SF 1889

1st Engrossment - 87th Legislature (2011 - 2012) Posted on 03/19/2012 08:36am

A bill for an act
relating to the permanent school fund; changing the Permanent School Fund
Advisory Committee into a legislative commission; providing for a director
to oversee, manage, and administer school trust lands; amending Minnesota
Statutes 2010, sections 15A.0815, subdivision 3; 16A.06, subdivision 11;
16A.125, subdivision 5; 84.027, subdivision 18; 84.085, subdivision 1; 92.12,
subdivision 1; 92.121; 92.13; 93.2236; 94.342, subdivision 5; 127A.30;
477A.11, subdivisions 3, 4, by adding a subdivision; 477A.12, subdivisions 2, 3;
Minnesota Statutes 2011 Supplement, section 477A.12, subdivision 1; proposing
coding for new law in Minnesota Statutes, chapter 127A.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1.

Minnesota Statutes 2010, section 15A.0815, subdivision 3, is amended to
read:

Subd. 3.

Group II salary limits.

The salaries for positions in this subdivision may
not exceed 85 percent of the salary of the governor:

Executive director of Gambling Control Board;

Commissioner, Iron Range Resources and Rehabilitation Board;

Commissioner, Bureau of Mediation Services;

Ombudsman for Mental Health and Developmental Disabilities;

Chair, Metropolitan Council;

new text begin Director of trust lands and mineral assets;
new text end

Executive director of pari-mutuel racing; and

Commissioner, Public Utilities Commission.

Sec. 2.

Minnesota Statutes 2010, section 16A.06, subdivision 11, is amended to read:

Subd. 11.

Permanent school fund reporting.

The commissioner shall annually
report to the new text begin Legislative-Citizen new text end Permanent School Fund deleted text begin Advisory Committee deleted text end new text begin
Commission, new text end and the legislature the amount of the permanent school fund transfer and
information about the investment of the permanent school fund provided by the State
Board of Investment. The State Board of Investment shall provide information about how
they maximized the long-term economic return of the permanent school fund.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2014.
new text end

Sec. 3.

Minnesota Statutes 2010, section 16A.125, subdivision 5, is amended to read:

Subd. 5.

Forest trust lands.

(a) The term "state forest trust fund lands" as used
in this subdivision, means public land in trust under the Constitution set apart as "forest
lands under the authority of the commissioner" of natural resources as defined by section
89.001, subdivision 13 new text begin , but excludes school trust lands as defined in section 92.025 new text end .

(b) The commissioner of management and budget shall credit the revenue from the
forest trust fund lands new text begin , excluding school trust lands defined under section 92.025, new text end to the
forest suspense account. The account must specify the trust funds interested in the lands
and the respective receipts of the lands.

(c) After a fiscal year, the commissioner of management and budget shall certify the
total costs incurred for forestry during that year under appropriations for the protection,
improvement, administration, and management of state forest trust fund lands and
construction and improvement of forest roads to enhance the forest value of the lands.
The certificate must specify the trust funds interested in the lands. The commissioner of
natural resources shall supply the commissioner of management and budget with the
information needed for the certificate.

(d) After a fiscal year, the commissioner shall distribute the receipts credited to the
suspense account during that fiscal year as follows:

(1) the amount of the certified costs incurred by the deleted text begin state deleted text end new text begin Department of Natural
Resources new text end for forest management, forest improvement, and road improvement during the
fiscal year shall be transferred to the forest management investment account established
under section 89.039;

(2) the balance of the certified costs incurred by the deleted text begin state deleted text end new text begin Department of Natural
Resources new text end during the fiscal year shall be transferred to the general fund; and

(3) the balance of the receipts shall then be returned prorated to the trust funds in
proportion to their respective interests in the lands which produced the receipts.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2014.
new text end

Sec. 4.

Minnesota Statutes 2010, section 84.027, subdivision 18, is amended to read:

Subd. 18.

Permanent school fund authority; reporting.

