Bill requiring Legacy Fund disclosure website sees support in North Dakota Legislature

The state may soon start development on a new website detailing its Legacy Fund holdings after the North Dakota Senate last week unanimously passed an investment transparency bill.

The Legacy Fund, worth more than $12 billion as of January, is a state trust fund supported by oil revenue. It was created by a ballot measure approved by voters in 2010 with the goal of being a source of perpetual revenue for the state. 

House Bill 1319, sponsored by Rep. Bernie Satrom, R-Jamestown, says the website must include all Legacy Fund “companies, funds and other financial mechanisms in which the Legacy Fund is invested,” so long as the information may be disclosed under state and federal law.

“Some people don’t care what they’re invested in,” Satrom said in February testimony on the bill before the House Finance and Taxation Committee. “To me, it matters.”

The North Dakota Retirement and Investment Office estimated the cost for the website at about $421,000, according to a fiscal note attached to the bill. It said it would cost around $27,500 annually to maintain the website.

The House in February approved the bill by a vote of 92-1.

The Retirement and Investment Office also supports the bill. Interim Executive Director Jodi Smith said that the agency already shares a wealth of information online about the fund, but a new website could make it more straightforward for members of the public to digest.

“I feel like all that language and information is on our website, but if you’ve been on our website and try to find it all, it can be a bit cumbersome,” Smith said. “It’s not easy to navigate.”

The office expects the website to save both state employees and members of the public a lot of time and effort.

Smith said that about a third of records requests filed with the Retirement and Investment Office relate to the Legacy Fund. The agency has dedicated thousands of dollars worth of staff time to fulfilling the records requests, she said. 

Getting a website up and running will take a long time, Smith said. The agency hopes to have an interface similar to one that Norway uses for its sovereign wealth fund, which allows visitors to sort all of its investments by country.

“It might take us a couple of years to get there,” she said.

The Retirement and Investment Office already discloses how much Legacy Fund money is invested in particular companies, Smith said.

However, for a portion of the money invested in commingled funds, the agency does not disclose which investments are made by specific fund managers. Smith said this would violate the agency’s contracts with those managers. About $3.1 billion of the Legacy Fund is in these commingled funds, also known as institutional funds.

“We can’t reveal a fund manager’s investment strategy,” she said.

Bismarck attorney Tory Jackson last year asked for the North Dakota Attorney General’s Office to weigh in on whether the Retirement and Investment Office violated public records laws by withholding this information.

Gov. Kelly Armstrong during his campaign for governor advocated for more transparency with Legacy Fund investments. He is now chair of the State Investment Board. Another Legacy Fund-related bill sponsored by Satrom, House Bill 1330, would instruct the State Investment Board to divest from all Chinese companies. The Senate has yet to vote on the bill.