Leases, Auctions and Conflict Bids on Idaho Endowment Land

An Idaho endowment parcel earns money for schools in only a handful of ways. Someone cuts its timber, grazes cattle on it, farms it, builds a cabin on it, puts a tower on it, digs gravel from it, or pays to drill under it. Every one of those uses begins with a contract, and nearly every contract begins with a price set by one of three methods: a formula, an appraisal or an auction. A reader who knows which method applies can tell in a minute whether a news story about a lease is about a routine renewal or a real contest.

This lesson follows the money from the application to the signature. It uses the statutes and rules that govern the process, the figures IDL has published for 2026, and a few invented parcels to show the arithmetic. The Land Board itself, and the votes it takes, is the subject of lesson 3, and the trust duty behind all of it is in lesson 2.

The lease menu

IDL's leasing pages list seven families of use: commercial, residential, grazing and farming and conservation, minerals, oil and gas, geothermal, and energy (solar and wind). Each page states that the Land Board and IDL may lease about 2.5 million acres of endowment land for that purpose, which is the same land counted several times, not 2.5 million acres per use. IDL's FY2025 annual report counts 2,503,572 acres of endowment land: 1,046,696 timberland, 1,433,486 rangeland, 19,702 farmland, 3,493 commercial and 195 residential.

Use	Authority and rules	How the price is set	How a contest is settled
Grazing, farming, conservation	Idaho Code 58-304, 58-307, 58-310; IDAPA 20.03.14	Land Board rent formula for grazing; Board-set methodology for the rest (rule 040.01)	Conflict auction when uses are incompatible (rule 105)
Cottage sites (Payette Lakes and Priest Lake)	Idaho Code 58-307; the 2025 Residential Cottage Site Leasing Plan	Appraised land value; IDL's published 2025 rents run roughly 4 to 5 percent of value	Auction cycles in 2029, 2034 and 2039 under the plan
Commercial, industrial, communication sites, non-commercial recreation	Idaho Code 58-307(5) and (12)	Fair market rental for the whole term, tested by auction or proposals	Auction or request for proposals; a lessee's preference right to renew only if the lease specifies it
Metallic and salable minerals	Idaho Code Title 47; IDL mineral leases	Rentals, bonuses and royalties in the lease	Quarterly auctions; canceled if only one party registers
Oil and gas	IDAPA 20.03.16	Bonus bid at auction plus rental and royalty in the lease	Tentative quarterly auction cycles
Timber (a sale, not a lease)	IDAPA 20.02.14	Net appraised stumpage value as the minimum; competitive bid above it	Public auction; unsold sales are reappraised and offered again

Sources: IDL leasing pages; IDAPA 20.03.14 and 20.02.14; Idaho Code 58-307. IDL's oil and gas and mineral pages do not state royalty rates or lease terms, so the table does not either. Read the lease template for those.

How long a lease can run

Idaho Code 58-307 sets maximum terms. As IDL's published text gives them: state trust land leases generally may not run longer than 20 years (subsection 1). Leases to government bodies for public purposes may run up to 25 years, residential leases on endowment trust land up to 35 years, grazing leases up to 40 years, and commercial leases on endowment trust land up to 49 years (subsections 2 through 5). A commercial lease over 20 years requires consulting the county commissioners and a hearing in the county where the land lies; grazing leases are excluded from that hearing requirement. Except for oil and gas, mineral and commercial leases, the lease year runs January 1 through December 31.

The ceiling is not the term IDL offers. IDAPA 20.03.14 says it covers leases of up to 20 years, and states that the Department may issue a lease for any period up to the maximum allowed by law. IDL's commercial leasing page lists terms from 5 to 20 years or more, mostly 10 years, with some at 19.5 years (just under the 20-year line that triggers the county hearing). The actual term of a grazing lease is in the lease and the auction notice, so check it there.

