ARIZONA STATE LAND DEPARTMENT
ANNUAL REPORT 2007 - 2008

Janet Napolitano
Governor
Mark Winkleman
State Land Commissioner

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

Contents

Message From the Commissioner........................................................................................ 1
Historical Overview ............................................................................................................... 3
Organizational Chart............................................................................................................. 5
Management Team............................................................................................................... 6
Real Estate Program ............................................................................................................ 7
Natural Resources Program ............................................................................................... 11
Land Information, Title & Transfer Program ....................................................................... 13
Board of Appeals ................................................................................................................ 14
State Trust Land Uses ........................................................................................................ 15
Land Ownership and Management .................................................................................... 16
Fiscal Year 2008– A Historic Revenue Year ...................................................................... 18
Permanent Fund ................................................................................................................. 20
Expendable Revenue ......................................................................................................... 21
Fund and Beneficiary Summary ......................................................................................... 22
Common 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, 2008

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 2008 as required by
A.R.S. §37-132. The report contains a summary of the Department’s management activities and, more importantly,
record-breaking 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.
The Department had record receipts of $382.4 million in fiscal year 2008. While land sales were down compared to
recent years, the $126 million for 1,994 acres ranks as the eighth best year in the history of the Land Department. The
Department brought in a record $77.6 million from rights-of-way and a record $29.4 million from commercial leases.

Mark Winkleman
Arizona State Land
Commissioner

The Department continues to carry a large outstanding balance for previous sales that are financed through the Department. The beneficiaries will earn interest on the balance at a rate averaging from 8% to 10% for an average term of
seven years. The total outstanding receivable balance from term sales is $927.6 million, which earns 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.
During this past year, the Department has worked closely with several of the buyers that financed their purchases
through the Department. Many buyers bought at or near the peak of the housing market and are unable to make their
scheduled payments in the current market at this time. They have not been able to progress as quickly with their development of the land, which has reduced their cash flow. Given the price paid for this land, it is usually in the best interest of the Trust to work with the buyers to extend their payment plans. We were fortunate that no land was returned.
The record $458.3 million revenue generated this year by the Trust has been allocated as follows: $255.9 million from
the sale of land, rights-of-ways and minerals was deposited into the Trust Permanent Fund, increasing the Fund to
$2,163,383,000; the public schools and institutions received $114.2 million from land rents and interest income, school
leases of $7.7 million as well as $75.9 million from the Treasurer’s formula distributions; and $4.6 million was depos-

1

Message From the Commissioner
ited in the General Fund. Of the $181.4 million in expendable earning for the schools (K-12), $72.3 was distributed through
the School Aid Formula, $101.4 million went to the Classroom Site Fund, and $7.7 million was used for school leases.
FY 2008 was a great opportunity to focus on the future of Arizona and the role of State Trust lands in that future. Trust land
is strategically located around the Phoenix and Tucson metropolitan areas as well as many other Arizona cities and towns.
Smart growth will require substantial planning and the inclusion of Trust land. The Department is currently working on the
areas north of Desert Ridge (Azara), the Superstition Vistas, I-17 corridor, Peoria Loop 303 area, White Tanks, Marana and
other areas across the state.
I also need to mention that the Forestry Division will report their activities separately. Through recent legislation and Executive Orders, the State Forester is appointed by you and reports directly to you on policy and administrative matters. As
such, I no longer have any oversight over the Forestry Division.
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 mapping, title, and conservation for the benefit of the citizens of Arizona.
Sincerely,

About the Commissioner
On January 6, 2003, Mark Winkleman
was appointed to be 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 25 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.

Mark Winkleman
Arizona State Land Commissioner

2

Historical Overview
Land Grant

Creation of the Land Department

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.

On May 20, 1912, an act of the First Legislature created the three-member
State Land Commission to serve as the temporary Land Department of the
State. The members were Mulford Winsor, Chairman; Cy Byrne, Secretary;
and William A. Moody, member. Appointed by Governor George W. P.
Hunt, they were charged with assessing, evaluating, and making recommendations about the land granted by Congress to the State for the Common
Schools and other institutions. The Commission was to report back to the
Legislature with its findings and conclusions by the end of the second Legislative session.

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.

State Land Commission riding Crook National Forest Boundary (Graham County). Horseman in
foreground is Forest Supervisor Swift. Second Horseman is W.A. Moody. Third Horseman is
Cy Byrne.

The Commission concluded that Arizona should not sell its Trust land outright, as other states had done. Instead, it should put the lands to their
“highest and best use.” The decision to sell or lease the land should be based
upon the potential use of each parcel. The Commission recommended the
creation of a permanent State Land Department “... in order that the multitudinous detail attached to the State’s varied land interests may have constant
attention and to prevent irretrievable loss.”

State Land Commission on south boundary of Santa Teresa division, Crook National Forest.
Standing: Senator W.W. Pace; left to right; W.A. Moody, Forest Ranger J.H. Kirby, Webster,
Cy Byrne.

3

Historical Overview
The State Land Department and the system by which Trust lands were to be managed were established in 1915 by the State Land Code. In compliance with the Enabling Act and the State Constitution, the State Land Code gave the Department
authority over all Trust lands and the natural products from these Trust lands.
Since the State Land Department’s inception, its missions have been to manage the
Land Trust and to maximize its revenues for the beneficiaries. All uses of the land
must benefit the Trust, a fact that distinguishes it from the way public land, such as
parks or national forests, may be used. While public use of Trust land is not prohibited, it is regulated to ensure protection of the land and compensation to the beneficiaries for its use.

Trust Revenue
Revenues earned from Trust land are classified as either permanent or
expendable. Revenues derived from the sale of State Trust land and
natural products are deposited in the Permanent Funds and invested in
stocks, bonds, and interest-bearing securities by the State Treasurer. The
Treasurer distributes money from the funds to the beneficiaries according to a constitutional formula.
Expendable revenue includes lease revenue from Trust land leases and
permits, interest from sales contracts, and the Treasurer’s formula distribution. This revenue is distributed directly to the beneficiaries for their
use.
State Trust land management priorities continually evolve to remain
efficient in all areas of the Trust’s maintenance. One change that dramatically increased the Department’s revenue-generating potential was
the passage of the Urban Lands Act in 1981. The Act allows the Department to increase the value of Trust land in urban areas by planning and
zoning it in cooperation with the local governments. The Legislature has
also expanded the Department’s leasing capabilities, making long-term
leases of up to 99 years possible for land that either has been planned
under the urban planning process, or is rural commercial land.

Northern Arizona University c. 1913

Beneficiaries
There are 13 beneficiaries of State Trust land revenues. The Common Schools is
the beneficiary with the largest Trust land acreage, originally receiving about 8.4
million acres of land. Other beneficiaries, which originally received a total of about
2.5 million acres, include the University Land Code; Legislative, Executive, and
Judiciary Building Fund; Penitentiary Fund; State Hospital; School for the Deaf
and Blind; Normal (Universities) Schools; State Charitable, Penal, and Reformatory Institutions; Agricultural and Mechanical Colleges; School of Mines; Military
Institutions; University of Arizona (Act of 2-18-1881); and two grants for the Miners’ Hospital. A 14th beneficiary, County Bonds, was funded by Trust revenues
until it was eventually paid. Revenues derived from County Bond lands are now
added to the Common Schools’ grant.

4

Today, the original school section pattern exists only in a few locations such
as the remote Arizona Strip. About
three-quarters 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.

Original Land Endowment Pattern

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

Organizational Chart
Commissioner’s
Office

Administration and
Resource Analysis

Forestry Division

Conservation
Advisory Committee

Board of Appeals

Office of Appraisal

Urban Land Planning
Oversight Committee

Land Information,
Title and Transfer

Natural Resources

During FY 2008, the Forestry Division’s
administration was placed completely
under the State Forester. Therefore, the
Land Commissioner no longer has oversight of the Forestry Division or its activities.

