In our previous two segments on Section 16 lands — Part 1 and Part 2 — we examined the dedication, by Congress, of one section in each Ohio township, usually Section 16, for the support of public education. Initially, while retaining title to such lands in trust, Ohio vested administrative control in township trustees. However, the allocation of authority to the townships did not go well and in 1914 and 1917 the legislature reallocated responsibility to the Auditor of State as administrator of school lands remaining in state hands.
From 1827 to 1917, when the township trustees were authorized to sell or lease school land to private individuals, mineral title typically passed with the fee simple title. However, this practice ended in 1917 when the auditor assumed authority.
The 1917 legislation, known as the Garver Act, was enacted to provide for better administration of school lands. H.B. No. 192, 107 Ohio Laws 357, G.C. 3203. One of the issues was confusion about the status and ownership of leases of Section 16 parcels granted by township trustees. Section 23 of the Garver Act —provided procedure by which someone claiming title could file a claim with the state supervisor who, after public notice and if satisfied that the claim was valid, would execute a new lease. The Garver Act also provided a mechanism whereby a lessee could surrender his lease and obtain a fee simple title.
With regard to the township’s remaining responsibilities, section 19 of the act provided:
“If the state supervisor determines that any such township officers are not satisfactorily administering such trust, or fail to properly perform any duty or act herein required of them, he may, upon publication for ten days in a newspaper of general circulation in the county wherein such township officers reside, remove such township officers or any of them from the performance of all acts and duties herein of them required.”
More important to our subject, however, is what the legislature said about oil and gas. Section 4 of the act, G.C. 3184, provides that:
“It is declared to be the policy of the state to conserve … mineral resources of the [school lands held in trust] … and to this end the state reserves all gas, oil, coal, iron and other minerals that may be upon or under the said school lands … .”
And Section 36 of the act, G.C. 3203-13, required each conveyance of the fee simple title to contain a mineral reservation.
The act details procedures for the leasing and sale of the school lands. Interestingly, Section 52, G.C. 3203-30, provides that the lessee could essentially trade in his original leasehold interest for a mineral lease or opt to purchase the minerals.
Sure enough, a review of deeds from 1917 indicates that some, but not all, contain a hand-written reservation included with the legal description: “Reserving to the State of Ohio, however, all oil, gas, coal and other minerals with the right of entry for the purpose of prospecting for, developing, producing or operating for the same and the right of occupancy … .” A sampling of deeds from 1918 and 1919 all contain the reservation.
Though the state deeds from this era effected a severance of the minerals, the severed interest is not the same as when a private grantor reserves the mineral. Unlike a private severance, the Ohio Dormant Mineral Act does not allow an abandonment of a severed mineral interest when “The mineral interest is held by the United States, this state, or any political subdivision … .” R.C. 5301.56 (B)(2). So, minerals reserved to the state in the few years after the Garver Act probably remain under the control of the state unless subsequently transferred by the state.
However, the Garver Act and the 1914 statute requiring a reservation of minerals were eviscerated in at least in one case involving land in Morgan County. In 1921, the legislature enacted special legislation — Am S. B. No. 75, 109 Ohio Laws 67 — which authorized lessees to the surrender their leases and purchase, in fee simple, school lands in section 16 of township 7, range 13, of the Ohio Company’s Purchase, Homer Township, Morgan County. The Auditor of State asked the Attorney General if minerals were to be included or reserved.
In his opinion, the Attorney General noted that Section 30 of the Garver Act (G.C. 3203-7), which applied to leasing school lands, required a reservation to the state of the oil, gas, coal and other minerals. But the special legislation that provided for the exchange of leases for land in Morgan County fixed the price based on a 1904 appraisal. And because that appraisal made no mention of minerals and the special legislation required the payment of the “full amount of the value of such lands,” the Attorney General opined that legislator intended that the minerals be included. The Attorney general explained, “The latter act is a special act, and contains no evidence of any legislative intention that the provisions of the Garver law — the general — should be read into and made a part of it.” 1921 Ohio Atty. Gen. Ops. No. 2318.
Administration passes to the director of administrative services
The auditor maintained administrative control of the state’s Section 16 lands until Aug. 1, 1985, when most of the duties were transferred to the state’s Director of Administrative Services. At that time, four school land farms in Hardin, Ross, Marion and Franklin Counties, totaling 1,232 acres, were under two-year leases, and several small lots in Columbiana County were under lease for 99 years, renewable forever.
Since the designation of school lands, proceeds from the leases and sales of the lands went to the state pursuant to the constitutional provision (see Part 2). It stayed that way until Ohio voters approved an amendment to the article in 1968. The trust monies were then disbursed for educational purposes.
Current Law: administration by the board of education
In June 1988, H.B. 497 and H.B. 549, 142 Ohio Laws Part III, 3955 and 4256, respectively, transferred authority to supervise school lands from the Department of Administrative Services to the board of education of each school district that contained school lands, though title to these lands was still held in trust by the state of Ohio pursuant to the 1803 federal law.
Revised Code section 501.02 now provides that school districts may bring and prosecute an action to enforce any lease upon the lands, to restrain the illegal use of such lands or the commission of waste, to recover damages arising out of the commission of such waste, or may bring any action that is otherwise necessary to enforce such laws.
To effect the transfer, the Department of Administrative Services was to provide each school district with copies of deeds, leases, field notes, records and other papers and documents that were in its possession. R.C. §501.03. The board of education for each school district is authorized to sell school lands and the proceeds from such sales, along with rents from remaining leases, were to belong to the school district. Procedures for sale by the school district and the granting of a deed by the Auditor of State to the successful bidder were established. There is no mention of oil and gas in the procedures, but presumably the board of education would reserve those rights, or be paid for them.
Anyone involved in a real estate transaction regarding property in a Section 16 — or in nearby sections where Section 16 was not the dedicated section — needs to determine if the state conveyed title and whether the mineral title passed with the surface. It is also worth noting there is a similar dedication of one section of land in each township (Section 29) to support “religious purposes,” and its history may be similar.