State Land Trust
The State Land Office is responsible for administering 9 million acres of surface and 13 million acres of subsurface land for the beneficiaries of the trust. Each.JPG)
acre of land is designated to a specific beneficiary, with public schools receiving more than 84 percent of the acreage.
State trust land is located in 32 of New Mexico’s 33 counties. The goals of the trust are to optimize revenues while protecting the health of the land for future generations.
Trust lands were granted to New Mexico by Congress under the Ferguson Act of 1898 and the Enabling Act of 1910. The latter act allowed New Mexico’s admission to the United States upon voter approval of the state constitution.
In general terms, the state was granted four square miles – Sections 2, 16, 32, and 36 – in each 36-section township. Where those sections had previously been sold or allocated to Indian pueblos, tribal reservations or pre-existing land grants, the state was allowed to pick lands elsewhere in lieu of the four designated sections. The state also received “quantity grants” from the federal government, in specific amounts to benefit specified universities, special schools, institutions, and other purposes. Those land grants totaled about 5 million acres.
Revenue generated from the extraction of oil and gas, from mining, the sale of land, and any other activity that depletes the resource is placed in the permanent fund, which is invested for the beneficiaries. Revenues from activities like grazing, rights of way, and commercial activities that do no permanently deplete the resource are distributed through the maintenance fund to the designated beneficiaries after the Land Office covers its own expenses – an amount which typically is equal to less than four percent of the revenue generated.
New Mexicans are fortunate that much of state trust land lies within the oil-rich Permian Basin and the gas-rich San Juan Basin. As a result, most trust land revenue has been generated through royalties on the production of oil and gas. Because this revenue –as well as the revenue from the sale of trust land and other mineral production royalties –represents a depletion of the trusts assets, it is set aside by federal law and the state Constitution in the Land Grant Permanent Fund. The body of the fund is maintained in perpetuity for future generation of New Mexicans, while the revenue it generates from interest and investments flows to public schools and other institutions.