Real Estate

History Timeline
• July 1966 – (Laws 1996 Chapter 20) The
Land Commissioner is the State Forester and
the Forestry Division is established to protect
State and privately-owned commercial timber
lands from fire and to manage the Trust’s
timber sales program.

•

Titles &
Contracts

Natural Resource
Conservation

Commercial
Lease & Sales

Budget &
Accounting

Administrative
Procedures &
Information

Range

Rights-of-Way

ALRIS

Cadastral

Water Rights &
Agriculture

Planning

Administration

Forestry Division Change

•

•

•
Information
Technology

State
Cartographer

Environmental
Resources &
Trespass

Engineering

Minerals

Southern
Arizona Office

5

•

April 2000 – (Laws 2000 Chapter 185) In
addition to fires, the Forester may respond to
other unplanned all risk emergencies.
June 2004 – (Laws 2004 Chapter 326) The
Land Commissioner is no longer the State
Forester. The State Forester is appointed by
the Governor.
August 2004 – (Executive Order 2004-21)
The Forestry Division is established as a
formal division within the Land Department.
The State Forester is subject to administrative
oversight by the Land Commissioner, but
reports directly to the Governor on policy
issues.
July 2006 – (Laws 2006 Chapter 344) The
Forestry Division’s budget is separated as a
special line item.
July 2007 – (Executive Order 2007-18) The
State Forester is responsible for the administration of the Forestry Division and reports
to the Governor on administrative and policy
issues.

Management Team

Mark Winkleman
Arizona State Land
Commissioner

Jim Adams
Director
Real Estate Division

Jamie L. Hogue
Deputy State Land
Commissioner

Lynn Larson
Director
Administration & Resource
Analysis Division
Retired 3/28/08

Richard Oxford
Director
Land Information, Title,
& Transfer Division

6

Bill Dowdle
Director
Natural Resources
Division

Real Estate Program
•

Fiscal Year 2008 was impacted substantially by the housing market slowdown and repercussions in the credit industry. A total of eight auctions
were held, with no competitive bidding. Nevertheless, the Department was
able to complete several major land transactions.

•

A total of 1,757 acres was sold to the City of Phoenix for $107.4 million;
most of the acreage will be incorporated into the Sonoran Preserve, with
the remainder to be developed as improved park land. These sales represent
the third and fourth parcels purchased for the Sonoran Preserve, adding to
almost 2,035 acres already purchased between 2000 and 2003. Additionally, there are approximately 6,000 acres under application for purchase for
the Sonoran Preserve (see map on page 9), as well as 235 acres in north
Phoenix and 243 acres in south Phoenix for park or other municipal uses.
The Department welcomes the efforts of the City of Phoenix to expend the
funds to purchase these lands that are well suited for preserve and park
uses. It has often been said that the Trust’s greatest asset is the diversity of
its holdings, and that attribute has proved highly beneficial in the current
challenged market, and should continue to do so.
Certificate of Purchase Balance
$1,200
$1,000
$800
$600
$400
$200
$0

19
99
20
00
20
01
20
02
20
03
20
04
20
05
20
06
20
07
20
08

Balance (in millions)

•

Fiscal Year

7

•

The interest payment on the certificate of purchase balances was
$51.5 million in FY 2008. The Department is negotiating extensions of time for payment of interest on certain certificates of purchase; the predominantly infill nature, and in many cases highly
desirable areas, of the major sales within the last few years will
more than likely mean the buyers will ride out the current downturn and bring the payments current during FY 2009 and 2010.

•

The beneficiaries received expendable revenues from commercial
leases of $29.4 million and rights-of-way leases of $21.5 million.
In addition, $7.7 million in school facility lease revenue was
earned.

Real Estate Program
Major Auctions
•

•

•

$85 Million Sale; Phoenix, November 8, 2007: The City of Phoenix acquired two large parcels of land, most of which will be added to the City’s
Sonoran Preserve. In November, the City bought 944.89 acres for $85 million, representing almost $90,000 per acre. On June 30th of 2008, the City
bought an additional 812.22 acres for $22.4 million, approximately $28,000
per acre. Both parcels are in north Phoenix. The discrepancy in price was
due to the terrain and ultimate ability to develop the parcels. The City has
received grants from the State Parks Department for half of the purchase
price for lands that had been classified as “Suitable for Conservation” under
the Arizona Preserve Initiative, or approximately 863 acres and 639 acres,
respectively. For the November sale, the 82 acres that were not classified as
Suitable for Conservation are slated for an improved park. For the June sale,
the 173 acres will likely be incorporated into the Sonoran Preserve, as the
expense to develop is prohibitive.
$32 Million Lease; Phoenix, April 30, 2008: Jaren Associates #4, an entity
comprised of major retail and commercial developers in the southwest, was
the successful bidder for a 99 year, 112 acre lease of some of the most prime
property in Arizona. This property is located north of the Loop 101 on the
west side of Scottsdale Road, in the Phoenix master planned community of
Paradise Ridge. The property, branded as “Palisene” by Macerich, a national
shopping center developer, is slated for a very dense mixed use project involving retail, office and residential uses. The land was valued at $32 million, and the lessee is required to construct an estimated $67 million in infrastructure, that will benefit hundreds of acres of additional land within Paradise Ridge. The lessee was required to deposit $20 million to secure a portion of the infrastructure costs at the time of the auction. The base rent over
the 99 year lease will total almost $525 million, and the lease will bring in
substantial additional revenue in participation rent.

•

$1.3 Million Sale; Marana, December 10, 2007: The Town of Marana purchased 90.71 acres for $1.3 million in December, to expand the
Pinal Airpark. The Airpark is ideally situated north of Tucson along the
I-10 corridor and will likely become one of the busier reliever airports
to Sky Harbor and Tucson International, similar to the Scottsdale Airpark and the Deer Valley Airport in the Phoenix metropolitan area. The
Trust retains lands strategically located adjacent to the Pinal Airpark,
which stand to benefit through value enhancement as the Airpark is
expanded and improved.

•

$2.2 Million Sale; Surprise, May 20, 2008: Similarly, the City of
Surprise purchased 50.71 acres in May of 2008, for $2.2 million to
construct a wastewater treatment plant. Again, this infrastructure will
benefit surrounding Trust holdings.

Facts and Figures
Land Auctioned FY 2008

Urban

$12.8 Million Sale; Scottsdale, June 30, 2008: JTW Partners purchased
16.81 acres in North Scottsdale for $12,750,000. The buyer has an interest in
the adjacent Pinnacle Peak Patio steakhouse and has plans to develop a small
resort on the site, which sits at the base of Pinnacle Peak. The parcel was a
remnant piece off of the main arterial (Alma School Road), and its value was
attributed to the assemblage opportunity with the restaurant site.

8

Acres
Leased

Minimum
Cumulative Lease
Revenue

112.03

$524,157,476.27

3,605,000.00

0

0

$125,997,000.00

112.03

$524,157,476.27

Acres
Sold

Total Sales
Price

1,783.20

$122,392,000.00

Rural

211.12

Total

1,994.32

$

Real Estate Program
Sonoran Preserve History

9

Natural Resources Program
The Natural Resources Division administers natural resource related
leases, Conservation Districts and any natural resource issue affecting
State Trust land. The main leasing categories include grazing, agriculture
and minerals. Other areas of natural resource administration include mineral material sales, exploration permits, water sales, water rights administration, trespass, recreational permits, environmental contamination, cultural resources, and dam safety. The Division includes five sections and a
dam safety program.
• Range Section
° Reviewed applications to place improvement and land treatment applications and provided environmental and cultural clearances.
° Participated 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.
° Experienced a 5% decrease in the appraised value of forage on State
Trust rangeland from the previous year.
• Water Rights & Agriculture Section
° Administered three distinct water programs for State Trust lands:
wells, water rights/claims, and water contracts/agreements, as well as
provided water right evaluations for land sale and other lease applications. The agricultural leasing program reviews the following types of
applications: improvements, sublease, assignment, renewal and new
lease for agricultural purposes.
° The Department is claiming federal reserved water rights for State Trust land. On
September 28, 2007, the Special Master
filed a report with the adjudication court
concluding that the Department’s claim is
not supported by record. On December 17,
2007, the Attorney General’s Office, on
behalf of the Department, filed an objection to the Special Master’s decision in
support of the claim. This matter is currently before the adjudication court.
° The Department held four agricultural stakeholder meetings to focus
on potential modifications to the leasing program. Next fiscal year,
the Department plans to hire a consultant to perform agricultural
rental studies in a few counties.

