SB1336 - 572R

Be it enacted by the Legislature of the State of Arizona:

Section 1. Title 27, chapter 2, article 1, Arizona Revised Statutes, is amended by adding section 27-201.01, to read:

START_STATUTE27-201.01. Definitions

In this chapter, unless the context otherwise requires:

1. "Commissioner" means the state land commissioner.

2. "Commodity type":

(a) Includes any of the following:

(i) Minerals.

(ii) Common variety mineral.

(iii) Oil as defined in section 27-501.

(iv) Gas as defined in section 27-501.

(v) Geothermal resources as defined in section 27-651.

(vi) Any other tangible natural product of the LAND, not including native plants, timber or water, that may be explored and produced in the future.

(b) Except for heat and other forms of energy associated with geothermal resources as defined in section 27-651, does not include nontangible natural products of the land, including wind, solar or electricity generated by nontangible natural products of the land.

3. "common variety mineral":

(a) Includes:

(i) a Deposit of petrified wood, stone, pumice, pumicite, cinders, decomposed granite, sand, gravel, boulders, common clay, fill dirt and waste rock.

(ii) a Deposit that, although the deposits may have value for use in trade, manufacturing, construction, landscape and decorative rock industries, does not possess a distinct, special economic value for those uses beyond the normal uses of the deposit.

(iii) a Material that is used as road base material, riprap, ballast, borrow, fill, facing stone, landscape or ornamental uses and other similar uses.

(b) Does not include limestone that is suitable for use in producing cement, metallurgical or chemical grade limestone or gypsum.

4. "Mineral" means a metallic ore mineral or industrial mineral other than a common variety mineral.

5. "Production lease" means a lease for the purposes of the extraction, sale or processing or any other processes of a commodity type.

6. "State land" means any land that is owned or held in trust, or otherwise, by this state, including leased school or university land.END_STATUTE

Sec. 2. Repeal

Section 27-231, Arizona Revised Statutes, is repealed.

Sec. 3. Section 27-239, Arizona Revised Statutes, is amended to read:

START_STATUTE27-239. Inspections, investigations and audits

A. The state land commissioner or the commissioner's authorized representative may enter, and the lessee shall maintain access to, the state land held under a mineral production lease at reasonable times to inspect the workings, improvements and other facilities used to extract or sever minerals or common variety minerals, as defined in section 27-271, from state lands.

B. The commissioner or the commissioner's authorized representative may enter at reasonable times to:

1. Obtain factual data or access to records pertinent to mineral production and required to be kept under the terms of the lease.

2. Otherwise ascertain compliance with law and the terms of the lease.

C. Inspections, investigations and audits under subsection A of this section shall be on reasonable notice to the lessee unless reasonable grounds exist to believe that notice would frustrate the enforcement of law or the terms of the lease. The commissioner may, and if required by law shall, apply for and obtain warrants for entry and inspection.

D. The commissioner may require a lessee to appear at reasonable times and on reasonable notice at the commissioner's office and produce such records and information as are specified in the notice to determine compliance with the terms of the lease.

E. The commissioner shall provide to the lessee a written report of each inspection, investigation and audit under this section.

F. Tax records and trade secrets, as defined in section 23-401, obtained under this section are confidential.END_STATUTE

Sec. 4. Title 27, chapter 2, article 3, Arizona Revised Statutes, is amended by adding section 27-240, to read:

START_STATUTE27-240. State trust lands; production leases; renewals; indexed royalties

A. Notwithstanding any other law, the commissioner may renew an existing production lease without public auction if the commissioner determines all of the following:

1. The lessee is in COMPLIANCE with the terms of the production lease.

2. the production lease is in production or a person will put the production lease in production WITHIN two years after the date of production lease renewal.

3. The renewal is for a term that is allowed by the laws of this state.

b. a production lease that the commissioner renews PURSUANT to this section shall provide for a royalty rate that is adjusted PURSUANT to a market-based indexing mechanism that the commissioner adopts. The indexing mechanism may include any of the following:

1. producer price indices.

2. regional or STATEWIDE construction aggregate price INDICES.

3. Other objective INDICATORS that are RECOGNIZED by the industry.

c. The commissioner shall review the indexed royalty rate for each renewed production lease not more than once every five years.END_STATUTE

Sec. 5. Heading change

The article heading of title 27, chapter 2, article 4, Arizona Revised Statutes, is changed from "mineral exploration permits and mineral leases" to "Exploration PERMITS".

Sec. 6. Section 27-251, Arizona Revised Statutes, is amended to read:

START_STATUTE27-251. Application for exploration permit

A. Any natural person who is over eighteen years of age and any other person qualified to transact business in this state may apply to the state land commissioner for a mineral an exploration permit on the state land in, including state land reserved minerals that are subject to section 37-231, subsection E. each Application for an exploration permit on state land in one or more of the rectangular subdivisions of twenty acres, more or less, or lots, in any one section identified contiguous sections of the public land survey may not exceed more than nine sections. Such The exploration permit application shall be in writing and signed by the applicant, or an authorized agent or attorney for the applicant, and shall contain the name and address of the applicant, a description according to the public land survey of the state land for which the applicant seeks a mineral exploration permit, and such other information as the commissioner may prescribe by rule. The application applicant shall be filed file the exploration permit application with the state land department and shall be accompanied by payment to the department of a filing fee accompany the application with a filing fee payable to the state land department as prescribed pursuant to section 37-107. The commissioner shall stamp each application meeting that meets the requirements of this section shall be stamped by the department with the time and date it that the application is filed with the state land department. The an application for AN EXPLORATION permit for a specific commodity type shall have priority over any other application for a mineral exploration permit involving the same state land which that may be filed with the state land department subsequent to such time and date, and such land shall be that is subject to the exploration permit application for a specific type is deemed withdrawn as long as the application is pending.

B. Not less than thirty days nor but not more than forty-five days from after the filing of the application with the state land department, provided there is no prior application for a mineral an exploration permit for the same COMMODITY type involving the same state land then pending before the state land department, or if such prior exploration application is then pending but is subsequently cancelled canceled, not more than thirty days after it is cancelled canceled, the state land department shall mail to the applicant at the address shown on the application a written notice designating the state land that is described in the exploration application and that, at the time the application was filed with the state land department, was open to application, the amount of rental required to be paid for the mineral exploration permit as herein provided, and whether a bond will be required under the provisions of section 27-255 as a condition to issuance of such issuing the exploration permit. If, within thirty days after the mailing of such the notice, the applicant pays to the state land department as rental for the permit the amount of two dollars $2 per acre for each acre of state land designated in the notice and files with the state land department the bond, if any, required under section 27-255, and if the commissioner finds that issuing the permit is in the best interest of the trust, the commissioner shall issue to the applicant a mineral an exploration permit for the state land designated in the notice. The commissioner may deny the application for any of the following reasons:

1. The application was not made in good faith.

2. The proposed exploration or possible future mining activities would not be the highest and best use of the trust lands.

