judicial Buildings

64,257

90,059.25

104,788.00

194,847.25

676,132.69

870,979.94

State Hospital

71,248

330,044.88

147,619.00

477,663.88

10,375.50

488,039.38

Miners’ Hospital*

95,431

1,558,754.58

165,791.00

1,724,545.58

105,549.33

1,830,094.91

State Charitable, Penal,
and Reformatory

76,930

6,078,196.96

1,182,283.00

7,260,479.69

15,304,982.25

22,565,461.94

Penitentiary

76,111

1,514,002.03

118,596.00

1,632,598.03

15,197.19

1,647,795.22

9,267,377

$78,531,561.19

$34,334,561.00

$112,866,122.19

$284,200,951.41

$397,067,073.60

BENEFICIARIES
Common Schools (K -12)
(Includes County Bonds)

Subtotal Education

TOTAL

*Miners’ Hospital and Miners’ 1929 combined.

4

TOTAL
EXPENDABLE
RECEIPTS

Permanent Fund
• Record Permanent Fund receipts of $284,200,951 increased the
total of the Fund to $1,775,521,000 (Book Value) in FY 2006.
• The Permanent Fund consists of revenues earned from the sale of
State Trust land combined with the sale of minerals and natural
products.
• The State Treasurer manages the Permanent Fund and invests the
funds in stocks, bonds and other interest bearing securities. The
earnings are transferred, through a formula distribution, to the
beneficiaries for their use.

BENEFICIARY SHARE OF PERMANENT FUND
JUNE 30, 2006

Common Schools (K - 12)

BOOK VALUE

MARKET VALUE

1,639,382,000

1,873,142,000

• Educational institutions including schools (K-12), the Universities
and the School for the Deaf and Blind were the beneficiaries for over
95.4% of the Permanent Fund as of the end of FY 2006.

Normal Schools

2,098,000

2,479,000

Agricultural & Mechanical Colleges

6,624,000

8,035,000

• Due to the growing value of urban Trust land, its strategic location
and an increase in agency resources, the Department estimates that
Trust beneficiaries will continue to see significant revenue growth to
the Permanent Fund in future years.

Military Institutes

370,000

446,000

School of Mines

7,861,000

8,816,000

University Land Code

11,499,000

13,433,000

University of Arizona (Act of 2/18/1881)

23,491,000

27,763,000

School for the Deaf & Blind

2,965,000

3,647,000

Legislative,Executive, and Judicial

5,219,000

6,155,000

State Hospital

3,128,000

4,032,000

Miners' Hospital*

6,182,000

7,394,000

61,244,000

71,138,000

5,458,000

6,643,000

1,775,521,000

2,033,123,000

Permanent Fund Balance
FY 1986 - 2006
$2,000
$1,800
$1,600

State Charitable,Penal and Reformatory

$1,200

Penitentiaries

$1,000

TOTAL

$800
$600

*Miners' Hospital and Miners' 1929 conbined.

$400
$200
'06

'04

'02

'00

'98

'96

'94

'92

'90

'88

$0
'86

(Million)

$1,400

Fiscal Year

5

Expendable Revenue
• Expendable revenue totaled $112,866,122 in FY 2006 and included
lease revenue from Trust land leases and permits, interest earnings
from sales’ contracts administered by the Department and the
Treasurer’s formula distribution.

EXPENDABLE REVENUE BY BENEFICIARY
2006

• Expendable revenues are available to the beneficiaries for use in
their operations during the same year they are generated.
• The $78,531,561 of expendable revenue the Department generated
was in large part due to the increase balance of Department
managed sales’ contracts which increased to $732.2 million and
generated $32.2 million in interest earnings.
• As a result of the growing value of urban Trust land, its strategic
location and an increase in agency resources, the Department
estimates that Trust beneficiaries will see significant expendable
revenue growth in future years.

Trust Expendable Earnings
FY 1994 - 2006
$120
$100

Common Schools (K – 12)
(Including lands
to Retire County Bonds)
Normal Schools
Agricultural and
Mechanical Colleges
Military Institutes
School of Mines
University Land Code
University of Arizona
(Act of March 18, 1881)
School for the Deaf
and Blind
Subtotal Education:

$80

Legislative, Executive &
Judicial Buildings
State Hospital
Miners’ Hospital
State Charitable,
Penal, and Reformatory
Penitentiary Grant

$60
$40
$20
$0

TOTAL

19
95
19
96
19
97
19
98
19
99
20
00
20
01
20
02
20
03
20
04
20
05
20
06

(Millions)

BENEFICIARIES

Total Expendable
Treasurer's Distribution
Land Department Earnings

TREASURER'S
FORMULA
DISTRIBUTION

31,437,534.00
41,740.00

LEASE AND
SALES CONTRACT
INTEREST

TOTAL
EXPENDABLE
REVENUE

67,605,995.23*
185,561.95

99,043,529.23
227,301.95

180,233.00
9,173.00
104,439.00
213,276.00

129,929.46
73,897.79
111,284.10
421,248.34

310,162.46
83,070.79
215,723.10
634,524.34

551,950.00

270,407.35

822,357.35

77,139.00

162,179.54

239,318.54

32,615,484.00

1,354,508.53

101,575,987.76

104,788.00
147,619.00
165,791.00

90,059.25
330,044.88
1,558,754.58

194,847.25
477,663.88
1,724,545.58

1,182,283.00
118,596.00

6,078,196.69
1,514,002.03

7,260,479.69
1,632,598.03

34,334,561.00

10,925,565.96

112,866,122.19

*The amount for ex pendable earnings includes the rev enue of $8,946,088.81 from the school leases in accordance
w ith § 37-221, D.

6

Real Estate Program
• A total of 21 Sales & Commercial Leases were auctioned leading to an
outstanding record year with gross sales of $544.3 million. In many of
these auctions there was intense, competitive bidding. The total sales
price was increased by approximately 10.5% above the appraised value.

• The interest payments on the certificate of purchase balances was an
impressive $32.2 million in FY 2006. Interest payments are expendable revenue and are available to the beneficiaries for use in their
operations during the same year they are generated.

• Of the total $544.3 million, $82.4 million was from cash sales and was
directly deposited into the Permanent Fund. The balance of just over
$461.9 million was financed through the Department and will be paid off
over time. The beneficiaries will earn interest on the balance at a rate
averaging from 8% to 11% for an average term of seven years. These
interest rates are generally higher than market, and the total outstanding
receivable balance from term sales was a record $732.2 million, earning
interest daily. The money earned on this balance will be paid to our beneficiaries over the next several years. In addition, the remaining principal
payments on the price for the land will be deposited in the Permanent
Fund in future years.

• The beneficiaries also received expendable revenues from commercial leases of $22.2 million and rights-of-way leases of $7.5 million.
In addition, $1.5 million in commercial prepayment revenue and $8.9
million in school facility lease revenue was earned.
• The Department paid approximately 3.0 million in Broker’s commissions in FY 2006. Beginning in 1996, Real Estate Brokers were authorized to represent bidders at State Trust land public auctions by
registering according to Land Department Rules. Commissions are
paid by the successful bidder as a condition of the public auction.
The program has been very successful in bringing more bidders to
the auctions and at increasing the sales prices.

• The chart to the
right shows the
significant increase
in the outstanding
certificate of purchase balance in
recent years due to
the cumulative effect of several very
successful sales
years. The $732.2
million balance at
the end of the FY06
was $283.9 million
higher than the
FY05 ending bal-

• The strong real estate market statewide created a vigorous demand
for additional infrastructure, including public roads, electrical power,
water and sewer. Revenues from rights-of-ways generated in excess
of $20.0 million in FY 2006.

