In 2009, the Legacy Fund Founders Committee drafted a blueprint for what today is a public savings account that is nearing $6 billion. The group generally has been quiet in the years since as the savings account grew.

However, as numerous proposals for spending dollars generated by the Legacy Fund file through the the North Dakota Legislature, the committee has come together again in hopes of educating the public on the founders' original intent.

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"What happens so often is legislators, during off years, think about what needs to be done and the first pot of money they want to go to is the Legacy Fund," said Tammy Ibach, an original member of the committee. "The conversation we want to have with is, partially, to remind legislators that we are here to watch and we're paying attention. We have reconvened as a group to let them know that it's not their money to play with. ... There were conversations this year where people wanted to take money from the actual principal of the fund. That's very concerning."

Ibach was among a group of four committee members who spoke Thursday with the Herald's editorial board, outlining their belief that the fund-despite its name-has not yet reached "legacy" proportions and that it needs strict oversight if North Dakotans truly want to see it benefit generations to come.

The Herald, meanwhile, has editorialized several times in favor of dedicating earnings from the Legacy Fund to boost university research at UND and NDSU, as well as using Legacy earnings to build a Theodore Roosevelt library and visitor center in Medora.

In 2010, 64 percent of North Dakota voters chose to start the Legacy Fund, which funnels 30 percent of oil and gas revenue into a state savings account. Earnings are projected at slightly more than $300 million in the coming biennium.

In 2009, the committee's goal was to create the fund to "secure North Dakota's financial future by providing a consistent state revenue stream for our children and grandchildren, long after the oil industry takes a downturn."

Ibach and Robert Harms, both of Bismarck, and Grand Forks residents Connie Triplett and Bruce Gjovig-all of whom were among the original members of the committee-spent an hour with the Herald's editorial board. Triplett is a former state lawmaker who was in office when the Legacy Fund was created.

Q: We see that your committee members have been making the rounds, visiting with newspapers. Why the new urgency?

GJOVIG: The fact that the Legacy Fund sat there for seven years gaining interest, we need to have more conversation again about its original purpose. We need to have community and statewide communication.

TRIPLETT: We aren't suggesting that none of the earnings should be spent. We would like some of the earnings to go back toward growing the principal. We are starting off from a position that we would like to save 75 percent and 25 percent to be spent. Our group has agreed to disagree what the money should be spent for, but we agree that it shouldn't be tied up for use for a long term. Going back to the beginning when the bill was first passed, and I was both a sponsor of the bill and a member of the conference committee that worked it up in the Legislature, we were very specific at that point not to put a use on the funds based on the idea that if it is going to be there for perpetuity, it should be up to current legislators each time to decide what the real priorities are for spending.

Q: How resolute are the founders in their belief that there shouldn't be a specific use for the funds?

TRIPLETT: Not that there shouldn't be a use, but that it shouldn't be tied up long-term in a particular use. There may be different priorities in different times. Of all the governor's (proposals), the one that seems the most transformative to me is the ($30 million) UAS proposal, to make sure we have infrastructure for growing industry. ... To me personally, the UAS idea seems to be one of the most transformative and future-looking ideas out there.

GJOVIG: There was a consensus that we shouldn't make long-term obligations with the earnings, but it should be investments in things that can be transformative-a bridge to a future economy, or to be used in an emergency or crisis, but not for a long-term commitment. We are uncomfortable in having projected earnings be spent because earnings, by definition, are both profits and loss.

HARMS: We're trying to create a conversation statewide. This week, the Senate passed a bill (to allocate 15 percent of Legacy earnings, up to $45 million) for university research. Because they don't have the money, they are willing to borrow from the Bank of North Dakota on projected earnings from the Legacy Fund. That's just bad policy. Those are the kinds of pressures we understand legislators get but if we don't have some thoughts about how we do this long-term, and we just go through session after session, it won't be as much of a "legacy" as we intended.

Q: Bob, you just touched on a very local issue and it sounds like you don't like the university research proposal. How do you others feel about it?

IBACH: It's just bad fiscal policy.

GJOVIG: Who says we're not going to have a recession (in the future)?

TRIPLETT: I agree. Some people have made the point that everything the Legislature does is based on earnings estimates. We all understand it. But this seems like it's a bit different because it's based on this notion that we are saving for the future and for future generations.

Q: Early on, the research university presidents sought an actual dollar figure. Now, the backers have come back with a proposal for 15 percent of the earnings instead of a hard figure and it passed the Senate 43-4. Did that make it more palatable to you?

IBACH: No. Not to me, and I speak for a lot of people from our Founding Fathers group. When you talk about the Legacy Fund, $6 billion is not a legacy. Not yet. It is still in the infancy stage. The Bakken Backers people have released data that says 50 percent of all tax revenue that comes into the treasury of North Dakota comes from oil and gas money. What if, like in 2015, suddenly some of that dries up again? And it's going to.

HARMS: We're taking a finite resource, oil, and we're trying to convert it to cash so that the cash fund provides long-term financial stability and other needs for the future of North Dakota.