The application calendar

Idaho Code 58-307 sets April 30 as the deadline to file to lease or renew a lease that expires on December 31 of the following year. Under IDAPA 20.03.14, section 020, IDL mails application forms to holders of expiring leases at least 30 days before the Department's deadline. An application needs the Department's form, a signature, a non-refundable fee set by the Board and a proposed management plan. Unleased endowment land may be applied for at any time or at a time the Department designates. Applications that conflict are treated as filed at the same moment, so the date of filing does not give one applicant priority over another.

Who may apply, and who may bid

Under rule 020.01, any person legally competent to contract may apply to lease endowment land, as long as the person is not in default on any contract with the Department. Idaho Code 58-310 limits an auction to those who filed applications in the manner and at the time the statute or rules require. A person who did not apply cannot appear at the auction and bid. A business must be registered to do business in Idaho; the timber rule says explicitly that a foreign corporation needs an accepted foreign registration with the Secretary of State.

The Land Board's grazing policy adds one layer: the Department decides whether a lessee is a qualified bidder under the Idaho Code, including in sublease situations. The policy also says an applicant must submit a management plan before an auction or the application will not be reviewed, and when several people apply for the same lease, the plans are sent to all applicants.

How grazing rent is set: the formula and the AUM

An AUM is the forage a cow needs for a month. IDAPA 20.03.14, section 010.02, defines it that way and gives the conversions that matter at the counter:

Animal	AUMs charged per month
Cow (with a calf under six months)	1.0
Bull	1.0 per month, as the rule defines it
Yearling	0.7
Five sheep, or five ewes with lambs	1.0 together
Horse	1.5

Source: IDAPA 20.03.14, section 010.02. A trespass claim under section 090.05 is assessed at triple the current State AUM rate.

The Land Board adopted its current grazing fee formula in 1993. Its policy memo describes the method as a predicted Idaho Forage Value Index for the fee year, divided by 100 and multiplied by a base figure. The index prediction uses a western forage value index, a beef cattle price index and a prices-paid index. A sheep AUM gets a 25 percent rental reduction if fat lamb prices fall 30 percent or more below the price of 500-pound calves. The memo itself notes two base figures, so the exact base is a question for IDL if a story depends on it. IDL's April 28, 2026 letter says the formula uses annual data on forage values, price inputs and beef cattle prices from USDA's National Agricultural Statistics Service, and that IDL is not considering any formula change unless the Land Board directs it.

Year	State grazing rate per AUM	Source
1994	$4.31 cattle, $3.23 sheep	Land Board policy memo
2026	$8.98	IDL letter, April 28, 2026
2027	$10.80	IDL letter, April 28, 2026

The rate rule has a notice requirement. Idaho Code 58-304(2) requires the Board to notify the lessee of a rent increase six months before the rent is due, and IDAPA 20.03.14, section 041, requires written notice at least 180 days before the due date. IDL's 2027 letter says grazing lessees will get a six-month notice of the 2027 rate before the end of October 2026.

Conflict auctions: how they work

The word conflict is the statute's own. Idaho Code 58-310(1) says that when two or more persons apply to lease the same land, the Director or an agent auctions the lease at a set time and place, and the lease goes to the applicant offering the highest premium bid. The Board sets the annual rental. The auction is therefore a contest over the premium, with rent set by the Board. IDAPA 20.03.14 adds the details for grazing, farming and conservation leases.

Step	What happens	Where it is written
1. Applications	Two or more eligible applicants file for the same endowment land, each with a management plan	Rule 020; 58-307(10) treats conflicting applications as simultaneous
2. Compatibility finding	The Department decides whether the proposed uses are compatible. If they are not, it holds an auction	Rule 105.01
3. Notice	The Director mails notice to each applicant at least 14 days before the auction, to the name and address the applicant gave	58-310(2)
4. Auction	Bidding starts at $250 or the cost of preparing any required Improvement Credit Valuation, whichever is greater. Bidders appear in person or by a proxy authorized in writing beforehand	Rule 105.02 and 105.03; 58-310(3) lets IDL proceed if applicants do not appear
5. Payment	The high bidder pays the high bid when the auction ends	Rule 105.05
6. Withdrawal	If a high bidder withdraws, the Department keeps the payment. With two participants the second-highest bidder gets the lease; with more, the lease is reauctioned	Rule 105.07; 58-310(5)
7. Land Board review	The Board reviews the proposed leases and the auction results and makes the determination required by Idaho Code 58-310, consistent with Article IX, section 8	Rule 106; 58-310(4) lets the Board reject any or all bids for fraud, collusion or another sufficient reason
8. Appeal	A decision of the Director may be appealed to the Board by written notice filed with the Director within 20 days of receiving notice of the Board decision being appealed or of the date the conflict auction is held	Rule 002.01

