SB49 Facilitates Competitive Bidding in Cabin Site Sales
Helena, Mont.- On Monday, Senate Bill 49, sponsored by Commissioner Troy Downing and carried by Senator Mike Cuffe was signed into law by Governor Greg Gianforte. This bill revises the sale of cabin sites on state trust lands to facilitate competitive bidding.
“As a member of the Board of Land Commissioners, I am committed to fulfilling my constitutional duty of maximizing the income we generate to fund public education.” Commissioner Downing said, “This bipartisan bill solves a problem in statute that has prevented market forces in the bidding process for these valuable state assets.”
In 2013, the Legislature passed a law allowing cabin site lessees to nominate their property for sale. However, under that law, a lessee could cancel the sale even if a competitive bidder filed and paid their bid bond.
Commissioner Downing testifies in support of Senate Bill 49
“Senate Bill 49 removes a barrier to market forces in the bidding process,” said Commissioner Downing. “Third-party bidders had little motivation to go through the process of depositing a competitive bid bond because the lessee could cancel the sale. Our bill solves this problem by simply saying, ‘if there’s a competitive bidder, the lessee cannot cancel the sale.’”
Only a small percentage of cabin sites have seen competitive bidding. Most sell to the current tenant at the minimum bid. With competitive bidding, the price can rise significantly, and we can see true value discovery. Proceeds from any sale go into the state land banking program and must be used to purchase replacement property for the state school trust.
Senate Bill 49 takes effect immediately.
Troy Downing is the Commissioner of Securities and Insurance, Montana State Auditor. Commissioner Downing is a two-tour combat veteran, businessman, and entrepreneur.
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