7

Real Estate Program
Major Auctions
• $92.2 Million; Phoenix, July 13, 2005:
After the sales price was raised 33 times, Meritage Homes made the winning bid to
purchase 288 acres of Arizona State Trust Land in the Desert Ridge Master Planned
Community.
• $135 Million; Phoenix, August 18, 2005:
A joint venture of Pulte Homes and Toll Brothers Homes made the record breaking
winning bid to purchase 502 acres of Arizona State Trust Land in the Desert Ridge
Master Planned Community. The bid broke the prior record price of State Trust Land
Auction of $100 Million.
• $47.2 Million; Scottsdale, September 15, 2005:
The City of Scottsdale was the successful bidder for 80 acres of prime State Trust Land
in Scottsdale located on the north side of Bell Road at the intersection of 94th Street.
• $350 Million Lease; Peoria, September 15, 2005:
An auction for a long term ground lease for a 55 acre parcel of State Trust Land in
Peoria for property located at the intersection of Happy Valley Road and Lake Pleasant
Parkway in Peoria.
• $14.1 Million; Tucson, October 19, 2005:
KB Homes was the successful bidder for 209 acres in Wingate.
• $33.4 Million; Phoenix, January 19, 2006:
Sonoran Desert Investors, L.L.C., purchased 32 acres of multi-family property in Desert
Ridge located at the intersection of the 101 Freeway and 56th Street in Phoenix.
• $239 Million Lease; Phoenix, March 28, 2006:
An auction for a long term ground lease for a 60 acre parcel of infill State Trust Land in
Phoenix located at the intersection of State Route 202 and 40th Street in Phoenix.
• $19.7 Million; Phoenix, April 6, 2006:
Toll Brothers Homes purchased 81 acres of Arizona State Trust Land located in the
Desert Ridge Master Planned Community in Phoenix located south of the Deer Valley
Drive alignment and west of Black Mountain Parkway.
• $102.5 Million; Peoria, June 22, 2006:
Two parcels of Arizona State Trust Land in Peoria were successfully sold for a
combined $102.5 Million.

8

Real Estate Program

Commercial Leases
• Two major commercial leases were auctioned in FY 2006. In Peoria,
at the Northeast corner of Lake Pleasant Parkway and Happy Valley
Road, a 55 acre regional commercial site was auctioned in September
of 2005. After 20 bids, the value was bid up from $10.8 million to
$13.5 million, resulting in an additional $71.3 million to the trust
over the 99 year term of the lease, for a total of an almost $357
million minimum revenue stream. In March of 2006, 33 bids were
placed for 59 acres in Phoenix, at the Southeast corner of 40th and
McDowell. The value was raised from $15.64 million to $21 million,
which in turn increased the minimum revenue stream almost $60
million over the 65 year lease term, from $177.8 million to just under
$239 million. Both leases have participation elements whereby the
Trust beneficiaries participate in the gross revenues of the developer
lessee.

Facts and Figures
Land Auctioned FY 2006
Arces Sold

Total Sales Price

Acres Leased*

Minimum Cumulative
Lease Revenue

Urban 2538.84

$484,497,800.00

114.37

$595,773,834.54

114.37

$595,773,834.54

Rural

887.20

$59,832,501.00

Total

3426.04

$544,330,301.00

Southern Arizona Office
In its first year of operation, the Southern Arizona Office located in
Tucson was successful and busy. In October, KB Homes was the
successful bidder for 209 acres in Wingate. Then, in June, the office
held four successful sales auctions totaling 188.9 acres at a total sales
price of $9.2 Million. One of these sales had 47 bids and another 27
bids.
The Southern Arizona Office was created to increase the accessibility
of Department staff to local officials, businesses and the public and to
increase the Department’s attention to the issues concerning the
valuable State Trust land in Pima County, Cochise County, and the
portion of Pinal County south of Picacho Peak. The fast-growing areas
in Tucson, particularly the Houghton Road area, are a high priority for
the Department.

9

DESERT RIDGE
A 5,400-Acre
Master
PlannedCommunity
Community in North
Phoenix
A 5,400-Acre
Master
Planned
in North
Phoenix
PARCEL 8
76 bids for 536 acre master planned
community that includes semi-custom
and condominium housing, a commu- P
nity center and open space areas.
A
R
C
E
L
13

The Aviano at Desert Ridge
Sold in 2001
The District at Desert Ridge Marketplace Opened
DESERT
RIDGE DISPOSITIONS
December 2001
Parcels 1E, 1F, and 1G
Date
Parcel No. Acres Sold/Leased
Use
Sold/Leased
1A & 1B
780
Sold
Residential/Golf
7/7/1993
180
Leased
Resort Golf
7/7/1993
1C
1D
54
Leased
Marriott Resort
7/7/1993
1E, F& 1G
332
Leased
Commercial Retail
7/7/1993
2A
106
Leased
Sumitomo Sitix
12/12/1995
2B
2
Sold
Utility Pump Station
12/12/1995
3
242
Sold
Mayo Hospital
1/3/1996
4
23
Sold
Residential
2/27/1996
5
24
Sold
Middle School
2/27/1996
6
62
Sold
High School
2/10/1998
7
91
Leased
American Express
11/13/2000
8
536
Sold
Residential
4/4/2001
9
50
Sold
Multi-family
6/24/2003
10
189
Sold
Residential
3/30/2004
11
279
Sold
Residential
5/12/2004
12
41
Sold
Residential
5/27/2004
13
40.23
Sold
Residential
9/21/2004
14
104
Sold
Mixed Use
5/11/2005
2
288
Sold
Residential
7/13/2005
1S
502
Sold
Residential
8/18/2005
32
Sold
Multi-family
1/19/2006
2H
12
81
Sold
Residential
4/6/2006

Revenue
$9,360,000
$33,200,000
$45,800,000
$347,400,000
$90,300,000
$57,350
$12,320,000
$1,416,000
$1,654,040
$2,965,000
$486,000,000
$52,900,000
$24,102,500
$49,300,000
$ 100,500,00
$32,000,000
$23,200,000
$38,200,000
$92,200,000
$135,000,000
$33,400,000
$19,700,000

PARCEL 9
The winning bid of $24,102,500 was
bid up 156 times before The Statesman Group was announced the successful bidder. The 50 acre Toscana
community will include luxury condominium housing.
Toscana at Desert Ridge
Sold in 2003

10

Natural Resources Program

• Range Section
° Reviews Applications to Place Improvement and Land Treatment
Applications, and provides environmental and cultural clearances.
° Participates in statewide efforts to coordinate rangeland management activities with landowners, lessees and other land management and natural resource management agencies on ranch units
with intermingled land ownership
patterns.
° Recorded its eleventh straight year
of increased grazing fees since the
Land Commissioner adopted the
recommendation of the Grazing
Land Valuation Commission in
1995.
• Minerals Section
° Administers five distinct leasing programs as well as providing
mineral resource evaluations and geologic information for land
sales, conservation proposals and conceptual plans.
° Continued improvement in metal prices and urban expansion is
reflected in the continued high levels of mineral exploration, aggregate production and oil and gas leasing activity.
° Revenues from aggregate sales increased 35% to $6.2 million dollars during the fiscal year.
• Natural Resource Conservation Section
° Provided administrative support to 32 NRCDs and the 21 environmental education centers they sponsor, including coordination of 32
special district elections and processing oaths of office for the 153
newly elected and appointed supervisors.
° Conducted two training sessions covering NRCD statutory authorities, personnel management and proper use of public funds.

