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Supreme Court will hear arguments on lakefront cottages in June

Supreme Court will hear arguments on lakefront cottages in June

Idaho Freedom Foundation staff
April 26, 2010
Idaho Freedom Foundation staff
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April 26, 2010

The Idaho Supreme Court will hear oral arguments from Attorney General Lawrence Wasden and lawyers for the Idaho Land Board on June 9 to settle the dispute over how much to charge leaseholders on state-owned property on Priest Lake and Payette Lake.  Money from the leases supports public schools, universities, hospitals, and other state programs.

The Land Board approved raising lease rates in March, but the Wasden, one of five statewide elected officials on the board, filed a lawsuit to block those increases because he said they are unconstitutionally low.  The Idaho Constitution requires the Land Board to get the maximum long-term value for beneficiaries like schools and hospitals.  Legal paperwork from the Land Board tried to throw out Wasden’s lawsuit, saying the Land Board had discretion to set rates that board members feel are appropriate.

Secretary of State Ben Ysursa said the board-approved increase would bring in several million dollars a year for beneficiaries.  The Land Board approved raising lease rates on Payette Lake and Priest Lake from their current rate of less than 2.5 percent of current land value to 4 percent of a 10-year average of land value, phased in over five years.  Leaseholders could also pay the state a higher premium rent, which is a fee they pay when they sell their lease to another buyer.  The attorney general has favored an increase to 6 percent of land value with no 10-year average, which he said would keep lease prices down.

Both Wasden and attorneys for the Land Board will get 30 minutes to argue before the Idaho Supreme Court on June 9.  Idaho Department of Lands (IDL) Director George Bacon, whose office hired lawyers to prepare the Land Board’s response to Wasden’s lawsuit, said he hasn’t been in a situation like this before.  “I’m not exactly sure what the oral testimony may be about,” Bacon told IdahoReporter.com.  “It may be about our request to dismiss (Wasden’s lawsuit.)”  Wasden's press secretary, Bob Cooper, said the attorney general's office hasn't received paperwork from the Supreme Court about the June hearing and can't comment on the matter.

Leaseholders on the two lakes are contemplating their own lawsuit against the Land Board to prevent any increase in lease rates.  The pending legal action could encourage people holding the leases to leave their property.  Current leaseholders whose leases expire at the end of the year must tell the IDL by the end of April if they want to extend their leases.  IDL will inform lessees by the end of June if their lease rates will go up based on the decision by the Land Board and the Supreme Court, as well as new property value assessments.  “Hopefully there will be time to adopt any of the changes and get everybody informed,” Bacon said.

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