Key Points:

• GOP lawmakers want to institute reforms at the State Land Department

• An auditor general’s report on the agency found 51 areas in need of improvement

• Gov. Katie Hobbs wants to give the agency time to implement auditor general recommendations

Republican lawmakers say the State Land Department needs a “complete overhaul” this session after decades of falling short of its statutory duties. 

The reform push is spurred by two reports from the auditor general that found the department had not developed statutorily required land disposition plans, had not adjusted rental rates on agricultural land to reflect market conditions and had neglected to inspect land previously used for mining to ensure its safety for other uses. Including both reports, the auditor general made 57 recommendations for improvement to the Land Department. 

The department manages 9 million acres of state trust land designated to generate revenue for 13 state beneficiaries, including the state’s K-12 public schools, public universities and several other state entities. The auditor general found that deficiencies in the department could be negatively affecting its ability to generate revenue for beneficiaries. 

At a sunset audit review hearing on Jan. 21, Republican lawmakers lambasted the failures of the department, but told current State Land Commissioner Robyn Sahid that the blame did not fall entirely on her, as her tenure only began in 2023.

“You inherited a mess,” Republican Rep. Teresa Martinez of Casa Grande said. “This is not something that happened in the last three years – you’re just the one stuck cleaning it up.”

To fix that mess, Republican lawmakers have introduced 12 bills with different reforms, including adding an advisory board to oversee ASLD, creating county land commissioner positions or removing some duties from the department and placing them elsewhere. 

Gov. Katie Hobbs told the Arizona Capitol Times on Feb. 2 that she agrees with lawmakers that “there’s just a lot of systems in place that don’t work,” but that ASLD should be given time to implement the auditor general’s recommendations first. 

“I’m certainly willing to talk about changes that make sense, but I think as the director is working to implement the audit recommendations that we give that a chance to go into effect before we make major changes on top of that,” Hobbs said. 

The debate over reforms was sparked by the usually mundane sunset review process for state agencies, which has become increasingly contentious with a Democratic governor on the Ninth Floor and a Republican-controlled Legislature. The sunset review process requires agencies to undergo periodic reviews from the auditor general and a committee of reference in both the House and the Senate. 

Republican lawmakers on the Joint Natural Resources Committee voted to recommend extending ASLD’s statutory life by four years, rather than the usual eight to 10 years granted to other agencies. The department would also be expected to return to the Legislature in two years with an updated report on its progress implementing the auditor general’s recommendations.

Additionally, Rep. Gail Griffin, R-Hereford, proposed adding a laundry list of stipulations to the department’s continuation bill, including opening investigations into issues raised by the auditor general, working alongside mining and agriculture industry representatives to address their concerns and creating a five-year disposition plan. Griffin did not share her colleagues’ sentiments regarding Sahid’s efforts to improve ASLD’s operations.

“Licensing timeframes, five-year disposition plans, and written policies and procedures are essential to upholding the best interests of the trust,” Griffin said in a statement released on Jan. 21. “These were the top issues. The commissioner acknowledged these issues during her confirmation hearing and committed to fixing them, but they haven’t been resolved. The captain isn’t steering the ship.”

Griffin also introduced a bill, House Bill 2427, which would require ASLD to implement all recommendations from the auditor general within two years — a relatively rare step in the usual agency sunset audit process. 

Griffin also introduced several other bills intended to provide reforms and oversight of the department, such as removing the Arizona Geological Survey from the department, prioritizing mineral extraction on state land, and requiring completion of the long-delayed five-year land disposition plan within two years.

Other lawmakers have also offered ideas for reforms at ASLD, including creating a state land advisory board with appointed members or creating elected county land commissioner positions that would form a board to oversee the department. 

None of the 12 ASLD-related bills introduced have been heard in committee yet, and it is unclear which, if any, will be signed by Hobbs if they reach her desk.