The cabin lease debate will resume Tuesday morning, when the state Land Board discusses 2008 rates for Payette Lake leases.
I have to admit, the leaseholders have a stronger case than I expected. Representatives of the Payette Lake Cabin Owners board came in Wednesday to make their presentation to the Statesman editorial board.
A few highlights:
• The 169 leaseholders are feeling the effects of rapidly increasing property values. If anything, they are worse off than landowners. If a property's value doubles, a property tax rate doesn't necessarily double. But when the value of a lease site doubles, the rental will double, since the rental rate is based on 2.5 percent of appraised value.
A case in point: Jim Young, the president of the cabin owners' board, said his 2001 rental, for a lot with 100 feet of lake frontage, was $13,225. The 2008 rental is expected to exceed $49,000.
• The rates are out of line with neighboring states. Recently, the Land Board offered up a pair of leases on North Idaho's Priest Lake, but had no takers. The reason, say cabin holders: the state's proposed rent was twice as high as the highest rental rate on Montana's Flathead Lake.
• The rapidly rising rental rates have also dried up the market for cabin owners looking to sell. Twenty-four of the cabins were on the market this year, Young said, also with no takers.
With all the leases up for renewal in 2010, the cabin owners are hoping for long-term relief. They hold 10-year leases and get first shot at renewal, and would like the Legislature to establish 49-year leases — in other words, the same special deal lawmakers extended to Tamarack resort developers a couple of years ago.
I'm torn on that one. Part of me wouldn't mind seeing legislators squirm under the precedent created by the Tamarack deal. But should the state let leaseholders lock in a lakefront site for 49 years at a time, with a right of first refusal that lets no other bidder in on the action?
In the short run, Payette cabin holders want a rollback to 2006 rates. For Young, that would equate to about a $25,000 rental next year.
The Constitution sets broad policy for endowment lands, such as the cabin sites, for "maximum long-term financial return." State code says this is long-term return is "best obtained through stable leases at market rent."
The Constitution and code are not at cross purposes. The trick is in how the state sets up the leasing system and the rental rates. That question falls the five-member Land Board — Gov. Butch Otter, Secretary of State Ben Ysursa, Attorney General Lawrence Wasden, Controller Donna Jones and schools superintendent Tom Luna.
David Leroy, a Boise lawyer and former attorney general, is representing the cabin holders. He says he hasn't counted votes to see how Tuesday's meeting will go.
The outcome should be interesting. Otter, Luna and Jones, elected a year ago, are new to the Land Board, and face an intriguing decision.