1.1 	A bill for an act
1.2 	relating to state lands; modifying landowner's bill of
1.3 	rights for sales to the state; modifying provisions
1.4 	for sale of internal improvement land; modifying land
1.5 	exchange provisions; appropriating money; amending
1.6 	Minnesota Statutes 2004, sections 84.0274, by adding
1.7 	subdivisions; 92.03, subdivision 4; 94.342,
1.8 	subdivisions 1, 3, 4, 5; 94.343, subdivisions 1, 3, 7,
1.9 	8, 10, by adding subdivisions; 94.344, subdivisions 1,
1.10 	3, 5, 8, 10, by adding a subdivision; 97A.135,
1.11 	subdivision 2a; 103F.535, subdivision 1; repealing
1.12 	Minnesota Statutes 2004, sections 94.343, subdivision
1.13 	6; 94.344, subdivision 6; 94.348; 94.349.
1.14 	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

1.15 	Section 1. Minnesota Statutes 2004, section 84.0274, is
1.16 	amended by adding a subdivision to read:
1.17 		Subd. 9.Exception for nonprofit organizations and
1.18 	governmental entities. When the commissioner acquires land or
1.19 	interests in land from a nonprofit organization or governmental
1.20 	entity, any or all of the provisions of this section may be
1.21 	waived by mutual agreement of the commissioner and the nonprofit
1.22 	organization or governmental entity.

1.23 	Sec. 2. Minnesota Statutes 2004, section 84.0274, is
1.24 	amended by adding a subdivision to read:
1.25 		Subd. 10.Right of first refusal agreement. The
1.26 	commissioner may enter into a right of first refusal agreement
1.27 	with a landowner prior to determining the value of the land.  No
1.28 	right of first refusal agreement shall be made for a period of
1.29 	greater than two years and payment to the landowner for entry
2.1 	into the agreement shall not exceed $5,000.

2.2 	Sec. 3. Minnesota Statutes 2004, section 92.03,
2.3 	subdivision 4, is amended to read:
2.4 		Subd. 4.Internal improvement lands. When lands donated
2.5 	to the state under the eighth section of an act of Congress
2.6 	entitled "An act to appropriate the proceeds of the sales of the
2.7 	public lands, and to grant preemption rights," approved
2.8 	September 4, 1841, must be are sold and ,the money derived from
2.9 	its sale must be invested, as provided by the Minnesota
2.10 	Constitution, article XI, section 8.

2.11 	Sec. 4. Minnesota Statutes 2004, section 94.342,
2.12 	subdivision 1, is amended to read:
2.13 		Subdivision 1.Class a.  All land owned by the state and
2.14 	controlled or administered by the commissioner or by any
2.15 	division or agency of the Department of Natural Resources shall
2.16 	be known as Class A land for the purposes of sections 94.341 to
2.17 	94.347.  Class A land shall include school, swamp, internal
2.18 	improvement, and other land granted to the state by acts of
2.19 	Congress, state forest land, tax-forfeited land held by the
2.20 	state free from any trust in favor of taxing districts, and
2.21 	other land acquired by the state in any manner and controlled or
2.22 	administered as aforesaid; but this enumeration shall not be
2.23 	deemed exclusive.

