Department of Trust Lands
(Authorized: Constitution, Article IX; Article X, Section 21)
[NDCC Chapters 15-01, 15-02, 15-08.1, 15-68, 47-30, 47-30.1, 57-62, 57-51.1-07.5, and 61-33-07]
The Board of University and School Lands (also known as the State Land Department) was created in the North Dakota State Constitution in 1889. The Constitution became the primary source of authority for the Board. Initially the Board of University and School Lands consisted of the Governor, Secretary of State, State Auditor, Attorney General, and the Superintendent of Public Instruction. The Board was empowered to appoint for a two year term a Commissioner of the Board of University and School Lands to serve as chief administrative and executive officer of the State Land Department. In 1907 legislation provided for the appointment of a Deputy Commissioner by the Commissioner of the Board upon the consent of the Board of University and School Lands. The Deputy in the absence of the Commissioner was to act as Secretary (S. L. 1907, Ch. 163). Through its agent the State Land Department, the Board of University and School Lands was given general authority, direction, and control over the care, management, and disposition of all common school and institutional grant lands and funds. This included the lease, sale, disposition, and general supervisory authority over leasing of minerals on state-owned lands for the purpose of maintaining stable distributions to fund beneficiaries. Responsibility extended to management of certain acquired lands and sovereign lands (S. L. 1927, Ch. 248).
The 1889 Constitution and locations of permanent lands
According to the Constitution public land was granted to the Board of University and School Lands in permanently located places and specifically granted by the United States Congress in the Act approved on February 22, 1889 and was to remain as a perpetual trust fund for maintenance of the common schools in the State. Concerning school and public lands the Legislative Assembly could prescribe for the disposal of lands or the use of lands within limitations as provided by the North Dakota State Constitution. Any changes to the Constitution concerning these lands would be made only if the people of the State voted to amend the Constitution. Statehood institutions included: 1) The seat of government at the city of Bismarck, Burleigh County; 2) The State University and the School of Mines at the city of Grand Forks, Grand Forks County; 3) The North Dakota State University of Agriculture and Applied Science at the city of Fargo, Cass County; 4) A state normal school at the city of Valley City, Barnes County; 5) The School for the Deaf and Dumb of North Dakota (S. L. 1971, Ch. 162) at the city of Devils Lake, Ramsey County; 6) A State Training School at the city of Mandan, Morton County; 7) A state normal school at the city of Mayville, Traill County; and 8) A State Hospital for the Insane at the city of Jamestown, Stutsman County. The Article continues “and the Legislative Assembly shall appropriate twenty-thousand acres of the grant of lands made by the Act of Congress afore said for the other educational and charitable institutions to the benefit and for the endowment of said institution, and there shall be located at or near the city of Grafton, in Walsh County an institution for the feebleminded on the grounds purchased by the Secretary of Interior for a penitentiary building” (North Dakota Constitution, Article IX, Section 12). Additional public institutions are listed in (Section 13) and include: 1) A soldiers' home as determined by the Legislative Assembly in Lisbon, Ransom County; 2) The School for the Blind, to be located in Grand Forks, Grand Forks County (S. L. 1951, Ch. 348) or as determined by the Legislative Assembly); 3) A School of Forestry, to be located in one of the counties of McHenry, Ward, Bottineau, or Rolette, as determined by an election of the residents of those Counties; 4) A School of Science or other educational or charitable institution as prescribed by the Legislative Assembly to be located in Wahpeton, Richland County; 5) A State College in Minot, Ward County; 6) A State College in Dickinson, Stark County; and 7) A State Hospital for the Mentally Ill as selected by the Legislative Assembly. In 1915 legislation concerned the sale of institutional lands required for town-site purposes, school house sites, church sites, cemetery sites, sites for other educational or charitable purposes, public parks, fair grounds, public highways, railroad right of way and other railroad uses and purposes. This legislation also included reservoirs for storage of water for irrigation and drain ditches and lands needed for any of the purposes over which the right of eminent domain was to be carried out under the Constitution and laws of the State (S. L. 1915, Ch. 242).
National park lands, wildlife preserves, and other lands
Authority over land exchanges was given to the Board of University and School Lands to deed lands to the U.S. Government including a site for use by the Northern Great Plains Field Station for the purpose of conducting experiments in grazing and for determining how best to use the rough lands of the Great Plains area (S. L. 1915, Ch. 243). Legislation also withdrew from sale certain lands in Dunn County, North Dakota known as the Killdeer Mountains except for park purposes or for a game, fish, and forest reserves (S. L. 1917, Ch. 205). In 1929 the Board was authorized to purchase or condemn certain lands in Slope, Golden Valley, Billings, and McKenzie Counties in order to establish a national park (S. L. 1929, Ch. 213). The very specific wording of this legislation addressed the role of the State Land Commissioner and rules and regulations to be followed by the Board of University and School Lands (S. L. 1929, Ch. 214). Additionally legislation submitted by Representative Constantine Sax (Williams and McKenzie Counties) and Representative Ira J. Wilson (Billings, Bowman, Golden Valley, and Slope Counties) required the Board of University and School Lands to re-convey certain state lands to the federal government for national park purposes (S. L. 1929, Ch. 216). The bill submitted by Sax and Wilson stated “This land consists of the famous Petrified Forest and the Bad Lands of the Little Missouri River where Theodore Roosevelt operated his historic cattle ranches and hunted wild game in the early history of Dakota Territory. A tract considered admirably fitted by nature for scenic purposes, and preserved in its natural state, the mountainous character and wild unchanged condition of fifty years ago, and which tract is practicable and appropriate to preserve and be set aside as a national park as a memorial in honor of Theodore Roosevelt.” The authors of the bill specified the land be located within the counties of Slope, Golden Valley, Billings, and McKenzie and that “this action should be only for national park purposes with releases recorded on the abstract and forwarded to the State Land Commissioner” (S. L. 1929, Ch. 216). In 1933 concerning the establishment of national forests the State granted the federal government all rights necessary for the proper control and administration of lands (S. L. 1933, Ch. 187). Also legislation provided for the transfer of certain school lands situated in Rolette County, to the International Peace Garden