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Utah school land trust to sell unprofitable 8,000-acre block near Powder Mountain

The Cinnamon Creek tract covers part of the Bear River Range in Cache and Weber counties.

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An 8,107-acre tract of state-owned land in northern Utah is about to go on the auction block, marking the largest land sale in the history of the Utah School and Institutional Trust Lands Administration, or SITLA.

Created in 1994, this agency manages 3.4 million acres of land for the benefit of public education. It has decided that the best way to “optimize” revenue from the Cinnamon Creek block is to sell it, with the minimum bid set at $19.5 million. SITLA will begin accepting sealed bids online on Nov. 9 for the parcel straddling the Weber-Cache county line near Powder Mountain Resort and Porcupine Reservoir.

(Christopher Cherrington | The Salt Lake Tribune)

The agency was not asked by anyone to put the land up for sale as is the case in most SITLA land sales, according to spokeswoman Marla Kennedy. Rather, the decision to sell hinged on the soaring prices that Western real estate is currently fetching and the meager revenue the land generates from livestock grazing.

“We thought about selling this block in the past and recently we had it appraised,” said Kennedy, who recently joined SITLA as director of communication. “We were happy with what it appraised for and believe it will sell for much higher. This particular piece generated just over $19,000 in revenue in 2020. You can see why this would be an important sale for SITLA and its beneficiaries. The interest [on the sale proceeds] would be dramatically more than the revenue it currently generates.”

Nestled in the Bear River Range, the forested tract features canyons, ridges and mountain tops with elevations ranging from 5,787 feet to 8,028 feet above sea level with slope gradients from level to very steep, according to SITLA. The land offers “great recreation opportunities and supports abundant wildlife, timber, and domestic livestock grazing resources,” the agency says on its website.

This land is zoned for “forest recreation” with minimum lot sizes of 40 acres.

The block is surrounded entirely be private land expect for a state-owned wildlife management area on its western border, SITLA resource specialist Ben Stireman told the Cache County Council at its Aug. 24 meeting. Cinnamon Creek passes through the property and empties into Porcupine Reservoir.

While the sale would add substantially to both counties’ property tax bases, Cache council members raised concerns about the sale’s potential to disrupt grazing and county roads that cross the parcel. Stireman said the counties have until Sept. 17 to submit road claims, which would have to be resolved prior to the auction.

“For me, I think the initial reaction to something like this is a sense of loss if it becomes private and any public use that was allowed is then restricted,” council member Gina Worthen said in a text. “But it’s important to remember that this land has been held in trust specifically for the benefit of public education.”

Under state law, SITLA is obligated to manage these holdings in ways to optimize revenues into the state public education trust fund. Increasingly, to the dismay of some rural county commissioners, that means lucrative sales and real estate development at the expense of longtime grazing permit holders.

Currently rancher Marlon Bingham and TK Swan Land hold grazing permits on Cinnamon Creek. Those permits will be canceled once the land sells, but that doesn’t necessarily mean the new owner would evict livestock operations.

SITLA typically holds auctions twice a year, where it sells several parcels, but typically few are larger than a single 640-acre section. Cinnamon Creek is being handled with its own auction. SITLA’s next sale starts Sept. 8, when it accepts sealed bids on 10 parcels totaling about 4,000 acres.

The agency used to hold its own auctions live with public bidding once the sealed bids were opened. Due to the pandemic, it switched to online sales on Energy.net. They might not be as fun or transparent as the live auctions, but online sales have fetched better prices and reduced the chances of bidders colluding, according to Kennedy.

SITLA has raised more than $2 billion for a public education endowment, which is now shelling out about $100 million a year to Utah schools.

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