OTHER FREQUENTLY ASKED QUESTIONS
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1 OTHER FREQUENTLY ASKED QUESTIONS 1) CAN I BUY STATE LEASE LAND? Generally, no the Commissioner s policy is to retain state ownership of all state trust land absent extenuating circumstances. 2) HOW DO I ACQUIRE A STATE LEASE a) Often ranches are composed of private, state and / or federal land and are run as one production unit. If acceptable to the Commissioner, the state leases within the ranch are assigned by the seller to the buyer as part of the sale. b) Open acreage - Leases may be acquired through applying for a lease on unleased acreage. There is a $50.00 application fee. The open acreage application must be submitted under oath on SLO forms. The application must include an appraisal from a disinterested third party for the value of the land, and an appraisal form on the improvements on the land within the state lease. If the lease is issued and if there are any improvements, the new applicant will be required to deposit the sum of the amount of the existing authorized improvements on the lease in order to compensate the previous lessee for the improvement value. c) Leases can be acquired through a competitive bid process which is explained in the frequently asked questions in the agricultural renewal process. 3) WHO IS LEASING A PARTICULAR SECTION-TOWNSHIP-RANGE AND HOW DO I IDENTIFY STATE LAND? It is important and facilitates the process if the area you are interested in is identified by the section, township and range. The BLM sells maps showing the surface management status or there are other commercially available maps that will show the land status and identify the sections, townships and range. The State Land Office has a website that will show the State lands and give lease information. Go to the state land website and push the GIS tab on the top. On the next screen either put in the section, township and range or lease number. The map will show the area and ownership of the area of interest. Push the info tab (i) on the top of the map and point to the state land and it will identify the lessee. The information can also be supplied through a written request to the State Lands Records Division or by coming to the State Land Office in Santa Fe to review the lease records. 4) WHAT RIGHTS DO HUNTERS HAVE TO USE STATE TRUST LAND?
2 The State Land Office has entered into an easement agreement with the State Game Commission to allow licensed hunters to hunt on SLO lands. The current easement is valid until June 30, Most State Land is included in the easement except some acreage that is held in a SLO business lease or withdrawn by the Commissioner or by the N.M. Game & Fish Department for other reasons. Vehicular access is restricted to public roads or highways or established roads. The easement does not grant a right of entry upon lands, such as private roads over private property, that are not under the control and custody of the Commissioner. SLO lessees must allow access to hunters on SLO lands where there is legal access. If the SLO Lands are fenced and no gate exists to provide access from a public highway or road or established road, then the hunter s access is limited to travel by foot. Camping on SLO land is not permitted without the consent of the lessee or special permission of the SLO. 5) WHEN WILL MY IMPROVEMENT APPLICATION BE APPROVED? It usually takes between 4 6 weeks for the approval of an improvement application. Once the application is received in this office, a field report is requested whereby a District Resource Manager (DRM) is assigned to inspect the site. The DRM issues a report and a recommendation for review by the grazing section. Once the application has been approved, a copy of the approval is sent to the lessee by mail. 6) WHERE AND WHAT ARE THE LAWS AND RULES THAT APPLY TO THE STATE LAND OFFICE? The New Mexico Constitution grants certain authority to the Commissioner of Public Lands and contains provisions in which the State s accepted the federal government s grant of the trust lands, and the restrictions imposed on the use and disposition of those lands. See N.M. Const. Article XII, 12, Article XIII, Article XIV, Article XXI, 9 and 11 and Article XXIV, 1. Most of the state statutes that apply to the State Land Office can be found in Title 19 of the New Mexico Statutes Annotated. The Commissioner has issued various State Land Office rules and regulations which can be found in Chapter 2 ("State Trust Lands") of Title 19 ("Natural Resources & Wildlife") of the New Mexico Administrative Code (NMAC). The part of the Rules that applies to agricultural leases is NMAC ( to ). These laws and rules can be found on the internet or at the local library, including the New Mexico State Records Center website ( and the State Land Office website (go to and click on the Forms and Permits tab on the left side of the page). 7) HOW DOES THE FEE FORMULA WORK?
