Understanding Arizona State Trust Land: Can You Buy It, Lease It, or Use It?

When you’re driving through Arizona and looking out at the vast, open desert, it’s easy to think you’ve found the perfect spot to just pull over and explore.

To most of us, those endless miles of wild landscape look like public land where anyone can hike, set up camp, or spend the afternoon on an ATV.

However, roughly 9.2 million acres fall into a specific and often misunderstood category: Arizona State Trust Land.

Unlike the national parks or a local city park down the street, State Trust Land is not “public” in the way most people think. In other words, it’s not managed for general recreation or conservation as its primary goal.

Instead, this land is a working asset managed by the Arizona State Land Department (ASLD). Its goal is to fund 13 specific beneficiaries, the largest of which is Arizona’s K-12 public schools.

Since this land exists to generate revenue for state institutions, every single person who steps foot on it, leases it, or buys it must compensate the trust.

Whether you want to build a homestead, run a cattle operation, or simply head out on a morning stroll, there is a legal process you have to follow.

Let’s walk through what you need to know.

The “High and Best Use” Mandate

To understand why the rules for State Trust Land are so strict, you have to understand the “Highest and Best Use” doctrine.

When Arizona became a state, the federal government granted millions of acres of its land to be held in trust.

The state’s constitution then mandated what was to come next. The ASLD must manage this land to maximize financial returns for the beneficiaries.

What does this mean?

Even today, this mandate means the Land Department cannot simply “give away” land or let people use it for free.

Let’s say a developer wants a piece of land that is also valuable for a school site. In this case, the state must choose the path that yields the most money to the trust in the long term.

This is why Trust Land is often “intermingled” with private property. As cities grow, these trust parcels become prime targets for high-value development.

Why You Need a Permit Just to Hike

Here comes the part that surprises many Arizona residents: you can’t actually go for a hike, do some birdwatching, or even snap a few photos on State Trust Land without a permit.

It doesn’t matter if there’s no fence and no “No Trespassing” sign in sight. Legally speaking, being on this land without a permit is considered a violation of state law.

Because this land is held in a trust, the state has a legal duty to make sure it earns its keep. To make that easy for the rest of us, they offer simple Recreational Permits.

Permit types and fees include:

• Individual Permit: $15 per year.
• Family Permit: $20 per year (covers two adults and any children under 18 in the same household).
• Small Group Permit: $15 for up to 5 days for groups of 19 people or less.

You can purchase these permits online in minutes. Once you have one, you must keep a printed copy in your vehicle while you are on the land.

This permit allows for day use and limited camping (up to 14 cumulative days per year).

But keep in mind that you must stay on existing roads and trails. Creating new tracks or driving cross-country is strictly prohibited.

Buying State Trust Land: The Long Road to Ownership

If you’ve found a perfect piece of Arizona State Trust Land and want to make it yours, you should know it is not as simple as just making an offer.

Unlike with a private land sale, where you might close in 30 days, buying land from the state is a marathon. Every single acre of Trust Land sold must go through a public auction.

Here’s what to know about the process:

The Application and “Due Diligence” Fees

The process begins when an individual or developer submits an Application to Purchase.

This application alone comes with a non-refundable filing fee of $2,000. But that is just the beginning of the costs.

Before the land can even go to auction, the applicant is often responsible for several “due diligence” expenses, including:

• Appraisal: Usually costs around $3,700.
• Legal Advertising: Roughly $3,500. The state must publish the auction notice in a newspaper for 10 consecutive weeks.
• Site Studies: This can include archaeological surveys, environmental assessments, and land surveys.

The 5-Step Disposition Process

The ASLD follows a strict roadmap before any land hits the auction block, which is as follows:

1. Conceptual Planning: The state looks at large areas to see how they fit into local city growth plans.
2. Five-Year Disposition Plan: The parcel must be listed on the state’s official plan for upcoming sales.
3. Site Studies: Detailed reviews to ensure there are no hidden issues with the land.
4. Appraisal: A formal determination of the “Highest and Best Use” value.
5. Public Auction: The actual event where the land is sold to the highest bidder.

It typically takes about two years to move through this process. Keep in mind, though, that for larger or more complex parcels, it can take up to ten years.

On the day of the auction, the bidding starts at the full appraised value (sadly, there are no “bargains” at state auctions). If you are the applicant, you must be prepared to be outbid by someone else who didn’t have to pay for the initial studies.

It’s a tough pill to swallow. You pay thousands for appraisals and studies, but if someone outbids you at the auction, you don’t get that money back. That’s why most people prefer the certainty of a private land sale.

Leasing Arizona State Trust Land

Because selling land in Arizona is a slow process, the state earns much of its annual revenue through leases.

These leases allow people to use the land for specific purposes while the state retains ownership. Here’s a rundown of the most common lease types:

Grazing Leases and the “AUM”

The most common lease in Arizona is the Grazing Lease, which covers over 8 million acres of the state.

Under this lease, ranchers pay for the right to graze their livestock on Trust Land, but they don’t pay a flat fee per acre. Instead, the rent is calculated using Animal Unit Months (AUMs).

• What is an Animal Unit (AU)?: One AU is typically defined as one mature cow (1,000 lbs) or its equivalent (like one horse or five sheep).
• Calculating the Rent: The annual rental rate is determined by multiplying the land’s animal unit number by the rental rate per AUM. This figure is set annually by the State Land Commissioner.
• Minimums: Even if the land is not being grazed, the state requires a minimum rental fee of at least five cents per acre per year.

Agricultural and Commercial Leases

For those looking to do more than graze cattle, there are Agricultural Leases for farming.

The Arizona Constitution limits these leases to a maximum of 10 years. Rent is due in advance by February 15th each year, and any late payments carry heavy penalties.

If you want to use the land for a business, a solar farm, or a communication tower, you will apply for a Commercial Lease. These are high-value leases that are also subject to public auction if they are long-term (more than 10 years).

State Trust Land vs. BLM and National Forest

One of the biggest headaches for landowners is figuring out who their “neighbor” is.

Arizona is a patchwork of different types of land, and the rules change the moment you cross an invisible line.

Check out these distinctions between public land, multiple-use land, and private land:

• Bureau of Land Management (BLM): These are truly “public lands.” While they have rules for conservation, they are generally free for hiking and dispersed camping for up to 14 days.
• National Forest Service: Managed by the USDA, these areas focus on “multiple use” (timber, water, and recreation). They rarely require a permit just to hike, though they may have fees for specific developed campsites.
• State Trust Land: As we’ve discussed, this is “private” land managed for a profit. You must have a permit, and you must stay on existing roads.

Here’s how to visualize the differences between Arizona’s private and state lands:

Challenges for Heirs and Landowners

If you’ve inherited a piece of land in Arizona, you might find that it is “landlocked” by State Trust Land. This means there is no public road leading to your property, and you have to cross state land to get there.

This can make selling your land a nightmare.

Traditional buyers often get scared away when they realize they might need to apply for a Right-of-Way (ROW) from the state. This can cost thousands of dollars and take months to approve.

Because of these hurdles, many banks won’t even offer a loan on the property. This leaves you stuck with a piece of land that is hard to visit and even harder to sell on the open market.

Skip the Stress and Talk to Us

If you’re feeling a bit overwhelmed by Arizona’s complex land rules, you don’t have to figure it all out on your own. Selling land, especially when State Trust Land is involved, can be a lot to handle, but it doesn’t have to be a headache.

We like to keep things simple and honest. If you’re looking for a straightforward way to move on from your property, we’d love to chat.

We provide a straightforward, human process that closes fast, usually within 30 to 60 days.