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Administering State Mineral Lands—What Is the State's Trust Responsibility?

Dallin W. Jensen, Proceedings of 35th Annual Rocky Mountain Mineral Law Institute (1989)

The school land grants comprise a large percentage of the land owned by the western states. The states received the grants in their enabling acts and accepted the lands through ratification of the state constitutions. Under the terms and conditions of the enabling acts, the states must administer the school lands pursuant to specific restrictions and limitations. Despite an early congressional policy to exclude known mineral lands from the school land grants, and as a result of a change in federal policy in 1927, a significant amount of valuable mineral lands passed to the states under the school land grants. Congress failed to state, however, whether the restrictions contained in the enabling acts apply to the administration of mineral leases on the school lands. Recently, in ASARCO, Inc. v. Kadish,1 the United States Supreme Court held that enabling act restrictions which attach to the states' ownership of other school trust assets also attach to the minerals underlying the school lands. In the absence of express enabling act language, however, the Court did not decide the extent to which the states hold those mineral lands pursuant to basic trust principles. The purpose of this paper is to summarize the considerations that were made by the Court in reaching the result in Kadish, and the questions that were left unanswered by the Court, in order to define the factors that aff