The future of about 80 acres off Fox Farm Road is uncertain as the Montana Department of Natural Resources works to meet the statutory mandate for the land to generate revenue for the state’s school trust fund.

A group of locals has been working to conserve the property as open space and briefed City Commissioners on their efforts during the Jan. 7 commission work session.

There are two parcels off Fox Farm that were previously appraised at about $1.2 million.

The local group is attempting to get an easement on the land that would preserve the open space, but the state would require fair market value for the easement, or $1.2 million per the most recent appraisal.

Fox Farm state land being considered for development, locals seek city help for conservation

The state would need to do another appraisal since the previous one has expired, according to DNRC officials.

The property is located outside the city limits and is bounded by Fox Farm Road on the west, 45th Avenue Southwest on the south, Grizzly Drive on the north, and the Missouri River and Island View Drive on the east.

Douglas Ormseth, one of the locals with the Missouri River Open Lands group, said “we don’t think there’s a high developer interest in the property.”

Ormseth and the group asked the city to consider holding an easement on the property since DNRC rules require a government entity to hold easements, but said they would raise the funds required.

Clock starts on Fox Farm DNRC property June 3 for conservation interests

City Manager Greg Doyon suggested that staff review the easement application and review the options then come back to the commission for further discussion.

The property is in the county and Mayor Bob Kelly asked why the group wasn’t asking the county to hold the easement.

Members of the group said that the county had said no, but all three County Commissioners told The Electric this week that they had not been asked to hold the easement.

Commissioners said they had discussions with the group and had provided a letter of support this spring for their grant application through Montana Fish Wildlife and Parks. The group did not get the grant funding but said they’ll try again this year.

They have not yet raised any funds.

DNRC still exploring development, sale options for Fox Farm parcel

If the city were to pursue an easement, it would have to fill out an application and go through the state land board approval process. If approved, they’d have one year to raise the fair market value payment, which was last estimated at $1.2 million, according to Andy Burgoyne, the Helena unit manager for DNRC.

If the city was granted the easement, it would also become responsible for maintenance and management of the property, which could include weeds, mowing, pest control and law enforcement, Burgoyne told commissioners.

According to DNRC, state trust lands were granted to the state by the federal government under the Enabling Act at the time of Montana’s statehood in 1889.

“The lands were granted for the sole purpose of generating income for support of the common schools and other public institutions. The Enabling Act mandated that the lands,
along with their proceeds and income, would be held in trust for the beneficiaries. As a means of generating revenue, a stipulation in the Enabling Act prohibited the state from disposing of an interest in these lands unless fair market value is received. ‘Disposal of an interest’ is considered to be the sale or exchange of the lands, or the granting of any use of them through issuance of a lease, license or easement, if such use is deemed to have a compensable value. Recreational use has been deemed to have a compensable value,” according to a DNRC fact sheet.

Originally, Sections 16 and 36 of every township were granted as school trust lands, but some of those sections couldn’t be acquired because they were already homesteaded, were within Indian Reservation boundaries, etc., according to DNRC.

The state was able to acquire other lands in lieu of those that couldn’t be acquired. At one time, the Department of State Lands made loans on private lands and held the deed as collateral. If the private landowner defaulted on the loan payments, the state acquired the deed to those lands, so the state trust now holds more than the original sections, according to DNRC.

The Fox Farm property is divided into two lots. The northern portion of the parcel is roughly 43 acres with 1,500 feet of Missouri River frontage. The southern portion is about 39 acres with no river frontage.

The property is currently vacant other than a radio communications tower on the southern end that is under a commercial lease and generating about $3,000 annually for the Montana School Trust Land program, according to DNRC.

DNRC looking at options to develop land on Fox Farm Road

The mandate for school trust lands is that the properties make money for the school trust. The property on Fox Farm benefits the University of Montana.

Since the property isn’t generating anything near its value, DNRC began looking several years ago at options to add conservation options, develop or sell a portion of the land.