What the courts settled

The auction rules read the way they do because of two Idaho Supreme Court decisions. The 2011 Statement of Purpose for S1145, which proposed to repeal the statutes the 1999 decision had undercut, describes that decision and the 2009 Attorney General opinion. The 2012 decision came later and is summarized here from the opinion itself.

Case and date	What it settled	What changed in practice
Idaho Watersheds Project v. State Board of Land Commissioners, 133 Idaho 64, 982 P.2d 367 (1999)	According to the S1145 Statement of Purpose, the Court struck down Idaho Code 58-310B, holding that considering indirect tax and economic benefits to the state conflicted with the constitutional requirement of maximum long term financial return to the schools	The Land Board's grazing policy says affected leases were invalidated and holders were given temporary permits for the 1999 season, after which new applications were accepted and conflicts went to auction
2009 Attorney General opinion	Concluded that the auction requirement applies to all endowment leases and that a court would likely find the cottage site exemption in 58-310A violated the trustee's duty of undivided loyalty, because the auction requirement was removed mainly to benefit lessees (per the S1145 Statement of Purpose)	An opinion, not a court ruling, but it set up the lawsuit
Wasden v. State Board of Land Commissioners, 153 Idaho 190, 280 P.3d 693 (2012), No. 39084 (filed June 29, 2012)	The Attorney General had standing. Article IX, section 8 uses disposal to include leases as well as sales, so it requires public auctions for endowment land leases. Idaho Code 58-310A, which exempted cottage site leases from conflict auctions, is unconstitutional and could not be severed	Cottage site leases are subject to conflict auctions. The opinion also noted that the Board had set 4 percent of fee-simple value as market rent, without ruling on whether that rate is right

Citations: the 1999 decision that struck down Idaho Code 58-310B is Idaho Watersheds Project v. State Board of Land Commissioners, 133 Idaho 64, 982 P.2d 367 (1999), the cite the S1145 Statement of Purpose itself gives. Two sibling decisions carry the same case name and year, so a reporter should not mix them up: 133 Idaho 55, 982 P.2d 358 (1999) struck down a 1998 constitutional amendment that would have changed "disposal" to "sale" in Article IX, section 8 (it failed the separate-submission rule of Article XX), and 133 Idaho 68, 982 P.2d 371 (1999) reversed Land Board decisions rejecting the group's applications for state grazing leases. The 2012 decision is Wasden v. State Board of Land Commissioners, 153 Idaho 190, 280 P.3d 693 (2012). An earlier decision, 128 Idaho 761, 918 P.2d 1206 (1996), held the Board may not lease to an applicant who does not bid at a required auction.

Cottage sites

IDL's residential leasing page lists 30 cottage site leases: 13 in the Payette Lakes area (Valley County, near McCall) and 17 in the Priest Lake area (Bonner County). Of the Payette Lakes leases, 8 are five-year leases expiring in 2029, 1 is a ten-year lease expiring 2034 and 4 are fifteen-year leases expiring 2039. Two are lakefront. All 17 Priest Lake leases are lakefront; 12 are five-year, 2 are ten-year and 3 are fifteen-year leases. The Land Board approved the 2025 Residential Cottage Site Leasing Plan on December 20, 2022, and it began January 1, 2025. Under the plan the listed sites go into the Real Estate Bureau's cottage site sales auction cycles for 2029, 2034 and 2039. One Payette Lake site, Shellworth Island (R500386), is marked not eligible for the auction process.