The deleted text begin commissioner
of natural resources deleted text end new text begin director of trust lands and mineral assets new text end has the authority and
responsibility for the administration of school trust lands under sections 92.121 and
127A.31. The deleted text begin commissioner deleted text end new text begin director new text end shall biannually report to the new text begin Legislative-Citizen
new text end Permanent School Fund deleted text begin Advisory Committee deleted text end new text begin Commission new text end and the legislature on the
management of the school trust lands that shows how the deleted text begin commissioner deleted text end new text begin director new text end has and
will continue to achieve the following goals:

(1) manage the school trust lands efficiently;

(2) reduce the management expenditures of school trust lands and maximize the
revenues deposited in the permanent school trust fund;

(3) manage the sale, exchange, and commercial leasing of school trust lands to
maximize the revenues deposited in the permanent school trust fund and retain the value
from the long-term appreciation of the school trust lands; and

(4) manage the school trust lands to maximize the long-term economic return for the
permanent school trust fund while maintaining sound natural resource conservation and
management principles.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2014.
new text end

Sec. 5.

Minnesota Statutes 2010, section 84.085, subdivision 1, is amended to read:

Subdivision 1.

Authority.

(a) The commissioner of natural resources may accept for
and on behalf of the state any gift, bequest, devise, or grants of lands or interest in lands or
personal property of any kind or of money tendered to the state for any purpose pertaining
to the activities of the department or any of its divisions. Any money so received is hereby
appropriated and dedicated for the purpose for which it is granted. Lands and interests in
lands so received may be sold or exchanged as provided in chapter 94.

(b) When the commissioner of natural resources accepts lands or interests in land,
the commissioner may reimburse the donor for costs incurred to obtain an appraisal needed
for tax reporting purposes. If the state pays the donor for a portion of the value of the
lands or interests in lands that are donated, the reimbursement for appraisal costs shall not
exceed $1,500. If the donor receives no payment from the state for the lands or interests in
lands that are donated, the reimbursement for appraisal costs shall not exceed $5,000.

(c) The commissioner of natural resources, on behalf of the state, may accept and
use grants of money or property from the United States or other grantors for conservation
purposes not inconsistent with the laws of this state. Any money or property so received
is hereby appropriated and dedicated for the purposes for which it is granted, and shall
be expended or used solely for such purposes in accordance with the federal laws and
regulations pertaining thereto, subject to applicable state laws and rules as to manner
of expenditure or use providing that the commissioner may make subgrants of any
money received to other agencies, units of local government, private individuals, private
organizations, and private nonprofit corporations. Appropriate funds and accounts shall
be maintained by the commissioner of management and budget to secure compliance
with this section.

deleted text begin (d) The commissioner may accept for and on behalf of the permanent school fund a
donation of lands, interest in lands, or improvements on lands. A donation so received
shall become state property, be classified as school trust land as defined in section 92.025,
and be managed consistent with section 127A.31. deleted text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2014.
new text end

Sec. 6.

Minnesota Statutes 2010, section 92.12, subdivision 1, is amended to read:

Subdivision 1.

Appraisers.

new text begin The director of trust lands and mineral assets may have
any school trust land appraised. new text end The commissioner may have any deleted text begin school trust or deleted text end other
state lands appraised. The appraisals must be made by regularly appointed and qualified
state appraisers. To be qualified, an appraiser must hold a state appraiser license issued
by the Department of Commerce. The appraisal must be in conformity with the Uniform
Standards of Professional Appraisal Practice of the Appraisal Foundation.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2014.
new text end

Sec. 7.

Minnesota Statutes 2010, section 92.121, is amended to read:

92.121 PERMANENT SCHOOL FUND LANDS.

The new text begin director of trust lands and mineral assets and the new text end commissioner of natural
resources shall exchange permanent school fund land as defined in the Minnesota
Constitution, article XI, section 8, located in state parks, state recreation areas, wildlife
management areas, scientific and natural areas, or state waysides or on lands managed
by the commissioner as old growth stands, for other lands as allowed by the Minnesota
Constitution, article XI, section 10, and section 94.343, subdivision 1, that are compatible
with the goal of the permanent school fund lands in section 127A.31 when, as a result
of management practices applied to the permanent school fund lands and associated
resources, revenue generation has been diminished or is prohibited and no alternative has
been put into effect to compensate the permanent school fund for the income losses.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2014.
new text end

Sec. 8.