3 The current fee calculation for agricultural leases was implemented in The fee formula takes into account a wide variety of factors including current private grazing land lease rates by western livestock ranchers, beef cattle prices, and the cost of livestock production. When cattle prices decline and the cost associated with livestock production increases, the grazing fee will decrease in response to these market conditions. Also, when forage is in demand by ranchers, it will tend to increase the grazing fee index and result in a higher grazing fee. The private land lease rate carries the largest weight of all factors used to determine the fee formula. Adjustment factors adjust state trust land grazing fees up or down depending on value of forage and economic conditions in the western livestock industry. The adjustment factor adjusts fees relative to a base period, and there is a one-year lag between when the data are collected by USDA and when they are reported. Indices used are for 11 western states. Since the formula was implemented in 1988, it has seen many increases and decreases depending on livestock prices, costs and private lease rates. Here is an example rental calculation: Lease No. GG-2007 Acreage: 640 Carrying Capacity for Billing: 10 Head (120 AUM s) Lease period: thru Here is an example of how to calculate the rental fee using this information: 10 head cc. X 12 months = 120 AUM s Per AUM: 120 AUM s x $2.71/AUM s = $ rental for lease period through Per Acre: $ divided by 640 acres = $.51/ Acre/Year
4 FREQUENTLY ASKED QUESTIONS DURING THE AGRICULTURAL RENEWAL PROCESS. 1) HOW DO I FILL OUT THE APPRAISEMENT FORM IN THE RENEWAL PACKET? The purpose of the appraisal is to provide the best estimate of the value of the subject property sworn under oath by a disinterested person who has personal knowledge and the ability to provide a true and accurate assessment of the value of the land and the improvements. The agricultural lessee or their agent or employee of the lessee is not a disinterested person and therefore may not sign the appraisement form. The State Land Office appraisment forms are usually filled out by another rancher, realtor or other disinterested person in the vicinity who is familiar with the lease lands and the value of the acreage that is leased. The disinterested person can not be paid for filling out the appraisement. An appraiser can not be hired to do the appraisal because of a potential conflict in the rules and regulations of the Real Estate Appraisers Board. The statements in the appraisal must be made based upon personal knowledge, and not upon information and belief. The disinterested person doing the appraisal must provide his or her address on the appraisement form and have his or her signature on the appraisement notarized. REMEMBER: The signature of the person doing the appraisement must be sworn before a Notary Public, who must also sign the notarization and put their notary seal or stamp on it. 2) WHAT HAS TO BE LISTED ON THE IMPROVEMENT LISTING IN THE RENEWAL PACKET?... an existing lessee applying for a new lease on trust land which the lessee currently leases, in lieu of an appraisal of the improvements shall submit a listing of all improvements located on the land... ( (B)(2) NMAC) The State Land Office rules require a listing of all existing and new improvements on the State Land Office agricultural lease when renewing a lease, including improvements placed on the land by a prior lessee. Even if an improvement listing has been submitted in prior years or there are no improvements, the improvement listing form must be filled out and signed by the lessee or the entire renewal application will be rejected.
5 If there are no improvements, the lessee still must sign and check off that there are none on the improvement listing form. Lessees are encouraged to keep and file copies of their last lease to help in preparing a new improvement listing. 3) HOW AND WHEN DO I PAY THE APPLICATION FEE AND RENTAL? The State Land Office receives the majority of its payments in the form of checks written on personal or business checking accounts. The State Land Office will also accept money orders, cashier or certified checks. The check should be made out to the Commissioner of Public Lands. The total amount of the check can be combined with the application fee of $50.00 plus the total rental which is shown on Exhibit A that is attached at the back of the Agricultural Lease renewal. The $50.00 application fee along with the Rental (amount found on Exhibit A page on the Agricultural lease application) must be remitted along with both sets of completed lease applications. The lease application serves as your first rental statement. In the event a competitive bid is placed on your lease, the statutory right to match a competing offer will be forfeited if the rental, application fee and properly executed lease application are not received in this office by 5 p.m. August 1, The right to participate in a sealed bid process will be forfeited if the rental, application fee and properly executed lease application are not received in this office by 5 p.m. September 1, Receipt and cashing of submitted fees and rentals does not guarantee the renewal application will be accepted or approved if there are other application errors or omissions. 4) WHO SIGNS THE LEASE? LESSEE SIGNATURE: The lessee s signature must match the name of the lessee as it appears on the face page of the lease application, including middle name or middle initial. Do not mark through any information on the lease. The lease application cannot be accepted if it is defaced in any way. MORE THAN ONE LESSEE: If the lease designates two or more lessees, all lessees must sign the lease application. Only a person with a valid Power-of-Attorney can sign on behalf of multiple lessees. The Power-of-Attorney must be recorded in the county where the state trust land is located and must be on record at the State Land Office. If there are more than two lessees, then the blank signature and notary page of the lease can be copied and attached to the lease. Each signature must be notarized. If the personal representative of the estate of a deceased lessee signs the lease in that capacity, he or she must note that they are signing as the personal representative for the (name) estate. Similarly, if a trustee or trustees are signing for the trust, trustee for the (name) of the trust should be written after the signature.
