Who is at Fault for the Misplaced $262 Million?

North Dakota Land Commissioner Jodi Smith recently revealed that $137 million was shorted from two constitutional funds dedicated to the state’s public schools. Days later, State Engineer Garland Erbele told a Senate committee that a third constitutional fund, the resources trust fund that benefits water projects, was also shorted $125 million. $262 million mandated by the North Dakota Constitution misplaced. Who is at fault? We must demand answers and accountability.

Treasurer Kelly Schmidt

There is a lot of finger-pointing among politicians over how the money was misplaced. State Treasurer Kelly Schmidt is responsible for transferring money into the many funds in state government. It is outlined in law where the money is to supposed to go. It turns out, Schmidt was depositing the money to the wrong funds negatively impacting our school and select infrastructure budgets.

But Schmidt isn’t accepting responsibility. In fact, she is pointing the blame at Attorney General Wayne Stenehjem and legislators themselves. Schmidt claims the wrong deposits were done at the guidance of the Attorney General’s office. In addition to the Attorney General’s guidance to “continue making distributions as they had” according to an email, Schmidt was told to seek legislative changes. Those changes were rejected by the Republican-led Legislature.

Because there appears to be so many at fault here, the public is receiving lip service and politicians are tying themselves in knots. It is an attempt to make this seem more minor than it really is. Words like “confusion” and “clarity” are being flung around while lawmakers somehow try to convince the public the $262 million in constitutionally-mandated funds wasn’t actually missing. The question, who’s butt are they trying to cover here? Kelly Schmidt? Wayne Stenehjem? Their own?

Attorney General Wayne Stenehjem

There is a bit of irony in all this. While politicians have spent a good portion of their time and energy stating that voters are confused when it comes to the North Dakota Constitution, they themselves have been confused about the North Dakota Constitution and its mandates for our public schools. Even more frustrating, they don’t seem to be taking seriously enough the fact that the mandate was being violated for years.

Instead of repaying the error as requested by Governor Burgum, legislators are debating a delayed bill to make changes going forward. Burgum’s appointee, Jodi Smith was correct to testify, “The effects of not repaying the (fund) will impact education in the state of North Dakota for generations to come.” She should be thanked for blowing the whistle over this continued error.

Were property taxes raised to cover the shorted funds to our schools? When the money went to the general fund instead of their constitutional funds, was it diverted or depleted during the budget cuts? Did not transferring money to the resources trust fund delay any important water projects? Will not repaying the funds lead to lawsuits?

Let’s be clear. If this was in a private sector situation, somebody would be held accountable. Personnel changes would be mandated by those in charge. But this is a public sector position that happens to be misallocating our tax dollars. Those in charge are the public. Where is the accountability?