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Serving Northern St. Louis County, Minnesota

School trust lands

There’s no good argument to hold out for an exchange of BWCAW lands

Posted 2/2/25

Opponents of the sale of approximately 80,000 acres of school trust lands in the Boundary Waters should check their calculators. Those opponents include Rep. Roger Skraba and Eighth District U.S. …

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School trust lands

There’s no good argument to hold out for an exchange of BWCAW lands

Posted

Opponents of the sale of approximately 80,000 acres of school trust lands in the Boundary Waters should check their calculators. Those opponents include Rep. Roger Skraba and Eighth District U.S. Rep. Pete Stauber, both of whom apparently see $33 million as a better deal for the state’s school trust than $528 million.
That’s the yawning difference over the next 40 years between the planned sale of these state lands and the alternative – a land swap that would trade those state lands in the Boundary Waters for federal lands located outside the wilderness.
It’s that enormous gap, among other factors, that has convinced Aaron Vande Linde, the director of the state’s office of the school trust lands, that a sale is the only sensible way to solve this long-standing issue. According to Vande Linde, it’s all about the value of money over time.
A sale of the lands, which could be completed as early as next year, is expected to generate about $34 million to the school trust, which would invest those funds in the state’s very successful investment fund, which has generated an annual return of about 7.5 percent. Through the wonders of compounding, the $34 million the trust could receive next year would be worth about $528 million in 40 years with equivalent growth over that period. In 50 years, we’d be looking at more than a billion dollars in additional revenue for the trust.
The state lands in question are required to produce revenue for the state’s school trust fund, but without the ability to log or otherwise develop those lands located within the wilderness, the state has generated nothing from those lands since passage of the Boundary Waters Wilderness Act in 1978. That’s 47 years with no income and no resolution to the problem, although it has offered local officials the opportunity to regularly take shots at the federal government, which is apparently valuable to them.
Opponents of the sale argue that an exchange is better because it would give the office of school trust lands more acres for logging. A Timberjay investigation last year found that over the next 40 years, logging on an additional 80,000 acres of school trust lands would generate about $6.4 million in stumpage receipts, with another $26 million coming from investment income off those receipts. Hence the choice: $528 million or $33 million over 40 years. Take a 50-year view and we’re talking about a difference of $1.05 billion versus $66 million. That shows the value of invested money over time.
Some opponents of a land sale correctly note that the school trust has, for years, generated most of its new revenue from taconite mining royalties. It’s an interesting fact, but irrelevant to this issue. Opponents of a sale are fully aware that the existing state and federal mineral rights will be unaffected regardless of whether the lands are transferred via sale or exchange. Both state law and the constitution, as well as federal law, prohibits the transfer of mineral rights. For those of us living in the reality-based world, that amounts to zero dollars in additional trust revenue from mining royalties.
When pressed, Rep. Skraba argued that an exchange would allow for more logging, which would benefit communities in other ways. Yet while the Forest Service logs at a slightly slower pace than the DNR (which manages the school trust forest lands), our own investigation concluded that the difference would amount to an additional 4,000 cords of timber on a statewide basis, an increase of about 0.14 percent. Sorry Mr. Skraba, that’s a rounding error, not a meaningful change that would add any appreciable employment to any community in the region.
And, of course, there is one other significant problem with the proposed exchange – both state and federal officials, and other stakeholders, have attempted in the past to come to agreement on an exchange, without success. Both the DNR and the U.S. Forest Service agreed to hammer out an exchange back in 2012 and worked for a decade without reaching a consensus. Land exchanges are complicated and one of this magnitude has rarely been attempted anywhere in the U.S.
Blocking a sale of the school trust lands doesn’t get us any closer to an exchange. It simply leaves us with the status quo that has existed for nearly half a century already… school trust lands that generate no income whatsoever for the trust. Given the complexities of an exchange, we could easily be sitting here half a century from now in the exact same position. And we would have effectively forfeited a billion dollars that could otherwise be sitting in the school trust.
Sadly, opponents of the land sale currently in the works appear more interested in a political talking point than a resolution that serves the public interest. That says a lot.