North Dakota HB 1525: A BILL for an Act to create and enact section 15.1‑36‑09 of the North Dakota Century Code, relating to a common schools building and renovation grant fund; to amend and reenact section 15‑03‑04 and subsection 1 of section 57‑15‑16 of the North Dakota Century Code, relating to legal investments and school district tax levies for building funds; to provide a continuing appropriation; and to provide for a report to the legislative management.

Bill Text

19.0868.02000
Sixty-sixth
Legislative Assembly
of North Dakota
Introduced by
Representatives Bellew, Becker, Hoverson, Kading, Paulson, Skroch
Senator O. Larsen
A BILL for an Act to create and enact section 15.1-36-09 of the North Dakota Century Code,
relating to a common schools building and renovation grant fund; to amend and reenact section
15-03-04 and subsection 1 of section 57-15-16 of the North Dakota Century Code, relating to
legal investments and school district tax levies for building funds; to provide a continuing
appropriation; and to provide for a report to the legislative management.
BE IT ENACTED BY THE LEGISLATIVE ASSEMBLY OF NORTH DAKOTA:
SECTION 1. AMENDMENT. Section 15-03-04 of the North Dakota Century Code is
amended and reenacted as follows:
15-03-04. Legal investments.
Subject to the provisions of section 15-03-05 and section 15.1 - 36 - 09 , the board of university
and school lands shall apply the prudent investor rule in investing the permanent funds under its
control. The "prudent investor rule" means that in making investments the board shall exercise
the same judgment and care, under the circumstances then prevailing and limitations of North
Dakota and federal law, that an institutional investor of ordinary prudence, discretion, and
intelligence exercises in the management of large investments entrusted to it, not in regard to
speculation but in regard to the permanent disposition of funds, considering probable safety of
capital as well as probable investment returns. Notwithstanding any investments made before
July 1, 1997, the board may not use any funds entrusted to it to purchase, as sole owner,
commercial or residential real property in North Dakota without prior approval of the legislative
assembly or the budget section of the legislative management. The board may also lend
securities held by the permanent funds, including the authority to pledge a security interest in
the securities in the possession of a custodian agent. These securities must be collateralized as
directed by the board.
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HOUSE BILL NO. 1525

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SECTION 2. Section 15.1-36-09 of the North Dakota Century Code is created and enacted
as follows:
15.1 - 36 - 09. Common schools building and maintenance fund - Board of university
and school lands - Continuing appropriation - Report to legislative management.
1. The common schools building and maintenance fund is a special fund within the
investments of the common schools trust fund administered by the board of university
and school lands. The board shall transfer funds from the common schools trust fund
to the common schools building and maintenance fund as needed for the purposes in
this section. The fund consists of all moneys transferred into the fund, all real property
acquired or constructed with fund assets, and all interest or other earnings of the fund.
The board of university and school lands shall use the assets in the fund for the
acquisition, construction, and maintenance of all common school facilities in the state.
The board of university and school lands shall adopt policies and establish guidelines
to administer the fund in accordance with this section.
2. The board of university and school lands shall identify all outstanding school bonds
encumbering common schools in the state. Notwithstanding any other provision of law,
school districts shall transfer all real property of the school district to the board of
university and school lands. The board of university and school lands shall accept the
real property of all school districts and shall retire any outstanding related debt.
3. To be eligible for new building construction and renovation of existing school district
real property under this section, the board of a school district shall obtain the approval
of the superintendent of public instruction for the building project under section
15.1 - 36 - 01 and submit a completed application to the board of university and school
lands. The board of university and school lands, in consultation with the
superintendent of public instruction, shall review construction and renovation
applications and shall consider:
a. Student occupancy, student enrollment growth, and academic needs in the
district;
b. The age of structures to be replaced or remodeled;
c. Building design proposals based on safety and vulnerability assessments;
d. Cost; and
Page No. 2 19.0868.02000
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e. Any other criteria established by the board of university and school lands, in
consultation with the superintendent of public instruction, after consultation with
an interim committee appointed by the legislative management.
4. If the new building construction or renovation project is approved by the
superintendent of public instruction and the board of university an