Subd. 1. Commissioner of natural resources may lease lands.

The commissioner of natural resources may lease as herein provided any state lands under jurisdiction and control of the commissioner for the purposes of cultivating and harvesting stagnant swamp trees for Christmas trees or other decorative purposes, except lands included in a state park and except lands within the area defined by the Act of Congress approved July 10, 1930, United States Code Annotated, title 16, section 577. Such leases shall be offered at public sale upon like proceedings as provided by law for the sale of state timber. The appraisers in such proceedings shall determine and report the annual rental value of the land and the location, estimated quantity and stumpage value of the stagnant swamp trees and other merchantable timber thereon.

Subd. 2. Bids.

No bid shall be accepted which is for less than the appraised price, and any bidding over and above the appraised price shall be by percentage, a percent bid to be added to the appraised rental value of the land and stumpage value of the stagnant swamp trees in the same proportion, provided that if no bids are received on a parcel when offered, it may be leased at not less than the appraised value at any time within one year thereafter, without reoffering it for public sale.

Subd. 3. Restrictions in leases.

Such leases shall be subject to the following restrictions:

1. (a) The commissioner, by written order, shall determine that the lands to be leased are not suitable for agricultural or forestry use other than the growing of stagnant swamp trees of no commercial value for other than decorative purposes, and that they are lands which, under the general policy of the natural resources department, would not be offered for sale; that in the opinion of the commissioner, the use of such lands for the cultivation and harvesting of stagnant swamp trees is in the public interest and will best advance the conservation of the resources of the state.
2. (b) All such leases shall be subject to sale and leasing of the land for mineral purposes under legal provisions and shall also be subject to cancellation by the commissioner of natural resources for mining or exploration purposes, upon three months written notice, and shall be subject to cancellation by the commissioner for violation of any conditions of the lease after giving the lessee written notice of alleged violations and at least three months to rectify same.
3. (c) No such lease shall be made for a term to exceed 15 years.
4. (d) No individual, corporation or partnership shall hold at any one time any lease or leases covering a total of more than 10,000 acres, and no lease shall cover a total of more than 5,000 acres. The lease shall specify the annual rental to be paid for the lands, and a stumpage value to be paid for stagnant swamp trees harvested therefrom.
5. (e) Such lease shall provide that before it becomes effective for any purpose, the lessee within 90 days from the date of purchase, shall give a good and valid bond to the state of Minnesota at double the sale value of all stumpage of stagnant swamp trees covered or to be covered by the lease.
6. (f) Such lease shall confer no rights to cut commercial timber other than the stagnant swamp trees.
7. (g) Such lease may prescribe such other terms and conditions as to the use and improvement of such lands, the manner of harvesting such trees, and other pertinent matter, as the commissioner deems in the public interest.
8. (h) Such lease shall be assignable only with the written approval of the commissioner of natural resources endorsed thereon.

Subd. 4. Form of lease; allocation of money received under lease.

The form of the lease shall be approved by the attorney general.

All money received under any such lease shall be credited to the fund to which the land belongs.

Subd. 5. Land rental in lieu of general property taxes on leased lands; distribution of rentals.

State lands, leased pursuant to subdivisions 1 to 4, for the purposes of cultivating and harvesting stagnant swamp trees for Christmas trees or other decorative purposes shall not be subject to general property taxation during the term of such lease, and section 273.19, shall not be applicable thereto, provided, however, that an amount equal to the annual land rental shall be paid in lieu of the general property tax to the county treasurer of the county in which the lands are located at the same time that such rentals are payable to the state, and shall be distributed to the taxing districts in which located in proportion to the local tax rates of such districts.