2.24 	Sec. 5. Minnesota Statutes 2004, section 94.342,
2.25 	subdivision 3, is amended to read:
2.26 		Subd. 3.class c additional restrictions on riparian
2.27 	land.  Land bordering on or adjacent to any meandered or other
2.28 	public waters and withdrawn from sale by law is Class C riparian 
2.29 	land. Class C Riparian land may not be given in exchange unless
2.30 	expressly authorized by the legislature or unless through the
2.31 	same exchange the state acquires land on the same or other
2.32 	public waters in the same general vicinity affording at least
2.33 	equal opportunity for access to the waters and other riparian
2.34 	use by the public; provided, that any exchange with the United
2.35 	States or any agency thereof may be made free from this
2.36 	limitation upon condition that the state land given in exchange
3.1 	bordering on public waters shall be subject to reservations by
3.2 	the state for public travel along the shores as provided by
3.3 	section 92.45, unless waived as provided in this subdivision,
3.4 	and that there shall be reserved by the state such additional
3.5 	rights of public use upon suitable portions of such state land
3.6 	as the commissioner of natural resources, with the approval of
3.7 	the Land Exchange Board, may deem necessary or desirable for
3.8 	camping, hunting, fishing, access to the water, and other public
3.9 	uses.  In regard to Class B or Class C riparian land that is
3.10 	contained within that portion of the Superior National Forest
3.11 	that is designated as the Boundary Waters Canoe Area Wilderness,
3.12 	the condition that state land given in exchange bordering on
3.13 	public waters must be subject to the public travel reservations
3.14 	provided in section 92.45, may be waived by the Land Exchange
3.15 	Board upon the recommendation of the commissioner of natural
3.16 	resources and, if the land is Class B land, the additional
3.17 	recommendation of the county board in which the land is located.

3.18 	Sec. 6. Minnesota Statutes 2004, section 94.342,
3.19 	subdivision 4, is amended to read:
3.20 		Subd. 4.additional restrictions on state park land.
 3.21 	Land specifically designated by law as a state park may not be
3.22 	given in exchange unless the land is school trust land that is
3.23 	exchanged for Class A or Class C land located outside a state
3.24 	park.

3.25 	Sec. 7. Minnesota Statutes 2004, section 94.342,
3.26 	subdivision 5, is amended to read:
3.27 		Subd. 5.additional restrictions on school trust land.
 3.28 	School trust land may be exchanged with other state Class A land
3.29 	only if the Permanent School Fund Advisory Committee is
3.30 	appointed as temporary trustee of the school trust land for
3.31 	purposes of the exchange.  The committee shall provide
3.32 	independent legal counsel to review the exchanges.

3.33 	Sec. 8. Minnesota Statutes 2004, section 94.343,
3.34 	subdivision 1, is amended to read:
3.35 		Subdivision 1.General exchange provisions. Except as
3.36 	otherwise herein provided,(a) Any Class A land may, with the
4.1 	unanimous approval of the board, be exchanged for any publicly
4.2 	held or privately owned land in the manner and subject to the
4.3 	conditions herein prescribed. Class A land may be exchanged
4.4 	only if it meets the requirements of subdivision 3 or 5.
4.5 	(b) The commissioner, with the approval of the board, shall
4.6 	formulate general programs of exchange of Class A land designed
4.7 	to serve the best interests of the state in the acquisition,
4.8 	development, and use of lands for purposes within the province
4.9 	of the Department of Natural Resources.

4.10 	Sec. 9. Minnesota Statutes 2004, section 94.343, is
4.11 	amended by adding a subdivision to read:
4.12 		Subd. 2a.Valuation of land. The commissioner shall
4.13 	cause the state land and the land proposed to be exchanged
4.14 	therefor to be examined and value determined as provided in
4.15 	section 84.0272; provided, that in exchanges with the United
4.16 	States or any agency thereof the examination and value
4.17 	determination may be made in such manner as the Land Exchange
4.18 	Board may direct.  The determined values shall not be
4.19 	conclusive, but shall be taken into consideration by the
4.20 	commissioner and the board, together with such other matters as
4.21 	they deem material, in determining the values for the purposes
4.22 	of exchange.