3. The value and income potential of surrounding trust lands would be adversely affected and the benefit from proposed exploration and future mining activity cannot reasonably be expected to be greater than the diminished value to those surrounding trust lands.

4. The proposed operations would violate applicable state or federal law.

5. The commissioner determines that the proposed exploration activities or possible future mining activities will create a liability to the this state greater than the income from the proposed operations.

C. During the period such mineral that an exploration permit is in effect, no person except only the permittee and the authorized agents and employees of the permittee shall be entitled to explore for minerals the specific commodity type on the state land covered by the permit. If the applicant fails to make the payment or furnish the bond within the period of thirty days, the application shall be deemed cancelled and of no further effect.END_STATUTE

Sec. 7. Title 27, chapter 2, article 4, Arizona Revised Statutes, is amended by adding section 27-251.01, to read:

START_STATUTE27-251.01. Definition of exploration

In this article, unless the context otherwise requires, "exploration" means activity conducted on state land, including activity on state reserved minerals, that is covered by an exploration permit issued PURSUANT to this article to determine the existence or nonexistence of a commodity type, including geological, geochemical or geophysical surveys conducted by qualified experts and drilling, sampling and excavating, together with the costs of assay and metallurgical testing of samples from state land.END_STATUTE

Sec. 8. Section 27-252, Arizona Revised Statutes, is amended to read:

START_STATUTE27-252. Terms of exploration permit

A. Every mineral an exploration permit shall be for a term of one year from five years after the date of issuance, subject to renewals the eligibility for exploration permit renewal for one additional five-year period as provided in this article for an aggregate of not to exceed five more than ten years from such after the date, of issuance and shall give to the permittee the rights, subject only to the terms and conditions, as follows:

1. During the period the an exploration permit is in force and effect, the permittee shall have the exclusive right to explore for minerals a specific commodity type within the state land covered by the permit and to apply for and obtain a mineral production lease or leases to the state land.

2. During the period the exploration permit is in force and effect, the permittee shall have those surface rights necessary for exploration for mineral on the state land covered by the permit, but may remove from the state land only that amount of mineral commodity type that is required by the permittee for sampling, assay and metallurgical testing purposes.

3. The permittee shall have the right of ingress to and egress from the state land covered by the permit across other state lands but only along routes first approved by the commissioner.

4. The permittee shall be liable to and shall compensate the owner and or any state lessee of the surface of the state land covered by the permit, or across which the permittee exercises the right of ingress and egress, for any loss to such owner and lessee from damage or destruction caused by the permittee or the permittee's agents or employees to grasses, forage, crops or improvements upon on such state land.

5. The permit shall terminate automatically as of the end of any annual the initial five-year period from and after the date of issuance unless and is subject to renewal for an exploration permit as provided by this article. During such annual the initial five-year period, or any renewal period, the permittee expended must expend in exploration for valuable mineral deposits the specific commodity type on the state land covered by the permit not less than the amount per acre provided in this article or paid to the state lAND department a sum equal thereto, and prior to before expiration of such annual the initial five-year period shall have filed with the state lAND department an application for renewal for the ensuing annual period, and an affidavit showing such expenditure, together with such other proof in support thereof as the commissioner by rule may prescribe. The amount to be so expended or paid to the state lAND department during each of the first two annual periods in which such years that the permit may be in effect shall be not less than ten dollars MUST BE AT LEAST $10 for each acre of state land covered by the permit at the commencement of such annual THE Five-year period, and the amount to be so expended or paid to the state land department during each of the last three annual periods in which such years that THE permit may be in effect shall be not less than twenty dollars MUST BE AT LEAST $20 for each acre of state land covered by the permit at the commencement of such annual period THE Five-year perIOD. Prior to Before termination of any such annual five-year permit period, the permittee may, by instrument in writing filed with the state lAND department, release from the permit the acreage covered thereby and contained within one or more rectangular subdivisions of twenty acres, more or less, or lots, according to the lines of the public land surveys.

6. When a permittee has an interest in one or more contiguous properties for which he or she that the person holds a mineral an exploration permit, such the permittee may group such permits and expend the sum required by this article under a common plan of development on one or more of the properties for the benefit of all if the total area of such contiguous property does not exceed three miles on a side.

7. Upon oN termination of the mineral exploration permit, other than by issuance of a mineral lease, the permittee shall submit to the state land department the following information, which shall not include any chemical analysis or other identification of minerals commodity types, concerning any drill holes or wells drilled on state land covered by the permit:

(a) Total depth.

(b) Lithologies and depths of lithologic boundaries encountered in the hole.

8. Drill hole information shall be confidential for one year after termination of the permit, and such period of confidentiality shall be extended for an additional year upon on the request of the permittee.

9. Any expenditures in exploration for valuable mineral deposits a specific commodity type made in excess of the requirements of this article during any annual period of the permit may be credited against expenditure requirements of successive annual periods years of the permit.

10. In lieu of making expenditures in exploration, the permittee may elect to make a money payment of the amounts required for expenditures in exploration for valuable mineral deposits a specific commodity type to the state lAND department.

B. Upon oN any partial or total relinquishment, or on the cancellation or expiration of the permit other than by issuance of a mineral production lease, the permittee shall fill any holes, ditches or other excavations, as may be required by the commissioner, and, as far as reasonably possible, reclaim the surface to its former condition.

C. As used in this article, "exploration" means activity conducted upon the state land covered by an exploration permit to determine the existence or nonexistence of a valuable mineral deposit, including but not limited to geological, geochemical or geophysical surveys conducted by qualified experts, and drilling, sampling and excavation, together with the costs of assay and metallurgical testing of samples from such land.END_STATUTE

Sec. 9. Section 27-253, Arizona Revised Statutes, is amended to read:

START_STATUTE27-253. Renewal of exploration permit

The holder of an exploration permit may, prior to within sixty days before the expiration of the annual initial five-year EXPLORATION permit period for which such permit was issued, or prior to expiration of the annual period for which such permit was renewed, file with the state lAND department an application for renewal of such the exploration permit for the ensuing annual five-year period. No such An application for renewal shall MAY NOT be filed, nor shall the exploration permit be renewed, for more than four successive annual periods following one additional five-year permit period after expiration of the annual initial five-year period for which such that the permit was issued. No rental shall be payable for the first annual period for which a permit may be renewed. The rental for each of the three subsequent annual periods following the first annual period permit period for which a permit may be renewed shall be one dollar $1 for each acre of state land for which the application for renewal is filed. Upon on receipt by the state land department of the application for renewal, and the affidavit of expenditure of the required amount in exploration during the current annual initial five-year period or a IN LIEU of the sum equal thereto, together with such other proof in support of such expenditure as the commissioner by regulation may prescribe, and payment to the state land department of the rental for the ensuing annual period, all prior to before the expiration of the current annual initial five-year period, the commissioner shall issue a renewal of the exploration permit for the ensuing annual five-year period.END_STATUTE

Sec. 10. Transfer and renumber

Section 27-254, Arizona Revised Statutes, is transferred and renumbered for placement in title 27, chapter 2, article 3, Arizona Revised Statutes, as a new section 27-231.

