(a) Freehold and Leasehold Interests.—With respect to any property acquired by the Secretary within a System unit or related area, except property within national parks or within national monuments of scientific significance, the Secretary may convey a freehold or leasehold interest in the property, subject to such terms and conditions as will ensure the use of the property in a manner that is, in the judgment of the Secretary, consistent with the purpose for which the System unit or related area was authorized by Congress. The Secretary shall convey the interest to the highest bidder, in accordance with such regulations as the Secretary may prescribe. The conveyance shall be at not less than the fair market value of the interest, as determined by the Secretary, except that if the conveyance is proposed within 2 years after the property to be conveyed is acquired by the Secretary, the Secretary shall allow the last owner of record of the property 30 days following the date on which the owner is notified by the Secretary in writing that the property is to be conveyed within which to notify the Secretary that the owner wishes to acquire the interest. On receiving the timely request, the Secretary shall convey the interest to the person, in accordance with such regulations as the Secretary may prescribe, on payment or agreement to pay an amount equal to the highest bid price.

(b) Exchange of Land.—

(1) In general.—The Secretary may accept title to any non-Federal property or interest in property within a System unit or related area under the Secretary's administration in exchange for any Federally-owned property or interest under the Secretary's jurisdiction that the Secretary determines is suitable for exchange or other disposal and that is located in the same State as the non-Federal property to be acquired.

(2) Exception.—Timberland subject to harvest under a sustained yield program shall not be exchanged under paragraph (1).

(3) Public hearing.—On request of a State or a political subdivision thereof, or of a party in interest, prior to an exchange under this subsection the Secretary shall hold a public hearing in the area where the properties to be exchanged are located.

(4) Values of properties exchanged.—The values of the properties exchanged—

(A) shall be approximately equal; or

(B) if they are not approximately equal, shall be equalized by the payment of cash to the grantor from funds appropriated for the acquisition of land for the area, or to the Secretary, as the circumstances require.

(c) Proceeds Credited to Land and Water Conservation Fund.—The proceeds received from any conveyance under this section shall be credited to the Land and Water Conservation Fund.