4.23 	Sec. 10. Minnesota Statutes 2004, section 94.343,
4.24 	subdivision 3, is amended to read:
4.25 		Subd. 3.exchanging land of substantially equal value
4.26 	required or lower value.  (a) Except as otherwise herein 
4.27 	provided, Class A land shall be exchanged only for land of at
4.28 	least substantially equal value to the state, as determined by
4.29 	the commissioner, with the approval of the board. For the
4.30 	purposes of such determination, the commissioner shall cause the
4.31 	state land and the land proposed to be exchanged therefor to be
4.32 	examined and appraised by qualified state appraisers as provided
4.33 	in section 84.0272; provided, that in exchanges with the United
4.34 	States or any agency thereof the examination and appraisal may
4.35 	be made in such manner as the Land Exchange Board may direct.
4.36 	The appraisers shall determine the fair market value of the
5.1 	lands involved, disregarding any minimum value fixed for state
5.2 	land by the state Constitution or by law, and shall make a
5.3 	report thereof, together with such other pertinent information
5.4 	respecting the use and value of the lands to the state as they
5.5 	deem pertinent or as the commissioner or the board may require.
5.6 	Such reports shall be filed and preserved in the same manner as
5.7 	other reports of appraisal of state lands.  The appraised values
5.8 	shall not be conclusive, but shall be taken into consideration
5.9 	by the commissioner and the board, together with such other
5.10 	matters as they deem material, in determining the values for the
5.11 	purposes of exchange.
5.12 	(b) For the purposes of this subdivision, "substantially
5.13 	equal value" means:
5.14 	(1) where the lands being exchanged are both over 100
5.15 	acres, their values do not differ by more than ten percent; and
5.16 	(2) in other cases, the values of the exchanged lands do
5.17 	not differ by more than 20 percent.
5.18 	(c) Other than school trust land, Class A land may be
5.19 	exchanged for land of lesser value if the other party to the
5.20 	exchange pays to the state the amount of the difference in value.
5.21 	Money received by the commissioner in such cases shall be
5.22 	credited to the same fund as in the case of sale of the land, if
5.23 	such a fund exists, otherwise to the special fund, if any, from
5.24 	which the cost of the land was paid, otherwise to the general
5.25 	fund.

5.26 	Sec. 11. Minnesota Statutes 2004, section 94.343,
5.27 	subdivision 7, is amended to read:
5.28 		Subd. 7.Public hearing.  Before giving final approval to
5.29 	any exchange of Class A land, the board commissioner shall hold
5.30 	a public hearing thereon at the capital city or at some place
5.31 	which it may designate in the general area where the lands
5.32 	involved are situated; provided, that the board may direct such
5.33 	hearing to be held in its behalf by any of its members or by the
5.34 	commissioner or by a referee appointed by the board.  The
5.35 	commissioner shall furnish to the auditor of each county
5.36 	affected a notice of the hearing signed by the state auditor as
6.1 	secretary of the board commissioner, together with a list of all
6.2 	the lands proposed to be exchanged and situated in the county,
6.3 	and the county auditor shall post the same in the auditor's
6.4 	office at least two weeks before the hearing.  The county
6.5 	auditor commissioner shall also cause a copy of the notice,
6.6 	referring to the list of lands posted, to be published at least
6.7 	two weeks before the hearing in a legal newspaper published in
6.8 	the county.  The cost of publication of the notice shall be paid
6.9 	by the state out of any moneys appropriated for the expenses of
6.10 	the board commissioner.

6.11 	Sec. 12. Minnesota Statutes 2004, section 94.343,
6.12 	subdivision 8, is amended to read:
6.13 		Subd. 8.Proposals for exchange.  The commissioner, with
6.14 	the approval of the board, may submit a proposal for exchange of
6.15 	Class A land to any land owner concerned.  Any land owner may
6.16 	submit to the commissioner and the board a proposal for exchange
6.17 	in such form as the commissioner, with the approval of the
6.18 	board,may prescribe.

6.19 	Sec. 13. Minnesota Statutes 2004, section 94.343, is
6.20 	amended by adding a subdivision to read:
6.21 		Subd. 8a.Fees. (a) When a private landowner or
6.22 	governmental unit, except the state, presents to the
6.23 	commissioner an offer to exchange privately or publicly held
6.24 	land for Class A land, the private landowner or governmental
6.25 	unit shall pay to the commissioner a determination of value fee
6.26 	and survey fee of not less than one-half of the cost of the
6.27 	determination of value and survey fees as determined by the
6.28 	commissioner.
6.29 	(b) Except as provided in paragraph (c), any payment made
6.30 	under paragraph (a) shall be credited to the account from which
6.31 	the expenses are paid and is appropriated for expenditure in the
6.32 	same manner as other money in the account.
6.33 	(c) The fees shall be refunded if the land exchange offer
6.34 	is withdrawn by a private landowner or governmental unit before
6.35 	the money is spent.