Conservation options are considered first, but if none are proposed through a letter of intent, commercial, residential or industrial development will be considered. No matter the proposed use, the department is required to get fair market value for the land.

DNRC staff said that the agency will work with the community to develop conservation options if there’s interest from local groups or individuals.

Last summer, DNRC began accepting conservation proposals on June 3 for 60 days.

The department received two proposals during that time. One was commercial in nature and didn’t qualify as a conservation proposal.

In September, DNRC was working with the Missouri River Open Lands group to get more information about their proposal.

Under the timeline released by DNRC last year, conservation proposals were due by Aug. 5 and after that, applicants had 45 days to submit a formal application for a license, lease, easement, etc. That deadline was Sept. 20 and applicants then had 12 months to secure proof of funding.

Burgoyne said the department would likely consider releasing a request for proposals for commercial use of the property in the near future but that wouldn’t prohibit anyone from submitting a conservation proposal.

Last summer, the group applied for a grant from Montana Fish Wildlife and Parks, but did not receive the funding. It has not raised any money yet, according to Al Rollo, one of the organizers.

In an email to The Electric, Rollo said, “if we can get the city to hold the easement we will be able to let people know we are serious about moving forward.”

During the Jan. 7 meeting, that group is asking commissioners to consider holding a conservation easement on the land.

In October, they wrote a letter to commissioners about their request. In November, City Manager Greg Doyon notified Burgoyne of the request and that commissioners had decided to discuss it at the Jan. 7 work session.

In their letter, the group wrote that if DNRC were to allow commercial development on the property it would “harm the character of the area, put too much pressure on Fox Farm Road and its intersection with 10th Avenue South, as well as Meadowlark School, and is not in keeping with adjacent city zoning.”

The group is asking for a letter from the city stating that it is “actively considering holding an easement on this property. Right now, this is all we are asking for, not for your to formally accept the easement. We have a lot work to do to raise money and work through the State’s process before that could happen. But, a letter from you would let the state know there is group seeking to keep this land open and would buy us critical time to complete other steps,” according to its October letter.

If the land were to be developed, it would stop serving as a recreation area, the group wrote.

“This land is currently used for hiking, dog walking and training, fishing, bird and wildlife watching, mountain biking, canoeing, paddle boarding, kayaking, Nordic skiing and snow-shoeing. The land offers these amenities in its raw, unimproved condition and has required no cost from the state for more than 50 years,” they wrote.

In their letter, the group wrote, “we know that the idea of the city owning an easement of this type might seem cutting edge for this town…Every other city in Montana holds easements of this type and have active open lands conversation groups and policies. Even a conservative city like Kalispell has an organized effort to preserve open land. We believe it is time for Great Falls to catch up to the rest of Montana, and that this project is the place to start.”

A shopping center that includes Cabela’s was opened in recent years on DNRC school trust land through a longterm commercial lease.

The local group created a Facebook page in late 2018 and organized in an effort to conserve the open space. That fall, they started an online petition to keep it as open space and the petition had about 300 signatures in Mary 2019. As of Jan. 7, it had 314 signatures.

The north half can’t be sold because of the river frontage, but it could be exchanged for a parcel that is equal or more valuable. That has been interpreted to mean equal or more riverfront on a similar river, DNRC told The Electric last spring. Past experience has shown there’s a high bar for such a trade.

The north line is the city-county boundary with major utilities stubbed at this line. The property is currently in the county.

The state received land to the north and east of the property and sold those parcels around 1920. Those areas are now residential.

DNRC staff identified the tract as having significant development potential about 10 years ago and held a public meeting to gauge interest. At that time, a group of local landowners emerged who were interested in maintaining the parcel as open space, but a formal proposal never materialized and the entire project fell by the wayside, according to DNRC.

Commercial leases are available for up to 99 years and are subject to a competitive bid process. All trust land sales are subject to public auction and Land Board approval, according to DNRC.

Got questions, proposals or comments? Send them to Andy Burgoyne by phone 458-3517 or email: jburgoyne@mt.gov.