Chief Sponsor: Chris H. Wilson

House Sponsor: Jefferson Moss


9     General Description:
10          This bill amends provisions related to the School and Institutional Trust Fund Board of
11     Trustees and trust funds managed by the School and Institutional Trust Fund Office.
12     Highlighted Provisions:
13          This bill:
14          ▸     allows the School and Institutional Trust Fund Board of Trustees to close a meeting
15     under certain circumstances;
16          ▸     increases the length of time used to determine the average value of the trust funds
17     for purposes of determining the annual trust distribution amount;
18          ▸     reduces the number of annually required meetings of the School and Institutional
19     Trust Fund Board of Trustees;
20          ▸     exempts certain information that the School and Institutional Trust Fund Office
21     provides to the Land Trusts Protection and Advocacy Office from the Government
22     Records Access and Management Act; and
23          ▸     makes technical changes.
24     Money Appropriated in this Bill:
25          None
26     Other Special Clauses:
27          None

28     Utah Code Sections Affected:
29     AMENDS:
30          53C-3-102, as last amended by Laws of Utah 2016, Chapters 172 and 389
31          53D-1-304, as last amended by Laws of Utah 2019, Chapter 191
32          53D-2-201, as enacted by Laws of Utah 2018, Chapter 448
33          53F-9-201, as last amended by Laws of Utah 2020, Chapters 207 and 354

35     Be it enacted by the Legislature of the state of Utah:
36          Section 1. Section 53C-3-102 is amended to read:
37          53C-3-102. Deposit and allocation of money received.
38          (1) (a) The director shall pay to the School and Institutional Trust Fund Office, created
39     in Section 53D-1-201, all money received, accompanied by a statement showing the respective
40     sources of this money.
41          (b) The administration and the School and Institutional Trust Fund Office shall enter
42     into a memorandum of understanding detailing:
43          (i) the classification of sources of money; and
44          (ii) other relevant information, as determined by the administration and the School and
45     Institutional Trust Fund Office.
46          (2) All money received from the sale of lands granted by Section 6 of the Utah
47     Enabling Act for the support of the common schools, all money received from the sale of lands
48     selected in lieu of those lands, all money received from the United States under Section 9 of the
49     Utah Enabling Act, all money received from the sale of lands or other securities acquired by the
50     state from the investment of those funds, all sums paid for fees, all forfeitures, and all penalties
51     paid in connection with these sales shall be deposited in the Permanent State School Fund.
52          (3) All money received from the sale and all net proceeds from other contractual
53     arrangements of institutional trust lands granted to the state by the United States under Section
54     7, 8, or 12 of the Utah Enabling Act shall be deposited into the respective permanent funds
55     established for the benefit of those institutions under the Utah Enabling Act and the Utah
56     Constitution.
57          (4) (a) All lands acquired by the state through foreclosure of mortgages securing school
58     or institutional trust funds or through deeds from mortgagors or owners of those lands shall

59     become a part of the respective school or institutional trust lands.
60          (b) All money received from these lands shall be treated as money received from
61     school or institutional trust lands.
62          (5) All money received from the sale of lands acquired by the state through foreclosure
63     of mortgages securing trust funds or through deeds from mortgagors or owners of such lands,
64     whether a profit is realized or a loss sustained on the principal invested, shall be regarded as
65     principal and shall go into the principal or permanent fund from which it was originally taken
66     in reimbursement of that fund, with profits being used to offset losses.
67          (6) (a) All money received by the director as a first or down payment on applications to
68     purchase, permit, or lease trust lands or minerals shall be paid to the state treasurer and held in
69     suspense pending final action on those applications.
70          (b) After final action the payments received under Subsection (6)(a) shall either be
71     credited to the appropriate fund or account, or refunded to the applicant in accordance with the
72     action taken.
73          (7) Distributions to the respective institutions from the associated permanent funds
74     created from lands granted in Sections 8 and 12 of the Utah Enabling Act shall consist of 4% of
75     the average market value of each institutional permanent fund over the past [12] 20 consecutive
76     quarters.
77          Section 2. Section 53D-1-304 is amended to read:
78          53D-1-304. Board meetings -- Closed meetings.
79          (1) The board shall hold at least [six] four meetings per year to conduct business.
80          (2) The board chair or two board members:
81          (a) may call a board meeting; and
82          (b) if calling a board meeting, shall provide as much advance notice as is reasonable
83     under the circumstances to all board members, the director, and the advocacy office director.
84          (3) Any board member may place an item on a board meeting agenda.
85          (4) The board shall adopt a set of parliamentary procedures to govern board meetings.
86          (5) The board may establish an attendance policy to govern the attendance of board
87     members at board meetings.
88          (6) (a) Notwithstanding Subsection 52-4-204(2) or 52-4-205(1), and in addition to the
89     reasons to close a meeting described in Section 52-4-205, the board may hold a closed meeting