6.36 	Sec. 14. Minnesota Statutes 2004, section 94.343,
7.1 	subdivision 10, is amended to read:
7.2 		Subd. 10.Conveyance.  Conveyance of Class A land given
7.3 	in exchange shall be made by deed executed by the commissioner
7.4 	in the name of the state, with a certificate of unanimous
7.5 	approval by the board appended.  All such deeds received by the
7.6 	state shall be recorded or registered in the county in which the
7.7 	lands lie, and all recorded deeds and certificates of registered
7.8 	title shall be filed in the office having custody of the state
7.9 	public land records in the Department of Natural Resources.

7.10 	Sec. 15. Minnesota Statutes 2004, section 94.344,
7.11 	subdivision 1, is amended to read:
7.12 		Subdivision 1.General exchange provisions. Except as
7.13 	otherwise provided,Class B land, by resolution of the county
7.14 	board of the county where the land is located and with the
7.15 	unanimous approval of the Land Exchange Board, may be exchanged
7.16 	for any publicly held or privately owned land in the same
7.17 	county. Class B land may be exchanged only if it meets the
7.18 	requirements of subdivision 3 or 5.

7.19 	Sec. 16. Minnesota Statutes 2004, section 94.344, is
7.20 	amended by adding a subdivision to read:
7.21 		Subd. 2a.Valuation of lands. For an exchange involving
7.22 	Class B land for Class A land, the value of the lands shall be
7.23 	determined by the commissioner, with approval of the Land
7.24 	Exchange Board.  For purposes of the determination, the
7.25 	commissioner shall determine the value of the state and
7.26 	tax-forfeited land proposed to be exchanged in the same manner
7.27 	as Class A land.  For all other purposes, the county board shall
7.28 	appraise the state land and the land in the proposed exchange in
7.29 	the same manner as tax-forfeited land to be offered for sale.
7.30 	The determined values shall not be conclusive, but shall be
7.31 	taken into consideration, together with such other matters as
7.32 	may be deemed material, in determining the values for the
7.33 	purposes of exchange.

7.34 	Sec. 17. Minnesota Statutes 2004, section 94.344,
7.35 	subdivision 3, is amended to read:
7.36 		Subd. 3.exchanging land of substantially equal value
8.1 	required or lower value.  (a) Except as otherwise provided,
8.2 	Class B land may be exchanged only for land of substantially
8.3 	equal value or greater value to the state, as determined by the
8.4 	county board, with the approval of the commissioner and the Land
8.5 	Exchange Board. For an exchange involving Class B land for
8.6 	Class A or Class C land, the value of the lands shall be
8.7 	determined by the commissioner, with approval of the Land
8.8 	Exchange Board.  For purposes of the determination, the
8.9 	commissioner shall appraise the state and tax-forfeited land
8.10 	proposed to be exchanged in the same manner as Class A land.
8.11 	For all other purposes, the county board shall appraise the
8.12 	state land and the land in the proposed exchange in the same
8.13 	manner as tax-forfeited land to be offered for sale.  The
8.14 	appraised values shall not be conclusive, but shall be taken
8.15 	into consideration, together with such other matters as may be
8.16 	deemed material, in determining the values for the purposes of
8.17 	exchange.
8.18 	(b) For the purposes of this subdivision, "substantially
8.19 	equal value" means:
8.20 	(1) where the lands being exchanged are both over 100
8.21 	acres, their values do not differ by more than ten percent; and
8.22 	(2) in other cases, the values of the exchanged lands do
8.23 	not differ by more than 20 percent.
8.24 	(c) Class B land may be exchanged for land of lesser value
8.25 	if the other party to the exchange pays to the state the amount
8.26 	of the difference in value.  Money received by the county
8.27 	treasurer shall be disposed of in like manner as the proceeds of
8.28 	a sale of tax-forfeited land.

