With taxpayers worried about a potential property tax increase to fund a new Dickinson High School, the district is often asked about other ways to fund the school. Can it use the Common Schools Trust Fund, the Legacy Fund? What about Operation Prairie Dog?
What about the Common Schools Trust Fund?
The Press spoke with Adam Tescher, director of school finance and organization for the North Dakota Department of Public Instruction, who said that although the money in the fund can be used to benefit all schools in the state, it cannot be used for to fund a new school building project.
"I know there were several bills brought up to this last Legislature that proposed using it for building funds. That didn't gain much traction, from what I could tell. It wouldn't be legal until they got the Legislature's okay, and actually many of them, I think, would require a constitutional change," he said.
Instead, the eligible distributions of the fund are appropriated into the funding formula.
"Right now, it's providing support for the $2 billion appropriation for the integrated formula payment, (which is) the per pupil funding for our school districts and how they get their operating money. For the 2019-2020 school year, the per pupil payment will be $9,839 a kid, which is funded by a combination of state and local taxes. Part of those state taxes are the Common Schools Trust Fund," Tescher said.
What about the Legacy Fund?
The Legacy Fund was created by North Dakota voters in 2010 and is comprised of 30% of the state's oil and gas tax revenue.
The Legacy Fund Earnings Committee, comprised of legislature officials, is charged with examining ways to use the fund's earnings. Dickinson's Senator Rich Wardner is on the committee. He discussed the potential for using Legacy Fund earnings for school construction.
"I would dare say this much - some of the earnings could be used to pay a small portion ... but there's a lot of other things that are going to be important, too," Wardner said. "I know everybody out in oil country says that schools need to be built because of the oil, and I understand that. We are working on that, but you gotta understand, we've got to deal with the whole state. Whatever you do for oil country, you will do for everybody else, and that's a big ticket item. "
Wardner said that the North Dakota Legislature does not fund building schools, but rather their operations.
"The Legislature of the State of North Dakota has not been in the business of building schools. They fund school operations - the learning, the curriculum, we fund that, so trying to change that mindset is a real tough job," he said.
What about Operation Prairie Dog?
As The Press reported in July, the money the district will be guaranteed as a result of Operation Prairie Dog will be used to help build a new elementary school in the future, as it was taken off of the current project to cut costs.
The funding for the elementary school project could instead come from leveraging funds given to Dickinson for its status as a HUB city. Hocker said they receive about $2 million every biennium, but that money wasn't a guarantee in the past, so the district could not use the funding to get a loan. That changed with Operation Prairie Dog.
“As a result of recent legislative action primarily driven by our local legislators including Senator Wardner, Operation Prairie Dog will provide quarantined funding for HUB cities and schools,” Hocker said. “This option was not available to us during the May 7th referendum. This guaranteed funding can now be leveraged to obtain financing that will assist in meeting our financial needs to address building a new elementary school.”
Wardner said he tried to include a capital impact fund for schools in the bill, but it had to be removed.
"As soon as I announced it or proposed it, it wasn't a half an hour later, there were superintendents on the phone to their representatives saying, 'If you're going to do it for those guys out west, you're going to do it for us." We didn't want to lose the rest of the bill, so we had to take it out. It would have been the right thing to do. It would have been a small amount, but it would have helped," he said.
Wardner is looking for solutions to alleviate some of the burden on taxpayers for funding school construction.
He said the Legislature has been working on a low-interest loan program to help district's fund school construction.
"That's a 2% loan, which is quite a bit better than if you had to go out on the bond market," he said.
Wardner understands the impact the oil industry has had on western North Dakota.
"I agree with the fact that out in oil country, we're getting these students because of the oil development," he said. "It seems right that the oil should pay for it, but we're not there yet. All of the schools in oil country do get oil money in lieu of property taxes. It's not like they get nothing. They get money from the oil taxes. Now, they need it for operations; they need it for the curriculum."