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    Subdivision 1. Establishment of program. The commissioner of finance, in consultation
with the University of Minnesota, the Minnesota State Colleges and Universities, and the Private
College Council, shall establish a college savings bond program, to be known as "gopher state
bonds" to encourage individuals to save for higher education costs by investing in state general
obligation bonds. The program consists of: (1) issuing a portion of the state general obligation
bonds in zero coupon form and in denominations and maturities that will be attractive to
individuals saving to pay for higher education costs; and (2) developing a program for marketing
the bonds to investors who are saving to pay for higher education costs. The commissioner of
finance may designate all or a portion of each state general obligation bond sale as "gopher
state bonds."
    Subd. 2. Denominations; maturities. The commissioner shall determine the appropriate
denominations and maturities for gopher state bonds. It is the intent of the legislature to make
bonds available in as small denominations as is feasible given the costs of marketing and
administering the bond issue. Minimum denominations of $500 must be made available. The
minimum denomination bonds need not be made available for bonds of all maturities. For
purposes of this section, "denomination" means the compounded maturity amount of the bond.
    Subd. 3. Direct sale permitted. Notwithstanding the provisions of section 16A.646,
subdivision 5
, the commissioner may sell any series of gopher state bonds directly to the public
or to financial institutions for prompt resale to the public upon the terms and conditions and the
restrictions the commissioner prescribes. The commissioner may enter into all contracts deemed
necessary or desirable to accomplish the sale in a cost-effective manner including a private or
negotiated sale, but the commissioner may contract for investment banking and banking services
only after receiving competitive proposals for the services.
    Subd. 4. Marketing plan. The commissioner and the Higher Education Advisory Council
shall develop a plan for marketing gopher state bonds.
The plan must include strategies to:
(1) inform parents and relatives about the availability of the bonds;
(2) take orders for the bonds;
(3) target the sale of the bonds to Minnesota residents, especially parents and relatives of
children who are likely to seek higher education;
(4) ensure that purchase of the bonds by corporations will not prevent individuals and
relatives of future students from buying them; and
(5) market the bonds at the lowest cost to the state.
    Subd. 5. Effect on student grants. The first $25,000 of gopher state bonds purchased for
the benefit of a student must not be considered in determining the financial need of an applicant
for the state grant program under section 136A.121. This $25,000 is in addition to any other
asset exclusion authorized under chapter 136A.
History: 1997 c 183 art 2 s 1