Section 2. Proceeds of School Lands to be a Perpetual Fund
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Investment of Permanent School and Swamp Land Funds
The permanent school fund of the state shall consist of (a) the proceeds of such lands as are or hereafter may be granted by the United States for the use of schools within each township, (b) the proceeds derived from swamp lands granted to the state, and (c) all cash and investments now or hereafter credited to the permanent school fund and to the swamp land fund. No portion of said lands shall be sold otherwise than at public sale, and in the manner provided by law. All funds arising from the sale or other disposition of such lands, or income accruing in any way before the sale or disposition thereof, shall be credited to the permanent school fund. Within limitations prescribed by law, to secure the maximum return thereon consistent with the maintenance of the perpetuity of the fund, such fund may be invested in: (1) interest bearing fixed income securities of the United States and of its agencies, fixed income securities guaranteed in full as to payment of principal and interest by the United States, bonds of the state of Minnesota, or its political subdivisions or agencies, or of other states, but not more than 50 percent of any issue by a political subdivision, shall be purchased; (2) stocks of corporations on which cash dividends have been paid from earnings for five consecutive years or longer immediately prior to purchase, but not more than 20 percent of said fund shall be invested therein at any given time, nor more than one percent in stock of any one corporation, nor shall more than five percent of the voting stock of any one corporation be owned; (3) bonds of corporations whose earnings have been at least three times the interest requirements on outstanding bonds for five consecutive years or longer immediately prior to purchase, but not more than 40 percent of said fund shall be invested in corporate bonds at any given time. The percentages referred to above shall be computed using the cost price of the stocks or bonds. The principal of the permanent school fund shall be perpetual and inviolate forever; provided, that this shall not prevent the sale of any public or private stocks or bonds at less than the cost thereof to the fund; however, all losses not offset by all gains, shall be repaid to the fund from the interest and dividends earned thereafter. The net interest and dividends arising from the investment thereof shall be distributed to the different school districts of the state in proportion to the number of scholars in each district between the ages of five and twenty-one years. No such investment shall be made until approved by a board of investment consisting of the governor, the state auditor, the state treasurer, the secretary of state, and the attorney general, who are hereby constituted a state board of investment for the purpose of administering and directing the investment of all state funds.
The state board of investment shall not permit the fund to be used for the underwriting or direct purchase of municipal securities from the issuer or his agent.
This item is based on 2 items:
Proceeds of School Lands to be a Perpetual Fund
The proceeds of such lands as are or hereafter may be granted by the United States for the use of schools within each township in this State, shall remain a perpetual school fund to the State, and not more than one third (1/3) of said lands may be sold in two (2) years, one third (1/3) in five (5) years, and one third (1/3) in ten (10) years; but the lands of the greatest valuation shall be sold first, provided that no portion of said lands shall be sold otherwise than at public sale. The principal of all funds arising from sales, or other disposition of lands, or other property, granted or entrusted to this State in each township for educational purposes, shall forever be preserved inviolate and undiminished; and the income arising from the lease or sale of said school lands shall be distributed to the different townships throughout the State, in proportion to the number of scholars in each township between the ages of five and twenty-one years, and shall be faithfully applied to the specific objects of the original grants or appropriations. All swamp lands now held by the State, or that may hereafter accrue to the State, shall be appraised and sold in the same manner and by the same officers, and the minimum price shall be the same less one-third (1/3), as is provided by law for the appraisement and sale of the school lands under the provisions of title one (1) of chapter thirty-eight (38) of the General Statutes. The principal of all funds derived from sales of swamp lands as aforesaid shall forever be preserved inviolate and undiminished. One-half (1/2) of the proceeds of said principal shall be appropriated to the common school fund of the State; the remaining one-half (1/2) shall be appropriated to the educational and charitable institutions of the State in the relative ratio of cost to support said institutions. A revolving fund of not over two hundred fifty thousand dollars ($250,000) may be set apart from the fund derived from the sale of school and swamp lands, to be used in constructing roads, ditches and fire breaks in, through and around unsold school and swamp lands and in clearing such lands, such fund to be replenished as long as needed from the enhanced value realized from the sale of such lands so benefited.
Proceeds of School Lands to be a Perpetual Fund
The proceeds of such lands as are or hereafter may be granted by the United States for the use of schools within each township in this State, shall remain a perpetual school fund to the State, and not more than one third (1/3) of said lands may be sold in two (2) years, one third (1/3) in five (5) years, and one third (1/3) in ten (10) years; but the lands of the greatest valuation shall be sold first, provided that no portion of said lands shall be sold otherwise than at public sale. The principal of all funds arising from sales, or other disposition of lands, or other property, granted or entrusted to this State in each township for educational purposes, shall forever be preserved inviolate and undiminished; and the income arising from the lease or sale of said school lands shall be distributed to the different townships throughout the State, in proportion to the number of scholars in each township between the ages of five and twenty-one years, and shall be faithfully applied to the specific objects of the original grants or appropriations. All swamp lands now held by the State, or that may hereafter accrue to the State, shall be appraised and sold in the same manner and by the same officers, and the minimum price shall be the same less one-third (1/3), as is provided by law for the appraisement and sale of the school lands under the provisions of title one (1) of chapter thirty-eight (38) of the General Statutes. The principal of all funds derived from sales of swamp lands as aforesaid shall forever be preserved inviolate and undiminished. One-half (1/2) of the proceeds of said principal shall be appropriated to the common school fund of the State; the remaining one-half (1/2) shall be appropriated to the educational and charitable institutions of the State in the relative ratio of cost to support said institutions.
Proceeds of School Lands to be a Perpetual Fund
The proceeds of such lands as are or hereafter may be granted by the United States for the use of schools within each township in this State, shall remain a perpetual school fund to the State, and not more than one third (1/3) of said lands may be sold in two (2) years, one third (1/3) in five (5) years, and one third (1/3) in ten (10) years; but the lands of the greatest valuation shall be sold first, provided that no portion of said lands shall be sold otherwise than at public sale. The principal of all funds arising from sales, or other disposition of lands, or other property, granted or entrusted to this State in each township for educational purposes, shall forever be preserved inviolate and undiminished; and the income arising from the lease or sale of said school lands shall be distributed to the different townships throughout the State, in proportion to the number of scholars in each township between the ages of five and twenty-one years, and shall be faithfully applied to the specific objects of the original grants or appropriations. Suitable laws shall be enacted by the legislature for the safe investment of the principal of all funds which have heretofore arisen or which may hereafter arise from the sale or other dispositions of such lands, or the income from such lands accruing in any way before the sale or disposition thereof, in interest bearing bonds of the United States, or of the state of Minnesota, issued after the year 1860, or of such other state as the legislature may, by law, from time to time direct.
Proceeds of School Lands to be a Perpetual Fund
The proceeds of such lands as are or hereafter may be granted by the United States for the use of schools within each township in this State, shall remain a perpetual school fund to the State, and not more than one third (1/3) of said lands may be sold in two (2) years, one third (1/3) in five (5) years, and one third (1/3) in ten (10) years; but the lands of the greatest valuation shall be sold first, provided that no portion of said lands shall be sold otherwise than at public sale. The principal of all funds arising from sales, or other disposition of lands, or other property, granted or entrusted to this State in each township for educational purposes, shall forever be preserved inviolate and undiminished; and the income arising from the lease or sale of said school lands shall be distributed to the different townships throughout the State, in proportion to the number of scholars in each township between the ages of five and twenty-one years, and shall be faithfully applied to the specific objects of the original grants or appropriations.