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More trust money to classrooms

Published (3/11/2011)
By Kris Berggren
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Lands owned by the state’s Permanent School Fund and managed by the Department of Natural Resources generate money for Minnesota’s public schools, but they could generate much more, Rep. Denise Dittrich (DFL-Champlin) told the House Education Finance Committee March 10.

She sponsors HF207, which would ensure more of the revenue ends up in classrooms across the state. The committee laid the bill over for possible inclusion in an omnibus bill. It has no Senate companion.

Permanent School Fund lands generate income from forestry, minerals and mining rights and other uses that are constitutionally directed to public schools. Oversight of the fund’s income and distribution has been lax over the years for various reasons, Dittrich said.

Trust land revenue goes into a minerals management account, which is a type of holding account. From that account, land management costs are paid to the DNR, but Dittrich said the records have been spotty and too little revenue has found its way to the trust itself.

“I do think it is a diversion of funds to take the management costs out,” Dittrich said.

The bill would exempt proceeds from mineral leases on school trust lands from a current requirement that 20 percent of those be deposited into the minerals management account. Those would go to the permanent school fund instead. The bill would instead appropriate a yet-unspecified amount from the General Fund to the DNR to cover the costs of minerals management activities on school trust lands.

Bob Meier, assistant DNR commissioner, estimated about $20 million net will be deposited into the account for fiscal year 2011. He said about $2.9 million a year was being spent to manage the lands and that would be true no matter who managed them.

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