Trust Fund not available
Lance D. Gaebe, Bismarck
As the Land Commissioner, it is not my role to determine Minot’s need for additional schools; that is up to voters. However it is my responsibility to correct misinformation being conveyed regarding the purpose of state “school lands” and the perpetual trust funds under the North Dakota Land Board’s responsibility. Simply put, under state law, funds cannot be diverted from the Common School Trust Fund to be utilized for school construction in Minot or any other school district.
North Dakotans were provided with an amazing gift at statehood when millions of acres of land were reserved from settlement and dedicated to support public education and institutions within the state. The largest of the 13 permanent trusts created by this grant is the Common Schools Trust Fund.
The total amount distributed each year is determined by a constitutional formula that uses the five-year average value of the trusts’ financial assets. During the 2013-2015 biennium, a total $130.3 million, or an estimated $613 per student will be annually distributed to the state’s schools; this is an increase of 40 percent over the previous biennium. These funds are used for each district’s operating costs to educate kids.
The Land Board manages the Common Schools Trust Fund to generate growth and income that is shared with K-12 schools across the entire state. Land is rented to farmers and ranchers, minerals are leased for oil and coal development and all the revenues are invested in diversified and conservative securities to provide perpetual, steady and growing distributions to North Dakota schools.
Throughout North Dakota’s 124-year history, the Land Board has been legally obligated to prudently manage the Common Schools and other trust funds to guard against inflation and provide stable distributions. In other words, the permanent trusts are managed to support education today and invested to support future generations.
The Land Board cannot divert funds to any purpose other than as part of the state aid to schools to support their operations. Any change in how distributions are made would involve amending state laws, the state constitution and federal authorizing acts.
Along with the Land Board members, I am honored to serve the state by managing trusts that support education. In that responsibility we will continue to manage the Commons Schools and other permanent trusts in a legal, prudent, and conservative manner. Doing so will continue to provide tax relief to all North Dakotans for generations to come.