GJOVIG: The state is 50 percent dependent on oil and gas revenues. That's way too high. It's one of the reasons we also don't want to see our earnings (from the Legacy Fund) be dedicated.

Q: So would any of you, if you had your way, spend any Legacy Fund dollars or earnings this year or in the near future?

IBACH: No. If there was a catastrophic situation and we didn't have the emergency funds available in the regular state government, then I would consider it.

TRIPLETT: I would probably go in the range of 25 to 30 percent of banked earnings (but only on one-time spending).

GJOVIG: I would spend maybe up to 50 percent of banked earnings, but nothing committed forward. Who knows what the next 24 months will hold?

HARMS: No for now, and if we had to, I could live with 25 percent of banked earnings.

Q: Yet oil is still projected to last a long time in North Dakota. Doesn't that projection give you confidence?

HARMS: I don't think we're going to get away from fossil fuels in the next decade or so, but certainly we are going to have price interruptions that are going to influence the outcome of the Legacy Fund if we rely just on oil revenues to grow the fund.

TRIPLETT: As the only Democrat in the room of guests here, I think it's important to say that there is something else going on here over this last period of years since the Legacy Fund has been put in place. The North Dakota Legislature has reduced other forms of taxes. The message there is that the representatives of the people have made a decision that they want smaller government in North Dakota. It wasn't my decision, but the majority of the Legislature made that decision. Having made that decision, they can't turn around now and all of them have their hands out, saying they want the Legacy Fund dollars. The Legacy Fund is to prevent North Dakota from being excessively dependent on oil and also to preserve some of the value of the oil for future generations. But the fact that the Legislature has reduced other forms of taxes has increased our dependence on oil.

Q: How high does the Legacy Fund have to reach for it to truly be a "legacy"?

IBACH: $50 billion. $100 billion. Something substantial. We've been at this for nine years and it's not a "legacy" yet.

HARMS: We haven't settled on a number. But I think we all agree that $6 billion isn't the "legacy" yet. If I had an answer, I would say I like the number 20 as a target.

IBACH: What happens so often is legislators, during off years, think about what needs to be done and the first pot of money they want to go to is the Legacy Fund. The conversations we want to have with (the Herald's editorial board) is, partially, to remind legislators that we are here to watch and we're paying attention. We have reconvened as a group to let them know that it's not their money to play with. They don't get to make decisions where-there were conversations this year where people wanted to take money from the actual principal of the fund. That's very concerning. In 2010, 64 percent of the voters wanted to establish this legacy, so we're going to keep at this committee. We're not just going to go quiet when the Legislature goes home.

Q: Sorry, but we're confused. Isn't it the Legislature's money to, as you say, play with? Aren't lawmakers able to determine how to spend it?

TRIPLETT: The earnings, yes. And up to 15 percent of the principal if there is a broad consensus in both houses. When Tammy said it isn't "their" money, it is theirs to allocate, but the idea behind the Legacy Fund is that it's the people's money-not just the people who are around today, but really our children and grandchildren. It's designed for the future. It's our "legacy" for future generations.

Q: How many bills introduced this year regard the Legacy Fund?


HARMS: There are three or four or five left that are a serious threat. A lot of them have gone by the wayside.

GJOVIG: And then add the governor's proposals to that.

HARMS: There are probably a half-dozen appropriations bills that have those structures in as well.

Q: Speaking of the governor, he has proposed that any Legacy Fund-related project must meet four criteria: regional, state or national impact; be multiplied through partnerships, matching funds or loan funds; diversify our economy/workforce; and have lasting impacts. Do you, as a committee, agree with those qualifications?

GJOVIG: I don't think we have a consensus among the group. But from my standpoint, I would agree with him.

HARMS: Bruce is right, there isn't a consensus in the group. The governor sets a good framework, but I would lay over his framework the policies we have talked about. We can argue whether (some of the governor's proposals for buildings) meet those three criteria. I would say some do not.

IBACH: I am disappointed in the fact that (Gov. Burgum) would use the earnings before they arrived in the bank. I'm not necessarily disappointed in his projects-I get that governors want to identify their own projects, but there isn't one of those projects that couldn't wait, except maybe the unmanned aircraft (proposal). Maybe.

Q: And you like the unmanned aerial systems proposal why? Because of competition from other states?


GJOVIG: If we're going to remain a leader, we need to keep up the pace.

IBACH: It brings tremendous benefit to the Bakken. That's the one I could say, "let's take a serious look at it this (legislative) session." Do we need to have matching funds for the Teddy Roosevelt library (proposal)? I have asked, "where is the data?" I want someone to show me the sustainability of that.

Q: OK, so we're talking about competition being a factor with UAS. What about competition from other universities in other states that are out-researching us because we don't have the funding in North Dakota? How do you justify competition with UAS, but not with research?

IBACH: Where is the data that shows we're losing? I have not seen data that our university system is losing students because we don't have the research components that we need. I have not been privy to it.

GJOVIG: I don't think we're losing students, nor do I think we are losing a lot of faculty. I think what it is is a great source of money for the university for overhead.

IBACH: I want the data. Somebody show me.