to be used and maintained as an International Peace Garden and a memorial to commemorate the long existing peace and good will between the governments of Canada and the United States to be known as the International Peace Garden, Incorporated with all costs of transferring the land to be paid by the State of North Dakota (S. L. 1933, Ch. 224). Additionally during the 1930s, legislation related to water/wildlife conservation projects on state lands by giving the Board authority to “grant to the United States or to any of its instrumentalities or agencies any and all easement rights as shall be required for the construction, maintenance, and operation of water/wildlife conservation projects to be constructed on the public lands of the State”. The legislation declared that such projects be considered as a benefit to the land and would not diminish the value or purchase price (S. L. 1935, Ch. 256). The Board of University and School Lands was also authorized to transfer and convey certain acreage of state school lands in exchange for other lands to the Game and Fish Department for projects relating to wildlife restoration. The project could not exceed 640 acres (S. L. 1941, Ch. 162) and legislation authorized the Board of University and School Lands to sell lands belonging to the Permanent School or Institutional Funds “exclusive” of Federal Grant Lands under the provisions as set up by the Board (S. L. 1941, Ch. 252). In 1949 legislation authorized the Board in the transfer and conveyance of certain lands held by the State for the use and benefit of the State Historical Society of North Dakota. The land exchange [NDCC 54-01-13.1] concerned the Theodore Roosevelt National Memorial Park (S. L. 1949, Ch. 310 and Ch. 326). Legislation also approved and authorized the Board of University and School Lands to donate and convey certain property for the use and benefit of the North Dakota State University of Agriculture and Applied Science to the federal government for the purpose of establishing and conducting a field laboratory to study various problems related to agriculture (S. L. 1961, Ch. 138) and for management of forests found on school lands (S. L. 1963, Ch. 138). Concurrent Resolution (No. 4036) directed the Legislative Council to study land use policies for state-owned land for the uniformity of transfer requirements for state-owned land.
Constitutional amendments and permanent trust funds
In 1937 legislation concerned Senate Concurrent Resolution “P” on the sale of school and public lands (S. L. 1937, Ch.109). Another of the changes to the Constitution came in 1951 relating to investment of moneys in the permanent school funds and other educational funds. The amendment was placed on the 1952 ballot and passed by voters. It specifically addressed how funds should be invested (S. L. 1951, Ch. 347). Again in 1959 voters chose to approve the amendment of House Concurrent Resolution “J” relating to sale of original grant school lands and the reservation of minerals. Descriptive terms provided by the bill contained a listing of the minerals to be included but “not only limited to oil, gas, coal, cement materials, sodium sulfate, sand and gravel, road material, building stone, chemical substances, metallic ores, uranium ores, colloidal, or other clays” (S. L. 1959, Ch. 436). Voters approved this resolution on June 28, 1960 (S. L. 1961, Ch. 138). Another amendment to the Constitution repealed the State Normal and Industrial School at Ellendale [NDCC 15-14] with legislation requesting that the State Normal and Industrial School be removed from the Constitution. It had been renamed UND-Ellendale Branch (S. L. 1973, Ch. 526). In 1979 an amendment allowed for the creation of a Coal Development Impact Fund for the purpose of loaning moneys to political subdivisions impacted by the mining of coal (S. L. 1979, Ch. 712). In 1980 an initiated measure (No. 6) was passed by voters. It established an Oil Extraction Tax as a companion tax to the existing Oil and Gas Gross Production Tax. Voters approved of it as measure (No. 3) on the June 8, 1982 ballot (S. L. 1981 Ch. 719). The state permanent trust fund moneys were to be invested in US Treasury notes and bonds, in certificates of deposit, and in other investments for the farm loan pool and administered by the Bank of North Dakota. Income from investments together with surface and mineral rentals would be distributed to schools and institutions at specified intervals during the biennium. The Concurrent Resolution provided for an amendment to deposit bonus moneys received from mineral activities on common school lands into the appropriate permanent trust fund along with the interest and income to be deposited into the Common School Trust Fund (S. L. 1981, Ch. 667). In a primary election held on June 10, 1986 voters amended the Constitution by voting to replace the State Auditor with the State Treasurer (S. L. 1987, Ch. 187). That brought changes to the membership of the Board. Legislation also repealed custodial school fund duties of the State Treasurer (S. L. 1987, Ch. 189). In 1989 legislation (S. L. 1989, Ch. 61) introduced monies for grants to counties impacted by activity surrounding the development of oil and gas in order to provide counties and cities with a certain percentage of interest earnings annually appropriated upon the approval of the Board of University and School Lands. Monies came from the Coal Development Trust Fund as established under the Century Code [NDCC 57-62]. Legislation also established the Oil and Gas Impact Grant Fund [NDCC 57-51-15] to deposit any revenue from oil and gas gross production taxes. The purpose was to offset a negative impact from the development of oil and gas in the state (S. L. 1989, Ch. 733, Ch. 734, Ch.735, Ch.736). Budget cuts brought about another constitutional amendment in 1994 that created a Foundation Aid Stabilization Fund to be used in the event of a shortfall in foundation aid funding for schools. This fund was established and available only to schools (S. L.1993, Ch. 663). Additions (S. L. 2005, Ch. 582) were made concerning distributions of the funds and voters approved the changes on the 2006 General Election ballot. A constitutional amendment (No. 3045) was placed on the ballot to make the Permanent Oil Tax Trust Fund a constitutional trust fund. This change established a permanent oil tax trust fund from oil and gas tax revenue with any excess revenue transferred to the State General Fund (S. L. 2007, Ch. 584). Voters did not pass the measure. In 2009 legislation again concerned the management of trust funds under the control of the Board of University and School Lands and repealed sections to the Code relating to distributions from trust funds under authority of the Board (S. L. 2009, Ch. 153). On November 2, 2010 voters approved the Legacy Fund. It provided for a deposit of certain oil and gas tax revenues into one fund and imposed limitations on use of the money. Established as a long term investment this Fund remains unavailable for use until 2017 when a two-thirds vote of the Legislative Assembly will be required and with no more than fifteen percent available for use during a biennium. A Concurrent Resolution (No. 3054) placed on the ballot and approved by voters established the Legacy Fund as a Constitutional Trust Fund during the 2010 General Election (S. L. 2011, Ch. 483).