8.29 	Sec. 18. Minnesota Statutes 2004, section 94.344,
8.30 	subdivision 5, is amended to read:
8.31 		Subd. 5.obtaining exchanging land of greater value. (a) 
8.32 	Class B land may be exchanged for land of greater value only in
8.33 	case if the other party to the exchange shall waive waives 
8.34 	payment for the difference.
8.35 	(b) Except for Class A school trust land, Class B land may
8.36 	be exchanged for Class A land of greater value if the county
9.1 	pays to the state the difference in value.
9.2 	(c) Class B land may be exchanged for United States-owned
9.3 	land of greater value if the county agrees to pay the difference
9.4 	in value.

9.5 	Sec. 19. Minnesota Statutes 2004, section 94.344,
9.6 	subdivision 8, is amended to read:
9.7 		Subd. 8.Proposals for exchange.  By direction of the
9.8 	county board,the county auditor may submit a proposal for
9.9 	exchange of Class B land to any land owner concerned.  Any land
9.10 	owner may file with the county auditor a proposal for exchange
9.11 	for consideration by the county board. Forms for such proposals
9.12 	shall be prescribed by the commissioner.

9.13 	Sec. 20. Minnesota Statutes 2004, section 94.344,
9.14 	subdivision 10, is amended to read:
9.15 		Subd. 10.Approval; conveyance.  After approval by the
9.16 	county board, every proposal for the exchange of Class B land
9.17 	shall be transmitted to the commissioner in such form and with
9.18 	such information as the commissioner may prescribe for
9.19 	consideration by the commissioner and by the board.  The county
9.20 	attorney's opinion on the title, with the abstract and other
9.21 	evidence of title, if any, shall accompany the proposal.  If the
9.22 	proposal be is approved by the commissioner and the board and
9.23 	the title be is approved by the attorney general, the same shall
9.24 	be certified to the commissioner of revenue, who shall execute a
9.25 	deed in the name of the state conveying the land given in
9.26 	exchange, with a certificate of unanimous approval by the board
9.27 	appended,and transmit the deed to the county auditor to be
9.28 	delivered upon receipt of a deed conveying to the state the land
9.29 	received in exchange, approved by the county attorney; provided,
9.30 	that if any amount is due the state under the terms of the
9.31 	exchange, the deed from the state shall not be executed or
9.32 	delivered until such amount is paid in full and a certificate
9.33 	thereof by the county auditor is filed with the commissioner of
9.34 	revenue.  The county auditor shall cause all deeds received by
9.35 	the state in such exchanges to be recorded or registered, and
9.36 	thereafter shall file the deeds or the certificates of
10.1 	registered title in the auditor's office.  If the land received
10.2 	by the county in the exchange is either Class A or Class C land,
10.3 	the commissioner of revenue shall deliver the deed for the Class
10.4 	B land to the commissioner of natural resources and following
10.5 	the recording of this deed, the commissioner of natural
10.6 	resources shall deliver to the county auditor a deed conveying
10.7 	the Class A or Class C land to the county auditor to be recorded
10.8 	or registered, and afterwards file the deeds or the certificate
10.9 	of registered title in the auditor's office.