6 5) WHAT DOCUMENTS IN THE RENEWAL PACKET NEEDS TO BE NOTARIZED? NOTARY: Lessee(s) must sign the agricultural lease application before a Notary Public and return both signed copies to the State Land Office for approval. The Notary must notarize the signature of the individual(s) whose name(s) appear on the face page of the application in the space entitled Name of Person Acknowledged. An incomplete or incorrect notary clause may cause a lease application to be rejected. In signing the lease application, the applicant s signature and the name inserted into the blank for Name of Person Acknowledged in the notary block should match the name on the face of the lease, including middle name or middle initial.. Some states such as California have their own notary form. If the signature is notarized outside of New Mexico, these forms can be attached as part of the lease form behind the lessee signature page. If the lessee is a natural person or the signature is that of a trustee of a trust or the personal representative of a decedent s estate, the signature should be notarized in the section for acknowledgements for natural persons. Also please remember that the notary must sign and stamp the notary section. A signature on behalf of a partnership should be notarized in the partnership section, and a signature on behalf of a corporation or limited liability company should be notarized in the Corporation section. The other form that must be notarized is the signature of the disinterested person that fills out the appraisement form. 6) HOW DO I TRANSFER MY LEASE? An agricultural lease can be transferred or assigned to another person or entity such as a trust, corporation or partnership only where the assignment has been approved in writing by signature of the Commissioner. For assignments during the renewal process, the paperwork must be received by the State Land Office by June 1 st. The State Land Office has an assignment form that must be signed by the existing lessee(s) and purchaser(s)/assignee(s), and all signatures must be notarized. A $50.00 assignment fee made out to the Commissioner of Public Lands must be sent along with the completed assignment. The lessee also has the option of filling out a partial assignment. This is used when only a part of the acreage of the lease is being transferred. The assignment form must be completed in duplicate, and all signatures on each duplicate must be original, notarized signatures. The assignment must have the name, mailing address, and telephone number of the purchaser/assignee and the description
7 of the land that includes the lots or the subdivision of the sections, Sections, Townships, Ranges, and acreage amounts. The assignment must be submitted to the State Land Office within 30 days of the date that the last signature is notarized. The Commissioner of Public Lands must sign and approve the assignment before it becomes effective. Lease assignment applications being assigned in the name of a trust must be accompanied by an original certified copy of the Trust Agreement with a $10.00 filing fee. Often a leashold interest is assigned to a bank or other lending institution as collateral for a loan. Before a lease assignment will be approved, the collateral assignment must be released by the lending institution, or the lending institution must agree to allow the purchaser/assignee to assume the loan. The State Land Office release or assumption of collateral forms must be properly filled out before the lease can be assigned. Divorce If the lease is in the name of the husband and wife and they have divorced, then to assign the lease, both parties must sign the assignment form. If the divorced parties cannot agree on the assignment, the person seeking to assign their interest in the lease must submit to the State Land Office a certified copy of the divorce decree that specifies ownership of the State Land Office lease. 7) HOW DOES THE FAMILY HANDLE A STATE TRUST LEASE AND THE ESTATE WHEN THE LESSOR DIES? The State Land Office strongly encourages the heirs of a deceased person s estate to consult an attorney regarding the probate process. The following information is given simply to help explain the basics of the process. If a lessee dies and his or her heirs (those who have inherited the decedent s interest in the lease) seek to renew the lease, the heirs must submit a certified copy of the documents showing that the decedent s interest has been transferred so that they are received by the State Land Office no later than June 1 st in order for the lease to be issued in the name of the heirs or other entity. A lease may be issued to two or more co-lessees (persons or legal entities -- e.g., a corporation or limited liability company) designated as joint tenants or as tenants in common. These terms have different legal meanings which affect what happens to a colessee s interest in the lease if he or she dies. If the co-lessees are designated as tenants in common : when one tenant dies, the decedent s interest passes to his or her heirs, not to the other lessee(s) (unless the other lessee(s) are also heirs of the decedent). If the co-lessees are designated as joint tenants : when a tenant dies, the decedent s interest in the lease passes automatically to the surviving tenant(s), not to the decedent s heirs (unless the heir(s) is a surviving tenant).