NATURAL RESOURCE
REVENUES

NATURAL RESOURCE
LEASES AND PERMITS

Lease Rentals
Facts & Figures
Acres

Number
of
Leases

Agriculture
Mineral Material

$4,097,439
$241,931

Grazing

$2,652,728

Exploration Permits
Agriculture

178,512

410

2,054

21

8,393,639

1,277

Mineral Material
Grazing
Exploration
Permits

89,886

234

Mineral

12,244

119

335,268

202

Oil & Gas

Number of Registrations
and Water Rights Claims
Stockpond Registrations
Certificated Surface
Water Rights

4,305

2,962

Adjudication Statements
of Claimant

7,027

Water Right Registrations

7,405

11

$0

Mineral

$4,779

Oil & Gas

$398,810

TOTAL

$7,489,218
Sale of Products

Public Auction Water Sales

$229,555

Lease Water Charges

$61,671

Mineral Royalties

$34,352

Natural Products

$6,204,825

TOTAL

$6,697,699

106

Well Registrations

Grandfathered
Groundwater Rights

Geothermal

$93,531

242

Trespass Revenues
Trespass Revenue

$114,937

TOTAL

$114,937

GRAND TOTAL

$14,301,854

Natural Resources Program
° Collected $114,937 from trespass and/or
unauthorized use penalties in 21 different case actions. An Arizona corporation
and two individuals were convicted of
felonies related to unauthorized removal
of rock products from 20 acres of Trust
land.
° Oversaw the completion of remediation
of a pesticide contaminated airstrip in Cochise County and remediation
of land surrounding a former gold mining operation in the Phoenix
area.
° Completed the second phase of multi-year remediation for a pesticide
contaminated airstrip in Pinal County and a farm airstrip in Maricopa
County.

° Represented the Agency on the Arizona Advisory Council on Invasive
Species (AISAC), established by the executive order of Governor Napolitano. Provided technical review of 3 trespass cases and 76 leases
that involved removal of native plants.
• Water Rights & Agriculture Section
° Executed agreements with Yavapai
County to contract for the modification
of Wineglass Dam and maintenance of
the structure. The Department received
a legislative appropriation, a grant from
the Arizona Department of Water Resources and funding from Yavapai
County. These combined sources provided the necessary funding to contract for the modification of Wineglass Dam, altering the dam’s status from jurisdictional to nonjurisdictional. The Department created a position to administer jurisdictional dams, and this program was transferred to another area in the
division.
° Completed a Water Conservation Plan for the State Trust lands which
was included in a Bureau of Reclamation contract for the delivery of
Colorado River water for irrigation.
° Agricultural leases issued this fiscal year were significantly modified
to provide additional protection to the State Trust. Four agricultural
leases were approved for the planting of date palm trees in the Yuma
Mesa area; the improvements were authorized with several provisions
including the future ability to collect rent based on the gross receipts
for the dates.

• Dam Safety Program
° In January 2006 the Dam Safety Program was reorganized and expanded to develop a program for the identification, inventory and management of all water barriers located on Trust land. The program’s
major objective is to reduce the State’s liability associated with jurisdictional and unsafe dams by identifying structural modifications that
will allow the Arizona Department of Water Resources to reduce or
completely remove the jurisdictional or unsafe classification.
° Research, identify and apply for available Federal and State grants to
secure funds needed to implement the structural improvements or mitigation actions necessary for the declassification of the dams.
° Develop a systematic process to identify, inventory and manage a comprehensive database linked with GIS identifying the jurisdictional, nonjurisdictional and unsafe dams located on Trust land.
° Review and comment on applications for structural improvements on
State leases that could result in the creation of new jurisdictional or
unsafe dams.
° Completed the Wineglass Dam construction phase and the Arizona
Department of Water Resources issued the declassification document
identifying Wineglass Dam as non-jurisdictional.

• Environmental Resources and Trespass Section
° Conducted 26 clean-up projects utilizing more than 1,716 volunteer
hours and resulting in 80 tons of trash and 862 tires being removed
from State Trust land.

12

Forestry Program
• The State Forester (the Forestry Division Director) has the authority to prevent and suppress
wildland fires on approximately 30 percent of
land throughout the
State; more than
nine million acres of
State Trust land and
nearly 13 million
acres of private land
outside incorporated
municipalities. The
Land Department mobilizes firefighters and
equipment to and from all areas of Arizona and
other states for fire and non-fire emergencies.
• The Forestry Division responded to 1,231 wildland fires; 857 were State responsibilities and
374 were in support of federal and tribal agencies. Although 94 percent of all Land Department
fires were controlled at less than 100 acres,
67,567 acres were burned on State and private
lands during the year.
• The Division maintains cooperative agreements
with more than 250 local and rural fire departments, other State and Federal agencies, and private companies to control wildfires on State and
private lands.
• The Division also sponsored 44 courses in basic
and intermediate wildland fire suppression strategies and tactics for approximately 1,200 students
from over 135 rural fire departments.

INMATE FIREFIGHTER PROGRAM
Governor Napolitano, with the support of the
State Legislature, has taken the initiative to
significantly expand the State’s Inmate Firefighter Program. There are currently 15 twentyperson Fire/Fuels Crews; 14 are all male crews
and one crew is staffed by all-female inmates.
These crews are
based out of the ten
Arizona Department
of Corrections Prisons Complexes located around the
State. The Fort
Grant,
Douglas,
Lewis and Yuma prison facilities each host one
crew. Four prisons each have two crews: Tucson, Florence, Globe and the Perryville Prison.
The Perryville facility houses the one female
crew and one of the all-male crews. The Winslow Prison Complex, including the smaller

“satellite” facility at Springerville, maintains
three crews.
The inmates selected for these Fire/Fuels Crews
are the lowest custody inmates in the system.
The inmates volunteer for this special work
assignment, and all
go through a comprehensive review
prior to being allowed into the program. Each of the
inmates must successfully complete
the standard firefighter training and physical
fitness testing prior to being allowed to go on
fire assignment. When these crews are not involved in fire fighting activities they work various thinning and brush abatement projects to
protect our communities at risk from wildfires.

Summary of Rural Fire and Volunteer Fire Assistance Grants
RFA Grant

VFA Grant

Annual Summary

Year

Number of
Projects

Dollars

Number of
Projects

Dollars

Number of
Projects

Dollars

2002
2003
2004
2005
2006

37
33
42
38
38

$415,000
$482,000
$592,000
$580,000
$580,000

26
21
24
22
22

$300,000
$298,000
$300,000
$283,000
$283,000

63
54
66
60
60

$715,000
$780,000
$892,000
$863,000
$863,000

13

Forestry Program
• The Division provides technical, educational, and financial assistance to rural communities and private landowners in the management of their forested
lands. Forest Stewardship Plans are written and implemented by natural resource professionals to guide landowners in reducing the risk of wildfire, insects
and disease, protecting soil and water quality, providing timber and other forest products, improving fish and wildlife habitat, and maintaining the landscape’s natural beauty. The Department supports rural fire departments and communities with State Fire Assistance Grants, Forest Health and Fire Abatement Grants, and Rural and Volunteer Fire Assistance Grants.
• The Division’s Urban and Community Forestry Program
provides technical assistance and grants to Arizona cities
SUMMARY OF COMMUNITY ASSISTANCE, 2002 - 2006
and towns. Staff coordinates
the Community Challenge
Grant Program, the Arizona
Acres Homes
Dollars
Firewise
Fuel
Arbor Day celebration and
Grant
Year Number Provided Plans Programs Workshops Treatments Treated Protected
poster contest. They work
closely with the Arizona ComState Fire Assistance
munity Tree Council, partici2002
38 $2,126,215
60
78
50
24
6,537
1095
pating in trade shows, consumer education programs, and
2003
19 $1,458,222
21
13
6
8
4825
1462
workshops. Arborists study
2004
29 $2,584,532
29
3
12
1507
889
classes are also coordinated by the staff and the Tree
2005
13 $2,375,574
15
1
2
4
140
84
Council, providing training for tree care professionals.
2006
13 $2,375,574
15
1
2
4
140
84
• The Division refurForest Health Protection
bished and distributed
2003
7 $1,089,050
7
2
1
4
1725
301
hand-held radios, as well
as nine excess federal
Fire Hazard Abatement
fire engines valued at
$326,916, to cooperating
2003
18 $1,995,290
20
6
6
7
1,295
729
rural fire departments.
2004
3 $1,498,324
3
Currently, there are 155
Annual Summary
refurbished fire fighting
2002
38 $2,126,215
60
78
50
24
6,537
1,095
vehicles in rural fire departments statewide. The Department has contracts for
2003
44 $4,542,562
48
21
14
19
9,092
2,567
future retrofitting of
2004
32 $4,082,856
32
10
18
2,307
889
three
heavy
trucks.
2005
13 $2,375,574
15
1
2
4
140
84
These trucks, along with
the equipment already
2006
13 $2,375,574
15
1
2
4
140
84
provided to cooperating
fire departments, are
valued
at
nearly
$4,613,118.

