North Dakota Administrative Code Title 85 - University and School Lands, Board of
🔹 Overview of the Board of University and School Lands
Constitutional Foundation:
The Board is established under Article IX, Sections 2 and 3 of the North Dakota Constitution.
It manages the permanent school fund and other institutional trust funds created from land grants received under the Enabling Act of 1889, which facilitated North Dakota’s statehood.
Composition of the Board:
Governor
Secretary of State
State Treasurer
Attorney General
Superintendent of Public Instruction
This Board acts as a trustee and must act in the best interests of the beneficiaries of the trust (primarily public schools).
🔹 Main Chapters in NDAC Title 85
Here are the key chapters within Title 85:
85-01: General Administration
Establishes the general powers and responsibilities of the Board.
Includes procedural rules for Board meetings and rulemaking.
85-02: Surface Management
Governs the leasing, sale, and use of surface lands.
Sets rules for grazing, agriculture, and recreation permits.
Ensures responsible stewardship of surface land resources.
85-03: Mineral Management
Provides the framework for leasing mineral rights (e.g., oil, gas, coal).
Includes royalty rates, bidding procedures, and environmental considerations.
85-04: Investment and Financial Management
Guides the investment of trust funds.
Ensures compliance with the "prudent investor rule", which mandates careful and diversified investment.
🔹 Legal Principles Underlying Title 85
Trust Doctrine:
The lands and assets managed by the Board are held in trust for public education.
The Board has fiduciary duties: loyalty, prudence, and impartiality.
Prudent Investor Rule:
Codified in NDCC § 15-03-04, applied in Title 85.
Requires the Board to manage investments as a prudent investor would, considering both risk and return.
🔹 Case Law Interpreting Title 85
Here are key North Dakota cases that help interpret Title 85 and the Board’s responsibilities:
🧑⚖️ Burr v. Board of University and School Lands, 2006 ND 110, 714 N.W.2d 441
Facts: A land lessee challenged the Board’s method for determining lease rates for school trust lands, claiming they were excessive and violated due process.
Holding: The North Dakota Supreme Court upheld the Board’s authority to set rates, ruling that the Board acted within its discretion and fiduciary duty to maximize trust revenue for the benefit of the schools.
Significance: Reaffirmed the fiduciary responsibility of the Board to act in the best interest of the beneficiaries, even if that means increasing costs to lessees.
🧑⚖️ North Dakota State Land Department v. Lund, 2012 ND 78, 815 N.W.2d 39
Facts: The case involved a dispute over mineral leasing and ownership rights.
Holding: The Court ruled in favor of the Land Department, affirming that mineral leases granted under Title 85 regulations were valid and enforceable.
Significance: Reinforced the authority of the Board under NDAC Title 85-03 to manage mineral leases and clarified interpretations around mineral rights and state ownership.
🧑⚖️ Richland County v. State, 2013 ND 133, 834 N.W.2d 812
Facts: A county challenged how revenue from state lands was distributed, alleging mismanagement.
Holding: The Court found that the Board acted within constitutional and statutory authority and dismissed the claims.
Significance: Highlighted the broad discretion the Board has under both the North Dakota Constitution and Title 85, provided it follows fiduciary principles.
🔹 Administrative Practices
The Board holds regular meetings, publishes notices, and allows for public comment in rulemaking (as per Chapter 85-01).
Land is typically leased via competitive bidding to ensure maximum return (Chapter 85-02 and 85-03).
The Department of Trust Lands operates as the administrative agency for the Board, handling day-to-day tasks.
🔹 Compliance and Enforcement
Lessees must comply with use restrictions, payment terms, and environmental protections.
Failure to comply may result in lease cancellation, penalties, or legal action.
🔹 Summary
NDAC Title 85 gives the Board of University and School Lands the regulatory tools to:
Manage public trust lands for the benefit of schools and institutions.
Lease land and minerals for revenue.
Invest trust funds prudently.
Enforce lease and use conditions.
Through constitutional and statutory authority, reinforced by case law, the Board's actions are guided by fiduciary responsibility to maximize long-term benefits for North Dakota’s public institutions.
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