There are reserved from settlement, entry, sale, or other disposal all those certain tracts, pieces, or parcels of land lying and being situated in the State of South Dakota and within the boundaries particularly described as follows: Beginning at the southwest corner of section 18, township 7 south, range 6 east, Black Hills meridian; thence east to the southeast corner of said section 18; thence south to the southwest corner of the northwest quarter of section 20; thence east to the southeast corner of the northeast quarter of section 21; thence north to the northeast corner of the southeast quarter of section 9; thence west to the center of section 7; thence south to the southwest corner of the southeast quarter of section 7; thence west to the northwest corner of section 18; thence south to the place of beginning, all in township 7 south, range 6 east, Black Hills meridian, in Fall River County, South Dakota: Provided, That nothing herein contained shall be construed to affect any valid rights acquired in connection with any of the lands embraced within the limits of said reserve.

Said reserve shall be known as the Battle Mountain Sanitarium Reserve, and shall be under the exclusive control of the Secretary of Veterans Affairs in connection with the Battle Mountain Sanitarium at Hot Springs, South Dakota, whose duty it shall be to prescribe such rules and regulations and establish such service as the Secretary may consider necessary for the care and management of the same.

In all cases of unperfected bona fide claims lying within the said boundaries of said reserve, which claims have been properly initiated prior to September 2, 1902, said claims may be perfected upon compliance with the requirements of the laws respecting settlement, residence, improvements, and so forth, in the same manner in all respects as claims are perfected to other Government lands: Provided, That to the extent that the lands within said reserve are held in private ownership the Secretary of the Interior is authorized in his discretion to exchange therefor public lands of like area and value, which are surveyed, vacant, unappropriated, not mineral, not timbered, and not required for reservoir sites or other public uses or purposes. The private owners must, at their expense and by appropriate instruments of conveyance, surrender to the Government a full and unencumbered right and title to the private lands included in any exchange before patents are issued for or any rights attached to the public lands included therein, and no charge of any kind shall be made for issuing such patents. Upon completion of any exchange the lands surrendered to the Government shall become a part of said reserve in a like manner as if they had been public lands at the time of the establishment of said reserve. Nothing contained in this section shall be construed to authorize the issuance of any land scrip, and the State of South Dakota is granted the privilege of selecting from the public lands in said State an equal quantity of land in lieu of such portions of section sixteen included within said reserve as have not been sold or disposed of by said State and are not covered by an unperfected bona fide claim as above mentioned.

All persons who shall unlawfully intrude upon said reserve, or who shall without permission appropriate any object therein or commit unauthorized injury or waste in any form whatever upon the lands or other public property therein, or who shall violate any of the rules and regulations prescribed hereunder, shall, upon conviction, be fined in a sum not more than $1,000, or be imprisoned for a period not more than twelve months, or shall suffer both fine and imprisonment, in the discretion of the court.