Should ND Legacy Fund Dollars Be Used To Subsidize Higher Education?

Dwight Cook

The supports of the initiated measure which created the state’s Legacy Fund, some of them quite conservative, insisted that locking away oil tax revenues into this fund would be a good idea because it would make it difficult for legislators to spend it. I found this a little hard to believe. Almost all appropriations bills passed by the legislature garnered more than the super-majority required to spend money out of the Legacy Fund.

Besides, the best way to keep the government from spending our tax dollars is to lock those tax dollars away in the pockets of tax payers.

But we have the Legacy Fund now, and not surprisingly the legislators want to explore new and exciting ways to spend all the loot, including a new entitlement program for higher education. Which is just what we need as the country faces a national problem with a higher education bubble.

More subsidies:

BISMARCK, N.D. (AP) – A North Dakota lawmaker says the state’s oil trust fund could have $1 billion by June 2013.

Mandan Sen. Dwight Cook says the Legislature should open a public discussion of how the “Legacy Fund” money should be used. …

Cook says he likes Wyoming’s idea of using the money for college scholarships for North Dakota high school graduates. But he says all options should be discussed.

Cook says he plans to introduce a resolution in the 2013 Legislature asking for a study of how the oil trust money should be used.

Legislators can’t start spending the fund’s money until 2017, but they want to start planning for that now.

The idea of emulating Wyoming’s higher ed entitlement program has been floated by Democrat gubernatorial candidate Ryan Taylor too, but it’s something North Dakota ought to avoid like the plague. The scholarships are supposed to help higher education be more affordable for the state’s students, but the problem with spiraling higher education costs has everything to do with endless government subsidies for tuition.

Just as federal housing policies inflated demand for subprime mortgages, state/federal subsidies for higher education have inflated demand for subprime student loans and degrees.

A much better use for the Legacy Fund, since we’re stuck with it, would be to use it as a fund to bond public works projects. Lend the money to political subdivisions for their road projects and the like, with the political subdivisions paying back the issued bonds with interest, and redirect the appropriations those bonds replace into tax relief.

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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  • whowon

    I agree Rob, 100%.

    • river16

      5 years before the money is even accessible, the vultures are circling.  Obviously Higher ed has “gotten to” a Senator here that USED to be conservative.  Boy district 34 is going to lose the entire oil industry pac contributions this upcoming elections.  We need to save this money for rainy day funds, NO VULTURES.

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

    These trust funds are nothing but slush funds for all the slackers on the public payroll. The state media plays obediently along.

  • headward

    Anybody against Measure 2 can read about this money being stored away.  We don’t even need the legacy fund to fund what PT was.  Governments should not be keeping cash on hand like this in the first place.  Idle resources that the government stole from the private sector.

  • Game

    “Lend the money to political subdivisions for their road projects and the like, with the political subdivisions paying back the issued bonds with interest, and redirect the appropriations those bonds replace into tax relief.”

    If measure 2 is passed, the local political subdivisions will have no way of raising funds to pay off bonds. They will be forced to go hat in hand to the North Dakota Legislature. I am sure the park in Max is going to be a big priority to them.  

    • headward

      The park district in Max will be allocated with funds that they can decide on what to use their budget for.  The same way it works right now but without all the mob payments to government.

    • http://sayanythingblog.com Rob

      That’s funny, because the idea for using the legacy fund for bonds comes from the supporters of Measure 2.

      If you’re operating under the idea that property taxes are a local entities only means for revenues, you’re wrong.

  • Brenarlo

    This is why the fund never should’ve been created.  Instead, income taxes should’ve been eliminated.

  • http://twitter.com/Dakota_Mel Dakota_Mel

    So they want to shove more kids, some of whom would be far better off with technical training, into a broken system? Not only is it not a good use of legacy fund money, it’s not a good use of any money.

    • Brenarlo

       And if the government is paying for everyone’s college… tuition will go up double digits annually.

      • http://Sayanythingblog.com The Whistler

        Then we can have even more college instructors that have no classroom responsibilities.  

    • ec99

      Because universities have become businessesw whose priority is to generate revenue streams.  You do that by eliminating admission standards and getting as many butts into desks as you can.

      • Sparkie Arbuckle

        We need to make it clear that profit is not the goal.  And we need more education money.

        Why are Singapore, Korea, Taiwan, Hong Kong, and Japan in good shape?  They spend on education.  You should see how much better my students from these countries perform on everything.  And English is their second language.

        • ec99

          You chose the wrong countries.  There, students bring home four hours of homework per night.  And if you screw up you bring shame to the family.  School isn’t just a social event.  That’s the way in was in the US decades ago.  Not now. 

        • ec99

          I might also add that the reason those students excell in the STEM subjects is that the systems stress rote learning.  The downside is that they are incapable of expressing ideas they have to come up with themselves, since they were never asked to do that.

  • TexasJew

    Sure
    Shove more money from the western part of the state over to the welfare whores in the east.

  • borborygmi

    “A much better use for the Legacy Fund, since we’re stuck with it, would be to use it as a fund to bondpublic works projects. Lend the money to political subdivisions for their road projects and the like, with the political subdivisions paying back the issued bonds with interest, and redirect the appropriations those bonds replace into tax relief.     Good IDEA

  • MinotAccounting

    Hey Game,
    Max like Minot ND need to look at how much property taxes and values have gone down to see if the cities need more money — WAIT A Minute property value never gone down and as for lower property taxes $100 to $50 some years is joke.. PS a friend who was flooded just got a notice from the city of Minot that property value is going to be 20% more than before the flood value, just because he finished rebuilding before everyone else.

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