Minnesota Statutes 2010, section 92.13, is amended to read:

92.13 STATE LANDS, DATE OF SALE.

The commissioner shall hold public sales of deleted text begin school and other deleted text end state lands new text begin other than
school trust lands new text end when it is advantageous to the state and to intending buyers and settlers.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2014.
new text end

Sec. 9.

Minnesota Statutes 2010, section 93.2236, is amended to read:

93.2236 MINERALS MANAGEMENT ACCOUNT.

(a) The minerals management account is created as an account in the natural
resources fund. Interest earned on money in the account accrues to the account. Money in
the account may be spent or distributed only as provided in paragraphs (b) and (c).

(b) If the balance in the minerals management account exceeds $3,000,000 on June
30, the amount exceeding $3,000,000 must be distributed to deleted text begin the permanent school fund
and deleted text end the permanent university fund. deleted text begin The amount distributed to each fund must be in the
same proportion as the total mineral lease revenue received in the previous biennium
from school trust lands and university lands.
deleted text end

(c) Subject to appropriation by the legislature, money in the minerals management
account may be spent by the commissioner of natural resources for mineral resource
management and projects to enhance future mineral income and promote new mineral
resource opportunities.

new text begin (d) Beginning July 1, 2014, no revenue from school trust lands, including revenue
from severed minerals interests, shall be deposited in the minerals management account.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2014.
new text end

Sec. 10.

Minnesota Statutes 2010, section 94.342, subdivision 5, is amended to read:

Subd. 5.

Additional restrictions on school trust land.

School trust land may
be exchanged with other Class A land only if the deleted text begin Permanent School Fund Advisory
Committee is appointed as temporary deleted text end new text begin director of trust lands and mineral assets is serving
as new text end trustee of the school trust land for purposes of the exchange. The deleted text begin committee deleted text end new text begin director
new text end shall provide independent legal counsel to review the exchanges.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2014.
new text end

Sec. 11.

Minnesota Statutes 2010, section 127A.30, is amended to read:

127A.30 new text begin LEGISLATIVE-CITIZEN new text end PERMANENT SCHOOL FUND
deleted text begin ADVISORY COMMITTEE deleted text end new text begin COMMISSION new text end .

Subdivision 1.

new text begin Commission established; new text end membership.

deleted text begin A state deleted text end new text begin (a) The
Legislative-Citizen new text end Permanent School Fund deleted text begin Advisory Committee deleted text end new text begin Commission of 16
members new text end is established deleted text begin to advise the Department of Natural Resources on the management
of permanent school fund land, which is held in trust for the school districts of the state deleted text end new text begin
in the legislative branch new text end . The deleted text begin advisory committee must consist deleted text end new text begin commission consists new text end
of the following persons deleted text begin or their designees deleted text end : deleted text begin the chairs of the education committees of
the legislature, the chairs of the legislative committees with jurisdiction over the K-12
education budget, the chairs of the legislative committees with jurisdiction over the
environment and natural resources policy and budget, the chair of the senate Committee
on Finance and the chair of the house of representatives Committee on Ways and Means,
the commissioner of education, one superintendent from a nonmetropolitan district, one
superintendent from a metropolitan area district, one person with an expertise in forestry,
one person with an expertise in minerals and mining, one person with an expertise in
real estate development, one person with an expertise in renewable energy, one person
with an expertise in finance and land management, and one person with an expertise in
natural resource conservation. The school district superintendents shall be appointed
by the commissioner of education. The committee members with areas of expertise in
forestry, minerals and mining, real estate development, renewable energy, finance and land
management, and natural resource conservation shall be appointed by the commissioner of
natural resources. Members of the legislature shall be given the opportunity to recommend
candidates for vacancies on the committee to the commissioners of education and natural
resources. The advisory committee must also include a nonvoting member appointed
by the commissioner of natural resources. The commissioner of natural resources shall
provide administrative support to the committee. The members of the committee shall
serve without compensation. The members of the Permanent School Fund Advisory
Committee shall elect their chair and are bound by the provisions of sections 43A.38 and
116P.09, subdivision 6.
deleted text end