Sec. 11. Section 27-255, Arizona Revised Statutes, is amended to read:

START_STATUTE27-255. Bonds

A. The commissioner, in his the commissioner's discretion, may require the applicant for a mineral an exploration permit, prior to issuance of such in conjunction with issuing the exploration permit, to file with the commissioner a surety bond, in form and amount and with surety approved by the commissioner, conditioned upon on the prompt payment to the owner and lessee of the surface of state land to be covered by the permit, or across which the permittee exercises the right of ingress or egress, for any loss to such owner or lessee from damage or destruction caused by the permittee or his or its agents or employees to grasses, forage, crops and improvements upon on such state lands.

B. The commissioner may also require the permittee to furnish a bond, in a reasonable amount to be fixed by the commissioner, conditioned that the permittee will guarantee restoration of the surface of the state land described in the mineral exploration permit to its former condition upon on any partial or total relinquishment of such state lands, or the cancellation or expiration of the permit other than by issuance of a mineral lease.

C. On default, the commissioner may use the proceeds of the bond for the purposes described in subsection A or B of this section.END_STATUTE

Sec. 12. Section 27-256, Arizona Revised Statutes, is amended to read:

START_STATUTE27-256. Assignment of exploration permits

Any mineral exploration permit issued hereunder PURSUANT to this article may be assigned in whole or in part by the permittee. , but such An exploration permit assignment shall not become is not effective unless and until the permittee files a copy thereof is filed of the exploration permit assignment with the state land department and is approved by the commissioner approves the assignment. The assignee shall succeed to all of the rights and shall be subject to obligations of the permittee under the mineral exploration permit.END_STATUTE

Sec. 13. Title 27, chapter 2, article 4, Arizona Revised Statutes, is amended by adding section 27-257, to read:

START_STATUTE27-257. Applicability

A mineral permit or common variety right of entry permit that the state land department issued before the effective date of this section may do either of the following at the choice of the permittee:

1. Continue in effect until the initial expiration date stated in the existing exploration permit.

2. Be surrendered at any time before the initial expiration date stated in the exploration permit and REMAIn subject to replacement with a five-year permit period as provided in this article.END_STATUTE

Sec. 14. Repeal

Section 27-271, Arizona Revised Statutes, is repealed.

Sec. 15. Section 37-102, Arizona Revised Statutes, is amended to read:

START_STATUTE37-102. State land department; powers and duties

A. The state land department shall administer all laws relating to lands owned by, belonging to and under the control of this state.

B. The department shall have charge and control primary oversight of all lands owned by this state, and timber, stone, gravel and other products of such lands, except lands under the specific use and control of state institutions and the products of such lands.

C. The department, in the name of this state, may commence, prosecute and defend all actions and proceedings to protect the interest of this state in lands within this state or the proceeds of lands within this state. Actions shall be commenced and prosecuted at the request of the department by the attorney general, a county attorney or a special counsel under the direction of the attorney general.

D. The department shall be the official representative of this state in any communication between this state and the United States government in all matters respecting state lands or any interest of this state in or to the public lands within this state. if the matter involves a federal land withdrawal or reservation or the federal government's acquisition of nonfederally controlled land, the department shall cooperate and seek the advice of the president of the senate and the speaker of the house of representatives on the communication.

E. The summons in any action against this state respecting any lands of this state or the products of such lands and all notices concerning such lands or products shall be served on the commissioner. Summonses, warrants or legal notices served on behalf of the department may be served by the commissioner or the commissioner's deputy, or by the sheriff or a constable of any county of this state.

F. The department shall maintain as a public record in each of the department's offices a public docket and index of all matters before the department that may be subject to appeal to the board of appeals or to the courts and all sale, exchange and lease transactions subject to bidding by the public. The department shall list a matter on the public docket immediately after an application or other request for department action is received by the department. The department shall include in the public docket every formal action and decision affecting each matter in question. The department shall establish by rule a means by which any person may obtain a copy of the public docket at the current copying cost.

G. The department shall reappraise or update the department's original appraisal of property to be leased, exchanged or sold if the board of appeals' approval of the lease or sale occurred more than two hundred forty days before the auction.

H. To the extent possible, the state land department shall:

1. Prepare maps of the ancillary military facilities described in section 28-8461, paragraph 7, subdivisions (b) and (c).

2. Make a map of the ancillary military facility described in section 28-8461, paragraph 7, subdivision (a) available to the public in printed or electronic format and provide the map in printed or electronic format to the state real estate department.

3. On receipt of proper information from the military installation commander with responsibility for the military electronics range, prepare a map of the military electronics range as defined in section 9-500.28 and make that map available to the public in printed or electronic format and provide the map in printed or electronic format to the state real estate department. Within ninety days after receipt of notice of any change in the boundaries of the military electronics range from the military installation commander, the state land department shall revise its map and provide the map to the public and to the state real estate department.

4. On or before December 31, 2024 and on receipt of proper information from the applicable military installation's and range's and Arizona national guard site's commanders, prepare electronic legal descriptions and maps of the military installation and range and Arizona national guard site and their respective influence areas as defined in sections 9-500.50 and 11-818.01 and provide the legal descriptions and maps to the state real estate department and the public. The state land department shall make changes to the boundaries of the military installation and range and Arizona national guard site and their respective influence areas and provide them to the state real estate department and the public within ninety days after receipt of those changes from the military installation's and range's and Arizona national guard site's commanders.

i. the department shall:

1. unless mutually agreed on by the department and the lessee, Restrict the use of a holdover provision for a lease or permit to not more than ninety days.

2. unless mutually agreed on by the department and the lessee, RESTRICT the use of special land use permits to ONLY temporaRY land uses that do not have a dedicaTED LAND use lease or perMit. The DEPARTMENT shall issue a special land use permit only for a set time frame enumerated in the special land use permit. The department may not cancel a special land use permit unless the special land use permittee violates the terms of the special land use permit.