LEASES AND PERMITS
FY 2008

REVENUE PRODUCTION
FY 2008

Facts & Figures

Lease Rentals

Number
of
Acres Leases
170,487
387

Agriculture
Grazing
Mineral Material

8,405,902
1,827

1,247
17

164,842

376

Exploration Permits
Mineral
Oil & Gas

12,605

99

1,004,792

519

3,229

27

Mineral SLUPs

Agriculture

$4,201,576

Grazing

$2,471,763

Mineral Material
Exploration Permits
Mineral

$230,091
$213,836
$95,624

Oil & Gas

$1,006,274

Mineral SLUPs

$179,711

TOTAL

$8,344,875

Number of Registrations
and Water Rights Claims

Sale of Products

Stockpond Registrations
Certificated Surface Water Rights

4,308
110

Public Auction Water Sales

Well Registrations

2,868

Mineral Royalties

$3,859,592

Natural Products

$4,888,808

TOTAL

$9,394,447

Adjudication Statements
of Claimant

7,022

Water Right Registrations

7,406

Lease Water Charges

Grandfathered Groundwater
Rights

$300,711

Trespass Revenues
234

Settlements
Trespass Revenue
TOTAL*
GRAND TOTAL

*In addition, $61,512 was collected in leasing revenue as a result of trespass resolution.

10

$345,336

$6,547,825
$129,155
$6,676,980
$24,416,302

Natural Resources Program
• Minerals Section
° Administered five permitting/leasing programs, including: exploration
permits, mineral leases (hard rock minerals like copper and gold), mineral materials leases (common varieties like sand and gravel), energy
leases (oil, gas, helium, CO2, and geothermal), and special land use
permits (surface use in split estate areas). Also provided mineral resource evaluations and geologic information for land sales, conservation proposals and conceptual plans.
° In June 2008, the ASLD joined in a cooperative effort with other state
agencies, the Arizona offices of several federal agencies, and some
private groups, to address the problem of Abandoned Mine Lands
(AML) in the state. Cooperative agreements and MOUs are being put
in place to allow the various agencies to pool resources and funds to
start reclaiming AML sites.
° Continued high mineral commodity prices, especially for copper, resulted in an increase in royalties from mineral production, and, mainly
due to higher prices for potash and uranium. The downturn in urban
expansion and construction resulted in reduced royalties from mineral
material operations.
° Due to world-wide increase in crude oil and natural gas prices, leasing
activity for oil and gas rights more than doubled, with just over one
million acres of State Trust lands now covered by oil and gas leases.
Exploration activity in the St. John’s—Springerville area has taken
place over the last several years, and the Department anticipates that
CO2 and helium may be produced from this field within the next two
to three years.

• Natural Resource Conservation Section
° Provided administrative support to 32 Natural Resource Conservation Districts, 30 of which sponsor 23 Environmental Education Centers. Served
as the clearing house and certified all statutory requirements. Processed 85
requests for supplemental funding that required quarterly distributions
totaling $470,000 General Funds for individual NRCD operations and
$180,000 from the Environmental Special License Plate Fund for individual Education Center operating expenses.
° Participated in 45 local, state, and federal meetings involving a variety of
natural resource conservation issues ranging from Rapid Watershed Assessments, reclamation and reforestation of wildlife habitat, and eradication and control of noxious and invasive plants on State Trust lands. Represented the ASLD on the Arizona Invasive Species Council established
by Governor Napolitano’s Executive Order 2007-07. The council presented a comprehensive invasive species strategic plan for the Governor’s
signature on June 30, 2008.
° Provided technical review and assessment of 55 lease applications and
land use permits (i.e. agricultural, commercial, Right of Way, etc.). The
purpose was to determine native plant value and compensation for the
removal from State Trust lands. Issued billing notices totaling $1,153,982
as part of the Department’s fiduciary responsibilities to the Trust.

• Environmental Resources and Trespass Section
° $12.1 million was collected in an environmental damages settlement.
Believed to be the largest single environmental action in Arizona, the
money was distributed among partner agencies, including the Arizona
Game and Fish Department, the Arizona Department of Environmental
Quality and the Arizona State Museum. $6.54 million was deposited
into the Permanent Fund to compensate the beneficiaries for loss of
natural product. Other trespass actions collected an additional
$129,155.

11

Natural Resources Program

• Environmental Resources and Trespass Section (continued)
° Working in conjunction with Arizona State Parks and their Site Steward volunteers, the Department helped protect Arizona’s heritage by
placing erosion control devices and fencing at two cultural resource
sites, Las Tusas Cemetery and the McClellan platform mound. A motion detection camera was placed at a site to help deter vandalism. 171
newly documented register eligible sites were determined to be on
Trust land.
° Initiated numerous cooperative efforts with various municipalities and
volunteer groups to improve air quality on Trust land in the Phoenix
metropolitan area. Of the 68 violations received from the Maricopa
County Air Quality Division since 2002, 30 were issued this last fiscal
year. A county island in Mesa was fenced to prohibit unauthorized
OHV activity after the fourth violation in four years, and more than
$90,000 was spent to respond to just one complaint on that vacant urban site in an effort to avoid legal action. Remediation efforts will continue on the other 29 locations.
° Provided roll-off and dump fees for 41 volunteer clean-up projects on
Trust land; more than 227 tons of trash (not including 308 tires) were
removed by Eagle Scouts and other concerned citizens. 16 vehicles
abandoned on Trust land were removed. Cooperative efforts with other
government entities, including the town of St. Johns, Bureau of Land
Management, and the Bureau of Reclamation resulted in trash
(including large dump sites and squatter camps) removal from Trust
land across the state.

• Dam Safety Program
° The Dam Safety Program’s (DSP) main objective is to develop and maintain an emergency protocol system that will facilitate the Department’s goal
to reduce the State’s liability associated with potential dam failures and
floods.
° DSP Data Base—Finalized the identification, investigation and data gathering for the development of a data base for the statewide DSP to be integrated with existing Department information systems.
° IGA—FDC 2007A001—Participated in the preparation of the IGA between
Maricopa County FCG and ASLD for the Dam Safety Program Repair Cost
for Powerline, Vineyard and Rittenhouse FRSs. Provided technical review
of the Work Plan and managed the utilization of the allocated funds and
approved the final disbursement for $230,600.
° Campomocho NRCS Project—Identified and initiated a data gathering and
investigation in past approved ranch improvements (stock ponds), with the
primary objective of providing flood control protection of downstream private lands and properties.
° Jurisdictional Dams (JD) - Managed the ASLD JDs inventory, interacted
with ADWR on all related
issues, and participated in
performing yearly JD inspections.
° Drainage and Flooding
Issues—Provided technical review, recommendations and monitoring for
drainage and flooding
issues that are related to
non-disposition parcels
(i.e. Killian Ranches, 15th
Lane and Rose Garden,
Santa Cruz River, KAI
Lease, etc.)
° Improvement Applications—Provided technical review and comments on
applications to place drainage improvements on existing Department leases.
° Lake Havasu City (LHC) Levees & SR 95 Realignment—Investigated,
located and identified several unauthorized levees built in the north and east
area surrounding LHC jurisdiction.
12

