REGIONAL— This fall, an amendment to Minnesota’s constitution is on the ballot, seeking to increase the annual distribution from the Permanent School Fund from 2.5 percent to 4.5 percent. The change would send more money to schools around the state, using investment proceeds from the state’s school trust. The trust has grown over the decades, both from investments as well as annual revenues generated through the management of the school trust lands for timber production or mining royalties.
When Minnesota became a state in 1858, its constitution set aside large portions of public land for the explicit purpose of generating revenue for public schools.
Today, school trust lands make up 2.5 million acres in the state, with an additional 1 million acres of lands with mineral rights. Ninety-two percent of trust lands are in the 10 northernmost counties in Minnesota, after most trust lands in state’s southern half were sold in the 1800s for agriculture.
Revenue collected on these lands goes straight to the Permanent School Fund, which has historically grown around seven percent each year and now holds $2.3 billion. Two-and-a-half-percent of that is distributed to school districts on a per-pupil basis, currently amounting to about $68 per student per year, a tiny fraction of the roughly $10,000 the state allocates annually on average per student.
This year’s ballot measure would increase the amount disbursed from the fund from about $68 per student, to about $101 next year. The change also modernizes the distribution formula by shifting the allocation calculation from interest and dividend revenue to the average net asset value of the fund.
The fund has grown significantly in recent years, from around $675 million in 2010 to $2.3 billion today. This growth helped prompt legislators to make better use of the fund. Rep. Spencer Igo (R-Wabana Township) proposed the increase in the state House, where it passed with a 133-0 vote before it was sent to the Senate, where it passed 43-24.
The amendment would bring about $596,569 annually to schools in the taconite assistance area. If the amendment passes, Ely would see an additional $16,910 based on current values while St. Louis County Schools would receive an extra $61,281.
While the financial impact is fairly small, compared to the size of most school budgets, school officials are eager to see the measure approved by voters.
Both Anne Oelke, the superintendent for Ely Public Schools, and Brian Masterson, the superintendent for St. Louis County, emphasized two points in statements in speaking to the Timberjay: The amendment will not raise taxes, and leaving the question blank counts as a “No” vote.
“Voters should know that their taxes will not be raised if this passes this fall. They should also know that if a voter skips answering this question, that it would then count as a no vote. Please make sure you are answering all the questions on the ballot this fall,” stated Masterson.