Changing times, state lands, and the role of the Board and Commissioner
In 1917 legislation addressed the duties of the Board of University and School Lands and the members of the Board. The Governor served as President, the Secretary of State as Vice-President, and the Commissioner of University and School Lands as Secretary (S. L. 1917, Ch. 203). Together the Governor and the Commissioner had responsibility to satisfy real estate mortgages held by the Board of University and School Lands whenever the State Treasurer certified the loans as secured and mortgages were fully paid (S. L. 1917, Ch. 203). In 1925 the Board was to provide for the re-sale of lands forfeited and for redeeming forfeited lands by requiring the Commissioner to record clear lists of original grant lands (S. L. 1925, Ch. 287). Additionally the Board had authority concerning the re-sale of lands if the rights of a purchaser, the heirs, or assigns were forfeited by a failure to pay the amounts due (S. L. 1925, Ch. 179). In 1927 legislation was related particularly to the leasing of state or school land containing oil. Rules and regulations relative to land development and improvement were established and legislation defined improvements as surface improvements such as machinery and other necessary equipment used in the development of the property for drilling oil or for operating equipment when drilling. Improvements had to be considered practical for future drilling operations (S. L. 1927, Ch. 249). Legislation defined improvements “not to mean surface improvements, machinery, and other necessary equipment used for the operation of or work performed in order to develop of the property for drilling, or for gas, or the extraction of any sodium, chemical substances, metals or clays unless such development work was of practical use for future operations or drilling”. Non-producing gas wells or wells that did not produce in commercial quantities were not considered as improved (S. L. 1931, Ch. 232). The Board could request a report from the State Geologist or State Chemist on leased school lands and make and establish rules and regulations relative to the development of the land, to provide for rent collection, and for the sale from improvements on the lands. Along with this legislation was the cancellation of contracts or redemption of state and school lands, by providing for the re-sale of the lands at public and private sales, setting the interest rate on deferred and interest payments, and publishing the notices of land sales. Legislation additionally related to the redemption of state and school lands on which the contracts had been cancelled by providing for the re-sale of such lands at public and private sale. The interest rate on deferred and interest payments, publication of notice of sale, method of cancellation of contracts, taxation of lands sold, redemption rights of the tax certificate holder, and the rules and regulations of the Board of University and School Lands in all these matters were also addressed (S. L. 1931, Ch. 233). Legislation in 1935 created an act relating to foreclosure of real estate mortgages held by the State of North Dakota as a security for an investment for permanent school funds and authorized the Board of University and School Lands to accept from the record title owner a deed of conveyance for land mortgaged in lieu of foreclosure (S. L. 1935, Ch. 254). The sale of original grant lands and payments on contracts for the sale of non-grant lands and the involvement by the Commissioner of University and School Lands in these transactions were again addressed (S. L. 1945, Ch. 163). The jurisdiction of the Board increased in 1967 to include all lands given to the state when no legal heirs were found or lands donated for use by penal, charitable, or educational institutions (S. L. 1967, Ch. 119). In 1971 legislation was passed that allowed the Board to invest money in first mortgages on farmlands (S. L. 1971, Ch. 159) and in 1975 legislation required the Board to establish fees in amounts equal to the cost of issuing a patent, deed, lease assignment, and land contract. Legislation also allowed the Board to hold land sales, furnish documents, and receive and process all loans. Leasing fees for agricultural purposes were to be collected by the County Treasurer of the county where the land was leased. At the time of the first payment the monies for such leases were deposited in the general fund of the county with all other funds deposited in the State Lands Maintenance Fund (S. L. 1975, Ch. 132). The Legislative Assembly in 1999 extended the term of office for the Commissioner of University and School Lands from two to four years (S. L. 1999, Ch. 150). In 2011 the Commissioner of University and School Lands wrote in a letter that accompanied the annual report concerning name State Land Department saying “prior to 2011 the administrative agent for the Board was informally called the State Land Department”. However in 2011 the Board adopted the name Department of Trust Lands as the common reference for the Office of the Commissioner of University and School Lands. The Century Code provides in detail a list of the Commissioner’s duties including the following charges [NDCC 15-02-05]; that the Commissioner serve as the Director of the Energy Infrastructure and Impact Office and give an opinion to the Legislative Assembly involving legislative bills related to the sale or exchange of state land by providing for the highest and best use of the land. The Code defines highest and best use to mean using “a parcel of land which will most likely produce the greatest benefit to the State and its inhabitants, and which will best meet the needs of the people. This determination includes soil capability, vegetation, wildlife use, mineral characteristics, public use, recreational use, commercial or industrial use, aesthetic values, cultural values, surrounding land use, nearness to expanding urban areas, and any other resource, zoning, or planning information.”
Additional functions and state trust funds
According to the North Dakota Blue Book the three additional functions of the Department of Trusts Lands include:
1. Unclaimed Property: In 1975 legislation created the operation of the Abandoned Property Office [NDCC 47-30-24] in the attempt to provide for the recovery of property by the rightful owners. All property assumed by the State through estate proceedings or the North Dakota Disposition of Abandoned and Unclaimed Property Act was included. The Land Department enforced the Unclaimed Property Act by collecting "abandoned property" (e.g., uncashed checks, unused bank accounts, etc.) after attempting to find the property's rightful owner (S. L. 1975, Ch. 425). An administrator of Abandoned Property and other personnel deemed as necessary for the proper administration were appointed by the Commissioner of the University and School Lands (S. L. 1985, Ch. 510). Added to the 1989 Supplement of the Century Code was the definition for the term “person” to include the federal government. Legislation in 1991 changed the requirements for publishing information relating to abandoned property (S. L. 1991, Ch. 490) and it added to the Century Code concerning the recovery of unclaimed property (S. L. 1991, Ch. 492). In 2013 legislation addressed the specific definitions for unclaimed property as it related to money orders (S. L. 2013, Ch. 353) and there were changes concerning the contracting for the in-state unclaimed property examinations and the disclosure of confidential tax information (S. L. 2013, Ch. 454). In 2015 there was an additional amendment related to the disclosure of confidential tax information (S. L. 2015, Ch. 454) and the exemption of records that gave the value of property paid to the State Abandoned Property Office (S. L. 2015, Ch. 13).
