Sec 37-321. Permission required for person other than holder of certificate of purchase to make improvements; forfeiture for failure to obtain permission; report of improvements

A. Except as otherwise provided in section 37-323, if a lessee, a permittee or other person having a legal interest in state lands, other than a holder of a certificate of purchase, desires to construct or make improvements upon the lands, he shall first file with the department an application for permission to construct or make the improvements unless improvement authorization is contained within the terms of the lease. The application shall be allowed or rejected as the best interest of the state requires as determined by the department. Unless permission is granted by the department, the applicant shall not be entitled to reimbursement or compensation for improvements placed upon the state lands. Upon expiration or cancellation of the lessee's lease or permit, improvements placed on the land without approval shall be forfeited and become the property of the state.

B. The owner of improvements placed upon state lands by a lessee, a permittee or any other person having a legal interest in state lands shall prior to December 31, 1965, unless such time is extended by the department, report to the department in writing the description of the improvements, their location and the actual current cash value thereof. The improvements reported as provided by this subsection shall be allowed or rejected as the best interest of the state requires as determined by the department.

C. Improvements placed on state land granted to the territory of Arizona by the act of Congress approved January 27, 1894, or placed on land to which the state gains title by any determination, by a person who is not a lessee or permittee may be reported to the department after the person becomes a lessee or permittee. The improvements shall be allowed or rejected as the best interests of the state require, as determined by the department.

D. The department may, from time to time, but not more frequently than once a year, require from any lessee or permittee or the person having a legal interest in state lands information concerning the improvements. Failure to make the report shall, in the discretion of the department, subject the improvements to forfeiture to the state.