3. Use publicly posted criteria that are created by the department and posted on the department's website and determine the administrative completeness of all applications that the department receives pursuant to state law. An application is subject to withdrawal if the applicant does not respond to a written and electronic notice of deficiency or request for additional information within three months after the notice or request. after the three-month period, the department shall issue a final notice that states the application is WITHDRAWN if the applicant does not respond in thirty days.

4. Make available to the public on the department's website all boilerplate lease, patent, addendum, application and other instrument conditions and obligations that the department requires in a lease, patent, addendum or other instrument for the use, POSSESSION, occupancy, lease or conveyance of state lands. The department may not include any term, condition or obligation in an instrument for the use, POSSESSION, occupancy, lease or conveyance of state lands that is not authorized by statute, that is more stringent than statute.

I. j. The state land department shall provide each map and the legal description of the boundaries of each ancillary military facility described in section 28-8461, paragraph 7 in electronic format to the state real estate department. Each map prepared by the state land department pursuant to this section shall:

1. Describe the ancillary military facility, the territory in the vicinity of the ancillary military facility and the high noise and accident potential zone, accident potential zone one and accident potential zone two associated with the ancillary military facility.

2. Be submitted to the county in which the ancillary military facility is located.

3. Be made available to the public.

J. k. The state land department shall prepare a military training route map. The map shall contain military training route numbers in this state that are used by various United States armed forces. The map shall be dated.

K. l. When preparing the military training route map, the state land department shall use information contained in the most current department of defense publication that is entitled "area planning military training routes for North and South America".

L. m. The military training route map shall be made available to the public.

M. n. Within ninety days after the department is notified of a change of a military training route in this state, the department shall prepare a revised military training route map. The map shall be dated and contain a statement that the map supersedes all previously dated maps. The state land department shall send the revised map to the state real estate department electronically and shall also send an accompanying letter specifying the military training route changes. The state land department shall send the revised map and an accompanying letter specifying the military training route changes to the municipalities affected by the changes and to all counties.

N. o. The department shall submit the military training route map prepared pursuant to this section to the counties in either an electronic or a printed format. The format shall be determined by the receiving county.

O. p. The state land department shall provide the legal description of the boundaries of the military training routes as delineated in the military training route map to the state real estate department in electronic format.

P. q. The state land department shall prepare a military restricted airspace map. The map shall contain military restricted airspace in this state that is used by various United States armed forces. The map shall be dated.

Q. r. When preparing the military restricted airspace map, the state land department shall use information contained in the most current department of transportation publication that is entitled "aeronautical chart".

R. s. The military restricted airspace map shall be made available in printed or electronic format to the public at the state land department and at the state real estate department.

S. t. Within ninety days after the department is notified of a change of military restricted airspace in this state, the department shall prepare a revised military restricted airspace map. The map shall be dated and contain a statement that the map supersedes all previously dated maps. The state land department shall send the revised map to the state real estate department electronically and shall also send an accompanying letter specifying the military restricted airspace changes. The state land department shall send the revised map and an accompanying letter specifying the military restricted airspace changes to the municipalities affected by the changes and to all counties.

T. u. The department shall submit the military restricted airspace map prepared pursuant to this section to the counties in either an electronic or a printed format. The format shall be determined by the receiving county.

U. v. The state land department shall provide the legal description of the boundaries of the military restricted airspace as delineated in the military restricted airspace map to the state real estate department in electronic format.

V. w. The department may accept title to and manage real estate, property rights and related infrastructure acquired pursuant to section 26-262, subsection K for preserving or enhancing military installations in this state. END_STATUTE

Sec. 16. Section 37-231, Arizona Revised Statutes, is amended to read:

START_STATUTE37-231. State lands subject to sale; rights reserved in lands sold; state lands not subject to sale; development agreements

A. All state lands, except as otherwise provided for in this title, including all improvements made or placed on or connected with state lands, shall be subject to appraisal and sale as provided in this title.

B. Any person over eighteen years of age is entitled to purchase any of the state lands.

C. All sales, grants, deeds or patents to any state lands sold between July 9, 1954 and March 18, 1968 shall be subject to and shall contain a reservation to the this state of an undivided one-sixteenth of all oil, gases and other hydrocarbon substances, coal or stone, metals, minerals, fossils and fertilizer of every name and description, together with all uranium, all thorium, or any other material which that is or may be determined by the laws of the this state or the United States or decisions of courts to be peculiarly essential to the production of fissionable materials, whether or not of commercial value, subject to the following:

1. For the purpose of promoting the sale of state lands and the more active cooperation of the owner of the soil, and to facilitate the development of its mineral resources, the state constitutes the purchaser of the land its agent for the purposes specified in this section, and in consideration hereof, relinquishes to and vests in the purchaser of the state land an undivided fifteen-sixteenths of all oil, gas and the value thereof which that may be upon on or within any state land purchased after July 9, 1954 and before March 18, 1968.

2. The purchaser of the soil may sell or lease to any person, firm or corporation the oil and gas and other minerals which that may be on or in the land, upon on terms and conditions the purchaser and the owner deem best, subject to the provisions and reservations of this section, but the lessee or purchaser shall pay to the this state an undivided one-sixteenth of the mineral produced or the value of the mineral produced at the well or mine as determined by the state land department.

3. Upon On discovery of oil and gas in paying quantities on land adjoining state lands purchased under the authority of this section, the purchaser or the purchaser's lessee shall drill and produce all wells necessary to protect the land so purchased from drainage by wells on lands in which the this state has no royalty interest, or has a lesser royalty interest. If the purchaser or the purchaser's lessee fails to protect against such drainage, the this state, acting through the state land department, may, three months after demand therefor in writing by the state land department to such purchaser and the purchaser's lessee, may enter upon on such lands and drill all wells necessary to protect the this state against such drainage.

4. The interest reserved by the this state in any state lands sold may be committed to a drilling unit or cooperative or unit plans of development and operation of oil and gas pools with the United States, its agencies and its and their lessees and permittees, and with private owners and persons holding oil and gas leases on private lands or on state lands. The state land department may, insofar as the interest of the this state may be affected thereby, may join in and consent to any such plan on behalf of the this state. Such agreements shall provide for the equitable division on an agreed basis of the oil and gas produced from the unit, but no such an agreement shall not relieve any operator from the obligation to develop reasonably the lands and leases as a whole committed thereto. The royalties to which the this state is entitled on production from land purchased under this section shall be computed only on that part of the production allocated to such tract. When the agreements made under this section provide for the return of gas to a formation underlying the unit, they may provide that no royalties are required to be paid on the gas so returned.