Land Information, Title & Transfer Program
The Land Information, Title & Transfer Division
ensures the integrity of the State’s title to 9.3 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 an integral part
of Arizona’s growth. Customer requests for 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
its computer adept customers with a state-of-theart computerized records information system covering 9.3 million acres, while at the same time,
providing the same level of service to customers
who have limited computer use skills. In FY 2008,
the Public Records and Cadastral Unit staff provided accurate and timely records and survey information to over 2,000 “walk-in” customers, responded to over 2,300 e-mail and telephonic inquiries and retrieved 8,882 physical files for customer and staff research. In addition, the staff entered 1,422 new State Trust land applications into
the Department’s computer processing system for
new, renewal and other transactions involving
Trust land and issued 5,857 recreational permits to
the public.
Public Response to the Department
Since 1998, the Department has provided a customer service rating survey to its customers in order to obtain customer service feedback. Customer
ratings and comments related to the Department’s
service and programs are used to determine where
customer service can be improved. Most of the
Department’s customers, including lessees,

members of the legal profession, land use, planning
and development interests, title companies and
members of the general public are repeat customers.
However, some customers may be visiting from
out-of-state and contact the Department only once,
so we’ve got one opportunity to get it right. Customer comments are excellent tools for measuring
program success as well as showing where improvement is needed. For FY 2008, 88% rated our customer service as a 4 or 5 on a 1-5 scale.
Legal and Administrative
For several years, the Department has, in coordination with the Attorney General’s Office, worked to
collect outstanding debt owed to the Trust for the
use of the Trust lands. In FY 2008, these efforts
cumulated in the Department collecting in excess of
$200,000 in past due rents owed to the Trust.
In addition to the general public records request
received in the Public Records area, the Department
continues to receive an increasingly large number of
public records requests for legal issues. Many of
these requests are under the Freedom of Information
Act or relate to lawsuits or other legal transactions
in which the Department may or may not be a party
or have a legal interest. These requests, often under
a court or media deadline, require hundreds of hours
of staff time to respond. In FY 2008, the Administrative Procedures and Information Section addressed 32 public records requests which totaled
over 142,000 documents.

Application and Contract Processing
The Division develops and processes all surface
lease, sale, and use applications; prepares, drafts
and revises all surface lease, permit, and rightof-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 1,337
new applications, finalized 1,344 contracts, and
researched 5.8 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. The Division processed a federal land use condemnation of 18.79 acres in San
Luis, Yuma County involving a 90 ft. strip of
land along the U.S.-Mexico border. The condemnation facilitated the U.S. Department of
Homeland Security’s continuing construction of
border security facilities. The Department continues to work with the U.S. Department of
Homeland Security in various other land management issues and expects additional Trust land
condemnation actions as the border security program progresses.

The Department continues to address various litigation issues, including but not limited to, sales of
subsurface rights, the issuance of minerals leases,
federal rights-of-way, quiet title land claim actions,
lessee improvement reimbursement rights, auction
protests and water rights.
Remodeled Public Records Room

13

Board of Appeals

CURRENT BOARD MEMBERS

Jeffrey Covill, Chair
Phoenix
Represents the Second District consisting of
Maricopa, Pinal, Gila, Yuma and La Paz counties.
Norman R. Brown, Vice-Chair
St. Johns
Represents the Third District consisting of Mohave,
Yavapai, Coconino, Apache and Navajo counties.

Sanders K. Solot
Tucson
Represents the First District, consisting of Pima,
Santa Cruz, Cochise, Graham and Greenlee counties.
Kathleen M. Holmes
Scottsdale
Member-at-Large.
Jolene U. Dance
Phoenix
Member-at-Large.

Arizona Revised Statute A.R.S. § 37-132(A)(7) 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 file an appeal with the Board of a final decision of the State Land Commissioner relating to appraisals and classifications.
The 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 five commercial leases, including four long-term leases, one for 75 years, and three for 99 years;
97 rights-of-way sales appraisals; and seven land sales appraisals, three
of which were urban land sales.
Seven new appeals were filed with the Board. Two appeals modified the
Commissioner's decisions. One appeal sustained the Commissioner's
decision. Three appeals were withdrawn and dismissed by the Board.
Two appeals were carried over to the next fiscal year. One appeal is
pending until September 11, 2008.

14

State Trust Land Uses

STATE TRUST LAND USES - FY 2008

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

9,121,656.25 acres of the surface are under
10,103 leases and other contracts.
1,187,064.61 acres of the subsurface are under
1,011 leases and other contracts.

NO. OF
LEASES

% OF
LEASES

Rights-Of-Way

7,335

73%

149,330.26

2%

Grazing

1,247

12%

8,405,901.74

92%

328

3%

92,575.93

1%

20

0%

1,083.15

0%

Agricultural

387

4%

170,487.35

2%

Use Permits

595

6%

236,816.23

3%

U.S. Government

156

2%

18,265.36

0%

3

0%

18.13

0%

10

0%

12,891.56

0%

SURFACE

Commercial
Commercial School Leases

Homesite
Institutional
Recreational
Subtotal (Leases)

TOTAL
ACREAGE

% OF
ACREAGE

22

0%

34,286.54

0%

10,103

100%

9,121,656.25

100%

99

10%

12,604.58

1%

376

37%

164,841.70

14%

SUBSURFACE
Mineral
Mineral Exploration
Mineral Materials

17

2%

1,826.67

0%

Oil & Gas
Subtotal (Leases)

519
1,011

51%
100%

1,004,791.66
1,184,064.61

85%
100%

TOTAL LEASES

11,114

10,305,720.86

Land Ownership and Management

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. The Arizona
State Land Department makes no warranties, implied or expressed, with respect to the information shown on this map.

16

Land Ownership and Management

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 into four basic categories.

COUNTY
Apache
Cochise

1,370,922

Coconino

1,125,118

Gila

496,321

Greenlee

172,104

La Paz

254,411

Maricopa

641,952

Mohave

564,885

Navajo

370,168

Pima

860,658

Pinal

1,205,178

Yavapai

61,154
1,264,280

Yuma

186,670

Misc*

2,540

TOTAL
*Trust lands located in California or Nevada due to
realignment of Colorado River

17

31,231

Graham

Santa Cruz

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.

ACRES
652,660

9,260,253

Fiscal Year 2008 - A Historic Revenue Year
Record Revenues
• FY 2008 was an exceptional year for Trust revenues. The Department received $382.4 million and the Treasurer distributed
$75.9 million for a grand total of $458.3 million.

Total Trust Revenue
FY 1999 - 2008

• Sold 1,994.32 acres for $126.0 million through seven successful auctions, including 1,757 acres sold to the City of Phoenix
at two auctions for $107.4 million.

$500

• Auctioned a long-term lease of 112 acres that will generate at
least $524 million over the 99-year term.

$450

• The Department deposited $101.0 million into the Classroom
Site Fund, a 51% increase.