2. Energy Infrastructure and Impact Office: In 1979 a Coal Development Impact Office was created and the Board of University and School Lands was required to appoint a Director with the approval of the Senate (S. L. 1979, Ch. 628). The Board was authorized to make loans to impacted counties, cities, and school districts from moneys deposited into the Coal Development Fund. Prior to loan approval a recommendation had to be submitted by the Coal Development Impact Office to the Board of University and School Lands (S. L. 1979, Ch. 626). The Board could then make loans to impacted counties, cities, and school districts from moneys deposited in the trust fund. In 1981 the Coal Development Impact Office was renamed [NDCC 57-62-04] the (EDIO) Energy Development Impact Office (S. L. 1981, Ch. 621). The coal program began in 1975 and expired in 1989 and the Energy Development Impact Office administration was combined with the State Land Department. It came under the direction of the Board of University and School Lands with the Director of (EDIO) selected by the Board of University and School Lands (S. L. 1989, Ch. 736). Also in 1989 legislation established the Oil and Gas Impact Grant Fund for deposit of revenue from oil and gas gross production taxes (S. L. 1989, Ch.733). There were changes in 2011 to the Energy Development Impact Office and also changed were the duties of the Director of the Energy Development Impact Director (S. L. 2011, Ch. 13). The Office was renamed the Energy Infrastructure and Impact Office and had authority to recommend funding for grants to the Board of University and School Lands. Language changes replaced “development” with the word “infrastructure” when it became a division within Land Department and was called the Energy Infrastructure and Impact Office. It no longer served as an appeals board (S. L. 2013, Ch. 44). In 2013 oil and gas gross production taxes were apportioned to political subdivisions as amended in the Century Code and there were additional amendments to the powers and duties of the Energy Infrastructure Impact Office (S. L. 2013, Ch. 471).
3. Management of four other state trust funds:
a) The Strategic Investment and Improvements Fund (SIIF): In 1977 the Lands and Minerals Trust Fund was created when the Legislative Assembly transferred to the Board of University and School Lands the possessory interest from properties obtained by the Bank of North Dakota (BND) including tracts of real property and reserved mineral interests. The Lands and Minerals Trust Fund was renamed in 2011 by the Legislative Assembly (S. L. 2011, Ch. 483) to the Strategic Investment and Improvements Fund (SIIF). The State Treasurer was required to close out the Lands and Minerals Trust Fund as soon as feasible after June 30, 2011 and transfer any remaining unobligated balance into the (SIIF) Strategic Investment and Improvements Fund. (SIIF) holds assets and revenues earned from the sovereign mineral acres including those formerly owned by the Bank of North Dakota and the State Treasurer. (SIIF) also includes all assets and revenues for minerals located under navigable rivers and lakes in the State (S. L. 1927, Ch. 248) and a portion of oil and gas production and extraction taxes. The oil and gas production and extraction taxes collected by the State are one-time expenditures to be used for the purpose of improving state infrastructure or for initiatives that improve the efficiency and effectiveness of state government. All income from the sale, lease, and management of minerals from these properties is deposited into the (SIIF). The Century Code has also specified the other requirements for the use of this money. Any unobligated monies and any fund balance designated by the Board of University and School Lands involving potential title disputes related to certain riverbed leases are deposited into the Legacy Fund. Deposits from the (SIFF) trust fund go into the Legacy Fund, the Budget Stabilization Fund, and the Oil and Gas Research Fund. In 2011 the Permanent Oil Tax Trust Fund was eliminated (S. L. 2011, Ch. 483). Legislation in 2015 concerned a study to be submitted to Legislative Management and a report on the unobligated balance to the Budget Section by (SIIF) on the Oil and Gas Gross Production Tax Fund (S. L. 2015, Ch. 463).
b) The Coal Development Trust Fund found in various sections of [NDCC 57-62] originated in 1979 (S. L. 1979, Ch. 638). In 1980 the voters approved setting up a constitutional trust fund called the Coal Development Trust Fund with the percentage of the moneys to be held in trust and administered by the Board of University and School Lands for loans to coal impacted counties, cities, and school districts as provided by the Century Code and for loans to school districts pursuant to [NDCC 15.1-36]. Additionally in order to limit the outstanding principal balance of school construction loans from the Coal Development Trust Fund [NDCC 57-61-01.5] a percentage of the money was deposited in the Coal Development Trust Fund for the Lignite Research Fund. Additions were made to the Century Code relating to revenues from a coal severance tax for the Coal Development Fund and the timely distribution of revenues within the counties (S. L. 1981, Ch. 619; S. L. 1981, Ch. 620; S. L. 1981, Ch. 622; and S. L. 1981, Ch. 623).
c) Capitol Building Fund: The Capitol Building Trust Fund [NDCC 48-10-02] was created and was authorized as a land grant for the purpose of erecting public buildings at the Capitol, for the construction and maintenance of public buildings at the Capitol, and to provide a continuing appropriation to the Capitol Grounds Planning Commission. The Capitol Building Fund was fully expendable as established and subject to legislative appropriation each biennium. An amendment in 2013 (S. L. 2013, Ch. 15) allowed for an increase to the amount of the maximum continuing appropriation. The Fund is not permanent in that the balance of the trust is subject to an appropriation each biennium by the Legislative Assembly.