D. State lands known to contain oil, gases and other hydrocarbon substances, geothermal resources, coal or stone, metals, minerals, fossils and fertilizer of every name and description, in paying quantities, or uranium, thorium or any other material which is or may be determined by the laws of the this state the United States or decisions of court to be peculiarly essential to the production of fissionable materials, whether or not of commercial value, and state lands adjoining lands upon on which there are producing oil, gas or geothermal wells or adjoining lands known to contain any of such substances in paying quantities, or uranium, thorium or any other material peculiarly essential to the production of fissionable materials, whether or not of commercial value, shall not be sold. The prohibition against sale shall not operate to prevent the sale of lands known to contain, in paying quantities, common variety minerals as defined in section 27-271 27-201.01 or to prevent the sale of lands where the this state does not own such substances, minerals or metals in the lands sought to be sold. The provisions of This subsection shall not prohibit the sale of such lands located within the exterior boundaries of an incorporated city or town, in which case the commissioner may offer the land for sale, provided the land shall be used solely for a public purpose. Such land shall revert to the this state if it is used other than for a public purpose.

E. Notwithstanding the provisions of subsection C of this section, all state lands sold after March 18, 1968 shall be sold with the reservation that all oil, gas, other hydrocarbon substances, helium or other substances of a gaseous nature, geothermal resources, coal, metals, minerals, fossils, fertilizer of every name and description, together with all uranium, all thorium or any other material which that is or may be determined by the laws of the United States or of this state, or by decisions of court, to be peculiarly essential to the production of fissionable materials, whether or not of commercial value, and the exclusive right thereto, on, in, or under such land, shall be and remain and be reserved in and retained by the this state, regardless of any sale under this section and the issuance of any certificate of purchase to any purchaser of state lands pursuant to this section, provided, that the reservation shall not include common variety minerals as defined in section 27-271 27-201.01, subject to the following:

1. The state land department shall adopt rules providing for the protection of the patentee or contract purchaser of state lands, or their successors in interest, and the this state of Arizona, against damage to the lands, livestock, water, crops, or other tangible improvements on lands held by such patentee or contract purchaser, and suffered by reason of the use or occupation of such lands by lessees or permittees engaged in mining and oil, gas and geothermal resource exploration and development under leases or permits executed by the department. The state land department may, at any time, may require each of its lessees or permittees to execute a bond in a reasonable principal amount conditioned upon on payment for all such damages.

2. The mineral rights reserved to the this state in the lands sold shall be closed to entry and location as a mineral claim or claims, but the department may issue, upon on application, mineral exploration permits embracing the reserved mineral rights when such issuance is deemed in the best interest of the this state, provided that the surface owner or owners shall have the first right of refusal to acquire such mineral exploration permits.END_STATUTE

Sec. 17. Section 37-233, Arizona Revised Statutes, is amended to read:

START_STATUTE37-233. Sale of state lands; restriction on sale of timber land; expense of sale; procedures and criteria for sale of state lands by the commissioner

A. On receiving an application, or on the commissioner's initiative, the state land department, under the rules of the department, may cause state lands to be sold if the sale of them is not prohibited by law.

B. Land containing timber of a value which in the opinion of the commissioner should be sold separately from the land shall not be subject to sale until after the timber is sold.

C. When an application is filed with the department for selection or sale of land under the laws of this state, and the department determines that the benefit to be derived from the selection or sale is less than the expense involved, the commissioner may accept from the applicant an amount of money sufficient to pay the expense incidental to the selection or sale. If the applicant fails to secure a lease after selection of land, or fails to purchase land after bidding for it, the successful lessee or purchaser shall reimburse the original applicant for all funds so advanced.

D. The department shall ESTABLISH A PROCEDURE AND the CRITERIA THAT THE COMMISSIONER MUST USE FOR DETERMINING WHETHER TO INITIATE THE SALE OF STATE LANDS BY THE COMMISSIONER'S OWN INITIATIVE and shall post the procedure and criteria on the department's website.

e. The commissioner shall hire a third-party contractor to appraise and prepare state lands for public auction. The department may use either department staff or a third-party contractor to satisfy the notice requirements prescribed in section 37-237.

f. This section does not prohibit the commissioner from selling state lands that have not been identified for sale in the five year disposition plan adopted pursuant to section 37-331.03 or restrict the use of state lands sold pursuant to this section to the uses identified in the conceptual land use plan approved pursuant to section 37-331.03.END_STATUTE

Sec. 18. Title 37, chapter 2, article 5, Arizona Revised Statutes, is amended by adding section 37-325, to read:

START_STATUTE37-325. Improvements; lease renewals; holdover leases

THE DEPARTMENT SHALL DO ALL OF THE FOLLOWING:

1. WITHIN NINETY DAYS, APPROVE OR DENY ANY APPLICATION TO PLACE AN IMPROVEMENT ON leased STATE LANDS THAT IS CONSISTENT WITH THE LEASE.

2. WITHIN SIX MONTHS AFTER THE CONCLUSION OF A LEASE or lease HOLDOVER, PROVIDE THE LESSEE A REIMBURSEMENT PLAN THAT INCLUDES BOTH OF THE FOLLOWING:

(a) A VALUATION OF THE FAIR MARKET VALUE OF ALL previously approved IMPROVEMENTS THAT THE LESSEE MADE TO THE STATE LANDS, AS DETERMINED BY AN INDEPENDENT THIRD-PARTY VENDOR.

(b) A REASONABLE TIMELINE IN WHICH THE DEPARTMENT WILL REIMBURSE THE LESSEE FOR THE FAIR MARKET VALUE OF ALL previously approved IMPROVEMENTS THAT THE LESSEE MADE TO THE STATE LANDS.

3. NOT LESS THAN SIX MONTHS BEFORE THE EXPIRATION OF A LEASE, PROVIDE TO THE LESSEE A NOTICE. THE NOTICE MUST INCLUDE ALL OF THE FOLLOWING:

(a) ANY PROPOSED RENTAL INCREASE OR PROPOSED CHANGE TO THE TERMS AND CONDITIONS OF THE LEASE.

(b) THE INTENT OF THE DEPARTMENT TO RENEW OR TERMINATE THE LEASE.