10.10 	Sec. 21. Minnesota Statutes 2004, section 97A.135,
10.11 	subdivision 2a, is amended to read:
10.12 		Subd. 2a.Disposal of land in wildlife management areas.
 10.13 	(a) The commissioner may sell or exchange land in a wildlife
10.14 	management area authorized by designation under section 86A.07,
10.15 	subdivision 3, 97A.133, or 97A.145 if the commissioner vacates
10.16 	the designation before the sale or exchange in accordance with
10.17 	this subdivision.  The designation may be vacated only if the
10.18 	commissioner finds, after a public hearing, that the disposal of
10.19 	the land is in the public interest.
10.20 	(b) A sale under this subdivision is subject to sections
10.21 	94.09 to 94.16.  An exchange under this subdivision is subject
10.22 	to sections 94.341 to 94.348 94.347.
10.23 	(c) Revenue received from a sale authorized under paragraph
10.24 	(a) is appropriated to the commissioner for acquisition of
10.25 	replacement wildlife management lands.
10.26 	(d) Land acquired by the commissioner under this
10.27 	subdivision must meet the criteria in section 86A.05,
10.28 	subdivision 8, and as soon as possible after the acquisition
10.29 	must be designated as a wildlife management area under section
10.30 	86A.07, subdivision 3, 97A.133, or 97A.145.
10.31 	(e) In acquiring land under this subdivision, the
10.32 	commissioner must give priority to land within the same
10.33 	geographic region of the state as the land conveyed.

10.34 	Sec. 22. Minnesota Statutes 2004, section 103F.535,
10.35 	subdivision 1, is amended to read:
10.36 		Subdivision 1.Reservation of marginal land and
11.1 	wetlands.  (a) Marginal land and wetlands are withdrawn from
11.2 	sale or exchange unless:
11.3 	(1) notice of the existence of the nonforested marginal
11.4 	land or wetlands, in a form prescribed by the Board of Water and
11.5 	Soil Resources, is provided to prospective purchasers; and
11.6 	(2) the deed contains a restrictive covenant, in a form
11.7 	prescribed by the Board of Water and Soil Resources, that
11.8 	precludes enrollment of the land in a state-funded program
11.9 	providing compensation for conservation of marginal land or
11.10 	wetlands.
11.11 	(b) This section does not apply to transfers of land by the
11.12 	Board of Water and Soil Resources to correct errors in legal
11.13 	descriptions under section 103F.515, subdivision 8, or to
11.14 	transfers by the commissioner of natural resources for:
11.15 	(1) land that is currently in nonagricultural commercial
11.16 	use if a restrictive covenant would interfere with the
11.17 	commercial use;
11.18 	(2) land in platted subdivisions;
11.19 	(3) conveyances of land to correct errors in legal
11.20 	descriptions under section 84.0273;
11.21 	(4) exchanges of nonagricultural land with the federal
11.22 	government, or exchanges of Class A, Class B, and Class C 
11.23 	riparian nonagricultural land with local units of government
11.24 	under sections 94.342, 94.343, and 94.344, and 94.349;
11.25 	(5) land transferred to political subdivisions for public
11.26 	purposes under sections 84.027, subdivision 10, and 94.10; and
11.27 	(6) land not needed for trail purposes that is sold to
11.28 	adjacent property owners and lease holders under section 85.015,
11.29 	subdivision 1, paragraph (b).
11.30 	(c) This section does not apply to transfers of land by the
11.31 	commissioner of administration or transportation or by the
11.32 	Minnesota Housing Finance Agency, or to transfers of
11.33 	tax-forfeited land under chapter 282 if:
11.34 	(1) the land is in platted subdivisions; or
11.35 	(2) the conveyance is a transfer to correct errors in legal
11.36 	descriptions.
12.1 	(d) This section does not apply to transfers of land by the
12.2 	commissioner of administration or by the Minnesota Housing
12.3 	Finance Agency for:
12.4 	(1) land that is currently in nonagricultural commercial
12.5 	use if a restrictive covenant would interfere with the
12.6 	commercial use; or
12.7 	(2) land transferred to political subdivisions for public
12.8 	purposes under sections 84.027, subdivision 10, and 94.10.

12.9 	Sec. 23. REPEALER.
 12.10 	Minnesota Statutes 2004, sections 94.343, subdivision 6;
12.11 	94.344, subdivision 6; 94.348; and 94.349, are repealed.