90     to discuss the sale or purchase of identifiable securities, investment funds, or investment
91     contracts if:
92          (i) the board, the director, or the office has entered into a confidentiality agreement
93     related to the identifiable securities, investments funds, or investment contracts; and
94          (ii) two-thirds of the members present when a quorum is present vote to close the
95     meeting for the purpose described in this Subsection (6)(a).
96          (b) If the board closes a meeting in accordance with Subsection (6)(a), the board shall
97     comply with the requirements for closed meetings described in Title 52, Chapter 4, Open and
98     Public Meetings Act.
99          Section 3. Section 53D-2-201 is amended to read:
100          53D-2-201. Land Trusts Protection and Advocacy Office -- State treasurer
101     oversight and rulemaking -- Advocacy office duties -- Applicability of Government Access
102     and Records Management Act.
103          (1) There is created the Land Trusts Protection and Advocacy Office to represent the
104     beneficiary interests of the school and institutional trust in advocating for:
105          (a) distribution of trust revenue to current beneficiaries; and
106          (b) generation of trust revenue for future beneficiaries.
107          (2) The state treasurer shall:
108          (a) acting in a fiduciary capacity to trust beneficiaries, oversee and support the
109     advocacy of the advocacy office, including:
110          (i) determining reporting requirements for the advocacy director and advocacy office;
111     and
112          (ii) submitting an advocacy office budget to the Legislature; and
113          (b) in accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, and
114     this chapter, make rules to administer the advocacy office, including the duties described in
115     Subsection (2)(a).
116          (3) The advocacy office shall have an advocacy director, as described in Section
117     53D-2-203.
118          (4) In accordance with the Utah Enabling Act, the Utah Constitution, and state law, the
119     advocacy office shall act with undivided loyalty to the trust beneficiaries, advocating against
120     the state using a trust asset to pursue a state goal that is inconsistent with a purpose of the trust

121     associated with that asset.
122          (5) To protect current and future beneficiary rights and interests as described in
123     Subsection (1), the advocacy office shall advocate for:
124          (a) productive use of and optimal revenue from school and institutional trust lands by
125     the School and Institutional Trust Lands Administration, as described in Title 53C, School and
126     Institutional Trust Lands Management Act;
127          (b) prudent and profitable investment of trust funds by the School and Institutional
128     Trust Fund Office, as described in Title 53D, Chapter 1, School and Institutional Trust Fund
129     Management Act;
130          (c) effective distribution of funds to public schools through the School LAND Trust
131     Program described in Sections 53F-2-404 and 53G-7-1206; and
132          (d) optimization of revenue to all trust beneficiaries.
133          (6) To fulfill the advocacy office's duties to trust beneficiaries, the advocacy office
134     shall:
135          (a) stay informed on the administration of the trust and trust assets, including:
136          (i) major School and Institutional Trust Land Administration transactions; and
137          (ii) the School and Institutional Trust Fund Office investments and investment policy
138     statements;
139          (b) fulfill advocacy office responsibilities and manage advocacy office activities in a
140     prudent and professional manner;
141          (c) promote efficient use of trust budgets for trust beneficiaries; and
142          (d) properly account to trust beneficiaries and the Legislature, as described in Section
143     53D-2-203.
144          (7) (a) Except as provided in Subsection (7)(b), the advocacy office and the advocacy
145     committee are subject to Title 63G, Chapter 2, Government Records and Management Act.
146          (b) The advocacy office and the advocacy committee are not subject to Title 63G,
147     Chapter 2, Government Records and Management Act, regarding a record described in
148     Subsection 53D-1-103(3)(a) that the School and Institutional Trust Fund Office provides to the
149     advocacy office or advocacy committee.
150          Section 4. Section 53F-9-201 is amended to read:
151          53F-9-201. Uniform School Fund -- Contents -- Trust Distribution Account.

