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School trust land management discussed in both chambers

Two bills pending on each side of the Minnesota Legislature could potentially strip Hubbard County of nearly $19,000 in revenues from school trust lands.

Minnesota's natural resources commissioner does not want to give up his job of managing 2.5 million acres of land, mostly in northern Minnesota that support schools across the state.

Commissioner Tom Landwehr told the House Education Finance Committee Tuesday that his department manages 3 million other acres and a proposal to establish a new agency for so-called school trust lands would just make for a larger government.

"When I look at this bill, I see more expenses," he said.

Hubbard County Land Commissioner Mark Lohmeier has been monitoring the bills. If the Payment in Lieu of Tax revenues got into a state fund, Hubbard County's loss would have to be offset by taxpayers, he told the Hubbard County Board of Commissioners Wednesday.

Supporters of the bill complain that the DNR has done a poor job of using the land to make money over the years. Money from sale, mineral leases, timber sales and other uses of the 2.5 million acres is split among all Minnesota public schools.

School districts now get the interest off timber and mineral sales from lands.

Rep. Denise Dittrich, DFL-Champlin, said that Minnesota schools have lost $400 million in the last 50 years because the lands were not well managed.

"We are looking to raise revenue for the schools of our state without raising money," said Grace Keliher of the Minnesota State School Boards Association.

Dittrich and other supporters of the change said the DNR has a conflict of interest because it is charged with the job of improving natural resources. They say that a new school land trust fund agency would have a priority of raising money.

Lohmeier said the schools stand to lose $1.6 million in overall PILT payments.

Craig Pagel of the Iron Mining Association said his members fear they would need to work with two state agencies instead of just the DNR if the bill becomes law.

And that is what concerns Lohmeier.

"I find it hard to believe you can create another bureaucracy and still make money," he told the county board doubtfully.

The bill is advancing in both the House and Senate. Landwehr said it is likely to pass the House, but the bill has less Senate support.

Also, a House natural resources committee heard a bill, but took no action, to exchange state-owned property in the Boundary Waters Canoe Area Wilderness for federal land. Supporters say the state could gain some funds for the school trust fund.

In the education committee, Landwehr said such an exchange would take years because the federal government will not move quickly.