new text begin (1) two public members appointed by the senate Subcommittee on Committees of
the Committee on Rules and Administration;
new text end

new text begin (2) two public members appointed by the speaker of the house;
new text end

new text begin (3) four public members appointed by the governor;
new text end

new text begin (4) four members of the senate, including two members from the minority party,
appointed by the senate Subcommittee on Committees of the Committee on Rules and
Administration; and
new text end

new text begin (5) four members of the house of representatives, including two members from the
minority party, appointed by the speaker of the house.
new text end

new text begin (b) Members appointed under paragraph (a) must not be registered lobbyists. The
governor's appointments to the commission are subject to the advice and consent of the
senate.
new text end

new text begin (c) Public members appointed under paragraph (a) shall have practical experience or
expertise or demonstrated knowledge in renewable or nonrenewable resource management
or development, real estate, business, finance, trust administration, asset management, or
the practice of law in the areas of natural resources or real estate.
new text end

new text begin (d) Public members serve four-year terms. Appointed legislative members serve
at the pleasure of the appointing authority. Public and legislative members continue to
serve until their successors are appointed. Public members shall be initially appointed
according to the following schedule of terms:
new text end

new text begin (1) two public members appointed by the governor for a term ending the first
Monday in January 2015;
new text end

new text begin (2) one public member appointed by the senate Subcommittee on Committees of the
Committee on Rules and Administration for a term ending the first Monday in January
2015;
new text end

new text begin (3) one public member appointed by the speaker of the house for a term ending
the first Monday in January 2015;
new text end

new text begin (4) two public members appointed by the governor for a term ending the first
Monday in January 2017;
new text end

new text begin (5) one public member appointed by the senate Subcommittee on Committees of the
Committee on Rules and Administration for a term ending the first Monday in January
2017; and
new text end

new text begin (6) one public member appointed by the speaker of the house for a term ending
the first Monday in January 2017.
new text end

new text begin (e) Terms, compensation, and removal of public members are as provided in section
15.0575. A vacancy on the commission may be filled by the appointing authority for the
remainder of the unexpired term.
new text end

new text begin (f) The first meeting of the commission shall be convened by the chair of the
Legislative Coordinating Commission no later than December 1, 2014. Members shall
elect a chair, vice-chair, secretary, and other officers as determined by the commission. The
chair may convene meetings as necessary to conduct the duties prescribed by this section.
new text end

new text begin (g) Upon coordination with the Legislative Coordinating Commission, the
commission may appoint nonpartisan staff and contract with consultants as necessary to
carry out the functions of the commission.
new text end

Subd. 2.

Duties.

The deleted text begin advisory committee deleted text end new text begin commission new text end shall review deleted text begin the policies of
the Department of Natural Resources and deleted text end current statutes on management of school trust
fund lands at least annually and shall recommend necessary changes in statutes, policy,
and implementation in order to ensure provident utilization of the permanent school fund
lands. By January 15 of each year, the deleted text begin advisory committee deleted text end new text begin commission new text end shall submit
a report to the legislature with recommendations for the management of school trust
lands to secure long-term economic return for the permanent school fund, consistent with
sections 92.121 and 127A.31. The deleted text begin committee's deleted text end new text begin commission's new text end annual report may include
recommendations to:

(1) manage the school trust lands efficiently;

(2) reduce the management expenditures of school trust lands and maximize the
revenues deposited in the permanent school trust fund;

(3) manage the sale, exchange, and commercial leasing of school trust lands to
maximize the revenues deposited in the permanent school trust fund and retain the value
from the long-term appreciation of the school trust lands; deleted text begin and
deleted text end

(4) manage the school trust lands to maximize the long-term economic return for
the permanent school trust fund while maintaining sound natural resource conservation
and management principles new text begin ; and
new text end

new text begin (5) manage the asset allocation of the permanent school fund new text end .

