North Dakota’s Legacy Fund Boondoggle Gets First Depost

According to PlainsDaily.com, North Dakota’s “Legacy Fund” is getting its first deposit.

Which represents tens of millions of dollars socked away in a fund where it can’t be used. Which, some argue, is good because then the legislators can’t spend it. But remember, it also can’t be given back to the taxpayers in the form of tax relief.

BISMARCK, ND – North Dakota State Treasurer Kelly Schmidt has announced that her office will be making a $34,311,019.74 into the state’s Legacy Fund. According to a press release sent from Schmidt’s office, this is the first deposit into the fund which was created by an amendment to the constitution passed by the legislature and approved on the 2010 ballot by voters.

Under Article X, Section 26 of the North Dakota Constitution, thirty percent (30%) of all state oil revenue derived from oil and gas production and extraction after June 30, 2011, will be deposited into the Legacy Fund. No principal or earnings of the fund may be spent until after June 30, 2017. Principal expenditures from the Legacy Fund after 2017 require a two-thirds passing vote of the legislature.

Keep in mind too that the Legacy Fund will be invested, and that those investments will be State Investment Board. The same board that handles the state’s pension investments, which currently have hundreds of millions (if not billions) in unfunded liabilities.

In other words, we’re locking tens of millions (ultimately hundreds of millions as funds go in) into this account instead of giving these surpluses back to the taxpayers that paid them. And these funds are to be invested by a government board with a dubious track record when it comes to investing.

But hey, at least the legislators can’t spend it all. Which was the main selling point of this fund, but I think we’re going to learn that the problems with this fund are larger than the advantages.

Rob Port is the editor of SayAnythingBlog.com. In 2011 he was a finalist for the Watch Dog of the Year from the Sam Adams Alliance and winner of the Americans For Prosperity Award for Online Excellence. In 2013 the Washington Post named SAB one of the nation's top state-based political blogs, and named Rob one of the state's best political reporters. He writes a weekly column for several North Dakota newspapers, and also serves as a policy fellow for the North Dakota Policy Council.

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  • Jimmmypop

    gosh, i think this is why i said we should vote against this stupidity…. these dollars should be back in the hands of those that paid them, not locked away to secure government growth.

    trust me…the pension board will have to add staff and raise salaries to manage this cash. even though all you do is change a $20,000 investment to a $22,000 investment…. our ‘conservatives’ are sickening.

    • http://nofreelunch.areavoices.com/ Kevin Flanagan

      These people aren’t Conservatives, they are big government collectivists feeding off of the backs of those of us in the productive private sector!

  • ec99

    “. No principal or earnings of the fund may be spent until after June 30, 2017. Principal expenditures from the Legacy Fund after 2017 require a two-thirds passing vote of the legislature.”

    Watch them suck that fund dry after that date.

    • http://sayanythingblog.com Rob

      Watch them suck that fund dry after that date.

      They’d have to amend the constitution to spend it all, but you can  bet they’ll spend everything they can every year beyond 2017.

      In the last legislative session every single spending bill (or near enough as not to matter) passed with a 2/3’s majority.

  • VocalYokel

    Aw, c’mon guys…

    Millions of dollars in the hands of politicos…what could go wrong?

  • sbark

    ………bout that time, the N.Dak public union retirement fund, that should’ve been fixed via a golden opportunity this winter, will be broke………..

    Look for the politicians to pour this fund into the union retirement black hole…………

  • borborygmi

    The WILL OF THE VOTERS……….means nothing to conservatives.

    • http://sayanythingblog.com Rob

      Ok, so if the guy you support loses the election you can never criticize the guy that won, right?

      If we’re to apply your “logic” to this situation?

      • borborygmi

        You are the one that was hyping will of the people, polls,   referendums and recalls/ …..Let’s just say it amuses me…..  Have you had a doctor look at that bite on you tuckus

        • http://sayanythingblog.com Rob

          I’ve never suggested that critics shut up just because their candidate or their side of an issue lost an election.

          • Gern Blanston

            Which is apt for when their candidate WINS an election, too.  THAT seems to be the point here. The Republicans own the ND legislature, but it hasn’t stopped them from acting like Dems on many issues, and, hence, the criticism will continue to flow from the likes of SAB. What some seem ot believe is that it is hypocrocy for a conservatve to criticize their elected officials; as if we’d be happier if the liberal democrat had been put into office instead of the republican. We only have to look at the Federal legislature of the W Bush years to see how Republicans can act too much like Democrats to their – and thei citizens’ – demise.

  • borborygmi

    a Yes 141,783 63.6% No 81,245 36.4%  

    • borborygmi

      Put it on a referendum again and/or stop you whining.   

    • http://nofreelunch.areavoices.com/ Kevin Flanagan

      How many of the “yeses” are latched onto to the government teat?

      • borborygmi

        Enough to make it the will of the people.  Oh reality comes up and slaps Kevin in the face.  That is alright you still pay less in Federal Taxes then State taxes.   

        • http://sayanythingblog.com Rob

          So, you’re not even going to think about whether or not it’s good policy.  You should want everyone to shut up because an election went a certain way.

          • borborygmi

            it would be a boring world.   

        • http://nofreelunch.areavoices.com/ Kevin Flanagan

          Will of the people or mob rule?

          • borborygmi

            will of the people and they spoke .

          • http://nofreelunch.areavoices.com/ Kevin Flanagan

            Yeah; people on the dole!

          • borborygmi

            and it is good policy.  

  • WOOF

    Like a family handling finances. R’s love that analogy.

    Pharaoh had a dream: He was standing by the Nile,  when out of the river there came up seven cows, sleek and fat, and they grazed among the reeds.
     After them, seven other cows, ugly and gaunt, came up out of the Nile and stood beside those on the riverbank.
    And the cows that were ugly and gaunt ate up the seven sleek, fat cows. Then Pharaoh woke up

  • http://nofreelunch.areavoices.com/ Kevin Flanagan

    Yeah; people on the dole!

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