Meridian Star

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January 21, 2013

Analysis: Hosemann defends school lands oversight

JACKSON —  Mississippi Secretary of State Delbert Hosemann is trying to head off another expected legislative movement that could undo 35 years of improvements in 16th Section land management for public schools.

The problem may be that too few remember the 16th Section Reform Act of 1978, which ended sweetheart leases that rewarded politically connected folks and shortchanged schools. Before then, 16th Section lands were often leased for pennies an acre.

The secretary of state's office, under current state laws, is responsible for helping manage 16th Section lands. Some school boards don't like the secretary of state looking over their shoulders.

However, figures don't lie.

"Since I took office, we have increased total 16th Section land revenue by over $17 million per year in a down economy — up from $54 million in 2007 to $71 million in 2011. Sixteenth Section land is a $91 million business, and it needs to be run like a business," Hosemann said at Mississippi Economic Council's Capital Day.

He told business people, politicians and others that some people don't want the 16th Section land system run like a business.

"There are just a few who want to run these lands like their own candy store," Hosemann said. "Make no mistake: If we go back sweetheart deals with no oversight, someone is going to have to pay for the additional cost of education, and that someone is you."

In 60 of Mississippi's 82 counties, the 16th Section of each 36-square-mile township belongs to the public schools, and people or businesses pay rent to use the land. The trust program was established in the 19th century.

In 22 northern counties in the Chickasaw Cession, schools get state funds equal to what's derived from 16th Section land, minus oil and gas revenue.

The movement to get a fair return on leases began in the 1970s with the late Land Commissioner John Ed Ainsworth and followed with the efforts of secretaries of state Dick Molpus, Eric Clark and now Hosemann.

Some credit goes to former Smith County schools superintendent Joe Tally, who fought for 16th Section reform in the 1970s. He and school board attorney Larry Clark sued the county supervisors. They also took their case to the Legislature, where, after a contentious hearing, Clark was punched by an irate opponent.

Ultimately, the case went to the Mississippi Supreme Court. Justices agreed leases of school lands should generate no less than leases on identical private lands.

The Supreme Court also ruled if the county officials who were the trustees of school lands leased them for too little, those officials were personally liable to pay the difference.

Reforms were adopted in 1978 with the late Lt. Gov. Evelyn Gandy casting a tie-breaking vote in the Senate.

Jurisdiction of the public school lands was given to local school boards with general supervision to the secretary of state.

Leaseholders for 16th Section land may own buildings or houses but not the land they're on. They can lease the property and must pay property taxes. In some school districts, oil and natural gas are mined from the land with companies paying royalties. It's also done for timber harvesting.

Hosemann said he was once approving an annual average of about 3,000 16th Section land leases and rejecting about 12 percent because districts weren't getting fair market value. He said rejection is now down to about 3 percent "because people got the message."

A Senate committee in 2011 killed a House-passed bill that would've allowed local school districts to lease 16th Section land without consent of the secretary of state's office. Hosemann's office would've still had oversight authority and could've intervened if it discovered problems in leases.


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