$350

FUNDS

FY 2008 TOTAL

Expendable

114,159,641.30

Commercial Prepayment
School Leases
General
Permanent

16,173.00
7,710,695.00
4,619,562.67
255,879,519.56

TOTAL LAND DEPARTMENT

382,385,591.53

Treasurer's Distribution
GRAND TOTAL - FY 2008

75,906,357.00
458,291,948.53

(Millions)

$400

$300
$250
$200
$150
$100
$50
$0
1999

2000

2001

2002

2003

2004

2005

Fiscal Year
Land Department Earnings
Treasurer's Distribution

2006

2007

2008

Fiscal Year 2008 - A Historic Revenue Year

REVENUES BY BENEFICIARY
FY 2008

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

TRUST
ACRES

STATE LAND
EXPENDABLE
EARNINGS

TREASURER'S
FORMULA
DESTRIBUTION

TOTAL
EXPENDABLE
RECEIPTS

TOTAL
PERMANENT
FUND RECEIPTS

TOTAL
RECEIPTS

8,098,658

112,087,536

69,297,633

181,385,169

238,474,714

419,859,882

Normal Schools

174,798

1,129,075

100,995

1,230,070

131,180

1,361,250

Agricultural & Mechanical Colleges

124,944

209,648

392,769

602,417

28,280

630,697

Military Institutes

80,168

103,767

20,229

123,996

10,732

134,728

School of Mines

123,254

138,740

322,836

461,576

69,461

531,038

University Land Code

137,907

877,159

504,909

1,382,068

1,302,579

2,684,647

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

54,101

579,723

1,167,414

1,747,137

281,656

2,082,793

School for the Deaf & Blind

82,560

253,899

165,981

419,880

8,787

428,666

8,876,390

$115,379,546

$71,972,766

$187,352,312

$240,307,389

$427,659,701

Legislative, Executive & Judicial Buildings

64,257

93,626

258,219

351,845

1,209

353,054

State Hospital

71,248

440,349

195,531

635,880

601,918

1,237,798

Miners’ Hospital*

95,429

1,775,746

312,123

2,087,869

3,065,341

5,153,210

State Charitable, Penal, and Reformatory

76,818

3,109,798

2,885,109

5,994,907

11,748,548

17,743,455

Penitentiary

76,111

1,071,272

282,609

1,353,881

155,114

1,508,995

9,260,253

$121,870,336

$75,906,357

$197,776,693

$255,879,520

$453,656,213

Subtotal Education

TOTAL
*Miners' Hospital and Miners' 1929 combined.

19

Permanent Fund
• The Department deposited $255.9 million into the Permanent
Funds in FY 2008, increasing the book value to $2,163,383,000.
• The balance of Department managed sales contracts is $927.6
million.
• The Permanent Funds consist of revenues earned from the sale
of State Trust land or assets such as minerals or other natural
products.
• Each beneficiary has its own Permanent Fund.
• The State Treasurer manages the Permanent Funds and invests
the funds in stocks, bonds and other interest bearing securities.
Distributions from the Permanent Funds to the beneficiaries are
based on a constitutional formula.
Permanent Fund Balance
FY 1989 - 2008

BENEFICIARY SHARE OF PERMANENT FUND
JUNE 30, 2008
BOOK VALUE

MARKET VALUE

2,001,153,000

2,382,654,000

Normal Schools

2,161,000

2,745,000

Agricultural & Mechanical Colleges

6,267,000

8,315,000

363,000

474,000

7,617,000

9,371,000

University Land Code

12,437,000

15,423,000

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

25,429,000

32,150,000

School for the Deaf & Blind

2,974,000

3,932,000

Legislative, Executive & Judicial

5,241,000

6,703,000

State Hospital

3,549,000

4,696,000

Miners’ Hospital

9,642,000

11,263,000

81,117,000

96,250,000

5,434,000

7,159,000

2,163,384,000

2,581,135,000

Common Schools (K - 12)

Military Institutes
School of Mines

State Charitable, Penal & Reformatory

$2,500

Penitentiaries
TOTAL**

$2,000

(Millions)

*Miners' Hospital and Miners' 1929 combined.

$1,500

**Values are provided by the State Treasurer's Office and are rounded to the nearest thousand.

$1,000

The Department celebrated a book value of
$2 billion with the August 17, 2007 deposit!

$500

$0
1989 1991 1993 1995 1997 1999 2001 2003 2005 2007

Fiscal Year

Expendable Revenue
• Expendable revenue includes lease revenue from Trust
land leases and permits, interest from sales contracts, and
the Treasurer’s formula distribution of the Permanent
Fund.
• Expendable revenues are distributed directly to the beneficiaries.

EXPENDABLE REVENUE BY BENEFICIARY
FY 2008

BENEFICIARIES

TREASURER'S LEASE & SALES
FORMULA
CONTRACT
DISTRIBUTION
INTEREST

TOTAL
EXPENDABLE
REVENUE

• Expendable revenue totaled $197.8 million in FY 2008.
• Revenue from Trust land leases, permits, and interest
earnings from sales financed through the Department totaled $121.9 million.

Common Schools (K-12)*

• The Treasurer distributed $75.9 million according to the
constitutional formula based on the 5-year average net
return and the 60 month average market value.

Military Institutes Grant

Trust Expendable Earnings
FY 1999 - 2008

69,297,633.00

112,087,535.60

181,385,168.60

Normal Schools Grant

100,995.00

1,129,074.90

1,230,069.90

Agricultural & Mechanical Colleges

392,769.00

209,648.19

602,417.19

20,229.00

103,767.23

123,996.23

School of Mines Grant

322,836.00

138,740.22

461,576.22

University Land Code

504,909.00

877,158.70

1,382,067.70

1,167,414.00

579,722.97

1,747,136.97

165,981.00

253,898.53

419,879.53

71,972,766.00

115,379,546.34

187,352,312.34

Legislative, Executive & Judicial Buildings

258,219.00

93,626.08

351,845.08

State Hospital Grant

195,531.00

440,348.57

635,879.57

Miners’ Hospital Grant

312,123.00

1,775,745.55

2,087,868.55

2,885,109.00

3,109,798.12

5,994,907.12

282,609.00

1,071,271.64

1,353,880.64

75,906,357.00

121,870,336.30

197,776,693.30

University of Arizona (Act 0f 2/18/1881)
School for the Deaf and Blind
Subtotal Education

$200
$180
$160
(Millions)

$140

State Charitable, Penal & Reformatory

$120

Penitentiary Grant

$100

TOTAL

$80
$60
$40
$20

*The amount for expendable earnings includes $7,710,695.00 from the school leases in accordance with
37-221, D.

$0
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008

Total Expendable
Treasurer's Distribution
Land Department Earnings

Fund and Beneficiary Summary
In 2008, State Trust revenues totaled $458,291,949. A total of $453,656,213 in receipts were earned for the beneficiaries, $4,619,563 was deposited in
the General Fund, and $16,173 was received as commercial prepayments. Of the beneficiary amount, $255,879,520 was deposited into the Permanent
Funds. The Permanent Funds are managed by the State Treasurer. The remaining $197,776,693 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
8,098,658

Receipts over $72.3 million
174,798

Normal Schools

124,944

Agricultural & Mechanical Colleges

80,168

Military Institutes

123,254

School of Mines

137,907

University Land Code

Classroom Site Fund

Board of Regents
to
Distribute to Universities

54,101

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

95,429

Miners’ Hospital (2 Grants)

Pioneers' Home

76,818

State Charitable, Penal, and Reformatory

76,111

Penitentiary

9,260,253

State Aid Formula for K - 12

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

50% Pioneers' Home
25% Department of Corrections

Department of Corrections

TOTAL

22

25% Department of Juvenile Corrections

Fund and 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 remain in the Trust for common
schools.

COMMON SCHOOLS (K - 12)
ACRES AND INCOME - FY 2008
SURFACE LEASES

ACRES

INCOME

Agriculture
Commercial

124,844
34,664

$3,090,537.85
$26,379,219.76

7,409,648

$2,058,352.98

Grazing
Homesite

• In FY 2008, $238.5 million
from sales and royalties was
deposited into the Permanent
Fund for common schools
bringing the total balance to
$2,001,153,000.

