To transfer the lands administered by the Bureau of Land Management to the State in which the lands are located.

Requires the Secretary of the Interior to transfer all right, title, and interest of the United States in and to all lands and interests administered by the Bureau of Land Management (BLM) to the State in which such lands and interests are located, with the exception of the mineral interests underlying a surface estate held by the United States in trust for an Indian tribe. Allows a State to only either accept the offer of all such lands or to reject such offer. Directs each State receiving lands under this Act to: (1) honor valid existing leases and permits; and (2) respect all rights-of-way granted by the United States on such lands. Requires the validity and existence of a transferred mining claim to be determined and administered under State law, with exceptions for the holders of specified patents. Requires: (1) transferred designated wilderness lands to continue to be managed as wilderness; and (2) transferred military purpose lands to continue to be military purpose lands. Transfers the administration of the mineral interests on Indian lands from the Bureau of Land Management.

Sets forth provisions concerning the transfer of all water rights associated with the lands to the State receiving such lands. Caps BLM obligations and expenditures.