Schools would lose funds under
BWCAW land swap
By Marshall Helmberger
For the past several legislative sessions, debate over
how best to deal with 93,000 acres of state school trust
land in the Boundary Waters Canoe Area has focused on
a potent political symbol-school kids.
Local legislators have complained bitterly that the state
is no longer able to meet its obligations to derive revenue
from those lands for the stateís schools due to the federal
wilderness restrictions, which prevent logging and other
activity on all lands in the Boundary Waters. That situation,
according to some legislators, is shortchanging the stateís
But the leading proposal to address the issue would,
in fact, lead to cuts in funding to many school districts
in northeastern Minnesota. That proposal, which is backed
by northeastern Minnesota legislators, the attorney general,
and the Pawlenty administration, calls for exchanging
the state lands for as much as 300,000 acres of federal
land outside the wilderness, in the Superior National
"I assume weíll be back with the proposal again
this next session," said State Rep. Tom Rukavina,
who has been the primary backer of the exchange idea.
Rukavina and other supporters say the revenue the state
could derive from logging and other activities on the
300,000 acres they hope to acquire would increase the
size of the stateís Permanent School Trust, and ultimately
But that argument isnít without its problems. For one
thing, proceeds from the school trust donít go directly
to schools. The Legislature sets the stateís appropriation
to schools, and interest from the school trust, which
amounts to between $20 and $30 million a year, helps to
offset the cost of school funding to the stateís general
fund, rather than adding to the overall appropriation.
That means any benefit to schools is indirect at best.
The argument finds even tougher going, however, when
the loss of federal funding is added to the equation.
Under longstanding federal statutes, federal land managers,
such as the U.S. Forest Service, are required to pay 25
percent of their receipts from the sale of timber or other
resources to schools and counties in which those federal
lands exist. While the dollars paid out by the Forest
Service under this provision have declined in the past
few years, along with harvest levels, they still provide
at least a modest boost to area schools. The Forest Service,
for example, paid the St. Louis County School District
about $113,000 last year. While some school districts
received considerably less-Ely received $10,503-other
districts fared better. The Lake Superior School District,
based in Two Harbors, received $163,000 last year. The
Cook County district came in about the same as the St.
Louis County district, averaging about $109,000 a year
the past two years.
Were the state successful in engineering a land exchange
of the size envisioned by local legislators, it would
reduce federal holdings outside the wilderness by nearly
a third, an outcome that could be expected to reduce 25
percent funding by a similar amount.
The Cook County School Board, concerned about the financial
impact of the exchange, approved a letter of support,
during last yearís legislative session, for a proposal
that would have required the DNR to conduct a cost-benefit
analysis of the proposal to exchange the land, as well
as analyze two alternative proposals, one to sell the
93,000 acres to the federal government, and the other
to establish a recreational fee for use of the state lands
in the BWCAW.
Critics of the exchange have argued that an outright
sale of the land would generate much more revenue to the
school trust than an an exchange ever would.
And since a sale of the land would not reduce federal
ownership outside the BWCAW, it would mean no reduction
in federal funding to area schools.
Under the exchange proposal, the loss of federal 25 percent
funds would likely fall hardest on the St. Louis County
School District-because the DNR has targeted lands on
the western side of the forest for possible exchange.
Since the 25 percent formula is based on the amount of
federal ownership in each county and school district,
the loss of much of the existing federal ownership in
St. Louis County (most of which resides in the St. Louis
County school district) would drastically reduce federal
funding for the county school district.
But it is unlikely the loss would be distributed equally-the
DNR has targeted federal lands on the west end of the
national forest, mostly in St. Louis County-which means
the St. Louis County district stands to lose the majority
of its 25 percent funding.
Rukavina acknowledged that school districts stand to
lose federal funds under his exchange plan. "But
I think on the other side of that is how many more kids
do you keep in your school districts?" He argues
that increased logging on newly-acquired state lands could
help boost job growth in the region, and keep more families
with children in the region. "Every kid we can keep
in the district brings in $6,000 in state aid," he
But others question whether the entire issue isnít more
about politics, than policy. "I think everybody has
come to the realization that neither a land exchange or
a buyout isnít feasible at this time," said Janet
Green, a Duluth area activist who has closely followed
the land exchange issue. According to Green, the state
had the opportunity to begin a federal buyout of the state
lands in the mid-1990s - a move supported by the stateís
entire congressional delegation - but the idea was ultimately
blocked by a handful of northern Minnesota legislators.
Green said the federal fund that would have paid for the
buyout is now all but empty.
Green said the only realistic alternative at this point
is to consider a recreational fee on canoeists and others
who wish to camp on the state lands in the wilderness.
"If you want to benefit schools, you could do that,"
said Green. "Otherwise, itís silly for legislators
to keep harping away on this issue, unless theyíre simply
using it as a screen for other issues," she said.