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Our Oregon 150 Story
School Kids and State Lands

 Oregon - the “Eden at the End of the Oregon Trail” – was land rich and cash poor at statehood in 1859. As scores of new families came west to settle and prosper, the new state had few resources to educate their children.
 
Realizing this challenge, the federal government granted Oregon two square miles out of each township (a 36-square-mile parcel), or approximately 3.4 million acres of land, to finance public schools.
 
Oregon’s Constitution established the State Land Board – which is still composed of the Governor, Secretary of State and State Treasurer – to oversee the new state’s school lands.

Many of these lands were quickly sold, as public officials felt private ownership would yield more for schools through property taxes and other economic benefits. Although school lands were sold for between $1.25 and $2.50 an acre, safeguards were put in place to limit the number of acres an individual could purchase.
 
Revenue from land sales seeded the Common School Fund, a trust fund for schools that now has a market value of just under $1 billion. The State Land Board distributes earnings from the fund twice a year to Oregon’s 198 K-12 public school districts. The two distributions in 2008 totaled $55.4 million.   
 
 
But here’s the interesting part – and a dark piece of Oregon history most citizens don’t know and may be surprised to learn: In the early 1900s, 33 people were sent to prison as a result of the Oregon Land Fraud Scandal, a scheme aided by public officials whereby land speculators – or their “front men” – obtained large tracts of land illegally, offering kickbacks to those who facilitated the land grab.
 
“Looters of the Public Domain,” written from his jail cell in 1908 by land-fraud kingpin Stephen A. Douglas Puter, exposed the details of the conspiracy that divested Oregon of nearly three-fourths of its school land, including thousands of acres of prime timberland worth many millions of dollars today.

 Although the state will never get those lands back, the Department of State Lands (DSL) and the Land Board are committed to managing our current real estate portfolio to significantly increase the Common School Fund over time. Through selling nonproductive, isolated parcels and reinvesting in higher-earning lands, the department is making long-term investments for Oregon’s schoolchildren.
 
DSL also is working to square up a 150-year-old debt of an additional 5,200 acres the federal government still owes the state. Approximately 3,000 acres have been transferred to the state, and another 2,200 acres are in process; most of the acreage is in the central Oregon area.
 
After 150 years of statehood, Oregon deserves well-managed school lands, and the Department of State Lands is delivering on that promise.
 
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