d) The Indian Cultural Education Trust [NDCC Ch.15-68] was created in 2003 for the purpose of generating income to benefit the Mandan, Hidatsa, and Arikara Nation Cultural Education Foundation. Management and distribution of the Trust was determined in the same manner as the Permanent Trust Fund [NDCC 57-51.2]. The Tribal share was to provide the requirements for allocating oil and gas tax revenues to the Three Affiliated Tribes within the Fort Berthold Reservation (S. L. 2007, Ch. 545). Also the Governor in consultation with the Tax Commissioner could enter separate agreements with the Three Affiliated Tribes, Standing Rock Sioux Tribe, and Turtle Mountain Band of Chippewa Indians concerning taxation, and regulation of oil and gas exploration, and production within the boundaries of the Fort Berthold Reservation, Standing Rock Sioux Tribe Reservation, or Turtle Mountain Band of Chippewa Indians Reservation including trust properties outside reservation boundaries. Each Tribal governing body is entitled to enter a separate agreement that conforms to the requirements of the Century Code [NDCC 57-51.2-04]. Legislation granted a five-year extraction tax exemption for production from new wells within the boundaries of an Indian Reservation on Tribal Trust Lands or lands owned by a Tribe (S. L. 2015, Ch. 421).
Trust Beneficiaries through 2013
A Concurrent Resolution in 2005 called for amendments to the Constitution (Article IX, Section 1 and Section 2) relating to the distributions from and management of the Common Schools Trust Fund (also known as the Permanent Trust Fund) and also the trust funds of other educational or charitable institutions. The Permanent Oil Tax Trust Fund (S. L. 2007, Ch. 545) established in 2007 was in 2011 eliminated (S. L. 2011, Ch. 483). According to the 2011-2013 Biennial Report for the Board of University and School Lands and the Office of the Commissioner of University and School Lands “there are thirteen trusts: 1) the Common Schools; 2) North Dakota State University, Fargo; 3) School for the Blind, Grand Forks; 4) School for the Deaf, Devils Lake; 5) State Hospital, Jamestown; 6) Ellendale State College[NDCC 15-14] including Dickinson State University, Minot State University, Dakota College at Bottineau; 7) Valley City State University; 8) Mayville State University; 9) Youth Correctional Center in Mandan; 10) State College of Science in Wahpeton; 11) School of Mines (UND); 12) Veterans Home, Lisbon; and 13)University of North Dakota in Grand Forks. The permanent fund revenue is apportioned from trust lands and distributed funds to the beneficiaries and based on the average financial assets value of the trusts rather than the amount of interest and income earned by each trust. The largest source of revenue in 2011 through 2013 came from mineral royalties, followed by extraction taxes, investment gains, investment income, and mineral bonuses. Other income sources included tobacco tax, surface rentals, unclaimed property, and mineral rentals.”
CHRONOLOGY
1889 The Board of University and School Lands was created to select, lease, and sell all the public state lands and to invest the permanent funds derived from the sales. The Superintendent of Public Instruction, Governor, Attorney General, Auditor, and the Secretary of State were members of the Board (North Dakota Constitution, Article IX, Section 3). The statute defined the fund, outlined its purposes, and assigned to the Board management of the land and fund investments.
1890 Legislation provided for the leasing and sale of public school lands by the Board of University and School Lands who as the responsible party would have the control of appraisement, sale, rental, and disposal of all school and university lands. Members of the Board of Appraisal were the Superintendent of Schools, the Chairman of the County Board of Commissioners, and from each county the County Auditor (S. L. 1890, Ch. 146).
1893 The Board appointed a general agent known as the Commissioner of University and School Lands who also served as the State Land Commissioner and was responsible for the management, control, and disposal of all university, school, and other public lands. The Commissioner managed funds and kept a record of permanent funds (S. L. 1893, Ch. 118).
1901 The duties defining the role of the State Land Commissioner were again addressed (S. L. 1901, Ch. 116).
1903 Legislation provided an act for the leasing of common school or other public lands for coal mining purposes and provided the manner and terms of the lease. It prescribed penalties for unlawfully removing coal from state lands (S. L. 1903, Ch. 176).
1907 Legislation related to the assignee as purchaser of school lands and the role of the Commissioner (S. L. 1907, Ch. 227). It also pertained to the investment of moneys belonging to the permanent school funds (S. L. 1907, Ch. 228).
1909 The Century Code was amended concerning the investments of the permanent school fund (S. L. 1909, Ch. 106).
1911 Legislation related to the duties of the County Board of Appraisal concerning the appraisement and sale of school lands (S. L. 1911, Ch. 261). It also included an act authorizing the Board of University and School Lands to examine all state and school lands in order to determine the extent, depth, and thickness of lignite coal veins underlying surface lands. The Board was also to show the soil characteristics and topographical features of the lands by requesting the aid of the State Engineer. It was the responsibility of the State Auditor to pay for any equipment needed by the State Engineer (S. L. 1911, Ch. 262). In other legislation normal schools established at Valley City, Mayville, and Minot were designated as normal schools for the purpose of preparing teachers in the science of education and the art of teaching for public schools in the State. The schools were “in all things to be free from political and sectarian control” (S. L. 1911, Ch. 61).
1915 Legislation concerned the investment of state school funds (S. L. 1915, Ch. 241) and required the Commissioner to have certified copies of the patents from selected lands that were held by the Register of Deeds for a particular county (S. L. 1915, Ch. 227).
1917 The investment of school funds from a first mortgage on cultivated farm lands was addressed (S. L. 1917, Ch. 204).
1919 An amendment concerned the investing of permanent funds that were managed by the Board of University and School Lands (S. L. 1919, Ch. 198). The Bank of North Dakota was established "to encourage and promote agriculture, commerce, and industry in the state" (S. L. 1919, Ch. 147). Referral legislation to abolish the Bank of North Dakota was voted upon in the primary election held on June 26, 1919.
1923 Voters in a special election held on October 28, 1921 defeated an initiated measure to dissolve the Bank of North Dakota.