14

Land Information, Title & Transfer Program
The Land Information, Title & Transfer
Division ensures the integrity of the State’s title
to 9.2 million acres of Trust land, is
accountable for the accuracy of public records
and land surveys, processes applications,
finalizes contracts and addresses legal and
administrative issues that come before the
Department.
• Public Records and Survey Information
State Trust lands have always been associated
with the growth of Arizona.
Customer
demands on Trust land information, whether
associated with land use planning, economic
development or conservation, have steadily
increased with the State’s growth.
The
Department prides itself in its ability to serve
all its customers with a State-of-the-art
computerized records information system,
while at the same time, provide the same level
of service to those customers who do not have
technological computer use skills. This past
year, the Department provided accurate and
timely records and survey information on 9.2
million acres of land to over 52,000 public,
corporate, and business inquiries.
• Public Response to the Department
The Department continually requests its
customers to rate our customer service in order
to assist us in improving our customer service
skills.
Virtually all customers, receiving

assistance or doing business with the
Department this past year, rated the
Department’s customer service as highly
satisfactory.
• Legal and Administrative
There can be numerous legal and
administrative issues that go hand-in-hand with
the administration of land management issues
associated with 9.2 million acres of surface and
subsurface estate.
The Department has made advances in bringing
to a close, several federal land management
actions that affect the Department’s
management of Trust lands. One such issue
addresses approximately 35,000 acres of Trust
land now located within the recently expanded
boundary of the Petrified Forest National Park.
The Department provided Park officials with a
right of access to the Trust land proposed for
acquisition by the federal government for Park
purposes. The Park will provide policing
services on the State lands until federal
acquisition
can
be
accomplished.
Another issue is the prospect that the State will
receive title to approximately 15,000 acres of
surface, mineral and oil and gas resources in
Apache County as compensation for the federal
condemnation of several hundred acres of Trust
land within the Fort Huachuca Military
Reservation.

15

• Application and Contract Processing
The Division develops and processes all
surface lease, sale, and use applications; and
prepares, drafts and revises all surface lease,
permit, and right-of-way documents, ensuring
compliance with laws, rules and guidelines of
the Department; and prepares land use and title
reports for all legal actions and special projects
addressing Trust lands.
This fiscal year, the Division processed 1,700
new applications, finalized 1,500 contracts, and
researched 8.7 million acres of land associated
with the sale, lease, use and title records
maintenance of the State’s Trust and sovereign
lands for its customers. In addition, the
Department’s right of way applications were
updated to expedite the processing time for
rights of way on Trust lands.

Public Records Room

Board of Appeals

CURRENT BOARD MEMBERS
•

Sanders K. Solot
Tucson
Represents the First District, consisting of Pima,
Santa Cruz, Cochise, Graham and Greenlee
counties.

•

Kathleen M. Holmes, Chair
Scottsdale
Member-at-Large.

•

William R. Gray
Scottsdale
Represents the Second District consisting of
Maricopa, Pinal, Gila, Yuma and La Paz counties.

•

Norman R. Brown
St. Johns
Represents the Third District consisting of Mohave,
Yavapai, Coconino, Apache and Navajo counties.

•

Jolene U. Dance
Phoenix
Member-at-Large.

Arizona Revised Statute §37-215 requires all land sales and commercial leases to be
approved by the Board of Appeals, which also serves as an Administrative Review
Board.
Applicants and lessees may appeal to the Board a final decision of the State Land
Commissioner that relates to appraisals and classifications.
The State Land Department Board of Appeals consists of five board members selected by
the Governor and confirmed by the Senate for six-year terms. Three members represent
the 15 counties in the State, which are divided into three districts. Two members hold
positions-at-large.

The Board meets once a month unless special circumstances warrant additional sessions.
Meetings are usually held in Phoenix.
During the fiscal year, the Board approved 40 commercial leases, including five longterm leases, three for 65 years, one for 75 years, and one for 99 years; 125 rights-of-way
sales appraisals, and 18 land sales appraisals; eight of which were urban land sales.
Eighteen new appeals were filed with the Board. Two appeals modified the
Commissioner's decision. Six appeals sustained the Commissioner's decision. Nine
appeals were withdrawn and dismissed by the Board. One appeal was resolved with a
settlement conference.

16

State Trust Land Uses

The State Land Department manages 9.3 million acres
of Trust land.
•

9,084,559 acres of the surface are under 9,989
leases and other contracts.

•

439,452 acres of the subsurface are under 576
leases and other contracts.

STATE TRUST LAND USES

SURFACE
Rights-of-Way
Grazing
Commercial
Commercial School Leases
Agricultural
Use Permits
U.S. Government
Homesite
Institutional
Recreational
Subtotal (Leases)
SUBSURFACE
Mineral
Mineral Exploration
Mineral Materials
Oil & Gas
Subtotal (Leases)
TOTAL LEASES

17

NO. OF
LEASES
7,193
1,277
321
17
410
551
159
6
10
45
9,989

% OF
LEASES
72.01
12.78
3.21
0.17
4.10
5.52
1.59
0.06
0.10
0.45
100

119
234
21
202
576

20.66
40.63
3.65
35.07
100

10,565

TOTAL
% OF
ACREAGE ACREAGE
139,641
1.54
8,393,639
92.39
82,147
0.90
878
0.01
178,512
1.97
220,190
2.42
18,274
0.20
27
0
12,892
0.14
38,359
0.42
9,084,559
100

12,244
89,886
2,054
335,268
439,452
9,524,011

2.79
20.45
0.47
76.29
100

State Trust Land - Surface Management Responsibility

i
N

BLM
Forest Service
Indian Trust
Military
Nat’l Parks/Monuments
Other
Parks & Recreation
Private
State Trust
Wildlife Refuge
Cities

Produced by the Arizona State Land Department, GIS Section,
March 2006. The Arizona State Land Department makes no
warranties, implied or expressed, with respect to the information
shown on this map.

18

State Trust Land within Each County

Land Ownership in Arizona
The State of Arizona contains an estimated 72,931,000 acres,
or approximately 113,417 square miles, making it the sixth
largest state in the United States. The surface land ownership
in Arizona can be classified in four basic categories.

COUNTY
Apache

ACRES
653,321

Cochise

1,371,104

Coconino

1,125,267

Gila

31,231

Graham

496,321

Greenlee

172,104

La Paz

254,411

Maricopa

646,432

Mohave

565,355

Navajo

370,169

Pima

860,846

Pinal

1,206,188

Santa Cruz
Yavapai
Yuma
Misc*
TOTAL
The percentages are estimates derived from digitized map data. The category
called Private is overestimated due to the inclusion of small amounts of land
owned by local, State, and Federal agencies.

