Priceless

State trust lands, created as a public trust to be held in perpetuity, must be managed to benefit all generations, current and future. To this end, state land departments and commissioners are granted a variety of powers and duties to manage their state’s lands, but also hold significant discretion to carry out their mandates. This paper examines some of the larger forces of change that are shaping the use of state trust lands throughout the Intermountain West, which are particularly sensitive to adjacent land values due to their checkerboard pattern. State trust land departments, to balance fiduciary duties towards current and future generations, must mitigate the significant risk inherent in some activities taking place on leased lands, such as oil and gas exploration. This paper provides some suggestions on how to mitigate these types of risks and a brief legal history of why appraisal methods and practices prohibit the inclusion of public interest values, or preservation of open space. The basis for this prohibition lags behind scientific and economic theory while failing to allow for the value capture of many natural asset service flows. As land and water scarcity impacts the Intermountain West, state trust land managers should continue to find ways to economically value the real property assets of the trust. This paper may assist state trust land commissioners and departments in further mitigating their liability through preservation of state trust lands, and provide a better understanding of the appraisal frameworks within which they work.