(c) THE JUSTIFICATION lease renewal, permit holdover provisions and a special land use permit, the department shall CEASE USING SPECIAL LAND USE PERMITS FOR AGRICULTURE LEASES LOCATED IN THE PATH OF DEVELOPMENT. IF THE DEPARTMENT IDENTIFIES A TEN-YEAR AGRICULTURAL LEASE WITHIN THE PATH OF DEVELOPMENT, THE DEPARTMENT SHALL PROVIDE THE LESSEE AT LEAST SIX MONTHS NOTICE IN ADVANCE OF THEIR LEASE EXPIRATION THAT THEIR LEASE WILL BE CONSIDERED FOR RENEWAL, BUT FOR A TERM LESS THAN TEN YEARS. UPON SUBMISSION OF A RENEWAL APPLICATION BY THE LESSEE, THE DEPARTMENT WILL WORK WITH THE LESSEE ON A MUTUALLY AGREEABLE ~~LEASE TERM.~~

3. WITHIN SIX MONTHS AFTER THE CONCLUSION OF A LEASE RENEWAL, A PERMIT HOLDOVER PROVISION OR A SPECIAL LAND USE PERMIT, PROVIDE THE LESSEE OR PERMITTEE A REIMBURSEMENT PLAN THAT INCLUDES BOTH OF THE FOLLOWING:

~~(a) A VALUATION OF THE FAIR MARKET VALUE OF ALL REASONABLE AND CUSTOMARY IMPROVEMENTS THAT THE LESSEE OR PERMITTEE MADE TO THE STATE LANDS, AS DETERMINED BY AN INDEPENDENT THIRD-PARTY VENDOR.~~

(b) A REASONABLE TIMELINE IN WHICH THE DEPARTMENT WILL REIMBURSE THE LESSEE OR PERMITTEE FOR THE FAIR MARKET VALUE OF ALL REASONABLE AND CUSTOMARY IMPROVEMENTS THAT THE LESSEE OR PERMITTEE MADE TO THE STATE LANDS.

3. NOT LESS THAN SIX MONTHS BEFORE THE EXPIRATION OF A LEASE RENEWAL OR SPECIAL LAND USE PERMIT, PROVIDE TO THE LESSEE OR PERMITTEE A NOTICE OF EXPIRATION. THE NOTICE MUST INCLUDE ALL OF THE FOLLOWING:

~~(a) ANY PROPOSED RENTAL INCREASE OR PROPOSED CHANGE TO THE TERMS AND CONDITIONS OF THE LEASE RENEWAL OR SPECIAL LAND USE PERMIT.~~

~~(b) THE INTENT OF THE DEPARTMENT TO RENEW OR TERMINATE THE LEASE OR SPECIAL LAND USE PERMIT.~~

~~(c) THE JUSTIFICATION~~ FOR THE COMMISSIONER'S DECISION, AS PRESCRIBED IN SECTION 37-133, TO RENEW OR TERMINATE THE LEASE.END_STATUTE

Sec. 19. Section 37-331.03, Arizona Revised Statutes, is amended to read:

START_STATUTE37-331.03. Conceptual land use plans; five year state trust land disposition plans; definitions

A. The commissioner department shall create and approve conceptual land use plans for all urban state trust land in this state and other state trust lands the commissioner considers to be appropriate. The commissioner shall:

1. Prioritize the creation of conceptual land use plans to the extent possible to:

(a) Correlate with the rate of population growth in the urban areas in this state.

(b) Coincide with the production of municipal general plans under title 9, chapter 4, article 6 and county plans under title 11, chapter 6, article 1.

2. Revise and update each conceptual land use plan at least every ten years. The COMMISSIONER shall issue a written order approving each conceptual land use plan and conceptual land use plan revision.

3. Consult with the city, or town or and county in which the STATE TRUST land is located and with any regional planning organization regarding integrating the conceptual plan into the general land use plan of the city, town or county and the arizona geological survey.

4. Submit post each conceptual land use plan, and revision of the a conceptual land use plan, to the urban land planning oversight committee for review and the Commissioner's written approval of each CONCEPTUAL land use plan and conceptual land use plan revision on the department's website.

B. On approval of the conceptual land use plan by the commissioner under this section, the conceptual lAND USE plan is considered to be a state general plan for THE purposes of this article and remains effective until revised as prescribed by this section.

C. The commissioner may create the conceptual land use plans under subsection A of this section by any of the following methods:

1. Using department staff or and private consultants.

2. Entering into participation contracts pursuant to section 37-239.

3. Issuing planning permits for urban state lands pursuant to section 37-338.

4. Entering into planning contracts for urban lands or other state trust lands the commissioner considers to be appropriate, including compensation as provided by section 37-338, subsection D.

D. The commissioner shall create a five year disposition plans plan for all state trust land in each county in this state, based at a minimum on market demand, POTENTIAL economic benefits to rural COMMUNITIES or anticipated transportation and infrastructure availability. The commissioner shall do all of the following:

1. Review and update each five year disposition plan each year for each county as may be necessary.

2. Consult with the city, or town or and county in which the land is located and with any regional planning organization.

3. post each five year disposition plan, each five year disposition plan revision and each written order that adopts or approves a five year disposition plan or five year disposition plan revision on the department's website to ensure conformity with the conceptual land use plan under subsection A of this section.

4. Ensure that each five year disposition plan and five year disposition plan revision conforms with the conceptual land use plan.

5. consider hiring third-party contractors to prepare the five year disposition plan.

6. include residential DEVELOPMENT WITHIN the service area of a municipal provider as defined in section 45-561.

3. Submit each plan and revision to the urban land planning oversight committee to ensure conformity with the conceptual plan under subsection A.

7. Issue a written order that approves and adopts each five year disposition plan and five year disposition plan revision. On approval of the five year disposition plan, the five year disposition plan shall remain effective until revised as prescribed by this section.

E. this section does not prohibit the conveyance of state lands that are not identified in the five year disposition plan or CONCEPTUAL land use plan.

E. f. For the purposes of this section:

1. "Conceptual land use plan" means a plan that is developed for urban state trust land and other state trust lands the commissioner considers to be appropriate and that identifies:

(a) Appropriate land uses and rights-of-way, including commercial, industrial, mining, forestry, agricultural, energy, grazing, residential and open space recreational uses that generate revenue.

(b) Transportation and energy corridors and infrastructure requirements.

(d) Known and proven mineral resources, including minerals, common variety minerals and commodity types as defined in section 27-201.01.

2. "Five year disposition plan" means a plan that identifies the land projected to be sold, leased, reclassified for conservation purposes, master planned or zoned during the next five years.END_STATUTE

Sec. 20. Section 37-527, Arizona Revised Statutes, is amended to read:

START_STATUTE37-527. Trust land management fund

A. The trust land management fund is established. The fund consists of Fees collected pursuant to section 37-107. Up to ten percent of the annual proceeds of:

1. Each beneficiary's trust lands granted to this state by the United States.

2. All sales of timber, mineral, gravel or other natural products or property from each beneficiary's trust lands granted to this state by the United States.