61,154
1,264,245
186,689
2,540
9,267,377

*Trust lands located in California or Nev ada due to
realignment of Colorado Riv er

19

Original Land Grant
The Territory of Arizona was established on February 24, 1863, by an Act of Congress. This Act granted sections
16 and 36 of each township for the benefit of the Common Schools. Endowment of public lands for educational
purposes was a practice established by the Northwest Ordinance in 1787. Congress quickly recognized the value of
the land and the importance of public schools to a developing nation.
The State Enabling Act, passed on June 20, 1910, allowed the Territory of Arizona to prepare for statehood. In
addition to the previously designated sections of land, the Enabling Act assigned sections 2 and 32 of each township to be held in trust for the Common Schools. The needs of other public institutions were considered by Congress, and through the Enabling Act, more than two million additional acres were allocated for their use.

Today, the original school section pattern exists only in a few
locations such as the remote
Arizona Strip. About threequarters of the school section
acreage were relocated through
selections and exchanges that
have consolidated the Trust
lands into large blocks in Pinal,
Pima, Graham, Greenlee, and
Cochise counties in central and
southeastern Arizona; north and
northwest of Phoenix in Maricopa
and Yavapai counties; and in the
checkerboard railroad grant zone
across Mohave, Yavapai, Coconino, Navajo, and Apache counties.

Land Endowment by Township
Township = 36 Sections
Each Section = 1 Square Mile

20

Management Team

Jim Adams
Director
Real Estate Division

Lynn Larson
Director
Administration &
Resource Analysis
Division

Bill Dowdle
Director
Natural Resources
Division

Ron Ruziska
Director
Southern Arizona
Real Estate Division

Richard Oxford
Director
Land Information,
Title, & Transfer
Division

Kirk Rowdabaugh
State Forester
Forestry Division

21

Fund and Beneficiary Summary
In 2006, State Trust revenues totaled $409,075,497. A total of $397,067,073 in receipts were earned for the beneficiaries, $10,557,639 was deposited
in the General Fund, and $1,249,464 was received as commercial prepayments. Of the beneficiary amount, $284,200,951 was deposited in the Permanent Fund. The Permanent Fund is managed by the State Treasurer. The remaining $112,866,121 in receipts were expendable and were distributed to
the beneficiaries for use in their operations. Expendable receipts are comprised of lease revenues, interest on the outstanding sales balance and the
Treasurer’s formula distribution. The table below indicates the number of acres remaining for each grant along with a breakdown on how the expendable receipts are distributed to the beneficiaries.

TRUST
ACRES

GRANT

BENEFICIARY

1st $72.3 million of expendable receipts
8,105,550

Receipts over $72.3 million
174,798

Normal Schools

124,944

Agricultural & Mechanical Colleges

80,168

Military Institutes

123,254

School of Mines

137,908

University Land Code

Classroom Site Fund

Board of Regents
to
Distribute to Universities

54,218

University of Arizona (Act 0f 2/18/1881)

82,560

School for the Deaf & Blind

School for the Deaf & Blind

64,257

Legislative, Executive & Judicial Buildings

Legislature, Executive & Judicial Branch

71,248

State Hospital

State Hospital

95,431

Miners’ Hospital (2 Grants)

Pioneers' Home

76,930

State Charitable, Penal, and Reformatory

76,111

Penitentiary

9,267,377

State Aid Formula for K - 12

Common Schools (K - 12) (Includes County Bonds)

Department of Corrections

TOTAL

22

50% Pioneers' Home
25% Department of Corrections
25% Department of Juvenile Corrections

Beneficiary Summary - Common Schools (K-12)
• Public education is by far the largest beneficiary of Trust land managed by the
Department. Congress granted two sections of each township to common schools
when Arizona became a territory and another two sections when Arizona became
a state. The State was able to select Federal lands equal to the sections that could
not be granted due to the establishment of Federal forests, parks and Indian reservations. Today, approximately 8.1 million acres remains in the Trust for common
schools.
• In FY 2006, a record $264.3
million from sales and royalties
was deposited in the Permanent
Fund for common schools
bringing the total balance to
$1,639,382,000.

COMMON SCHOOLS (K-12)
ACRES AND INCOME - FY 2006
SURFACE LEASES
Agriculture
Commercial
Grazing
Homesite
Rights-of-Way
Use Permits
Institutional Taking
U.S. Government
Other
TOTAL SURFACE

ACRES
130,317
24,185
7,396,701
22
101,706
175,763
5,406
17,434
0
7,851,536

INCOME
$2,997,928.99
$17,372,310.33
$2,252,394.61
$10,594.00
$6,232,609.33
$1,727,999.35
$137,750.38
$64,799.99
$88,409.30
$30,884,796.28

11,905
77,190
1,457
296,822
387,374

$4,058.77
$83,242.22
$113,931.00
$353,795.64
$555,027.63

SUBSURFACE LEASES
Mineral
Prospecting Permit
Mineral Material
Oil & Gas
TOTAL SUBSURFACE

• In FY 2006, 99.0 million was
generated in expendable receipts from leases, interest on
the outstanding sales balance
and from the Treasurer’s formula distribution. Of this total,
$8.9 million was transferred to
the School Facilities Board,
$72.3 million was distributed
through the School Aid Formula and $17.8 million was
deposited into the Classroom
Site Fund which will be used
for teacher raises, classroom
size reduction and dropout prevention programs.

Penalty & Interest
Sales Interest
School Leases
Treasurer's Formula Distribution
GRAND TOTAL EXPENDABLE
Permanent Fund Receipts
Permanent Fund Balance

• The location of common school grant lands are shown in the above map. As a
result of the large number of acres that are strategically located around urban
areas, substantial revenues are expected to be generated in future years on behalf
of the schools.

23

$106,715.36
$27,113,367.15
$8,946,088.81
$31,437,534.00
$99,043,529.23
$264,273,649.75
$1,639,382,000.00

Classroom Site Fund
Actual

Beneficiary Summary - Common Schools (K-12)
Proposition 310 (passed by voters in the 2000 election) created a Classroom Site Fund
whereby particular sources of funds, including revenue from the fiduciary management
of State Trust land, are directed to fund such items as teacher salaries, classroom size
reduction and dropout prevention programs. According to Proposition 301, the first
$72.3 million in expendable revenue for common schools is used to fund the basic state
aid formula which funds education. Expendable revenue in excess of $72.3 million is
deposited into the Classroom Site Fund.

Fiscal Year

2002

2003

2004

2005

2006

Permanent Fund Revenue

46.7

77.5

131.3

264.4

264.3

Treasurer's Distribution

54.8

53.9

18.6

24.4

31.4

Rent & Interest Received

31.1

39.2

46.3

60.8

58.7

Expendable Received

85.9

93.1

64.9

85.2

90.1

(72.3)

(72.3)

(72.3)

(72.3)

(72.3)

13.6

20.8

12.9

17.8

Base Year Amount
Classroom Site Fund

-

Common Schools Expendable
Earnings FY 1994 - 2006
Classroom Site Fund
FY 2002 - 2006

$120
$100

$100.0
$90.0
$80.0
$70.0

$60

(Millions)

(Millions)

$80

$40

$60.0
$50.0
$40.0
$30.0

$20

$20.0
$10.0

$0
'94 '95 '96

'97 '98

'99 '00 '01

'02 '03

'04 '05 '06

$0.0
2002

2003

2004

2005

Total Common School Expendable

Expendable Earnings
Treasurer's Formula Distribution
Leases & Sales Interest

Classroom Site Fund Distribution

24

2006

Beneficiary Summary - University Grants
• Arizona’s three universities (Arizona State University, Northern
Arizona University, and University of Arizona) are the beneficiaries of six Trust grants.
TOTAL UNIVERSITY GRANTS
FY 2006

• The total expendable revenue that was distributed to the Board
of Regents and then to the universities to fund their operations
was $2.3 million in FY 2006. An additional $3.8 million was
earned and added to the permanent funds for the six grants
bringing the total permanent fund balance to $51.9 million.