1927 Legislation provided for leasing and sales by the Board of University and School Lands to be treated in the same manner as other lands under the control of the Board. Related to this was the lease and sale of islands formed in beds of navigable streams and declared property of the State. Proceeds derived from such land were considered a part of the common school funds and distributed as directed by law (S. L. 1927, Ch. 248). Rules and regulations relative to land development or improvement were established and the Board could request a report on the land by the State Geologist (S. L. 1927, Ch. 249). Legislation related to the leasing of state or school lands particularly to land containing oil.
1929 Legislation addressed the procedures regarding the investment fund for the Board of University and School Lands and the payment and collection from the principal and interest (S. L. 1929, Ch. 215). Other legislation concerned an amendment relating to the sale of school or institutional lands and applications for the acquisition of land (S. L. 1929, Ch. 217).
1931 Legislation amended laws relating to the collection of moneys due on school lands by the County Treasurers and the State Land Commissioner (S. L. 1931, Ch. 229) and the interest on the daily balances for all moneys. Instructions concerning collections of funds were directed to the Commissioner of University and School Lands (S. L. 1931, Ch. 230). Also the sale of school lands or the fixing and collecting of fees from the leasing or sale of school lands was amended (S. L. 1931, Ch. 231).
1933 Legislation granted an act to empower the federal government to acquire lands in the State of North Dakota by purchase or otherwise for the establishment of national forests and to grant all rights necessary for the proper control and administration of lands by the federal government (S. L. 1933, Ch. 187).
1935 Legislation concerned the reduction of past due interest on loans made by the Board (S. L. 1935, Ch. 255).
1939 Legislation addressed the resale of lands acquired by the State on foreclosure of mortgages given to secure loans of permanent school funds or by deed in lieu of foreclosure. It awarded preference to mortgagors whose land was resold or to heirs and it provided for the terms and conditions of resale. It authorized and empowered the Board of University and School Lands to sell the lands with a directive to the State Land Department as approved by the Board (S. L. 1939, Ch. 224).
1944 Legislation related to the percentage of interest on the investments of University and School Land funds (S. L. 1944, Ch. 35).
1945 Legislation concerned specific terms, interest, and payment for a farm loan made by the Commissioner of University and School Lands on first mortgages (S. L. 1945, Ch. 167).
1951 A Concurrent Resolution provided for an amendment to the Constitution concerning the location for the School for the Blind that read “the blind asylum shall be known as the North Dakota School for the Blind and may be removed from the County of Pembina to such other location as may be determined by the Board of Administration” (S. L. 1951, Ch. 348). The Resolution was passed by voters on June, 24, 1952.
1953 Amendments were made specifying the investments considered acceptable for the common schools and other public institutions (S. L. 1953, Ch. 124) and the exemption of oil drilling rigs from taxation was repealed (S. L. 1953, Ch. 309).
1957 The Oil and Gas Gross Production Tax rate was amended (S. L. 1957, Ch. 368).
1961 Legislation related to amendments concerning the leasing of grant lands (S. L. 1961, Ch. 151) and it defined “working interest” as it related to oil and gas (S. L. 1961, Ch. 240).
1963 Legislation concerned farm foreclosure and rental of school lands (S. L. 1963, Ch. 133, Ch. 134, and Ch. 135). Also addressed was the process of withdrawal of school lands (S. L. 1963, Ch. 136), the redemption of school lands (S. L. 1963, Ch. 139), and the rental and lease terms on school lands (S. L. 1963, Ch. 137). Appointed by the Governor the Commissioner became a member of the State Investment Board [NDCC 21-10-06].
1965 An amendment to the Century Code related to the investment of school funds by the Board of University and School Lands (S. L. 1965, Ch. 121).
1971 Legislation was passed allowing the Board to invest moneys in first mortgages on farm land (S. L. 1971, Ch. 159) and to set and establish fees for leases, contracts, and patents (S. L. 1971, Ch. 160). It also concerned the creation of the State Land Maintenance Fund (S. L. 1971, Ch. 161), and the deleted from the Code the term “deaf and dumb” by replacing it with the word “mute” (S. L. 1971, Ch. 162).
1973 Legislation concerned [NDCC 15-14] the State Normal and Industrial School at Ellendale (S. L. 1973, Ch. 131) and the creation of the State Board of Higher Education (S. L. 1973, Ch. 526). The Legislature authorized the State Board of Higher Education to sell the UND-Ellendale Branch (S. L. 1973, Ch. 180) with the income from the Ellendale grant lands to be reallocated and distributed into equal proportions to the Soldiers Home, the North Dakota School for the Blind, the Forestry School, the State School of Science, the State Hospital, Minot State College, and Dickinson State College (S. L. 1973, Ch. 176). An act to amend and reenact the Code concerned investments and farm loans made by the Board of University and School Lands and legislation that allowed for the amount of mortgage and any limitations on farm loans (S. L. 1973, Ch. 129).
1975 Legislation created the Permanent Trust Fund as a part of the State Land Department (S. L. 1975, Ch. 425). The Abandoned Property Office [NDCC 47-30-24] was also created as a division within the Office of the State Land Commissioner (S. L. 1975, Ch. 425), and the Energy Development Impact Office (EDIO) came into existence.
1977 The State Legislature changed the Century Code [NDCC 15-02-05.1] relating to the duties of the Commissioner of University and School Lands and concerning the duties of the Attorney General in reviewing sale bills for state-owned land (S. L. 1977, Ch. 137). The Commissioner was appointed to the Outdoor Recreation Interagency Council [55-08-02.1].
1979 Legislation provided for a severance tax upon all coal “mined” and provided procedures for the imposition, collection, and administration of the tax. It also provided for the allocation of moneys collected to provide for impact loans to be administered by the Board of University and School Lands (S. L. 1979, Ch. 626). The bill was “not approved or disapproved” by the Governor.
1981 A new section was added to the Code relating to pre-filing and review of legislative bills for the sale or exchange of state-owned land. Legislation also repealed certain sections of the Code concerning the Attorney General and the Commissioner of University and School Lands (S. L. 1981, Ch. 516). The Oil Impact Grant program began in 1981 and was funded from one-third of the first one-fifth of the Oil and Gas Production Tax.
