Fund off $112 million since 2011 due to “number error”
Five months into his role as school trust lands director, Aaron VandeLinde provided an update to the House Education Finance committee Tuesday afternoon. Part of the update was news that a “number error” was just picked up in the November forecast process from FY 2011. That error was $112 million – not a small dollar amount to be off for over four years. When questioned by legislators, VandeLinde referred to Liz Connor, executive budget officer for Minnesota Management & Budget. She indicated the error stemmed from a correction that should have been made to the 2012 beginning balance. “Swift Accounting simply recorded the wrong balance,” said O’Connor.
Talent Brings Return on Investment
VandeLinde was clear his role, per statue 127A.353, is to provide strategic direction and advice for long term revenue growth and the Department of Natural Resources (DNR) is still responsible for the management of the school trust lands. He has brought some talent into the office hiring two and one-half employees to research and provide advice & recommendations. A recent hire of a school trust aggregate provided a $1.5 million return on investment by finding resources. VandeLinde also brought in a business analyst to help create a 10-year business plan and 25-year management framework. And, because the school trust lands are so plentiful in forestry and mining, a real estate evaluator will be conducting highest and best use analysis. There will also be a Forestry Certification investigation done to determine if there is an economic benefit to dual certification.
Distributions to the public school students in Minnesota were about $2 million in FY14 or about $28 per student. VandeLinde projects a slight downturn in revenue for FY16 due to a decline in mineral mining and the warm weather has forestry harvest down, both industries the fund relies heavily upon.
MSBA continues to support VandeLinde and his initiatives. We are perplexed as to why it took MMB five years to discover a $112 million accounting error.