152          (1) As used in this section:
153          (a) "Annual distribution calculation" means, for a given fiscal year, the average of:
154          (i) 4% of the average market value of the State School Fund for that fiscal year; and
155          (ii) the distribution amount for the prior fiscal year, multiplied by the sum of:
156          (A) one;
157          (B) the percent change in student enrollment from the school year two years prior to
158     the prior school year; and
159          (C) the actual total percent change of the consumer price index during the last 12
160     months as measured in June of the prior fiscal year.
161          (b) "Average market value of the State School Fund" means the results of a calculation
162     completed by the SITFO director each fiscal year that averages the value of the State School
163     Fund for the past [12] 20 consecutive quarters ending in the prior fiscal year.
164          (c) "Consumer price index" means the Consumer Price Index for All Urban
165     Consumers: All Items Less Food & Energy, as published by the Bureau of Labor Statistics of
166     the United States Department of Labor.
167          (d) "SITFO director" means the director of the School and Institutional Trust Fund
168     Office appointed under Section 53D-1-401.
169          (e) "State School Fund investment earnings distribution amount" or "distribution
170     amount" means, for a fiscal year, the lesser of:
171          (i) the annual distribution calculation; or
172          (ii) 4% of the average market value of the State School Fund.
173          (2) The Uniform School Fund, a special revenue fund within the Education Fund,
174     established by Utah Constitution, Article X, Section 5, consists of:
175          (a) distributions derived from the investment of money in the permanent State School
176     Fund established by Utah Constitution, Article X, Section 5;
177          (b) money transferred to the fund pursuant to Title 67, Chapter 4a, Revised Uniform
178     Unclaimed Property Act; and
179          (c) all other constitutional or legislative allocations to the fund, including:
180          (i) appropriations for the Minimum School Program, enrollment growth, and inflation
181     under Section 53F-9-201.1; and
182          (ii) revenues received by donation.

183          (3) (a) There is created within the Uniform School Fund a restricted account known as
184     the Trust Distribution Account.
185          (b) The Trust Distribution Account consists of:
186          (i) in accordance with Subsection (4), quarterly deposits of the State School Fund
187     investment earnings distribution amount from the prior fiscal year;
188          (ii) all interest earned on the Trust Distribution Account in the prior fiscal year; and
189          (iii) any unused appropriation for the administration of the School LAND Trust
190     Program, as described in Subsection 53F-2-404(1)(c).
191          (4) If, at the end of a fiscal year, the Trust Distribution Account has a balance
192     remaining after subtracting the appropriation amount described in Subsection 53F-2-404(1)(a)
193     for the next fiscal year, the SITFO director shall, during the next fiscal year, apply the amount
194     of the remaining balance from the prior fiscal year toward the current fiscal year's distribution
195     amount by reducing a quarterly deposit to the Trust Distribution Account by the amount of the
196     remaining balance from the prior fiscal year.
197          (5) On or before October 1 of each year, the SITFO director shall:
198          (a) in accordance with this section, determine the distribution amount for the following
199     fiscal year; and
200          (b) report the amount described in Subsection (5)(a) as the funding amount, described
201     in Subsection 53F-2-404(1)(c), for the School LAND Trust Program, to:
202          (i) the State Treasurer;
203          (ii) the Legislative Fiscal Analyst;
204          (iii) the Division of Finance;
205          (iv) the director of the Land Trusts Protection and Advocacy Office, appointed under
206     Section 53D-2-203;
207          (v) the School and Institutional Trust Lands Administration created in Section
208     53C-1-201;
209          (vi) the state board; and
210          (vii) the Governor's Office of Management and Budget.
211          (6) The School and Institutional Trust Fund Board of Trustees created in Section
212     53D-1-301 shall:
213          (a) annually review the distribution amount; and

214          (b) make recommendations, if necessary, to the Legislature for changes to the formula
215     for calculating the distribution amount.
216          (7) Upon appropriation by the Legislature, the SITFO director shall place in the Trust
217     Distribution Account funds for the School LAND Trust Program as described in Subsections
218     53F-2-404(1)(a) and (c).