Asset Management Plan
Minnesota’s school trust lands are a long-term asset held in trust for the support of the state’s public schools. Managing that portfolio effectively requires more than generating gross revenue. It requires understanding the value, costs, risks, and long-term earning potential of the lands and resources within the portfolio.
To support that work, the Office of School Trust Lands, in conjunction with the Department of Natural Resources, is developing Minnesota’s first comprehensive Asset Management Plan for school trust lands. The plan is intended to provide a 25-year framework for managing approximately 2.5 million acres of school trust lands and an additional one million acres of severed mineral interests.
Minnesota law identifies six goals for the 25-year framework:
- Retain core real estate assets.
- Increase the value of real estate assets and the cash flow they generate.
- Rebalance the portfolio toward assets with stronger performance potential and strategically dispose of selected assets.
- Establish priorities for management actions.
- Balance revenue enhancement and resource stewardship.
- Advance strategies to capitalize on emerging ecosystem services markets.
Phase One
Phase One of the Asset Management Plan established a foundation for more systematic and financially informed management of the school trust land portfolio.
OSTL retained Callan LLC, an institutional investment consulting firm with experience advising other states on school trust land portfolios, to evaluate Minnesota’s current approach and recommend improvements.
Callan’s priority recommendations included:
- Developing a full-cost accounting or allocation methodology to identify the complete costs of managing school trust lands.
- Establishing a performance-measurement system.
- Increasing net proceeds deposited into the Permanent School Fund.
- Addressing climate-related risks and opportunities.
- Clarifying how DNR defines and applies sound natural resource conservation and management principles in the context of school trust lands.
Callan also recommended development of several management tools, including:
- A land classification system to identify the current role and characteristics of individual parcels.
- A parcel-ranking system to compare lands within asset classes based on financial performance and future potential.
- Asset-class business plans to connect long-term portfolio objectives with day-to-day management decisions.
These recommendations are intended to improve the state’s ability to evaluate school trust lands as a portfolio rather than as a collection of individual management activities.
Phase Two
Phase Two is currently underway. Its primary focus is to identify the full costs of managing school trust lands, better define the financial position of the portfolio, and determine the data and systems needed to measure performance over time.
The School Trust Lands Classification Application is currently being developed to organize parcel-level information, support portfolio planning, and identify future management opportunities. Phase Two will also evaluate whether and how to implement the parcel-ranking and asset-class planning systems recommended in Phase One.
Phase Two is targeted for completion in early 2027. The scope and timing of future phases will depend on the results of that work.
Long-Term Purpose
When complete, the Asset Management Plan is intended to provide a common framework for evaluating school trust land management across minerals, timberlands, real estate, and emerging revenue opportunities.
The plan is intended to help OSTL and DNR:
- Assess revenues, costs, risks, and future earning potential across asset classes.
- Identify opportunities to improve net financial returns.
- Establish clearer management priorities.
- Evaluate changing market, industry, and environmental conditions.
- Improve transparency and performance reporting.
- Support more informed long-term decisions about the school trust land portfolio.
The completed plan will provide a framework for more consistent, transparent, and financially informed management of school trust lands on behalf of current and future beneficiaries.
School Trust Lands interactive web map
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