SURFACE LEASES
Agriculture
Commercial
Grazing
Homesite
Rights-of-Way
Use Permits
Institutional Taking
U.S. Government
Other
TOTAL SURFACE

• The Board of Regents distributes the expendable earnings from
the six grants to the University of Arizona, Northern Arizona University and Arizona State University as follows:

Board of Regents
Distribution of Trust Revenues to the Universities
Grant

Distribution

Agricultural & Mechanical Colleges

1/2 to UofA and the other 1/2 split
between the 3 Universities based on
Engineering Credit hours

Military Institutes Grant

Split between the 3 Universities
based on Credit hours

University Land Code

Split between the 3 Universities
based on Credit hours

Normal Schools

1/3 to each University

UofA 1881 Grants

UofA

School of Mines Grant

UofA

SUBSURFACE LEASES
Prospecting Permit
Mineral Material
Oil & Gas
TOTAL SUBSURFACE
Penalty & Interest
Treasurer's Formula Distribution
GRAND TOTAL EXPENDABLE
Permanent Fund Receipts
Permanent Fund Balance

25

ACRES
14,764
51,737
597,408
4
7,717
13,610
5,151
299
0
690,690

INCOME
$158,159.77
$458,403.97
$234,471.25
$0.00
$190,189.56
$92,270.24
$918.48
$1,600.01
$1,384.00
$1,137,397.28

5,321
180
30,690
36,191

$2,714.54
$11,760.09
$36,628.22
$51,102.85
$3,828.86
$1,100,811.00
$2,293,139.99
$3,771,137.27
$51,943,000.00

Location of University Trust Grant land

Northern Arizona University (NAU) is, along with the University of Arizona and Arizona
State University, beneficiary of six Trust grants. The 1913 historic photo on the bottom
right shows the first buildings on the campus in Flagstaff with the San Francisco Peaks in
the background. The building on the left behind the trees is ‘Old Main’ which opened its
doors in 1899 with twenty-three students and one professor. This photo was taken by the
three member Land Commission created by the First Legislature in 1912. This
Commission was charged with assessing, evaluating and making recommendations about
the land granted by Congress to the State. This Commission took pictures as it traveled
the State on horseback and in its automobile. The photo to the left is of ‘Old Main’ taken
from the front in 1901. Directly below is a current photo of the NAU campus.

Current photo of NAU campus

Old Main (NAU) 1901

1913 of First buildings on NAU campus (originally the Northern Arizona Normal School)

26

Beneficiary Summary - University Grants

NORMAL SCHOOLS GRANT

AGRICULTURAL & MECHANICAL COLLEGES

MILITARY INSTITUTES

ACRES AND INCOME - FY 2006

ACRES AND INCOME - FY 2006

ACRES AND INCOME - FY 2006

SURFACE LEASES

ACRES

INCOME

SURFACE LEASES

ACRES

INCOME

SURFACE LEASES

ACRES

INCOME

Agriculture

165

$4,194.01

Agriculture

251

$2,911.78

Agriculture

480

$960.00

Commercial

22,539

$15,352.52

Commercial

10,172

$1,417.90

Commercial

1,935

$36,821.00

145,569

$58,496.35

Grazing

107,323

$43,998.25

Grazing

76,749

$33,258.26

Rights-of-Way

1,521

$84,643.49

Rights-of-Way

1,870

$58,610.39

Rights-of-Way

259

$2,237.76

Use Permits

3,217

$5,397.05

Use Permits

2,920

$13,729.00

Use Permits

Institutional Taking

2,721

$0.00

Institutional Taking

1,917

$0.00

184

$1,600.01

U.S. Government

0

$1,200.00

Other

175,916

$170,883.43

Grazing

U.S. Government
Other
TOTAL SURFACE
SUBSURFACE LEASES

TOTAL SURFACE

86

$0.00

0

$184.00

124,538

$120,851.32

Penalty & Interest

$100.00

79,463

$73,377.02
$520.77

Treasurer’s Formula Distribution

$9,173.00

GRAND TOTAL EXPENDABLE

$83,070.79

SUBSURFACE LEASES

Prospecting Permit

376

$0.00

Mineral Material

160

$10,560.09

Oil & Gas

2,938

$3,366.41

TOTAL SUBSURFACE

3,473

$13,926.50

Prospecting Permit

60

$0.00

Permanent Fund Receipts

$3,024.45

Mineral Material

20

$1,200.00

Permanent Fund Balance

$370,000.00

7,421

$7,580.95

Oil & Gas
U.S. Government
TOTAL SUBSURFACE

Penalty & Interest

TOTAL SURFACE

40

86

$0.00

7,587

$8,780.95

$752.02

Treasurer’s Formula Distribution

$41,740.00

GRAND TOTAL EXPENDABLE

$227,301.95

Permanent Fund Receipts

$118,908.44

Permanent Fund Balance

$2,098,000.00

Penalty & Interest

$297.19

Treasurer’s Formula Distribution

$180,233.00

GRAND TOTAL EXPENDABLE

$310,162.46

Permanent Fund Receipts

$10,012.01

Permanent Fund Balance

$6,624,000.00

27

Beneficiary Summary - University Grants

SCHOOL OF MINES

UNIVERSITY LAND CODE

UNIVERSITY OF ARIZONA - 1881

ACRES AND INCOME - FY 2006

ACRES AND INCOME - FY 2006

ACRES AND INCOME - FY 2006

SURFACE LEASES

ACRES

INCOME

2,485

$42,199.28

Agriculture
Commercial

Agriculture
Commercial

8,483

$8,562.35

111,207

$41,753.22

Rights-of-Way

1,044

$2,072.70

Use Permits

1,285

$1,123.99

17

$0.00

124,520

$95,711.54

Grazing

U.S. Government
TOTAL SURFACE
SUBSURFACE LEASES

1,271

$0.00

11,737

$14,752.42

U.S. Government
TOTAL SUBSURFACE

17

$0.00

13,025

$14,752.42

ACRES

INCOME

4,276

$51,322.38

Agriculture
Commercial

$820.14

Treasurer’s Formula Distribution

$104,439.00

GRAND TOTAL EXPENDABLE

$215,723.10

Permanent Fund Receipts

$15,663.97

Permanent Fund Balance

$7,861,000.00

ACRES

INCOME

7,107

$56,572.32

8,238

$259,895.35
$44,715.85

Grazing

Rights-of-Way

2,217

$22,357.63

Home Site

Use Permits

4,237

$27,322.97

Rights-of-Way

107

$918.48

U.S. Government

8

$0.00

Institutional Taking

Other

0

$0.00

U.S. Government

4

$0.00

136,764

$406,532.66

Other

0

$0.00

49,475

$270,041.31

120

$119.99

4

$0.00

124

$119.99

Institutional Taking

369

$136,354.85

38,880

$12,249.32

4

$0.00

Use Permits

TOTAL SURFACE

793

$20,267.59

1,911

$44,597.23

406

$0.00

SUBSURFACE LEASES
Prospecting Permit

3,614

$2,714.54

Oil & Gas

8,474

$10,808.45

8

$0.00

12,097

$13,522.99

U.S. Government
Penalty & Interest

SURFACE LEASES

117,681

Grazing

TOTAL SURFACE

Prospecting Permit
Oil & Gas

SURFACE LEASES

TOTAL SUBSURFACE
Penalty & Interest

$1,192.69

SUBSURFACE LEASES
Oil & Gas
U.S. Government
TOTAL SUBSURFACE
Penalty & Interest

$246.05

Treasurer’s Formula Distribution

$213,276.00

Treasurer’s Formula Distribution

$551,950.00

GRAND TOTAL EXPENDABLE

$634,524.34

GRAND TOTAL EXPENDABLE

$822,357.35

Permanent Fund Receipts

$405,174.85

Permanent Fund Receipts

$3,218,353.55

Permanent Fund Balance

$11,499,000.00

Permanent Fund Balance

$23,491,000.00

28

Beneficiary Summary - Other
• The remaining six Trust grants have as their beneficiaries the School for the Deaf & Blind, the Legislative, Executive and Judicial Buildings, the State Hospital,
the Pioneers’ Home, the Department of Juvenile Corrections and the Department of Corrections. These six grants were authorized in the Enabling Act and
received 100,000 acres, except for the State Charitable Grant which received 200,000 acres. A chart showing the connection between the grants and the beneficiaries is provided below.
• The Pioneers’ Home received a total of $5,354,785 in expendable receipts and $7,758,040 in Permanent Fund receipts in FY 2006.
• The Department of Juvenile Corrections received a total of $1,815,120 in expendable receipts and $3,826,246 in Permanent Fund receipts in FY 2006.
• The Department of Corrections received a total of $3,447,718 in expendable receipts and $3,841,443 in Permanent Fund receipts in FY 2006.

