Amends existing law to extend the length for commercial leases on endowment lands.

LEGISLATURE OF THE STATE OF IDAHO Sixty-eighth Legislature Second Regular Session - 2026 IN THE SENATE SENATE BILL NO. 1413 BY STATE AFFAIRS COMMITTEE AN ACT1 RELATING TO ENDOWMENT LAND LEASES; AMENDING SECTION 58-307, IDAHO CODE, TO2 REVISE A PROVISION REGARDING THE TERM OF COMMERCIAL LEASES; AND DECLAR-3 ING AN EMERGENCY AND PROVIDING AN EFFECTIVE DATE.4

Be It Enacted by the Legislature of the State of Idaho:5

SECTION 1. That Section 58-307, Idaho Code, be, and the same is hereby6 amended to read as follows:7 58-307. TERM OF LEASE -- APPLICATION FOR RENEWAL -- ALLOWANCE FOR IM-8 PROVEMENTS. (1) No lease of state trust lands shall be for a longer term than9 twenty (20) years.10 (2) Notwithstanding any other provisions of law, all state lands may11 be leased for a period of up to twenty-five (25) years to the federal gov-12 ernment, to federal agencies, state agencies, counties, or cities, school13 districts or political subdivisions when leased for public purposes. Such14 leases for public purposes may be entered into by negotiation and shall se-15 cure a rental amount based on the fair market value of the state land.16 (3) Notwithstanding any other provisions of law, all state endowment17 trust lands may be leased for a period of up to thirty-five (35) years for18 residential purposes as determined by the state board of land commissioners19 including, but not limited to, single family, recreational cottage site and20 homesite leases.21 (4) Notwithstanding any other provision of law to the contrary, all22 state lands may be leased for a period of up to forty (40) years for grazing23 leases.24 (5) Notwithstanding any other provisions of law, all state endowment25 trust lands may be leased for a period of up to forty-nine (49) ninety-nine26 (99) years for commercial purposes under such terms and conditions as may27 be set by the board, provided that, for such leases in excess of twenty (20)28 years, the board consults with the county commissioners of the county in29 which the lands are located before leasing the lands, and the use for which30 the land is leased shall be consistent with the local planning and zoning31 ordinances insofar as is reasonable and practicable. For each lease in ex-32 cess of twenty (20) years, the department shall hold a hearing in the county33 in which the parcel is located. Grazing leases shall be excluded from the34 hearing requirement.35 (6) The term "commercial purposes" means fuel cells, low impact hy-36 dro, wind, geothermal resources, biomass, cogeneration, sun or landfill37 gas as the principal source of power with a facility capable of generating38 not less than twenty-five (25) kilowatts of electricity, industrial enter-39 prises, retail sales outlets, business and professional office buildings,40 hospitality enterprises, commercial recreational activities, multifamily41 residential developments and other similar businesses. For purposes of42

2 this section, farming leases, grazing leases, conservation leases including1 lands enrolled in federal conservation programs such as the conservation2 reserve enhancement program (CREP), noncommercial recreation leases, oil3 and gas leases, mineral leases, communication site leases, single family,4 recreational cottage site and homesite leases, and leases for other similar5 uses, are not considered leases for commercial purposes. The terms fuel6 cells, low impact hydro, wind, geothermal resources, biomass, cogeneration,7 sun or landfill gas shall have the same definitions as provided in section8 63-3622QQ, Idaho Code.9 (7) The board may require that all fixed improvements constructed upon10 land leased for commercial purposes be removed or become the property of the11 state upon termination of the lease, and that any heirs, encumbrances or12 claims of third parties with respect to any improvements shall be expressly13 subordinate and subject to the rights of the state under this section.14 (8) Except for oil and gas, mineral and commercial leases, the lease15 year shall run from January 1 through December 31, and all leases shall ex-16 pire on December 31 of the year of expiration.17 (9) All applications to lease or to renew an existing lease which ex-18 pires December 31 of any year, shall be filed in the office of the director19 of the department of lands by the thirtieth day of April preceding the date20 of such expiration. Such applications will be considered by the state land21 board and be disposed of in the manner provided by law; except that the board22 may reject conflicting applications for a lease for commercial purposes if23 the lessee exercises the preference right to renew clause, and provided such24 right is specified in the lease.25 (10) Where conflicts appear upon leases, except for mineral leases26 which, pursuant to chapter 7, title 47, Idaho Code, contain a preferential27 right to renew clause, such applications shall be considered as having been28 filed simultaneously. However, nothing herein shall be construed to prevent29 the state board of land commissioners from accepting and considering appli-30 cations for new leases at any time.31 (11) In case improvements have been made on land while under lease which32 is expiring, and the former lessee is not the successful bidder, but the land33 is leased to another, the amount of such improvements shall be paid to the34 former lessee. The following shall be considered improvements: plowing35 done within one (1) year, provided no crop has been raised on the plowed land36 after such plowing, fencing, buildings, cisterns, wells, growing crops and37 any other asset which shall be considered an improvement by the director.38 (12) Commercial leases of the state lands shall not be subject to the39 conflict auction provisions of section 58-310, Idaho Code. The board may,40 at its discretion, consider individual applications or call for proposals41 and sealed bids by public advertisement, and may evaluate said proposals and42 award the lease to the bidder whose proposal achieves the highest return over43 the term of the lease and who is capable of meeting such terms and conditions44 as may be set by the board; in the alternative, the board may call for lease45 applications by public advertisement and if more than one (1) person files46 an application to hold an auction in the same manner as provided in section47 58-310, Idaho Code. In all cases, the board must obtain a reasonable rental,48 based upon fair market value of the state land, throughout the duration of49 the lease. The board may reject any or all proposals and any or all bids, and50

3 may reoffer the lease at a later date if the board determines that the pro-1 posals or bids do not achieve the highest and best use of the land at market2 rental.3

SECTION 2. An emergency existing therefor, which emergency is hereby4 declared to exist, this act shall be in full force and effect on and after5 July 1, 2026.6