deleted text begin Subd. 3. deleted text end

deleted text begin Duration. deleted text end

deleted text begin Notwithstanding section 15.059, subdivision 5, the advisory
committee is permanent and does not expire.
deleted text end

new text begin Subd. 4. new text end

new text begin Conflict of interest. new text end

new text begin (a) A commission member may not be an advocate
for or against a commission action or vote on any action that may be a conflict of interest.
A conflict of interest must be disclosed as soon as it is discovered. The commission shall
follow the policies and requirements related to conflicts of interest developed by the Office
of Grants Management under section 16B.98.
new text end

new text begin (b) For the purposes of this section, a "conflict of interest" exists when a person
has an organizational conflict of interest or direct financial interests and those interests
present the appearance that it will be difficult for the person to impartially fulfill the
person's duty. An "organizational conflict of interest" exists when a person has an
affiliation with an organization that is subject to commission activities, which presents
the appearance of a conflict between organizational interests and commission member
duties. An "organizational conflict of interest" does not exist if the person's only affiliation
with an organization is being a member of the organization.
new text end

new text begin Subd. 5. new text end

new text begin Open meetings. new text end

new text begin (a) Meetings of the commission and other groups the
commission may establish are subject to section 3.055. Except where prohibited by
law, the commission shall establish additional processes to broaden public involvement
in all aspects of its deliberations, including recording meetings, video conferencing,
and publishing minutes. For the purposes of this subdivision, a meeting occurs when a
quorum is present and the members take action on any matter relating to the duties of the
commission. The quorum requirement for the commission shall be seven members.
new text end

new text begin (b) For legislative members of the commission, enforcement of this subdivision is
governed by section 3.055, subdivision 2. For nonlegislative members of the commission,
enforcement of this subdivision is governed by section 13D.06, subdivisions 1 and 2.
new text end

new text begin Subd. 6. new text end

new text begin Director nominations. new text end

new text begin The commission shall nominate three to five
people to the governor to appoint as director of trust lands and mineral assets.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2014.
new text end

Sec. 12.

new text begin [127A.3011] POLICY AND PURPOSE.
new text end

new text begin (a) The purpose of sections 127A.3011 to 127A.3019 is to establish a director to
oversee, manage, and administer Minnesota's school trust lands in accordance with the
provisions of the Minnesota Constitution, article XI, section 8.
new text end

new text begin (b) As trustee, the state must manage the lands and revenues generated from the
lands in the most prudent and profitable manner possible, and not for any purpose
inconsistent with the best interests of the trust beneficiaries as defined in the Minnesota
Constitution, article XI, section 8.
new text end

new text begin (c) The trustee must be concerned with both income for the current beneficiaries
and the preservation of trust assets for future beneficiaries, which requires a balancing of
short-term and long-term interests so that long-term benefits are not lost in an effort to
maximize short-term gains.
new text end

new text begin (d) Sections 127A.3011 to 127A.3019 shall be liberally construed to enable
the director and the commission to faithfully fulfill the state's obligations to the trust
beneficiaries.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2014.
new text end

Sec. 13.

new text begin [127A.3012] DEFINITIONS.
new text end

new text begin Subdivision 1. new text end

new text begin Scope. new text end

new text begin For purposes of sections 127A.3011 to 127A.3019, the
definitions have the meanings given.
new text end

new text begin Subd. 2. new text end

new text begin Commission. new text end

new text begin "Commission" means the Legislative-Citizen Permanent
School Fund Commission.
new text end

new text begin Subd. 3. new text end

new text begin Director. new text end

new text begin "Director" means the director of trust lands and mineral assets.
new text end

new text begin Subd. 4. new text end

new text begin School trust land. new text end

new text begin "School trust land" means land or interests in land
granted by the United States for use of schools within each township, swampland granted
to the state, and internal improvement land that are reserved for permanent school fund
purposes under the Minnesota Constitution, article XI, section 8, and land exchanged,
purchased, or granted for the benefit of the permanent school fund.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2014.
new text end

Sec. 14.