18

$6,179.11

Rights-of-Way

109,063

$19,142,318.24

Use Permits

191,027

$2,039,373.73

5,406

$324,913.80

17,426

$141,446.25

Institutional Taking
U.S. Government
Other
TOTAL SURFACE

• In FY 2008, a record $181.4
million was generated in
expendable receipts from
leases, interest on the outstanding sales balance and
from the Treasurer’s formula
distribution. Of this total,
$7.7 million was transferred
to the School Facilities
Board, $72.3 million was
distributed through the
School Aid Formula and
$101.4 million was deposited
into the Classroom Site
Fund, which will be used for teacher raises, classroom size reduction and dropout
prevention programs.
• 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

0

$116,393.54

7,892,096

$53,298,735.26

SUBSURFACE LEASES
Mineral
Prospecting Permit
Mineral Material
Oil & Gas
U.S. Government
TOTAL SUBSURFACE

Penalty & Interest
Sales Interest
School Leases

12,265

$62,959.67

149,626

$188,242.46

1,270

$100,348.67

882,106

$876,700.77

17,426

$0.00

1,062,694

$1,228,251.57

$497,589.53
$49,352,264.24
$7,710,695.00

Treasurer's Formula Distribution

$69,297,633.00

GRAND TOTAL EXPENDABLE

$181,385,168.60

Permanent Fund Receipts
Permanent Fund Balance

$238,474,713.76
$2,001,153,000.00

Fund and Beneficiary Summary
Common Schools (K-12)

Common School Revenue
(Millions)

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 items such 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

2005

2006

2007

2008

Permanent Fund Revenue

264.4

264.3

182.7

238.5

Treasurer's Distribution

24.4

31.4

32.4

69.3

Rent & Interest

60.8

58.7

106.9

104.4

Total Expendable

85.2

90.1

139.2

173.7

(72.3)

(72.3)

(72.3)

(72.3)

12.9

17.8

67.0

101.4

Base Year Amount
Classroom Site Fund

Common Schools Expendable
Earnings FY 1999 - 2008

Classroom Site Fund
FY 2002 - 2008

$200
$180
$200

$160

$180
$160

$120

$140

$100
(Millions)

(Millions)

$140

$80
$60

$120
$100
$80
$60

$40

$40

$20

$20

$0
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008
Expendable Earnings
Treasurer's Formula Distribution
Leases & Sales Interest

$0
2002

2003

2004

2005

2006

2007

Total Common School Expendable
Classroom Site Fund Distribution

24

2008

Fund and Beneficiary Summary
University Grants
• Arizona’s three universities (Arizona State University, Northern Arizona University, and the University of Arizona) are the beneficiaries
of six Trust grants.

TOTAL UNIVERSITY GRANTS
FY 2008
SURFACE LEASES

• The total expendable revenue that was distributed to the Board of Regents and then to the universities to fund their operations was $5.5
million in FY 2008, a 112% increase over FY 2007. An additional
$1.8 million was earned and added to the permanent funds for the six
grants bringing the total Permanent Fund balance to $54.3 million.

ACRES

INCOME

Agriculture

14,764

$194,978.69

Commercial

51,676

$558,840.45

Grazing
Rights-of-Way
Use Permits
Institutional Taking

• 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:

U.S. Government
Other
TOTAL SURFACE

Board of Regents
Distribution of Trust Revenues to the Universities
Grant

Distribution

Agricultural & Mechanical Colleges

1/2 to UA and the other 1/2 split between
the three universities based on engineering credit hours