B. The commissioner shall determine the percentage of trust land proceeds to be deposited in the fund each fiscal year. The percentage shall be the same for all beneficiaries. The commissioner shall notify the joint legislative budget committee and the governor's office of strategic planning and budgeting of the determination on or before September 1 of the preceding fiscal year.

C. b. The monies in the fund:

1. Are subject to legislative appropriation. The department may retain an amount of monies from the fund that is sufficient to pay the department's costs for contracting with a qualified third-party reviewer as prescribed in section 37-132, subsection A, paragraph 12.

2. Shall be used exclusively to manage trust lands as prescribed by law and to prepare state lands for sale or lease as prescribed by law.

3. May be used to award department-wide, PERFORMANCE-based INCENTIVES as PRESCRIBED in section 38-618. For the purposes of this paragraph, the commissioner may only use monies collected pursuant to section 37-107, subsection B, paragraph 1 and the commissioner may not DIVERT more than ten percent of the REVenues collected PURSUANT to section 37-107, subsection B, Paragraph 1 in any one fiscal year.

D. The commissioner shall administer the fund. On notice from the commissioner, the state treasurer shall invest and divest monies in the fund as provided by section 35-313, and monies earned from investment shall be credited to the fund.

E. Monies in the fund are exempt from the provisions of section 35-190 relating to lapsing of appropriations, but if the balance in the fund at the end of any fiscal year exceeds two times the budget of the department for the management of trust lands for the next fiscal year, the excess amount shall be credited proportionately to the several permanent funds based on the last fiscal year's deposits.

F. This section does not prevent the legislature from appropriating state general fund monies for the purposes described in this section.END_STATUTE

Sec. 21. Repeal

Section 41-3026.05, Arizona Revised Statutes, is repealed.

Sec. 22. Title 41, chapter 27, article 2, Arizona Revised Statutes, is amended by adding section 41-3030.19, to read:

START_STATUTE41-3030.19. State land department; termination July 1, 2030

A. The state land department terminates on July 1, 2030.

b. Title 37, chapters 1 and 2 and this section are repealed on January 1, 2031. END_STATUTE

Sec. 23. Section 44-301, Arizona Revised Statutes, is amended to read:

START_STATUTE44-301. Definitions

In this chapter, unless the context otherwise requires:

1. "Airdrop":

(a) Means to issue a unit of a digital asset that is distributed in a broad, equipped and nondiscretionary manner based on conditions that are capable of being satisfied by a participant in a blockchain system as incentive-based rewards, including any of the following:

(i) To users of a digital asset or any blockchain system to which the digital asset relates.

(ii) For activities that are directly related to the operation of the blockchain system, including mining, validating, staking and any other activity that is directly tied to the operation of the blockchain system.

(iii) To existing holders of another digital asset in proportion to the total units of the other digital assets that are held by each person.

(b) Does not include an exchange of more than a nominal value of cash, property or other assets.

2. "Apparent owner" means a person whose name appears on the records of a holder as the person entitled to property held, issued or owing by the holder.

3. "Business association" means any corporation, joint stock company, investment company, partnership, limited partnership, registered limited liability partnership, unincorporated association, joint venture, limited liability company, business trust, trust company, land bank, safe deposit company, safekeeping depository, financial organization, insurance company, mutual fund, utility or other business entity, whether for profit or not for profit, that consists of one or more persons.

4. "De minimis property" means any account balances of business associations of $50 or less that is payable to another business association.

5. "Department" means the department of revenue.

6. "Digital assets" means any of the following that confers economic, proprietary or access rights or powers:

(a) Virtual currencies.

(b) Cryptocurrencies.

7. "Director" means the director of the department of revenue.

8. "Domicile" means the state of incorporation of a corporation and the state of the principal place of business of a holder other than a corporation.

9. "Financial organization" means a savings and loan association, building and loan association, savings bank, industrial bank, bank, banking organization or credit union.

10. "Holder" means a person who is obligated to hold for the account of or deliver or pay to the owner the property that is subject to this chapter.

11. "Insurance company" means an association, corporation or fraternal or mutual benefit society or organization, whether for profit or not for profit, that is engaged in the business of providing life endowments, annuities or insurance, including accident, burial, casualty, credit life, contract performance, dental, disability, fidelity, fire, health, hospitalization, illness, life, malpractice, marine, mortgage, surety, wage protection and workers' compensation insurance.

12. "Mineral" means gas, oil, coal, sand, gravel, road material, building stone, chemical raw material, gemstone, fissionable and nonfissionable ores, colloid and other clay, steam and other geothermal resource or any other substance defined as a mineral in sections 27-231 27-201.01 and 27-901.

13. "Mineral proceeds" means the amounts payable for the extraction, production or sale of minerals or, if those amounts are abandoned, all payments that become payable after the abandonment. Mineral proceeds include amounts payable:

(a) For the acquisitions and retention of a mineral lease, including bonuses, royalties, compensatory royalties, shut-in royalties, minimum royalties and delay rentals.

(b) For the extraction, production or sale of minerals, including net revenue interest, royalties, overriding royalties, extraction payments and production payments.

(c) Under an agreement or option, including a joint operating agreement, unit agreement, pooling agreement and farm out agreement.

14. "Money order" includes an express money order and a personal money order on which the remitter is the purchaser. Money order does not include a bank money order or any other instrument that is sold by a financial organization if the seller has obtained the name and address of the payee.

15. "Owner" means a person who has a legal or equitable interest in property that is subject to this chapter or the person's legal representative. Owner includes a depositor in the case of a deposit, a beneficiary in the case of a trust other than a deposit in trust and a creditor, claimant or payee in the case of other property.

16. "Person" means an individual, business association, financial organization, estate, trust, government, governmental subdivision, agency or instrumentality or any other legal or commercial entity.

17. "Property":

(a) Means any of the following:

(i) Tangible property pursuant to section 44-303.

(ii) A fixed and certain interest in intangible property that is held, issued or owed in the course of a holder's business or by a government, governmental subdivision, agency or instrumentality and all income or increments from that property.

(iii) Digital assets.

(b) Does not include de minimis property, property of a person who is maintaining a current business relationship with the holder, monies collected pursuant to section 46-441 and property that is referred to or evidenced by gift certificates, electronic gift cards, nonrefundable tickets, certificates evidencing property denominated in value other than a currency, including prepaid phone cards, frequent flyer miles, stored value cards and merchandise points.

(i) Money or any check, draft, deposit, interest or dividend.

(ii) Any credit balance, customer's overpayment, security deposit, refund, credit memorandum, unpaid wage, unused ticket, mineral proceeds or unidentified remittance.

