31 Tex. Admin. Code § 13.1 – Leases

(a) Term.
1. (1) Unsold permanent free school and asylum land may be leased by the commissioner of the General Land Office for agricultural, grazing, and commercial purposes under terms and conditions set by the commissioner.
2. (2) Land that is escheated to the state may not be leased for anything other than grazing purposes for a period of over two years. Lessee shall pay rent due under any lease of escheated land in money; credits for improvements will not be granted.
3. (3) Any leased land is subject to trade or sale.
(b) Competitive bids. Competitive bids may be received by the commissioner. Anyone who notified the General Land Office, in writing, of a desire to lease a particular tract of land, will be furnished an application at least 30 days prior to the awarding of the lease. Each applicant will have 30 days from the date the application was forwarded in which to submit his bid.
(c) Application and delivery. Applications for lease must specify and describe the particular lands desired and the purpose for which the lease is intended, and must be submitted with the applicant's offer for the first year's rental and a filing fee. Applications shall be signed by the applicant and made a part of any lease awarded.
(d) Lease fee. The appropriate filing fee will be determined by §1.3 of this title (relating to Fees), except for commercial leases. The General Land Office will charge commercial lease applicants a fee to offset the costs of evaluating the lease proposals. The fee shall be 1.5% of the fair market value of the property being leased, determined at the time the lease is executed. The commissioner may waive all or a part of this fee.
(e) Awards. After study and investigation of the application for suitability of the purpose for the lease, surrounding ownership of the tract, access, water availability, improvements by any prior lessee, and management by any current lessee, the commissioner may award the lease to the highest responsible bidder.
(f) Delivery. The applicant will be notified that his application has been accepted, and a lease will be executed by the commissioner and forwarded to the county clerk of the county in which the land is located for recordation. Upon payment of the recording fee by the applicant, the county clerk will forward the original lease to the lessee.
(g) Expired leases. If a lease expires within 180 days of a sale date, the commissioner may withhold from lease the tracts involved.
(h) Forfeiture and lien. If a lessee fails to pay the annual rental due for any year within 60 days after such rental becomes due, the commissioner will forfeit the lease. The state will have a lien upon all private property owned by the lessee located upon the leased premises to secure all payments due. This lien will be effective during the lease term, and will continue in effect after forfeiture of the lease.
(i) Improvements. The lessee may place or construct improvements on the lease. The lessee may bear the cost of an improvement or may apply to receive a grant or credit for an improvement on permanent free school land under §13.3 of this title (relating to Grants and Credits).
1. (1) Existing improvements and improvements made pursuant to a grant or credit are the property of the state and cannot be removed by the lessee at any time without the commissioner's written permission.
2. (2) Improvements, for which no grant or credit is extended, made by the lessee during the lease term are the property of the lessee. The lessee may remove the improvements or the lessee's personal property within a reasonable time after expiration of the lease, provided the lessee gives prior written notice to the commissioner and owes the state no rent or other sums or obligations. The commissioner may retain the improvements or any personal property on the land as an offset against such debts. If they are retained as an offset or not removed in a reasonable time, they become the property of the state. If the commissioner determines that any improvements cannot be removed without harming the land, they may not be removed until satisfactory provisions are made for mitigation or compensation for the damage caused by removal.
3. (3) Commercial improvements on land leased under subsection (a)(1) of this section shall not become the property of the state and shall be taxed in the same manner as other private property. All such improvements should be removed prior to the expiration of the lease term or any extensions or renewal periods. If the commercial improvements are not removed prior to the expiration and there has been no renewal or extension of the lease, then they shall become the property of the state.
(j) Soil and water conservation plans. In the interest of sound land management practices, lessee will be required to implement a soil and water conservation plan. The plan is to be developed between lessor, lessee, and may include the USDA Soil Conservation Service and/or Soil and Water Conservation Districts. Lessee shall comply with the following procedures adopted by the General Land Office for submission and approval of the plan.
1. (1) After entering into a surface lease with the General Land Office, lessee will prepare a soil and water conservation plan to meet the needs of the leased tract. The plan shall cover a five-year period. Lessee may contact the Soil Conservation Service, the Association of Soil and Water Conservation Districts of Texas, or the Texas State Soil and Water Conservation Board for assistance. Failure to timely submit the soil and water conservation plan as outlined below will subject the lease to forfeiture.
2. (2) The preliminary plan should be submitted to the appropriate field office of the General Land Office, which shall then forward the plan to the General Land Office in Austin. The preliminary plan shall be submitted for approval within a reasonable amount of time, and in any event, no later than six months from the time lessee entered into the lease agreement. Submission of the plan to the appropriate field office shall constitute filing for the purposes of this paragraph.
3. (3) The General Land Office shall notify lessee in writing at the earliest possible time of approval or rejection.
4. (4) Only after receiving notice of approval shall lessee present the plan to the local soil and water conservation district. Lessee will work in conjunction with the local district to carry out the provisions of the plan.
5. (5) If the plan or any part thereof is not approved, lessee will be notified by letter stating the specific reasons. Lessee will be required to follow the same procedure and resubmit a modified plan to the appropriate field office. The modified plan shall be submitted within a reasonable period of time from notice of rejection, and in no event later than four weeks from the date of the notice. Once approval has been granted, lessee shall proceed as directed in paragraph (4) of this subsection.
6. (6) Once a plan has been approved, lessee will be required to comply with the timetables and schedules set out in the plan document. Failure to do so at any time during the lease term will subject the lease to forfeiture.
(k) Uses. Lessee shall use the leased premises for purposes stated in the lease only. Any other use of the leased premises is unauthorized and shall subject the lease to forfeiture at the discretion of the commissioner.
(l) Fine for unlawful use. If a person without authority or right cuts or removes any mineral, guayule, or lechuguilla from land that belongs to the permanent school fund, a fine will be imposed against the person by the general office in an amount that is equal to the value of the substance that was cut or removed and will subject the lease to forfeiture at the option of the lessor.
(m) Bid rejection. Any bid or offer may be rejected by the commissioner for good and sufficient cause before the lease is signed.
(n) Late payments. If the lessee does not deliver or mail to the land office any rental payment within 15 days after it is due, a penalty of 10% of the payment shall be assessed and added to the amount due.
(o) Refunds. Refunds may be issued in cases of mistake, overcharge, or for other good cause. If a lessee abandons or surrenders a lease, a refund will not be issued unless the commissioner agrees to rescind the lease.

Source Note:The provisions of this §13.1 adopted to be effective January 1, 1976; amended to be effective September 14, 1983, 8 TexReg 3416; amended to be effective September 16, 1986, 11 TexReg 3862; amended to be effective December 10, 1987, 12 TexReg 4474; amended to be effective May 26, 1992, 17 TexReg 3473.