Wiger Says Bill Would Maximize State Land’s Payout for Schools

The down economy and shifts in state payments have left school districts hurting for money, and Sen. Chuck Wiger said he sees untapped potential in the more than 2.5 million acres of land and 1 million acres of mineral rights constitutionally guided to provide funding to the state’s schools.

Wiger said his bill SF1982—which would take the Permanent School Fund out of the jurisdiction of the Minnesota Department of Natural Resources and put it instead into the purview of a legislative commission—is the first step in maximizing the assets’ potential payout for schools.

“We’re looking at ways to more effectively get money from trust land,” said Wiger (DFL-Maplewood). “Whether it’s on the sale [of land] or the mineral rights.”

School District 622 Superintendent Patty Phillips, who sits on the state’s Permanent School Fund Advisory Committee, said last Tuesday she’d like to see the state consider selling some of the school trust lands in the Boundary Waters Canoe Area Wilderness to the federal government to raise money for schools.

Selling some of the 86,000 acres of school trust land in the Boundary Waters could generate more than $100 million for the fund, according to a letter from the Minnesota DNR to the state’s congressional delegation sent earlier this year.

Schools currently get $20 per student from the Permanent School Fund, but Grace Keliher, director of government affairs for the Minnesota School Boards Association, said with proper management schools could get much more money from the assets.

“Certainly the shift could be paid back,” she said. “We could put an iPad in every kid’s hand. The future is boundless.”

The problem with having the Department of Natural Resources manage the land, Keliher said, is that part of that agency’s charge is conservation. This creates an inherent conflict she said, because sometimes maximizing the land’s economic potential goes against the principle of conservation.

A government affairs representative from the Minnesota DNR could not be reached for comment.

As an example of what Minnesota’s fund could be, Keliher points to the state of Utah, where reforms turned their school trust fund into a $1 billon asset. The market value of Minnesota’s fund was $614 million in 2009, according to Session Weekly.  

Wiger has been working for years on reforming the system of managing the Permanent School Fund, he said, since he was the chair of the Education Committee, but he thinks now might be the time for change.

“We have a great deal of bipartisan support,” Wiger said. “We see a lot more potential and having this independent commission could help.”

The commission would not only seek out opportunities to bring in more money, he said, but also ensure that the DNR isn’t pulling too much money out of the fund for its own use.

The DNR's management fees have risen 300 percent since 2004, and its administrative costs have risen 100 percent, Keliher said.