1983 Legislation concerned the definition of “property” for oil tax extraction purposes (S. L. 1983, Ch. 662) and provided for distribution of certain education aid funds. It also related to quarterly allocations of moneys into the Oil Extraction Tax Development Fund (S. L. 1983, Ch. 663). Added to this legislation were the Sinking Fund and the Resources Trust Fund and the enactment of an excise tax to be known as the Oil Extraction Tax [NDCC 57-51.1-08]. The Board exchanged certain land in Oliver and McKenzie Counties with the State Parks and Recreation Department (S. L. 1983, Ch. 184).
1987 The State Auditor was replaced on the Board by the State Treasurer (S. L. 1987, Ch. 187). Legislation concerned the powers and duties of the State Investment Board and a revised list of members including the Commissioner of University and School Lands (S. L. 1987, Ch. 190). Legislation also repealed certain custodial duties of the State Treasurer concerning school funds (S. L. 1987, Ch. 189). The Budget Stabilization Fund (Rainy Day) was created as a special fund of the State Treasury and a cap was placed on what percentage could be spent (S. L. 1987, Ch. 638). Legislation also established the Venture Capital Corporation (S. L.1987, Ch. 141).
1989 Added to the Code was a subsection relating to the authority of the Board of University and School Lands and concerning the issuance of refunds (S. L. 1989, Ch. 188). Legislation also concerned meetings held by the Board (S. L. 1989, Ch. 189), and other changes to the Code regarding the types of legal investments to be made by the Board of University and School Lands (S. L. 1989, Ch. 191). Additionally legislation created and enacted two new sections to the Code relating to investments and calculation and distribution of the investment income under the control of the Board of University and School Lands (S. L. 1989, Ch. 190). Legislation also amended the Code concerning interest to be paid on Oil and Gas Production Tax as it related to extensions in making payments (S. L. 1989 Ch. 732) and for any exemptions from the Oil Extraction Tax (S. L. 1989 Ch. 734).
1991 Legislation approved an appropriation from the Oil and Gas Impact Grant Fund for the purpose of providing oil and gas development impact grants (S. L. 1991, Ch. 17) and concerned an amendment of the Code regarding the removal of or payment for improvements on school lands (S. L. 1991, Ch. 158).
1993 Sections to the Code were amended as they related to the calculation and distribution of fund beneficiaries from income earned by the Board of University and School Lands (S. L. 1993, Ch. 157).
1995 The Century Code was amended concerning surface leasing of state school lands. It defined the use of land for recreational purposes and repealed sections of the Code relating to surface leasing of state school lands and the sale of coal lands (S. L. 1995, Ch. 162).
1997 Prior to using entrusted funds for the purchase as sole owner of property considered to be commercial or residential real property the Board of University and School Lands was required to submit proposal recommendations to the Legislative Assembly and the Budget Section (S. L. 1997, Ch. 42). A House Concurrent Resolution directed the Legislative Council to study the investment processes of the state in relationship to the state bonding fund and the fire and tornado fund. Additionally it required that the performance of all investments of the State Investment Board and the Board of University and School Lands be monitored (S. L. 1997 Ch. 577). Legislation repealed the Outdoor Recreation Interagency Council of which the Commissioner was a member (S. L.1997, Ch. 471).
1999 The Legislative Assembly extended the term of office for the Commissioner of University and School Lands from two to four years (S. L. 1999, Ch. 150). The Legislature created a Tobacco Settlement Trust Fund and a percentage was transferred as an investment to the Common Schools Trust Fund (S. L. 1999, Ch. 430).
2003 Legislation gave the Board authority to pledge securities relating to lending transactions (S. L. 2003, Ch. 130) and repealed quarterly reports of apportionment on maintenance fund balances (S. L.2003, Ch. 129). The Oil and Gas Research Council and the Oil and Gas Research Fund were established from a percentage of monies taken from the Oil and Gas Production Tax and the Oil Extraction Tax (S. L. 2003, Ch. 472).
2005 Distributions from and management of the Common Schools Trust Fund and trust funds of other educational or charitable institutions was addressed including revenues earned and deposited into a perpetual trust fund. A Concurrent Resolution concerning Common Schools Trust Funds was on the ballot in the 2006 General Election as measure (No. 1). The measure required that the Permanent Trust Fund be managed to preserve purchasing power and to provide for stable distributions to benefit fund beneficiaries. The measure would have changed trust fund distributions from earned interest and income to distributions based on an average value thereby requiring that all revenue produced by a trust fund be deposited into the fund after administrative costs had been paid (S. L. 2005, Ch. 624).
2007 A Concurrent Resolution was approved by voters in the 2006 General Election concerning the Common Schools Trust Fund specifically relating to the distributions from and management of the Common Schools Trust Fund and the trust funds of other educational or charitable institutions. Revenues earned by a perpetual trust fund were required to be deposited into the funds (S. L. 2007, Ch. 582). In 2007 the Legislative Assembly consolidated funding for the state school aid program. Legislation also created and enacted a new section to Article X of the Constitution relating to the establishment and use of a Permanent Oil Tax Trust Fund (S. L. 2007, Ch. 584). Voters did not approve the measure when it was placed on the ballot in the 2008 General Election.
2009 The State Lands Maintenance Fund [NDCC15-03-01.1] funded by trust fund assets was amended and funding needed approval from the Legislative Assembly (S. L. 2009, Ch. 153). Legislation concerned the management of trust funds including state lands. Legislation also addressed the topic of the existence of coal on state land with the Board of University and School Lands requesting reports from the State Geologist (S. L. 2009, Ch. 154).
2010 Voters approved the Legacy Fund measure (No. 1) on November 2, 2010. It provided for the deposit of certain oil and gas tax revenues into a fund and imposed limitations on use of the money. A two-thirds vote of both Houses of the Legislative Assembly was needed in order for any of the funds to be spent. No more than fifteen percent could be used per biennium and would become available in 2017.