Military Institutes Grant

Split between the three universities based
on credit hours

University Land Code

Split between the three universities based
on credit hours

Normal Schools

1/3 to each university

UA 1881 Grants

UA

School of Mines Grant

UA

597,156

$210,112.28

7,821

$1,519,205.71

13,768

$114,561.72

5,151

$974.42

299

$4,000.02

0

$237.00

690,634

$2,602,910.29

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

25

5,741

$9,380.01

140

$11,760.09

103,814

$117,349.79

299

$4,000.02

109,994

$142,489.91
$5,919.85
$290,792.18

Treasurer's Formula Distribution

$2,509,152.00

GRAND TOTAL EXPENDABLE

$5,551,264.23

Permanent Fund Receipts

$1,823,888.59

Permanent Fund Balance

$54,274,000.00

Fund and Beneficiary Summary
University Grants

ASU Memorial Union Building

San Francisco Peaks and
NAU Campus

UA Dennis Deconcini Environment
and Natural Resources Building

26

Fund and Beneficiary Summary
University Grants

NORMAL SCHOOLS GRANT

AGRICULTURAL & MECHANICAL COLLEGES

MILITARY INSTITUTES

ACRES AND INCOME - FY 2008

ACRES AND INCOME - FY 2008

ACRES AND INCOME - FY 2008

SURFACE LEASES

ACRES

Agriculture

SURFACE LEASES

165

$3,914.01

Agriculture

22,539

$11,426.94

Commercial

146,026

$50,219.88

Grazing

Commercial
Grazing

INCOME

ACRES

INCOME

251

$2,617.78

Agriculture

10,172

$1,662.51

Commercial

106,443

$35,907.53

Rights-of-Way

1,619 $1,010,334.64

Rights-of-Way

1,882

$130,485.93

Use Permits

3,364

Use Permits

2,925

$16,829.88

Institutional Taking

2,721

$0.00

Institutional Taking

1,917

$0.00

184

$4,000.02

86

$0.00

123,676

$187,503.63

U.S. Government
TOTAL SURFACE

$5,202.30

176,619 $1,085,097.79

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

U.S. Government
TOTAL SURFACE

SUBSURFACE LEASES
2,216

$1,575.73

120

$10,560.09

Mineral Material

31,041

$31,324.48

Oil & Gas

184

$0.00

33,561

$43,460.30
$516.81

Prospecting Permit

U.S. Government
TOTAL SUBSURFACE
Penalty & Interest

ACRES

Grazing
Rights-of-Way
Use Permits
TOTAL SURFACE

INCOME

480

$960.00

1,935

$38,677.00

76,749

$30,278.62

259

$6,071.20

40

$2,580.47

79,463

$78,567.29

SUBSURFACE LEASES
Oil & Gas

24,868

$24,868.25

TOTAL SUBSURFACE

24,868

$24,868.25

380

$700.00

20

$1,200.00

18,223

$19,666.22

Treasurer’s Formula Distribution

$20,229.00

86

$0.00

GRAND TOTAL EXPENDABLE

$123,996.23

18,709

$21,566.22
$578.34

Treasurer’s Formula Distribution

$100,995.00

Treasurer’s Formula Distribution

$392,769.00

GRAND TOTAL EXPENDABLE

$1,230,069.90

GRAND TOTAL EXPENDABLE

$602,417.19

Permanent Fund Receipts

$131,179.72

Permanent Fund Receipts

$28,280.16

Permanent Fund Balance

$2,161,000.00

Permanent Fund Balance

$6,267,000.00

27

SURFACE LEASES

Penalty & Interest

$331.69

Permanent Fund Receipts

$10,732.16

Permanent Fund Balance

$363,000.00

Fund and Beneficiary Summary
University Grants

SCHOOL OF MINES

UNIVERSITY LAND CODE

UNIVERSITY OF ARIZONA - 1881

ACRES AND INCOME - FY 2008

ACRES AND INCOME - FY 2008

ACRES AND INCOME - FY 2008

SURFACE LEASES

ACRES

INCOME

2,485

$31,758.63

Agriculture
Commercial

Agriculture
Commercial

SURFACE LEASES

8,483

$9,625.34

111,207

$41,355.35

Grazing

Rights-of-Way

1,045

$27,936.43

Use Permits

1,291

$3,486.13

17

$0.00

124,527

$114,161.88

Grazing

U.S. Government
TOTAL SURFACE

Prospecting Permit
Oil & Gas
U.S. Government
TOTAL SUBSURFACE

2,551

$3,830.68

13,993

$19,993.47

17

$0.00

16,560

$23,824.15

INCOME

4,276

$59,675.90

Agriculture

8,238

407.651.46

Commercial

$40,596.24

Grazing

Rights-of-Way

2,221

$313,445.51

Use Permits

4,248

$29,516.17

107

$974.42

U.S. Government

8

$0.00

Other

0

$42.96

136,953

$851,902.66

Institutional Taking

$754.19

Treasurer’s Formula Distribution

$322,836.00

GRAND TOTAL EXPENDABLE

$461,576.22

Permanent Fund Receipts

$69,461.38

Permanent Fund Balance

$7,617,000.00

ACRES

INCOME

7,107

$96,052.37

308

$89,797.20

38,876

$11,754.66

782

$30,932.00

1,900

$56,946.77

406

$0.00

U.S. Government

4

$0.00

Other

0

$194.04

49,383

$285,677.04

Prospecting Permit

400

$800.00

Oil & Gas

120

$239.99

Rights-of-Way
Use Permits
Institutional Taking

TOTAL SURFACE
SUBSURFACE LEASES

SUBSURFACE LEASES
Prospecting Permit
Oil & Gas
U.S. Government

Penalty & Interest

SURFACE LEASES

117,855

TOTAL SURFACE

SUBSURFACE LEASES

ACRES

TOTAL SUBSURFACE
Penalty & Interest

195

$2,473.60

15,569

$21,257.38

8

$0.00

15,771

$23,730.98
$1,525.06

Treasurer’s Formula Distribution

$504,909.00

GRAND TOTAL EXPENDABLE

$1,382,067.70

Permanent Fund Receipts

$1,302,579.34

Permanent Fund Balance

$12,437,000.00

28

U.S. Government
TOTAL SUBSURFACE
Penalty & Interest
Sales Interest

4

$0.00

524

$1,039.99
$2,213.76
$290,792.18

Treasurer’s Formula Distribution

$1,167,414.00

GRAND TOTAL EXPENDABLE

$1,747,136.97

Permanent Fund Receipts

$281,655.83

Permanent Fund Balance

$25,429,000.00

Fund and Beneficiary Summary
Other Grants
• The remaining six Trust beneficiaries are 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 beneficiaries 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 $5,085,322 in expendable receipts and $8,939,616 in Permanent Fund receipts in FY 2008.
• The Department of Juvenile Corrections received a total of $1,498,727 in expendable receipts and $2,937,137 in Permanent Fund receipts in FY 2008.
• The Department of Corrections received a total of $2,852,608 in expendable receipts and $3,092,252 in Permanent Fund receipts in FY 2008.

Grant
Beneficiary
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 Prison Complex—
Florence Historical Building

The “Insane Asylum of Arizona”, circa 1886

29

Fund and Beneficiary Summary
Other Grants

SCHOOL FOR THE DEAF & BLIND

LEGISLATIVE, EXECUTIVE, & JUDICIAL BUILDINGS

STATE HOSPITAL

ACRES AND INCOME - FY 2008

ACRES AND INCOME - FY 2008

ACRES AND INCOME - FY 2008

SURFACE LEASES

ACRES

INCOME

Agriculture

2,638

$71,354.51

Agriculture

Commercial

1,453

$28,561.25

Commercial

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

SURFACE LEASES

ACRES

INCOME

2,180

$24,470.23

Agriculture

5

$19,800.00

Commercial

72,540

$31,397.88

Grazing

56,406

$21,374.23

Grazing

800

$97,817.13

Rights-of-Way

1,387

$19,989.34

Rights-of-Way

6,133

$9,977.01

Use Permits

5,061

$2,500.62

U.S. Government

1

$2,326.04

32

$0.00

83,597

$241,433.82

TOTAL SURFACE

92

$0.00

65,131

$88,134.42

2,692

$960.00

Oil & Gas

9,967

$10,340.51

32

$0.00

12,691

$11,300.51

TOTAL SUBSURFACE
Penalty & Interest

$1,164.20

Treasurer’s Formula Distribution

$165,981.00

GRAND TOTAL EXPENDABLE

$419,879.53

Permanent Fund Receipts

$8,786.56

Permanent Fund Balance

$2,974,000.00

INCOME

4,251

$118,371.39

269

$200,342.68

58,240

$22,039.34

890

$25,795.58

4,957

$13,366.09

Institutional Taking

80

$12,948.12

U.S. Government

108

$0.00

0

$12,285.00

68,795

$405,148.20

Use Permits

TOTAL SURFACE

Prospecting Permit

Prospecting Permit

ACRES

Other
SUBSURFACE LEASES

SUBSURFACE LEASES

U.S. Government

SURFACE LEASES

2,119

U.S. Government
TOTAL SUBSURFACE

$3,399.32

92

0

2,211

$3,399.32

SUBSURFACE LEASES
Mineral
Oil & Gas

Penalty & Interest

$2,092.34

Treasurer's Formula Distribution

$258,219.00

GRAND TOTAL EXPENDABLE

$351,845.08

60

$32,544.00

755

($1,748.44)

U.S. Government

108

$0.00

TOTAL SUBSURFACE

923

$30,795.56

Penalty & Interest

$4,404.81

Permanent Fund Receipts

$1,208.51

Treasurer's Formula Distribution

$195,531.00

Permanent Fund Balance

$5,241,000.00

GRAND TOTAL EXPENDABLE

$635,879.57

Permanent Fund Receipts

$601,917.98

Permanent Fund Balance

$3,549,000.00

30

Fund and Beneficiary Summary
Other Grants

MINERS' HOSPITAL*

STATE CHARITABLE, PENAL, & REFORMATORY

PENITENTIARY

ACRES AND INCOME - FY 2008

ACRES AND INCOME - FY 2008

ACRES AND INCOME - FY 2008

SURFACE LEASES
Agriculture
Commercial

ACRES

INCOME

13,031

$384,680.88

590

$894,519.66

73,515

$23,125.86

Rights-of-Way

1,894

$328,693.18

Use Permits

4,290

$101,683.70

1

$1,839.78

Grazing

Institutional Taking
U.S. Government
Other
TOTAL SURFACE

168

$0.00

0

$239.76

SURFACE LEASES
Agriculture
Commercial

ACRES

INCOME

3,997

$79,882.75

Agriculture
Commercial

3,401

$677,456.67

63,005

$22,851.02

Rights-of-Way

1,798

$170,199.65

Use Permits

5,560

$153,251.52

475

$62,773.66

Grazing

Institutional Taking
U.S. Government

Prospecting Permit
Oil & Gas
U.S. Government
TOTAL SUBSURFACE

INCOME

4,673

$230,249.40

478

$641,503.40

65,932

$25,969.65

497

$89,181.44

Use Permits

5,763

$72,791.28

Institutional Taking

1,778

$0.00

5

$0.00

Rights-of-Way

117

$0.00

78,354

$1,166,415.27

Mineral

160

$120.00

Prospecting Permit

0

$2,055.38

Prospecting Permit

280

$560.00

U.S. Government

5

$0.00

TOTAL SUBSURFACE

5

$2,055.38

TOTAL SURFACE
SUBSURFACE LEASES

Mineral Material

Grazing

ACRES

U.S. Government
TOTAL SURFACE

79,125 $1,059,695.00

93,489 $1,734,782.82

SUBSURFACE LEASES
Mineral

SURFACE LEASES

119

$0.00

4,384

$9,239.12

230

$20,239.91

6,716

$6,170.74

168

$0.00

11,618

$35,649.77

SUBSURFACE LEASES

Mineral Material
Oil & Gas
U.S. Government
TOTAL SUBSURFACE
Penalty & Interest

Penalty & Interest

$5,312.96

186

$97,742.33

1,268

($2,700.31)