The page lists each lease's appraised land value and 2025 rent without stating a formula. In IDL's table, rents run roughly 4 to 5 percent of appraised value, which is consistent with the 4 percent figure the Supreme Court noticed in Wasden.

Commercial leases and communication sites

Commercial leasing covers communication sites (cell towers, radio, billboards), ground leases, industrial facilities, commercial and non-commercial recreation, and military, office and retail uses. Idaho Code 58-307(12) tells the Board to obtain a reasonable rental based on fair market value for the entire lease duration, and lets it reject any or all bids or proposals and reoffer the lease if they do not reach the highest and best use at market rental. Under subsection (5), a commercial lease longer than 20 years needs consultation with the county commissioners and a hearing. IDL's page shows how that looks: a notice of a public hearing on a proposed Ada County industrial and commercial lease with a term exceeding 20 years, with oral or written comment accepted and a written-comment deadline of September 14, 2026.

On renewals, Idaho Code 58-307(9) allows the Board to reject conflicting applications for a commercial lease if the lessee exercises a preference right to renew, but only if the lease specifies that right. A lessee without that clause in the lease has no commercial preference right. Mineral leases under Title 47 carry their own preferential right to renew and are handled differently in a conflict (58-307(10)).

IDL's commercial leasing page, as viewed this session, listed an Adams County communication site with a 19.5-year term and applications due April 9, 2026, and a Valley County non-commercial recreation site with a 19.5-year term and applications due April 10, 2026. It also listed a request for proposals for about five acres in the Selkirk Mountains with an existing backcountry cabin, with proposals that were due October 12, 2026. These are examples of how IDL posts openings. Check the page for what is current.

Timber: a sale, not a lease

Timber is the biggest earner on endowment land. IDL's FY2025 report shows timber at $84,663,213 of the $91,772,231 endowment revenue deposited in the earnings reserve, with rangeland second at $3,329,953. Timber is not leased. It is sold under IDAPA 20.02.14, which says that timber and delivered products sales must be sold at public auction (section 031.01).

• Who may bid: Bidders must not be delinquent on payments to the State, must not be minors, and, if a foreign corporation, must hold an accepted foreign registration with the Secretary of State (031.02).
• Deposit: 10 percent of the net appraised value (031.02.a).
• Performance bond: the greater of an amount sufficient to ensure compliance or 15 percent of net sale value, executed within 30 days of the sale and before the contract is signed (032.02).
• Appraisal: net appraised value is the minimum estimated sale value after subtracting the development credit (010.07).
• Direct sales: without advertisement, if the Director authorizes and the net appraised value is within the Board's maximum. They last six months and carry a 30 percent bond with a $100 minimum.
• Annual plan: IDL's FY2025 plan listed 74 sales across ten supervisory areas, totaling 334,362 MBF of sawlog on 25,378 acres, advertised four weeks in a newspaper in the county where each sale lies. The plan says the goal is maximum stumpage returns to the endowment funds consistent with prudent long-term management.

Reading a timber auction result

The Land Board's September 15, 2026 packet reports the August 2026 auctions. The arithmetic is simple, and it shows what a reporter should check.

August 2026 auction	Sales	Volume (MBF)	Appraised value	Net sale value	Net per MBF
Endowment (4 of the 10 drew competitive bidding)	10	10,860	$1,685,979.81	$1,846,178.66	$170.00
Good Neighbor Authority sale (non-endowment)	1	9,205	$1,373,202.42	$2,533,151.30	$275.19

• Endowment premium over appraisal: 1,846,178.66 divided by 1,685,979.81 is 1.095, so about 9.5 percent over. The packet says about 10 percent.
• Net per MBF: 1,846,178.66 divided by 10,860 is $170.00.
• Appraised per MBF: 1,685,979.81 divided by 10,860 is about $155.25.
• Good Neighbor sale: 2,533,151.30 divided by 1,373,202.42 is 1.845, about 85 percent over appraisal, as the packet says.
• Five other endowment sales did not sell in August: West Rock, Odonnell Darn Salvage, Smashpaddy Salvage, Bald Larch and Egale Salvage, totaling 18,035 MBF and $1,867,668.62 in appraised value. The packet gives reasons such as difficult logging and road building, or small salvage volume, and lists reoffer dates in September and October 2026. West Rock and Bald Larch were to be reappraised.