8 In general, if the co-lessees are designated as husband and wife and there is no designation indicating that they hold the lease as tenants in common or that their respective interests in the lease are sole and separate property: when one of them dies, the decedent s interest in the lease passes automatically to the surviving tenant. If the applicant is submitting a court document, will, death certificate or trust document, the applicant must submit to the State Land Office an original or certified copy and a $10.00 filing fee. If an applicant is seeking to be designated as a lessee in the place of a lessee who has died, the applicant must submit to the State Land Office the following documents: (1) a court order approving the appointment of a personal representative a letter testamentary, which is a court instrument of authority and appointment given to an executor. (2) An original or certified copy of the death certificate and (3) A completed assignment form signed by the personal representative or the executor that is identified in the letter testamentary, along with a certified copy of any documents validating the assignment, such as a will or trust document. 8) CAN I CONSOLIDATE TWO DIFFERENT LEASES INTO ONE LEASE? During the renewal process, the State Land Office can consolidate multiple leases into one lease if you wish. The state leases to be consolidated must be in close physical proximity to one another, or be part of a larger ranch unit. If the leases are due to expire at different times -- for example, if one lease comes due for renewal in 2010 and the other lease is due in then the State Land Office will renew the earlier expiring lease so that it is expires at same time as the later expiring lease. In the example, the 2010 lease will be renewed for one rather than five years, and if acceptable to the Commissioner, when the 2011 lease comes due for renewal, the 2010 and 2011 lease can be consolidated. 9) WHAT DO I DO IF MY ADDRESS HAS CHANGED? Please notify the State Land Office by mail, or telephone of the change of address. A change of address form can be obtained by going to the State Land Office website (go to and click on the Forms and Permits tab on the left side of the page) or the State Land Office will mail the address form that should be filled out with the corrected address and signed by the named lessees 10) HOW DOES THE COMPETITIVE BID PROCESS WORK? Under state statute (NMSA ) and State Land Office Rules (NMAC (G)), if the State Land Office receives more than one application seeking to acquire a lease upon the expiration of its existing term, the lease will be awarded to
9 the applicant offering the highest annual rental, if it is in the best interests of the trust. Competitive bid applications may be submitted between August 1 st and September 1 st of the year the lease expires. All competitive bid applications must be received and time stamped by 5:00 P.M. on September 1 of the year the lease expires. All leases are exposed to a 30-day competitive bid period at the time of expiration. Leases expire and are renewed every five years or sooner. Competitive bids may be submitted during a 30-day period prior to the lease expiration. If the current lessee submits an application to renew the lease no later than August 1 st of the year that the lease is expiring, he or she has the right to submit a bid matching the highest bid, if any, submitted by a competing bona fide applicant. If the current lessee is out of compliance with any of the current lease terms or fails to submit a timely application to renew the lease in accordance with State Land Office requirements, he or she may lose their right to match the highest competing bid, or the right to participate in a sealed bid auction, which means the lease would be awarded to the highest bidder. Applications must be accompanied by lease application filing fee, first year s offered rental, and a deposit of the amount of the appraised value of the existing improvements.
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