Beneficiary
Grant
School for Deaf & Blind ........................................ School for Deaf & Blind
Legislative, Executive & Judicial Buildings .......... Legislature, Executive & Judicial Branch
State Hospital......................................................... State Hospital
Miners’ Hospital (2 Grants) ................................... Pioneers’ Home
State Charitable, Penal & Reformatory.................. 50% Pioneers’ Home
25% Dept. of Juvenile Corrections
25% Dept. of Corrections
Penitentiary ............................................................ Dept. of Corrections

Arizona State School for the Deaf and
the Blind - Tucson Campus

Arizona Pioneers’ Home
Prescott, Arizona

29

Beneficiary Summary - Other

SCHOOL FOR THE DEAF & BLIND

LEGISLATIVE, EXECUTIVE, & JUDICIAL BUILDINGS

STATE HOSPITAL

ACRES AND INCOME - FY 2006

ACRES AND INCOME - FY 2006

ACRES AND INCOME - FY 2006

SURFACE LEASES

ACRES

INCOME

SURFACE LEASES

ACRES

INCOME

SURFACE LEASES

ACRES

INCOME

Agriculture

2,819

$70,674.03

Agriculture

2,180

$23,536.19

Agriculture

5,367

$97,548.79

Commercial

1,453

$20,441.52

Commercial

6

$19,800.00

Commercial

269

$177,453.27

72,540

$27,960.34

Grazing

56,406

$26,268.70

Grazing

58,121

$23,085.56

Grazing
Rights-of-Way
Use Permits
Institutional Taking
U.S. Government
TOTAL SURFACE

796

$25,845.11

Rights-of-Way

1,399

$17,039.37

5,954

$6,408.91

Use Permits

5,062

$1,510.61

1

$1,163.02

U.S. Government

92

$0.00

65,145

$88,154.87

32

$0.00

83,594

$152,492.93

TOTAL SURFACE

Rights-of-Way
Use Permits
Institutional Taking
U.S. Government
TOTAL SURFACE

869

$18,610.13

4,960

$8,937.46

80

$1,557.96

108

$0.00

69,775

$327,193.17

60

$600.00
$440.00

SUBSURFACE LEASES
SUBSURFACE LEASES
Prospecting Permit
Oil & Gas
U.S. Government
TOTAL SUBSURFACE
Penalty & Interest

800

$1,920.00

6,102

$6,662.46

32

$0.00

6,934

$8,582.46

Prospecting Permit

1,479

$1,280.00

SUBSURFACE LEASES

TOTAL SUBSURFACE

1,479

$1,280.00

Mineral

Penalty & Interest

$624.38

Treasurer's Formula Distribution

$104,788.00

GRAND TOTAL EXPENDABLE

$194,847.25

$1,104.15

Oil & Gas

755

U.S. Government

108

$0.00

TOTAL SUBSURFACE

923

$1,040.00

Penalty & Interest

Treasurer’s Formula Distribution

$77,139.00

Permanent Fund Receipts

$676,132.69

GRAND TOTAL EXPENDABLE

$239,318.54

Permanent Fund Balance

$5,219,000.00

$1,811.71

Treasurer's Formula Distribution

$147,619.00

GRAND TOTAL EXPENDABLE

$477,663.88

Permanent Fund Receipts

$43,927.43

Permanent Fund Receipts

$10,375.50

Permanent Fund Balance

$2,965,000.00

Permanent Fund Balance

$3,128,000.00

30

Beneficiary Summary - Other

MINERS' HOSPITAL*

STATE CHARITABLE, PENAL, & REFORMATORY

PENITENTIARY

ACRES AND INCOME - FY 2006

ACRES AND INCOME - FY 2006

ACRES AND INCOME - FY 2006

SURFACE LEASES

ACRES

INCOME

Agriculture

13,845

$413,083.79

Commercial

600

$779,502.87

73,835

$28,332.70

Grazing
Home Site

0

$1,800.00

Rights-of-Way

1,506

$236,074.18

Use Permits

3,055

$54,452.02

Institutional Taking
U.S. Government
Other
TOTAL SURFACE

1

$919.89

168

$0.00

0

$17,000.00

ACRES

INCOME

Agriculture

3,997

$121,485.77

Commercial

3,380

$420,377.04

63,035

$32,390.56

Rights-of-Way

1,759

$174,468.08

Use Permits

5,240

$62,504.74

Use Permits

Institutional Taking

475

$59,563.18

Institutional Taking

1,778

$0.00

U.S. Government

117

$0.00

5

$0.00

0

$5,000.00

78,003

$875,789.37

Mineral

160

$120.00

Grazing

Other
TOTAL SURFACE

93,010 $1,531,165.45

SUBSURFACE LEASES
Mineral

119

$0.00

4,107

$3,541.07

Mineral Material

230

$20,239.91

Oil & Gas

254

$0.00

Prospecting Permit

U.S. Government
TOTAL SUBSURFACE

168

$0.00

4,878

$23,780.98

Penalty & Interest
Treasurer’s Formula Distribution
GRAND TOTAL EXPENDABLE

SURFACE LEASES

$3,808.15

Permanent Fund Receipts

$105,549.33

Permanent Fund Balance

$6,182,000.00

ACRES

INCOME

Agriculture

4,673

$208,351.19

Commercial

478

$593,961.56

65,932

$24,674.69

494

$617,389.33

6,514

$66,185.63

Grazing
Rights-of-Way

U.S. Government
TOTAL SURFACE

79,874 $1,510,562.40

SUBSURFACE LEASES
Mineral Material

186

$96,000.00

Oil & Gas

640

$1,279.44

U.S. Government

117

$0.00

1,103

$97,399.44

TOTAL SUBSURFACE

Prospecting Permit
U.S. Government
TOTAL SUBSURFACE
Penalty & Interest
Treasurer’s Formula Distribution

Penalty & Interest

$5,704.36

GRAND TOTAL EXPENDABLE

990

$832.74

5

$0.00

995

$832.74
$2,606.89
$118,596.00
$1,632,598.03

Sales Interest

$5,099,303.52

Treasurer’s Formula Distribution

$1,182,283.00

Permanent Fund Receipts

$15,197.19

GRAND TOTAL EXPENDABLE

$7,260,479.69

Permanent Fund Balance

$5,458,000.00

$165,791.00
$1,724,545.58

SURFACE LEASES

Permanent Fund Receipts

$15,304,982.25

Permanent Fund Balance

$61,244,000.00

*Miners' Hospital and Miners' 1929 combined

31

Financial Schedules

Receipts by Category .................................................................33
Rental Acreage and Receipts.....................................................34
Treasurer’s Formula Distribution ................................................35
State Trust Land Acreage by Beneficiary...................................36
Auctions of Leases with and without Preferred Right.................37