117

$0.00

2,012

$95,722.02

Penalty & Interest

$9,521.14

Treasurer’s Formula Distribution

$282,609.00

GRAND TOTAL EXPENDABLE

$1,353,881.00

$7,010.83

Sales Interest

$1,840,650.00

Permanent Fund Receipts

$155,114.50

Permanent Fund Balance

$5,434,000.00

Treasurer’s Formula Distribution

$312,123.00

Treasurer’s Formula Distribution

$2,885,109.00

GRAND TOTAL EXPENDABLE

$2,087,868.55

GRAND TOTAL EXPENDABLE

$5,994,907.12

Permanent Fund Receipts

$3,065,341.35

Permanent Fund Receipts

$11,748,548.35

Permanent Fund Balance

$9,642,000.00

Permanent Fund Balance

$81,117,000.00

*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

Financial Schedules
RECEIPTS BY CATEGORY - FY 2008

ROYALTY
Common Schools (K - 12)
Normal Schools
A&M Colleges

University Land Code
U of A (Act of 2/18/1881)
School for the Deaf & Blind

SALES

LEASE

PENALTY &

OTHER

PRINCIPAL

INTEREST

RENTAL

INTEREST

RECEIPTS

TOTAL

8,230,274.87

230,244,438.89

49,352,264.24

54,526,986.83

497,589.53

0.00

342,851,554.36

125,786.56

5,393.16

0.00

1,128,558.09

516.81

0.00

1,260,254.62

17,735.05

10,545.11

0.00

209,069.85

578.34

0.00

237,928.35

0.00

10,732.16

0.00

103,435.54

331.69

0.00

114,499.39

25,617.51

43,843.87

0.00

137,986.03

754.19

0.00

208,201.60
2,179,738.04

Military Institutes
School of Mines

SALES

29,076.36

1,273,502.98

0.00

875,633.64

1,525.06

0.00

192,867.18

88,788.65

290,792.18

286,717.03

2,213.76

0.00

861,378.80

3,118.75

5,667.81

0.00

252,734.33

1,164.20

0.00

262,685.09

668.92

539.59

0.00

91,533.74

2,092.34

0.00

94,834.59

Leg., Exec & Judicial
State Hospital

104,902.39

497,015.59

0.00

435,943.76

4,404.81

0.00

1,042,266.55

Miners' Hospital*

149,967.60

2,915,373.75

0.00

1,770,432.59

5,312.96

0.00

4,841,086.90

St Char., Pen. & Ref

383,074.40

11,365,473.95

1,840,650.00

1,262,137.29

7,010.83

0.00

14,858,346.47

Penitentiaries

131,357.03

23,757.43

0.00

1,061,750.50

9,521.14

0.00

1,226,386.10

0.00

0.00

0.00

7,710,695.00

0.00

0.00

7,710,695.00

School Leases

0.00

0.00

0.00

0.00

0.00

16,173.00

16,173.00

9,394,446.62

246,485,072.94

51,483,706.42

69,853,614.22

533,015.66

16,173.00

377,766,028.86

F.E.M.A. Lands

0.00

0.00

0.00

75,252.00

1,377.80

0.00

76,629.80

Farm Loan Lands

0.00

0.00

0.00

3,300.18

0.00

0.00

3,300.18

Navigable Streambeds

0.00

0.00

0.00

70,114.98

229.30

0.00

70,344.28

Lands Held in Trust

0.00

0.00

0.00

9,364.73

0.00

0.00

9,364.73

Fees: Lease, Sale & Misc

0.00

0.00

0.00

0.00

0.00

4,459,923.68

4,459,923.68

Total General Fund

0.00

0.00

0.00

158,031.89

1,607.10

4,459,923.68

4,619,562.67

Riparian Trust Fund

0.00

0.00

0.00

0.00

0.00

0.00

0.00

TOTAL RECEIPTS

9,394,446.62

246,485,072.94

51,483,706.42

70,011,646.11

534,622.76

4,476,096.68

382,385,591.53

Commercial Prepayment
Total Schools & Institutions
GENERAL FUND

*Miners' Hospital and Miners' 1929 combined

33

Financial Schedules
RENTAL ACREAGE AND RECEIPTS
FY 2008
BY TYPE OF LEASE
SURFACE LEASES

ACRES

RECEIPTS

Agriculture

170,487

4,201,575.68

Commercial

92,576

29,432,007.23

*

7,710,695.00

8,405,902

2,417,763.42

School Leases
Grazing
Homesite

18

6,179.11

Rights-of-Way

124,278

21,465,644.27

Use Permits

236,816

2,551,578.63

Institutional Taking

12,892

405,775.82

U.S. Government

18,265

145,446.27

Other
TOTAL SURFACE

0

129,155.30

9,061,234

$68,465,820.73

SUBSURFACE LEASES
Mineral
Prospecting Permit
Mineral Material

12,605

95,623.67

164,842

213,836.29

1,827

230,091.00

Oil and Gas

1,004,792

1,006,274.42

TOTAL SUBSURFACE

1,184,066

$1,545,825.38

NON-LEASE RECEIPTS
Penalty & Interest

534,622.76

Sales Interest

51,483,706.42

Royalty

9,394,446.62

Land Sales Principal

183,843,359.80

Rights-of-Way Sales Principal

56,093,887.78

Settlements

6,547,825.36

Commercial Prepayments

16,173.00

Fees

4,459,923.68

TOTAL NON-LEASE REVENUES

$312,373,945.42

GRAND TOTAL

$382,385,591.53

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

34

Financial Schedules
TREASURER'S FORMULA DISTRIBUTION*
YEAR ENDING JUNE 30 YEAR ENDING JUNE 30
FY 2007
FY 2008
Common Schools

INCREASE
(DECREASE)

5/12/1912
TO DATE

32,351,317

69,297,633

36,946,316

1,092,063,108

46,082

100,995

54,913

2,401,692

201,319

392,769

191,450

8,172,736

9,949

20,229

10,280

1,189,699

School of Mines Grant

133,902

322,836

188,934

673,127

University Land Code

226,823

504,909

278,086

10,666,298

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

566,953

1,167,414

600,461

21,910,635

87,629

165,981

78,352

4,296,384

Legislative, Executive & Judicial Buildings

122,537

258,219

135,682

6,955,198

State Hospital Grant

124,204

195,531

71,327

3,342,665

Miners' Hospital Grant**

158,276

312,123

153,847

6,550,190

1,403,184

2,885,109

1,481,925

23,699,080

140,515

282,609

142,094

4,203,052

35,572,690

75,906,357

40,333,667

1,186,123,864

Normal Schools Grant
Agricultural & Mechanical Colleges
Military Institutes Grant

School for the Deaf & Blind

State Charitable, Penal, and Reformatory
Penitentiary Grant
TOTAL
*Information from the State Treasurer
**Miners' Hospital & Miners' Hospital 1929 combined

35

Financial Schedules
STATE TRUST LAND ACREAGE BY BENEFICIARY
TRUST ACRES
BENEFICIARY

FY 1978

FY 2008

Common Schools (K - 12)*

8,342,469

8,098,658

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

137,907

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

62,216

54,101

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

47,742

Miners' Hospital (1929)

53,311

47,686

State Charitable, Penal, and Reformatory

80,010

76,818

Penitentiary Grant

80,830

76,111

9,586,606

9,260,253

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
LOCATION

PREFERRED NO. OF PREFERENCE
RIGHT
BIDDERS EXERCISED
REVENUE

4/30/2008 03-111607 SWC Deer Valley Drive alignment and Scottsdale Road, Phoenix

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

37

Yes

1

No

MINIMUM
BID

BONUS
BID

SUM BASE
RENTAL

$32,000,000*

NA

$524,157,476

1616 West Adams ● Phoenix, Arizona 85007
www.land.state.az.us