new text begin [127A.3013] GOVERNANCE.
new text end

new text begin Subdivision 1. new text end

new text begin Management. new text end

new text begin (a) The director shall manage all school trust lands
within the state. The Legislative-Citizen Permanent School Fund Commission shall
recommend policies for the director and legislature for the management of trust lands
and assets.
new text end

new text begin (b) The director may enter into an agreement with the commissioner of natural
resources for administration and management of trust lands. This agreement must specify
the services that the Department of Natural Resources will provide to the director and
the fees the department will charge for providing these services. If the director and the
commissioner of natural resources cannot reach an agreement satisfactory to both parties,
the director may contract with an outside entity for these services.
new text end

new text begin (c) If the director determines that receiving administrative and management services
from the commissioner of natural resources is not the best way to manage lands in the
most prudent and profitable manner, the director may move these services to another
agency or outside entity.
new text end

new text begin Subd. 2. new text end

new text begin Joint ventures. new text end

new text begin The director, upon approval of the governor, may enter
into joint ventures to develop trust lands and minerals.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2014.
new text end

Sec. 15.

new text begin [127A.3014] POLICIES.
new text end

new text begin Subdivision 1. new text end

new text begin Management. new text end

new text begin The commission shall recommend policies for the
director of trust lands and mineral assets. The policies shall:
new text end

new text begin (1) be consistent with the Minnesota Constitution and state law;
new text end

new text begin (2) reflect undivided loyalty to the beneficiaries consistent with fiduciary duties;
new text end

new text begin (3) require the return of not less than fair market value for the use, sale, or exchange
of school trust assets;
new text end

new text begin (4) seek to optimize trust land revenues and increase the value of trust land holdings
consistent with the balancing of short-term and long-term interests, so that long-term
benefits are not lost in an effort to maximize short-term gains; and
new text end

new text begin (5) maintain the integrity of the trust and prevent the misapplication of its lands
and its revenues.
new text end

new text begin Subd. 2. new text end

new text begin Duties. new text end

new text begin The commission and the director shall recommend to the governor
and the legislature any necessary or desirable changes in statutes relating to the trust or
their trust responsibilities. The commission shall recommend policies for the long-term
benefit of the trust utilizing the broad discretion and power granted to it in sections
127A.3011 to 127A.3015.
new text end

new text begin Subd. 3. new text end

new text begin Policies continued unless changed. new text end

new text begin Policies adopted by the Department of
Natural Resources prior to the effective date of this act regarding school trust lands shall
remain in effect until amended or repealed by the director. The director shall be the named
party in substitution of the Department of Natural Resources or its predecessor agencies
with respect to all documents affecting trust lands from the effective date of this section.
new text end

new text begin Subd. 4. new text end

new text begin Accept land and property. new text end

new text begin The director may accept for and on behalf
of the permanent school fund a donation of lands, interest in lands, or improvements on
lands. A donation so received shall become state property, be classified as school trust
land as defined in section 92.025, and be managed consistent with section 127A.31.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2014.
new text end

Sec. 16.

new text begin [127A.3015] DIRECTOR.
new text end

new text begin Subdivision 1. new text end

new text begin Appointment. new text end

new text begin The director shall be appointed by the governor from
the list of candidates submitted by the commission under section 127A.30, subdivision
6. The commissioner of administration shall provide office space for the director. The
commissioner of administration shall provide human resources, payroll, accounting,
procurement, and other similar administrative services to the director, except to the extent
the director decides to obtain these services from another public or private entity. The
director's appointment is subject to the advice and consent of the senate.
new text end

new text begin Subd. 2. new text end

new text begin Term. new text end

new text begin The governor shall select the director on the basis of outstanding
professional qualifications pertinent to the purposes and activities of the trust. The director
serves in the unclassified service for a term of four years or until a successor has been
appointed by the governor. The governor may remove the director for cause. The
commission may recommend the removal of the director for cause.
new text end

new text begin Subd. 3. new text end

new text begin Compensation. new text end

new text begin Compensation of the director shall be established under
chapter 15A.
new text end

new text begin Subd. 4. new text end

new text begin Employees. new text end

new text begin The director may employ unclassified staff in state service to
carry out the duties of the director.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2014.
new text end

Sec. 17.