32

Financial Schedules

RECEIPTS BY CATEGORY - FY 2006

Common Schools (K - 12)
Normal Schools
A&M Colleges
Military Institutes
School of Mines
University Land Code
U of A (Act of 2/18/1881)
School for the Deaf & Blind
Leg., Exec & Judicial
State Hospital
Miners' Hospital
St Char., Pen. & Ref
Penitentiaries
School Leases
Commercial Prepayment
Total Schools & Institutions

ROYALTY

SALES
PRINCIPAL

5,881,798.50
77,117.28
9,153.77
0.00
14,443.57
3,127.09
164,433.92
4,666.37
293.42
9,263.10
91,521.83
260,351.12
14,232.75
0.00
0.00
6,530,402.72

258,391,851.25
41,791.16
858.24
3,024.45
1,220.40
402,047.76
3,053,919.63
39,261.06
675,839.27
1,112.40
14,027.50
15,044,631.13
964.44
0.00
0.00
277,670,548.69

0.00
0.00
0.00
0.00
0.00
0.00
0.00

0.00
7.92
0.00
0.00
0.00
7.92
0.00

6,530,402.72

277,670,556.61

SALES
INTEREST

LEASE
RENTAL

PENALTY &
INTEREST

OTHER
RECEIPTS

TOTAL

27,113,367.15 31,439,823.91
0.00
184,809.93
0.00
129,632.27
0.00
73,377.02
0.00
110,463.96
0.00
420,055.65
0.00
270,161.30
0.00
161,075.39
0.00
89,434.87
0.00
328,233.17
0.00 1,554,946.43
5,099,303.52
973,188.81
0.00 1,511,395.14
0.00 8,946,088.81
0.00
0.00
32,212,670.67 46,192,686.66

106,715.36
752.02
297.19
520.77
820.14
1,192.69
246.05
1,104.15
624.38
1,811.71
3,808.15
5,704.36
2,606.89
0.00
0.00
126,203.86

0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
1,450,785.54
1,450,785.54

322,933,556.17
304,470.39
139,941.47
76,922.24
126,948.07
826,423.19
3,488,760.90
206,106.97
766,191.94
340,420.38
1,664,303.91
21,383,178.94
1,529,199.22
8,946,088.81
1,450,785.54
364,183,298.14

15,695.99
3,649.17
54,951.90
1,603.68
0.00
75,900.74
0.00

0.00
4.85
96.73
0.00
0.00
101.58
0.00

0.00
0.00
0.00
0.00
10,481,628.46
10,481,628.46
0.00

15,695.99
3,661.94
55,048.63
1,603.68
10,481,628.46
10,557,638.70
0.00

32,212,670.67 46,268,587.40

126,305.44

11,932,414.00

374,740,936.84

GENERAL FUND
F.E.M.A. Lands
Farm Loan Lands
Navigable Streambeds
Lands Held in Trust
Fees: Lease, Sale & Misc
Total General Fund
Riparian Trust Fund
TOTAL RECEIPTS

0.00
0.00
0.00
0.00
0.00
0.00
0.00

*Miners' Hospital and Miners' 1929 combined

33

RENTAL ACREAGE AND RECEIPTS
FY 2006
BY TYPE OF LEASE
SURFACE LEASES
Agriculture
Commercial
School Leases
Grazing
Homesite
Rights-of-Way
Use Permits
Institutional Taking
U.S. Government
Other
TOTAL SURFACE
SUBSURFACE LEASES
Mineral
Prospecting Permit
Mineral Material
Oil and Gas
TOTAL SUBSURFACE
NON-LEASE REVENUES
Penalty & Interest
Sales Interest
Royalty
Land Sales Principal
Rights-of-Way Sales Principal
Settlements
Commercial Prepayments
Fees
TOTAL NON-LEASE REVENUES

ACRES
178,512
82,147
*
8,393,639
27
116,380
220,190
12,892
18,274
0
9,022,061

RECEIPTS
4,097,438.85
19,860,647.54
8,946,088.81
2,652,727.58
12,394.00
7,521,602.48
2,058,571.13
201,872.91
66,400.00
111,793.30
$45,529,536.60

12,244
89,886
2,054
335,268
439,452

4,778.77
93,530.57
241,931.00
398,810.46
$739,050.80

126,305.44
32,212,670.67
6,530,402.72
265,132,783.10
12,522,622.92
15,150.59
1,450,785.54
10,481,628.46
328,472,349.44

GRAND TOTAL

$374,740,936.84

*The acres for School Leases are included in the total for Commercial acres.

34

Financial Schedules

TREASURER'S FORMULA DISTRIBUTION *
YEAR ENDING JUNE 30
FY 2005
FY 2006
Common Schools

INCREASE
(DECREASE)

5/12/1912
TO DATE

24,430,529

31,437,534

7,007,005

990,414,158

32,020

41,740

9,720

2,254,615

143,306

180,233

36,927

7,578,648

Military Institutes Grant

7,781

9,173

1,392

1,159,521

School of Mines Grant

76,972

104,439

27,467

6,274,532

University Land Code

171,189

213,276

42,087

9,934,566

University of Arizona (Act 0f 2/18/1881)

430,985

551,950

120,965

20,176,268

School for the Deaf & Blind

53,809

77,139

23,330

4,042,774

Legislative,Executive & Judicial Buildings

75,015

104,788

29,773

6,574,442

State Hospital Grant

115,826

147,619

31,793

3,022,930

Miners' Hospital Grant**

123,217

165,791

42,574

6,079,791

State Charitable,Penal, and Reformatory

771,500

1,182,283

410,783

19,410,787

76,506

118,596

42,090

3,779,928

26,508,655

34,334,561

7,825,906

1,080,702,960

Normal Schools Grant
Agricultural & Mechanical Colleges

Penitentiary Grant
TOTAL
*Information from the State Treasurer
**Miners' Hospital & Miners' Hospital 1929 combined

35

STATE TRUST LAND ACREAGE BY BENEFICIARY
TRUST ACRES
BENEFICIARY

FY 1978

FY 2006

8,342,469

8,105,550

Normal Schools Grant

172,405

174,798

Agricultural & Mechanical Colleges

134,469

124,944

Military Institutes Grant

82,945

80,168

School of Mines Grant

132,882

123,254

University Land Code

166,354

137,908

University of Arizona (Act 0f 2-18-1881)

62,216

54,218

School for the Deaf & Blind

84,209

82,560

Legislative,Executive & Judicial Buildings

66,660

64,257

State Hospital Grant

79,198

71,248

Miners' Hospital

48,648

47,745

Miners' Hospital (1929)

53,311

47,686

State Charitable,Penal, and Reformatory

80,010

76,930

Penitentiary Grant

80,830

76,111

9,586,606

9,267,377

Common Schools (K - 12)*

TOTAL
*Includes County Bonds

36

Financial Schedules

AUCTIONS OF LEASES WITH AND WITHOUT THE
PREFERRED RIGHT TO MATCH THE HIGHEST BID
(REPORT REQUIRED BY A.R.S.§37-132)

AUCTION

LEASE #

DATE

PARCEL

PREFERRED

NO. OF

PREFERENCE

MINIMUM

BONUS

SUM BASE

LOCATION

RIGHT

BIDDERS

EXERCISED

BID

BID

RENTAL

REVENUE
09/14/05

03-107734

NEC of Happy Valley Road and
Lake Pleasant Pkwy., Peoria,
Maricopa County

No

2

No

$10,800,000*

$2,700,000*

$356,934,780.90

03/28/06

03-105720

SWC Loop 202 and 40th Street,
Phoenix, Maricopa County

No

2

No

$15,640,000*

$5,360,000*

$238,839,053.64

*Minimum bid at auction based on appraised land value rather than 1st year rent.

37

ARIZONA STATE LAND DEPARTMENT
1616 West Adams ● Phoenix, Arizona 85007
www.land.state.az.us