2011 Legislation concerned the repeal of the Permanent Oil Tax Trust Fund (S. L. 2011, Ch. 483). Other legislation involved the powers of the Board of University and School Lands, the duties of the Commissioner, and the proceeds from the apportionment of the Oil and Gas Gross Production Tax.
2013 Legislation provided for a Board of University and School Lands report to be submitted to the Legislative Management before October 1, 2014. The study concerned private lands owned and adjacent to lands under the control of the US Army Corps of Engineers surrounding Lake Sakakawea and Lake Oahe and for controlling noxious weeds and protecting public areas used for hunting and fishing. Also included were costs associated with a transition of the land from the US Army Corps of Engineers and costs of property maintenance if the State took over ownership from the US Army Corps of Engineers (S. L. 2013, Ch. 129). Legislation was to adjust the regulations as determined to be fair relating to coal leases on state land (S. L. 2013, Ch. 130) and amend the Abandoned Oil and Gas Well Plugging and Site Reclamation Fund (S. L. 2013, Ch. 277).
2015 Legislation related to the Board of University and School Lands and the use of Oil and Gas Impact Grants that were created during the session. This addressed hospital treatment for victims of sexual assault (S. L. 2015, Ch. 463) and assistance to law enforcement agencies impacted by oil and gas development. Grants aiding the domestic violence and rape crisis program and a community-based or hospital-based sexual assault examiner program were to start on July 1, 2015 (S. L. 2015, Ch. 191). Legislation provided a one-time appropriation to the Attorney General for human trafficking victim treatment and support services in non-oil producing counties in the form of grants. Additionally funds from the Board of University and School Lands (S. L. 2015, Ch. 463) made available grants to organizations involved in providing prevention and treatment services related to human trafficking victims in the “hub” cities located in oil-producing counties with the approval of the Attorney General (S. L. 2015, Ch. 375). Other changes concerned the Abandoned Oil and Gas Well Plugging and Site Reclamation Fund (S. L. 2015, Ch. 465).
RECORD SERIES
BANK OF NORTH DAKOTA
30043 Land Department. Farm Loan Department Finance Committee Minutes, 1922-1933.
30046 Land Department. Card Index to Closed Farm Loan Files.
30047 Land Department. Record of Principal and Interest Losses.
30581 Land Department. Farm Loan Photographs.
31245 Land Department. Farm Loan Department, Collection Department, and Land Department Reports.
31333 Land Department. Closed Farm Loan Files.
LAND DEPARTMENT
30329 Board of University and School Lands. Oil and Gas Lease Files.
30331 Board of University and School Lands. Records of Income from Oil and Gas Leases.
30332 Board of University and School Lands. Lease Applications.
30333 Board of University and School Lands. Farm Loan Case Files.
30334 Board of University and School Lands. School Land Leases.
30538 Board of University and School Lands. Farm Photographs.
30539 Board of University and School Lands. Daily Collection Record.
30540 Board of University and School Lands. Cashier’s Register.
30541 Board of University and School Lands. Farm Loan Investment Record.
30542 Board of University and School Lands. Bond Investment Record.
30543 Board of University and School Lands. Land Grant Contract Control Sheets.
30544 Board of University and School Lands. Summary of Leasing Collections.
30545 Board of University and School Lands. Original Land Grant Investment Record.
30869 Board of University and School Lands. Contract and Loan Report.
31355 Board of University and School Lands. Permanent School Fund File.
31798 Land Sales Division. Land Data File.
31805 Land Sales Division. Satisfaction of Mortgage Records.
31806 Land Sales Division. Records of the Partial Release of Mortgage.
31807 Land Sales Division. Assignment of Contract Books.
31808 Land Sales Division. Judicial Wing Construction Project Files, 1979-1982.
31809 Land Sales Division. Reference Maps and Plats.
31820 Mineral Division. Investigation of School Lands for Coal.
31891 State Energy Development. Files.
31941 Land Sales Division. Oil and Coal Land Leasing Maps, 1975-1987.
32013 Maps. 1949-1985.
32036 Aerial Photographs, 1968-1997.
32058 Minerals Division. NDIC Oil and Gas Advisement Committee
32059 Oil and Land Leases Card Index. (Not in locator)
32100 Surface Management. Tract Inspection Reports.
32114 Administrative Division. Photographs.
32120 Plat Maps for Barnes and Burleigh County.
32121 Common School Lands Index.
32122 Record of School Lands Sold.
32123 Losses by filings in the Bismarck Land District, November, 1895.
32124 Selected Land Index.
32125 Farm Loan Record.
32126 Sale Lists of School Lands, 1891-1909.
32152 Administration. Correspondence.
32233 Minerals Management. Mineral Resource Files.
32248 Surface Management. Tract Inspection Reports.
32405 Surface Management. Patent Records.
32406 Surface Management. Right of Way Files.
32407 Board of University and School Lands. Minutes.
32408 Surface Management. Deed Record: Quit Claim Deeds.
32409 Surface Management. Land Contract Ledgers and Journals.
32415 Minerals. Bank of North Dakota Loan or Land Files
32417 Surface Management. Acquired Lands.
32425 Surface Management. Right of Way and Easement Land Sold.
32427 Surface Management. Soil Surveys.
32428 Administration. Bankruptcies, Foreclosures, Cancelations.
32431 Surface Management. Grant Land Sales.
SOURCES
Gray, David P. Guide to North Dakota State Archives, 1983.
North Dakota Century Code.
North Dakota Department of Trust Lands Biennial Report. (2013-2015). Commissioner of the University and School Lands and the Office of the Commissioner of University and School Lands.
North Dakota Department of Trust Lands Website.
North Dakota Legislative Council Staff. (March, 2015) Analysis of Major Special Funds for 2013-2015 and 2015-2017 Biennium’s Reflecting Legislators Action through March 24, 2015.
North Dakota Legislative Council Staff on Taxation Committee. (August, 2011) Oil extraction tax-background memorandum.
North Dakota Secretary of State Blue Book.
North Dakota State Legislature Session Laws.
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