new text begin [127A.3016] RESPONSIBILITIES OF DIRECTOR.
new text end

new text begin (a) The director shall:
new text end

new text begin (1) take an oath of office before assuming any duties as the director;
new text end

new text begin (2) adopt procedures necessary for the proper administration of matters entrusted to
the director by state law;
new text end

new text begin (3) faithfully manage the administration under the policies established by the
director;
new text end

new text begin (4) submit to the commission and for public inspection an annual management
budget and financial plan for the administration of school trust lands, and submit the
budget to the governor;
new text end

new text begin (5) direct and control the budget expenditures as finally authorized and appropriated;
new text end

new text begin (6) establish job descriptions and employ, within the limitation of the budget, staff
necessary to accomplish the purposes of the director's office;
new text end

new text begin (7) maintain appropriate records of school trust land activities to enable the
legislative auditor to conduct periodic audits of school trust land activities;
new text end

new text begin (8) submit all leases, contracts, and agreements to legal counsel for review of
compliance with applicable law and fiduciary duties prior to execution and utilize the
services of the attorney general as provided in section 127A.3017;
new text end

new text begin (9) keep the commission, beneficiaries, governor, legislature, and the public
informed about the work of the director by reporting to the commission in a public
meeting at least once during each calendar quarter; and
new text end

new text begin (10) respond in writing within a reasonable time to a request by the commission for
responses to questions on policies and practices affecting the management of the trust.
new text end

new text begin (b) The director may contract with other public agencies or other public or private
entities for personnel management services.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2014.
new text end

Sec. 18.

new text begin [127A.3017] ATTORNEY GENERAL.
new text end

new text begin The attorney general shall: represent the director in any legal action relating to trust
lands; review leases, contracts, and agreements submitted for review prior to execution;
and undertake suits for the collection of royalties, rental, and other damages in the name
of the state.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2014.
new text end

Sec. 19.

new text begin [127A.3018] LAND EXCHANGE.
new text end

new text begin The director may enter into land exchange agreements with the commissioner of
natural resources according to the provisions of section 92.121.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2014.
new text end

Sec. 20.

new text begin [127A.3019] FOREST AND MINERALS MANAGEMENT.
new text end

new text begin Subdivision 1. new text end

new text begin Control. new text end

new text begin All forest and minerals management on school trust lands is
vested with the director according to the provisions of sections 127A.3011 to 127A.3019.
new text end

new text begin Subd. 2. new text end

new text begin May contract. new text end

new text begin The director may contract with any public or private entity
to make improvements to or upon trust lands and to carry out any of the responsibilities of
the office, so long as the contract requires strict adherence to trust management principles
and applicable law.
new text end

new text begin Subd. 3. new text end

new text begin School trust lands suspense account. new text end

new text begin A school trust lands suspense
account is established in the state treasury. The director shall credit all revenue from
the school trust lands to the school trust lands suspense account. After a fiscal year,
the director shall certify that year's costs for oversight, protection, improvement,
administration, and management of school trust lands against the account and distribute
the balance of the revenue to the permanent school fund.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2014.
new text end

Sec. 21.

Minnesota Statutes 2010, section 477A.11, is amended by adding a
subdivision to read:

new text begin Subd. 1a. new text end

new text begin Director. new text end

new text begin "Director" has the meaning given in section 127A.3012.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2014.
new text end

Sec. 22.

Minnesota Statutes 2010, section 477A.11, subdivision 3, is amended to read:

Subd. 3.

Acquired natural resources land.

"Acquired natural resources land"
means:

(1) any land presently administered by the commissioner new text begin or the director new text end in which the
state acquired by purchase, condemnation, or gift, a fee title interest in lands which were
previously privately owned; and

(2) lands acquired by the state under chapter 84A that are designated as state parks,
state recreation areas, scientific and natural areas, or wildlife management areas.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2014.
new text end

Sec. 23.

Minnesota Statutes 2010, section 477A.11, subdivision 4, is amended to read:

Subd. 4.

Other natural resources land.

"Other natural resources land" means any
other land presently owned in fee title by the state and administered by the commissioner new text begin
or the director new text end , or any tax-forfeited land, other than platted lots within a city or those lands
described under subdivision 3, clause (2), which is owned by the state and administered by
the commissioner new text begin or the director new text end or by the county in which it is located.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2014.
new text end

Sec. 24.

Minnesota Statutes 2011 Supplement, section 477A.12, subdivision 1, is
amended to read:

Subdivision 1.

Types of land; payments.

