The Department of Natural Resources (DNR) manages a number of different categories of land, each for a specific purpose and under different management requirements. These include approximately three million acres of federally-granted lands and state forest lands, which DNR manages to support common schools, counties, and other public institutions.
DNR has the authority to lease state lands for commercial, industrial, residential, agricultural, and recreational uses in order to obtain a fair-market rental return to the state or appropriate trust. DNR generally may not lease state lands for longer than ten years, although longer leases are specifically authorized in multiple instances. Lands leased for agricultural purposes may not exceed 25 years, except leases for tree fruit or grape production, which may be for up to 55 years. Share crop leases may not exceed ten years. DNR must include language in any grazing lease that explains the right of access, and associated assumption of liability when a livestock owner makes a request to retrieve livestock, at-risk due to a wildfire.
When a state land lease for agricultural or grazing purposes includes a nondefault or early termination provision, DNR must provide:
DNR is not required to include a non-default or early termination provision in any agricultural or grazing state land lease. DNR is not prohibited from allowing the lessee to surrender the property under the lease subject to terms provided in the lease. DNR may execute other lease provisions designed to protect the interests of the lessee in the event the lease is terminated under a non-default or early termination provision.
If DNR exercises a nondefault or early termination provision in a state land lease for agricultural or grazing purposes, DNR shall compensate the lessee according to the following schedule:
For both grazing leases and agricultural leases, if the lessee has placed any authorized improvements on the land subject to the lease, DNR is responsible for compensating the lessee for the fair market value of the improvements. If an agreement cannot be reached between DNR and the lessee on the fair market value of the improvements, the valuation must be determined by a board of appraisers.
If DNR's exercise of a nondefault or early termination provision results in removal of fencing from the land subject to the lease, DNR is responsible for ensuring the replacement of any removed fencing. If DNR's exercise of a nondefault or early termination provision causes the lessee to incur a financial penalty as a result of an early withdrawal from a Natural Resources Conservation Service program, DNR is responsible for reimbursing the lessee for payment of the financial penalty.
The compensation and reimbursement available to a lessee is the sole financial remedy available to the lessee based on DNR's exercise of a nondefault or early termination provision in an agriculture or grazing lease. Appeal rights are unaffected by this relief.