(iii) Any stock or other evidence of ownership of an interest in a business association or financial organization.

(iv) Any bond, debenture, note or other evidence of indebtedness.

(v) Money deposited to redeem stocks, bonds, coupons or other securities or to make distributions.

(vi) An amount due and payable under the terms of an annuity or insurance policy, including policies that provide life, property, casualty, workers' compensation, health or disability insurance.

(vii) An amount distributable from a trust or custodial fund that is established under a plan to provide health, welfare, pension, vacation, severance, retirement, death, stock purchase, profit sharing, employee savings or supplemental unemployment insurance or similar benefits.

18. "Record" means information that is inscribed on a tangible medium or that is stored in any electronic or other medium and that is retrievable in a perceivable form.

19. "Stake" means committing digital assets to a blockchain network to participate in the blockchain network's operations by validating transactions, proposing and attesting to blocks and securing the network.

20. "State" means a state of the United States, the District of Columbia, the Commonwealth of Puerto Rico or any territory or insular possession that is subject to the jurisdiction of the United States.

21. "Utility" has the same meaning prescribed in section 40-491.END_STATUTE

Sec. 24. Joint legislative ad hoc committee on state land oversight; membership; delayed repeal

A. The joint legislative ad hoc committee on state land oversight is established.

B. The president of the senate and the speaker of the house of representatives shall collaborate to determine the appropriate number of members and to appoint members and cochairpersons of the joint legislative ad hoc committee on state land oversight.

C. The senate and the house of representatives shall provide meeting space and staff support as requested by the cochairpersons of the joint legislative ad hoc committee on state land oversight.

D. The state land department and the state land commissioner shall do both of the following on request of either of the cochairpersons of the joint legislative ad hoc committee on state land oversight:

1. Provide any requested information that is in possession of the state land department.

2. Appear and testify during a meeting of the committee.

E. This section is repealed from and after December 31, 2026.

Sec. 25. Five year disposition plans; conceptual land use plan; requirements; delayed repeal

A. Within two years after the effective date of this section, the state land commissioner shall:

1. Complete the five year disposition plans for state trust lands and update the conceptual land use plan for state lands pursuant to section 37-331.03, Arizona Revised Statutes, as amended by this act.

2. Adopt written policies and procedures for updating:

(a) The five year disposition plan every five years.

(b) The conceptual land use plan every ten years.

3. Adopt written policies and procedures on how the state land department will use the five year disposition plans and the conceptual land use plan for determining whether state trust lands are or will be sent to public auction.

4. Provide a copy of the five year disposition plans and the conceptual land use plan and the policies and procedures adopted pursuant to this section to the joint legislative ad hoc committee on state land oversight.

Sec. 26. Biosolids study committee; membership; powers and duties; report; delayed repeal

A. The biosolids study committee is established consisting of the following members:

1. The chairperson of the senate natural resources committee, or the chairperson's designee, who serves as the chairperson of the study committee in even-numbered years.

2. The chairperson of the house of representatives natural resources energy and water committee, or the chairperson's designee, who serves as the chairperson of the study committee in odd-numbered years.

3. The director of the department of environmental quality or the director's designee.

4. The director of the Arizona department of agriculture or the director's designee.

5. The state land commissioner or the commissioner's designee.

6. The chairperson of the Yuma county board of supervisors or the chairperson's designee.

B. The study committee shall review the use of biosolids for agricultural and other uses in this state, including on state trust lands, and shall evaluate the policy of accepting biosolids from other states.

C. The study committee may hold hearings, conduct fact-finding tours, request data from any political subdivision of this state and take testimony from witnesses who may assist the study committee in fulfilling the study committee's responsibilities. All hearings held by the study committee shall be open to the public.

D. The legislature, the state land department, the department of environmental quality and the Arizona department of agriculture shall provide meeting space, staff and support services to the study committee.

E. Study committee members are not eligible to receive compensation but are eligible for reimbursement of expenses pursuant to title 38, chapter 4, article 2, Arizona Revised Statutes.

F. On or before December 31, 2028, the study committee shall submit a report of its findings and recommendations for rule changes or legislative changes that the committee determines necessary to the governor, the president of the senate and the speaker of the house of representatives and shall provide a copy of this report to the secretary of state.

G. This section is repealed from and after June 30, 2029.

Sec. 27. Legislative findings

The legislature finds that:

1. According to the auditor general's performance audit and sunset review of the state land department completed on July 9, 2025, the state land department has failed to develop the statutorily required five year disposition plans since 2016.

2. According to the auditor general's performance audit and sunset review, all five members of the urban land planning oversight committee have been vacant since at least 2018.

3. Pursuant to section 37-331.02, Arizona Revised Statutes, and section 37-331.03, Arizona Revised Statutes, as amended by this act, the urban land planning oversight committee serves in an advisory role only and is not required for the commissioner to fulfill the commissioner's obligations to create a five year disposition plan pursuant to statute.

4. The fact that the governor has not appointed any members to the urban land planning oversight committee has not absolved the commissioner of the commissioner's obligations to create a five year disposition plan as prescribed in section 37-331.03, Arizona Revised Statutes, as amended by this act.

5. The creation of a five year disposition plan is necessary for housing affordability and to ensure the highest and best use of the land for the beneficiaries of the trust.

6. Minerals and common variety minerals exist where they are.

7. Minerals and common variety minerals are needed for all forms of commercial development on state trust lands, including affordable housing and semiconductor fabrication.

8. Development that occurs over state trust lands that contain minerals permanently locks away those minerals, preventing the minerals from being extracted and permanently foreclosing their revenues from accruing to the trust.

9. Mineral extraction is subject to reclamation plans that restore the land to usable condition, and this makes the land usable for other commercial uses when mining is completed.

10. While the legislature has granted discretionary authority to the state land commissioner, the legislature intends that the state land department's processes and procedures are transparent and consistent with the manner that the legislature has prescribed for the disposition and management of state trust lands.

11. This act is necessary to ensure the best interest of the state land trust, the state land beneficiaries and this state.

Sec. 28. Purpose

Pursuant to section 41–2955, subsection B, Arizona Revised Statutes, the legislature continues the state land department to have charge of and control over all lands owned by this state, except lands under the specific use and control of state institutions, and the resources in and on those lands and to regulate the use of and access to those lands and resources as prescribed by the enabling act, the Constitution of Arizona and state law and to perform such other functions in compliance with and as prescribed by law.

Sec. 29. Retroactivity

Section 41-3026.05, Arizona Revised Statutes, as repealed by this act, and section 41-3030.19, Arizona Revised Statutes, as added by this act, apply retroactively to from and after July 1, 2026.