North Dakota Land Swap Bill Allows State-Federal Trades to Consolidate Holdings, Sets Valuation Rules

This bill, the North Dakota Trust Lands Completion Act of 2025, sets up a framework for the State of North Dakota to exchange land parcels with the federal government. The main goal is to help the state consolidate its 'trust lands' – lands granted by Congress primarily to generate revenue for schools – which are currently scattered, sometimes within the boundaries of federally recognized Indian reservations. It defines which federal lands are eligible for exchange and outlines the process for these swaps.

The Big Shuffle: How the Land Swap Works

Under Section 3, North Dakota can identify state-owned land parcels, particularly those inside an Indian reservation, and offer to relinquish them to the federal government. In return, the state can select 'unappropriated Federal land' of supposedly similar value elsewhere in North Dakota. The Secretary of the Interior has 180 days to approve or deny the state's selection. Once approved, the transfer should happen within 60 days.

A key point here involves tribal lands: If the state relinquishes a parcel located within an existing reservation, that land (under Sec 3d) will be held in trust by the federal government for the benefit of that specific Indian Tribe and become part of their reservation. The bill mandates consultation with affected tribes before these transfers happen. While a selection is pending, the chosen federal land is protected from other claims (Sec 3e).

Getting the Value Right (Mostly?)

Section 4 tackles how these land parcels are valued, stating they must be of 'substantially equal value.' Standard federal appraisal methods are the default. However, there's a catch: if both the state and the feds agree, and the land's market value is under $500,000 and less than $500 per acre, they can use quicker methods like 'mass appraisals' or even just 'statements of value.' This raises questions about ensuring fair value in these potentially lower-oversight scenarios. The bill explicitly prohibits artificially splitting parcels to meet this threshold.

If the values aren't perfectly equal, the difference can be paid directly or tracked in a 'ledger account.' These accounts must be balanced within three years and fully closed within five years of the last land transfer under the Act (Sec 4). This ledger system adds flexibility but relies on future actions to ensure the value exchange truly balances out.

Loose Ends: Grazing, Hazards, and Existing Rights

Section 5 covers several important details. Any existing leases or permits generally transfer with the land to the new owner (Sec 5c). For land involved in the swap, hazardous material inspections and certifications are required before the transfer (Sec 5c). The Act also explicitly states it doesn't change tribal treaty rights or land already held in trust (Sec 5b).

For ranchers, there's a specific provision regarding grazing (Sec 5d, 5e): If land currently under a grazing lease or permit gets swapped, the grazing can continue for the current term. However, the new owner (either the state or the federal government) can cancel or modify that grazing permit if the land is later sold, leased, or transferred for non-grazing purposes. This means a rancher's long-term access isn't guaranteed if the land's use changes post-swap. Finally, Section 6 clarifies this Act won't interfere with any land ownership lawsuits already in progress when the law takes effect.