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School trust advisors could expand

Published (2/11/2011)
By Kris Berggren
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Rep. Denise Dittrich (DFL-Champlin) hopes those with the biggest responsibility for school funding have the biggest say in how one of its biggest assets is managed.

Dittrich sponsors HF206, which would add a minority party member from the House and Senate and one person with expertise on school finance to the Permanent School Fund Advisory Committee, which advises the Department of Natural Resources on the management of 3.5 million acres of school trust lands.

Approved Feb. 8 by the House Education Reform Committee, it now goes to the House Government Operations and Elections Committee. It has no Senate companion.

School trust lands generate income intended to be deposited into the Permanent School Fund. Income has come mainly from mineral rights and mining, according to Dan Roark, an attorney with the DNR’s Lands and Minerals Division. Forestry activities, leases and land sales also generate income. The $700 million trust is managed by the State Board of Investment.

Dittrich said land management and fund distribution haven’t been monitored to the best advantage of K-12 schools. For example, the Legislature has allowed the DNR to be reimbursed for many expenses from school trust revenues. Also, until last year school trust revenue generated no net gain to school districts, instead being subtracted from the General Fund, she said.

The fund generated $26 million in fiscal year 2010. “That was the first year we sent that money to schools and it stayed in schools,” Dittrich said.

There’s potential for even more income, said Grace Keliher, governmental relations director for the Minnesota School Boards Association. A proposed land sale and swap of nearby federal lands with school trust lands that lay within the Boundary Waters Canoe and Wilderness Area could generate $100 million cash and 32,000 new acres of school lands.

The advisory committee members include six citizen experts in forestry, minerals and mining, real estate development, renewable energy, natural resource conservation and finance and land management; two school superintendents; the education commissioner; and the chairs or their designees of legislative committees on education, K-12 education budget, environment and natural resources policy and budget, the Senate Finance Committee and House Ways and Means Committee.

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