Measures matter here. One MBF is 1,000 board feet, and one acre of ground may yield several MBF or very little. A story that confuses acres harvested with board feet sold, or MBF with MMBF (millions of board feet), is off by orders of magnitude. The FY2025 plan's 334,362 MBF is about 334 million board feet.

Minerals, oil and gas, geothermal and energy

IDL says it administers mineral leasing on more than 3.4 million acres of endowment trust land mineral estate, plus mineral estates under navigable waterbeds. The page's own metadata says approximately three million acres, so treat the figure as approximate. Anyone who wants to mine on state-owned mineral estates must first obtain a lease from IDL. The page lists salable minerals (sand, gravel, basalt, limestone), metallic minerals (gold, silver, copper) and non-metallic minerals (phosphate, gemstones). It posts lease auctions on a map. Registration has a deadline, and an auction is canceled if only one party registers.

Oil and gas leasing is governed by IDAPA 20.03.16, and IDL's page posts quarterly tentative auction cycles with a nomination deadline, a registration deadline and an auction date. In October 2026 the page listed a tentative October 22, 2026 auction (registration closed October 15), though the same page also said no auctions were currently scheduled. Nominations for the January 21, 2027 auction closed October 8, 2026. Check the page for results and the next cycle. FY2025 revenue shows how small this is in Idaho: oil and gas rentals and bonuses brought $2,519 to the earnings reserve and $77,596 in oil and gas receipts to the permanent fund, against $2,690,139 from minerals to the permanent fund. The report keeps the earnings reserve and the permanent fund as separate accounts, which is why the figures sit apart.

Public access across leased endowment land

A lease is not a gate. IDL Policy 2205, revised by Director Dustin Miller on November 10, 2025 under the Land Board's August 21, 2018 recreation policy, says public recreation is allowed on endowment lands, including hunting, fishing, hiking, camping, boating, biking and snow sports. Recreation must not conflict with the primary revenue-generating use. Firewood cutting, mineral collection and disturbing artifacts need separate authorization. A person may not recreate on endowment lands in a manner closed to such use.

Rule in Policy 2205	What it says
Dispersed camping	14 days within any 28 consecutive days; to continue, move camp and belongings outside a five-mile radius
Distance from water	At least 30 feet from any body of water or wetland
Designated campgrounds	A recommended maximum of eight people and two vehicles per site, unless posted otherwise
Target shooting	Only in areas with an adequate backstop
Closures and restrictions	Provided in writing to the affected surface lessee; Idaho Code 58-156 covers closing, restricting or prohibiting use of endowment land
Organized or commercial recreation	Handled through leases, land use permits or other contracts
Liability	The policy cites Idaho Code 36-1604, the limitation of landowner liability

Two sides in the access discussion have a case, and both are in the record. Lessees, and especially ranchers, point to damage to fences, gates and water systems and to the lease's revenue purpose, which is why recreation yields to the primary use. Recreation groups point to the policy and to the Land Board's history of keeping the land open as part of the bargain with hunters, anglers and local communities. Where land is closed, Policy 2205 says that must be in writing to the lessee, so the question for a reader is whether a closure was formally done, not whether a rancher would prefer it.

Recent changes to watch

• The 2027 grazing rate. $10.80 is a 20.3 percent increase from 2026. The formula has not changed, so the increase comes from the data inputs.
• Timber volume and price. The September 2026 packet reports FY2026 volume sold of 315,706 MBF against a sales plan of 333,000, and an August 2026 six-month average stumpage price of $258.79 per MBF against $292.43 a year earlier. Prices fell 11.5 percent between the two figures (258.79 divided by 292.43 is 0.885).
• Cottage sites. The 2025 plan puts the sites in auction cycles from 2029.
• Constitutional proposals. The 2026 Legislature considered resolutions on how the Land Board weighs financial return against public access. HJR 8 was introduced February 4, 2026 and the Legislature's page shows no action after referral to State Affairs. See lesson 2 for the text and status, and lesson 9 for the politics.

