SF2881

Purpose of the Bill

This bill aims to modify how income from mining royalties is distributed in Minnesota, specifically within the permanent university fund. It seeks to adjust the allocation of funds to enhance support for academic and research activities, particularly those related to natural resources and the environment.

Main Provisions

• Endowed Chair Account: A portion of the permanent university fund will be used to support professorial chairs through endowments. The income and capital gains from this account can be used, but they must not exceed more than 6% annually of the account's average market value over 36 months.

• Mineral Royalties Allocation:

  • Starting January 1, 2026, half of the income from state mineral lease royalties will be distributed to support mineral research and related programs.
  • One-fourth of this income, up to $150 million, will go to the Natural Resources Research Institute in Duluth and Coleraine for mineral research, including environmental research.
  • Another one-fourth, up to $25 million, will support operation costs for mining, mineral, and STEM degree programs. It will also provide scholarships to Minnesota students, prioritizing those in specific economic regions.
  • Another one-fourth will be used for the general operating and research costs of the Natural Resources Research Institute.
  • Remaining funds will be credited to a scholarship account to support undergraduate Minnesota resident students at the University of Minnesota.

• Reporting and Distribution: The University of Minnesota's Board of Regents is tasked with reporting biennially to the legislature on how these funds are distributed and utilized. The distribution of scholarship account funds must be proportional to the student population on each University of Minnesota campus.

Significant Changes to Existing Law

• The allocation of mining royalty income is more clearly defined with set percentages for specific purposes, which include both research and scholarships.
• The changes also aim to enhance transparency and accountability through regular reporting to the state legislature.

Relevant Terms

permanent university fund, endowed chair account, mineral research, mining royalties, Natural Resources Research Institute, scholarships, University of Minnesota, STEM programs, Board of Regents, capital gains