NORTH DAKOTA (KXNET) — North Dakota’s Legacy Fund has been called the “people’s fund.” It’s filled with our tax dollars, more than $8 billion worth.

It has been nearly 16 months since the major part of House Bill 1425 was signed into law. Some $550 million of those dollars must be used for in-state economic investing.

But, there is still no implementation process in place and no investments have been made from the largest portion set aside for investments in North Dakota.

At Thursday’s Legacy Fund Advisory Board Meeting, the board grappled with what the fund actually is.

“I think there is conflict right now about, is this a true sovereign wealth fund, which is meant to diversify and maximize and grow our state or economy through those tools? Or is this, for lack of a better term, and I’m not sure which one is right, or is it truly more of a pension fund for the state,?” asked ND Insurance Commissioner Jon Godfread.

Financial consulting firm RVK, Inc. presented the findings of their Legacy Fund Asset Allocation Study.

They found House Bill 1425 never fully spelled out a process for how the funds were to be invested in equity or economic development projects.

“We’re assuming, again directed otherwise, that the core objective, the end game for 1425, and all the related things you do with Legacy Fund capital, are for economic development,” said RVK Director of Research and Senior Consultant Jim Voytko.

3% of the Legacy Fund has been delegated to Chicago-based investment firm 50 South Capital to divvy out to venture capital firms. Our previous reporting showed that those firms were all initially headquartered out of state.

But the other 7%, which is some $550 million, has been sitting in limbo for nearly 16 months.

“Outcomes like jobs, like the potential creation of companies, like the addition or expansion of company’s operations within the state. The creation of wealth, the building of income, and all of those things that are the end game of investment,” explained Voytko.

The second immediate concern is that the State has no implementation process in place.

“Who actually does it? Who finds these investments? Who vets them? Who negotiates them,” asked Voytko.

But, before they can even delegate the authority and accountability to make the capital requests, they still need to settle square one.

“We’ve got a messaging problem to the citizens because they are misunderstanding this. And, that is partial as a SIB member, RIO. We’ve all got our hands in it somewhere,” stated Godfread.

“Are we going to incorporate jobs, created, earnings, all those sorts of things? That’s not going to be returned to the Legacy Fund. That’s a total other return and a total other measurement. We are going to have to make a decision in committee because that’s what 1425 does, and you know, we’ll have to make a decision whether that’s how we want to continue to move forward,” said Bank of North Dakota President Todd Steinwand.

A sub-committee of the advisory board has been formed to work on bringing suggestions on how to implement an in-state investing process at the next Legacy Fund Advisory Board Meeting. As things stand, it is expected to take many more months of bureaucratic redundancies and inaction when it comes to implementing our new in-state investing law.

The Legacy & Budget Stabilization Fund Advisory Board is made up of 10 members. Six state lawmakers, the State Treasurer, the Insurance Commissioner, the Tax Commissioner, and the President of the Bank of North Dakota.