Questions and answers

Who decides who gets a grazing lease when two people want it?

If the uses are compatible, IDL may be able to serve both. If they are not, IDL holds a conflict auction and the lease goes to the applicant offering the highest premium bid, after Land Board review (Idaho Code 58-310; IDAPA 20.03.14, sections 105 and 106).

How is the annual rent decided if bidders bid a premium?

The statute says the Board sets the annual rental and the auction is for the premium. For grazing, the rent follows the Board's formula, which gives $10.80 per AUM for 2027.

What does 180 days of notice mean for a rent increase?

Rule 041 lets the Department raise rent but requires written notice at least 180 days before the due date. Idaho Code 58-304(2) says six months.

Can I recreate on endowment land that is leased?

Yes, unless it is closed to the use you have in mind. Policy 2205 allows hunting, fishing, hiking, camping and other uses that do not conflict with the primary revenue use, and requires closures to be given to the lessee in writing.

What happens to a timber sale nobody bids on?

IDL can reappraise and reoffer it. The September 2026 packet lists five unsold August sales with reoffer dates, and says West Rock and Bald Larch would be reappraised.

Do cottage site lessees have to compete at auction?

Since Wasden (2012), the Constitution as the Court read it requires public auction for endowment leases, and the 2025 leasing plan places the sites in auction cycles in 2029, 2034 and 2039. Shellworth Island is marked not eligible for the auction process on IDL's page.

Can anyone show up and bid at a conflict auction?

No. Only people who filed applications as the statute and rules require may bid (58-310(6)). Bidders attend in person or by a written proxy authorized before the auction (rule 105.03).

Where do I find open leases and upcoming auctions?

IDL's leasing pages and its interactive leasing application list endowment land available for lease and auction notices. Mineral and oil and gas pages post quarterly cycles and offer email alerts.

Hard questions

"Should the highest bid always win a grazing lease?"

The Supreme Court's 1999 decision, as the S1145 Statement of Purpose summarizes it, held that the Board could not weigh indirect tax and economic benefits against the constitutional requirement of maximum long term financial return. People who favor the auction point to that duty to the schools and to the 2012 holding that disposal includes leases. People who worry about the effect on family ranches argue that stable local operators support counties and communities, and the 2011 sponsors of S1145 argued that continued litigation created uncertainty for lessees and could reduce endowment income. The Board still reviews results and can reject bids, so the decision is not purely mechanical.

"Is the grazing formula fair to ranchers or to the schools?"

The formula ties rent to forage values, beef prices and price indexes, so rent rises and falls with the cattle market. Supporters say that is why it has lasted since 1993. The 2027 rate is 20.3 percent above 2026, which is a real cost to lessees. The schools' side of the argument is that the Constitution asks for maximum long term return, and a formula set decades ago may not reflect what the land would earn at auction. The record in this lesson cannot settle whether the formula yields more or less than market rent; the Court in Wasden noted the 4 percent market-rent figure for cottage sites without ruling on it.

"Should the public be able to camp and hunt on land that earns money for schools?"

Policy 2205 allows it where it does not conflict with the primary use, citing Article IX, section 8. Recreation groups argue that access is part of what Idahoans expect from state land. Lessees and timber buyers argue that recreation can add costs. HJR 8 in 2026 would remove the maximum long term financial return wording and put ongoing revenue generation first and access for recreation, hunting, fishing and trapping after it, as its Statement of Purpose describes; the Legislature's page shows no action after its referral to committee. The policy as written favors revenue first and recreation where compatible.

"Why does the Board need to review an auction result?"

Rule 106 ties the review to the Board's obligation under Article IX, section 8, and 58-310(4) lets it reject all bids if fraud or collusion appears. The review is the check that a high bid was an honest one and that the lease serves the trust. The cost is time and uncertainty for the winner, who has already paid the high bid at the close of the auction (rule 105.05).