_________ Bill No. _______

Introduced By _______________________________________________________________________________

By Request of the Department of Natural Resources and Conservation

A Bill for an Act entitled: "An Act authorizing the funding of the trust land management functions of the department of natural resources and conservation from the interest income of the land grant trusts; creating an account to record and administer receipts and disbursements; providing contingent appropriations; amending sections 17-3-1003, 18-2-107, 20-9-341, 20-9-601, and 20-25-422, MCA; and providing an effective date."

Be it enacted by the Legislature of the State of Montana:

NEW SECTION. Section 1.  Trust land administration account. (1) There is a trust land administration account in the state special revenue fund. Money in the account is available to the department by appropriation and must be used to pay the costs of administering state trust lands.

(2) Appropriations from the account for each fiscal year may not exceed 1 1/8% of the balance in the nonexpendable trust fund on the first day of January preceding the fiscal year.

(3) Funds remaining in the account at the end of a biennium must be transferred to the nonexpendable trust fund.

NEW SECTION. Section 2.  Deposit of proceeds in trust land administration account.  (1) The department shall, until the deposit equals the amount appropriated for the fiscal year pursuant to [section 1], deposit into the trust land administration account created by [section 1], the following:

(a) 1 1/8% of mineral royalties;

(b) 1 1/8% of the proceeds from the sale of trust land, easements, and timber; and

(c) 5% of the interest and income annually credited to the public school fund in accordance with 20-9-341.

(2) After the deposits in subsection (1) have been made, the remainder of the proceeds must be deposited in the permanent fund for the trust.

NEW SECTION. Section 3.  Contingent appropriations. If an appropriation to the department from the account established in [section 1] is unavailable on the date of a final determination that the appropriation is ineffective, there is appropriated from the state general fund to the department the amount appropriated from the account established in [section 1].

Section 4.  Section 17-3-1003, MCA, is amended to read:

"17-3-1003.   Support of state institutions. (1) For the support and endowment of each state institution, there is annually and perpetually appropriated, after any deductions made under Title 77, chapter 1, part 6 [section 2], the income from all permanent endowments for the institution and from all land grants as provided by law. All money received or collected in connection with permanent endowments by all higher educational institutions, reformatory, custodial and penal institutions, state hospitals, and sanitariums, for any purpose whatever, except revenues revenue pledged to secure the payment of principal and interest of obligations incurred for the purchase, construction, equipment, or improvement of facilities at units of the Montana university system and for the refunding of obligations or money that constitutes temporary deposits, all or part of which may be subject to withdrawal or repayment, must be paid over to the state treasurer who shall deposit the money to the credit of the proper fund.

(2)  Except as provided in subsection subsections (1) and (3), all money received from the investment of grants of a state institution and all money received from the leasing of lands granted to a state institution must be deposited with the state treasurer of Montana for each institution, to the credit of the state special revenue fund.

(3)  All money received from the sale of timber from lands granted to a state institution must be deposited to the credit of the permanent trust fund for the support of the institution."

Section 5.  Section 18-2-107, MCA, is amended to read:

"18-2-107.   Deposit of capitol building grant revenues revenue. (1) The state treasurer shall deposit in a capital projects fund all revenue from the capitol building land grant after any deductions made under Title 77, chapter 1, part 6 [section 2].

(2)  The funds must be held and dedicated for the purpose of constructing capitol buildings or additions to buildings in accordance with the provisions of section 12 of The Enabling Act."

Section 6.  Section 20-9-341, MCA, is amended to read:

"20-9-341.   Definition of interest and income moneys. (1) As used in this title, the term "interest and income moneys" means the total of the following revenues revenue, as provided for by Article X, section 5, of the 1972 Montana constitution:

(a)  95% of the interest received from the investment of the public school fund;

(b)  95% of the interest received from the investment of any other school funds held in trust by the state board of land commissioners;

(c)  95% of the income received from the leasing of or sale of timber from state school lands after any deductions that may be made under the provisions of Title 77, chapter 1, part 6; and

(d)  95% of any other income derived from any other covenant affecting the use of state school lands.

(2)  The remaining 5% of such revenues shall the revenue must be annually credited to the public school fund after any deductions made under [section 2]."

Section 7.  Section 20-9-601, MCA, is amended to read:

"20-9-601.   Public school fund. The public school fund shall must be maintained by the state treasurer as a fund in the nonexpendable trust fund type, and the principal amount of such the fund shall be is irreducible and permanent. The following moneys shall money must be credited to such the fund as an addition to the irreducible and permanent principal amount:

(1)  appropriations and donations by the state;

(2)  donations and bequests by individuals to the state or schools;

(3)  the proceeds of land and other property which revert to the state by escheat and forfeiture;

(4)  the proceeds of all property granted to the state, when the purpose of the grant is not specified or is uncertain;

(5)  funds accumulated in the treasury of the state for the disbursement of which provision has not been made by law;

(6)  except as provided in [section 2], the proceeds of the sale of stone, materials, or other property from school lands other than those granted for specific purposes and all moneys money other than rental recovered from persons trespassing on such school lands;

(7)  except as provided in [section 2], the principal of all moneys money arising from the sale of lands and other property which have that has been and may be hereafter granted to the state for the support of common schools;

(8)  except as provided in [section 2], the amount earmarked for deposit in this fund under the provisions of 20-9-341; and

(9)  such other moneys money as may be provided by the legislature."

Section 8.  Section 20-25-422, MCA, is amended to read:

"20-25-422.   Support of university of Montana-Missoula. (1) For the support and endowment of the university, there is annually and perpetually appropriated:

(a)  the university fund income, the proceeds and revenue from the grant of any estate or interest disposed of pursuant to 20-25-307, and all other sums of money appropriated by law to the university fund after any deductions made under Title 77, chapter 1, part 6 [section 2];

(b)  all tuition and matriculation fees; and

(c)  all contributions derived from public or private bounty.

(2)  The entire income of all the funds must be placed at the disposal of the board of regents by transfer to its treasurer and must be kept separate and distinct from all other funds. The income must be used solely for the support of the colleges and departments of the university or those connected with the colleges and departments.

(3)  All means derived from other public or private bounty must be exclusively devoted to the specific objects designated by the donor."

NEW SECTION. Section 9.  Codification instruction. [Sections 1 through 3] are intended to be codified as an integral part of Title 77, chapter 1, part 1, and the provisions of Title 77, chapter 1, part 1, apply to [sections 1 through 3].

NEW SECTION. Section 10.  Effective date. [This act] is effective July 1, 1997.

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