(a) As an offset for expenses incurred
by counties and towns in support of natural resources lands, the following amounts are
annually appropriated to the commissioner of natural resources from the general fund for
transfer to the commissioner of revenue. The commissioner of revenue shall pay the
transferred funds to counties as required by sections 477A.11 to 477A.14. The amounts
are:

(1) for acquired natural resources land, $5.133 multiplied by the total number
of acres of acquired natural resources land or, at the county's option three-fourths of
one percent of the appraised value of all acquired natural resources land in the county,
whichever is greater;

(2) $1.283 multiplied by the number of acres of county-administered other natural
resources land;

(3) $1.283 multiplied by the total number of acres of land utilization project land; and

(4) 64.2 cents multiplied by the number of acres of commissioner-administered new text begin or
director-administered new text end other natural resources land located in each county as of July 1 of
each year prior to the payment year.

(b) The amount determined under paragraph (a), clause (1), is payable for land
that is acquired from a private owner and owned by the Department of Transportation
for the purpose of replacing wetland losses caused by transportation projects, but only
if the county contains more than 500 acres of such land at the time the certification is
made under subdivision 2.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2014.
new text end

Sec. 25.

Minnesota Statutes 2010, section 477A.12, subdivision 2, is amended to read:

Subd. 2.

Procedure.

Lands for which payments in lieu are made pursuant to
section 97A.061, subdivision 3, and Laws 1973, chapter 567, shall not be eligible for
payments under this section. Each county auditor shall certify to the Department of
Natural Resources during July of each year prior to the payment year the number of acres
of county-administered other natural resources land within the county. The Department of
Natural resources may, in addition to the certification of acreage, require descriptive lists
of land so certified. The commissioner of natural resources shall determine and certify to
the commissioner of revenue by March 1 of the payment year:

(1) the number of acres and most recent appraised value of acquired natural
resources land new text begin , excluding the acres administered by the director new text end within each county;

(2) the number of acres of commissioner-administered natural resources land within
each county;

(3) the number of acres of county-administered other natural resources land within
each county, based on the reports filed by each county auditor with the commissioner
of natural resources; and

(4) the number of acres of land utilization project land within each county.

new text begin The director shall determine and certify to the commissioner of revenue by March 1
of the payment year the number of acres of land and the appraised value of acquired land
administered by the director subject to payments under this section.
new text end

The commissioner of transportation shall determine and certify to the commissioner
of revenue by March 1 of the payment year the number of acres of land and the appraised
value of the land described in subdivision 1, paragraph (b), but only if it exceeds 500 acres.

The commissioner of revenue shall determine the distributions provided for in this
section using the number of acres and appraised values certified by the commissioner of
natural resources and the commissioner of transportation by March 1 of the payment year.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2014.
new text end

Sec. 26.

Minnesota Statutes 2010, section 477A.12, subdivision 3, is amended to read:

Subd. 3.

Determination of appraised value.

For the purposes of this section,
the appraised value of acquired natural resources land is the purchase price for the first
five years after acquisition. The appraised value of acquired natural resources land
received as a donation is the value determined for the commissioner of natural resources
new text begin or the director new text end by a licensed appraiser, or the county assessor's estimated market value
if no appraisal is done. The appraised value must be determined by the county assessor
every five years after the land is acquired.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2014.
new text end

Sec. 27. new text begin TRANSFER OF RESPONSIBILITY.
new text end

new text begin Unless otherwise provided by statute, the responsibilities of the Department of
Natural Resources and any other state agency with respect to the permanent school fund
lands are transferred to the director of trust lands and mineral assets effective upon
establishment of the director under Minnesota Statutes, section 127A.3015.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2014.
new text end

Sec. 28. new text begin REVISOR'S INSTRUCTION.
new text end

new text begin (a) The revisor of statutes shall recode Minnesota Statutes, section 84.027,
subdivision 18, as section 127A.3019, subdivision 4.
new text end

new text begin (b) By January 15, 2013, the revisor of statutes shall submit a bill draft to the senate
and house of representatives to make changes in statutes, laws, and rules to transfer all
authority for school trust lands to the director of trust lands and mineral assets. The
revisor of statutes shall consult with senate and house of representatives staff in preparing
the bill draft.
new text end