192: Is it imprudent to invest in North Dakota?

"This bill changes the legal guidelines."

That's what former North Dakota Treasurer Kelly Schmidt had to say of a proposal, currently before the Legislature in Bismarck, which would invest 20 percent of the billions in the state's Legacy Fund in North Dakota businesses and infrastructure.

Private entrepreneurs could access that capital to start up or expand their businesses. Also, local communities could access the money to finance infrastructure projects cheaper and quicker than they are at present. The Legacy Fund is already invested in these sort of things, just not in North Dakota.

Currently, less than 2 percent of the Legacy Fund is invested in North Dakota.

Schmidt spent 16 years at Treasurer before declining to run for another term last year, and that means she spent 16 years on the State Investment Board which oversees the Legacy Fund's fiscal management. Her objection to the legislation - it's House Bill 1425, introduced by Rep. Mike Nathe (R-Bismarck) and backed by Insurance Commissioner and SIB member John Godfread - is that it modifies what's called the prudent investor rule.

"It's never good to make an exemption to the prudent investor rule," she told me, arguing that the rule is more than North Dakota law but a standard in the investment world.

Nathe's legislation modifies it because the goal is to prioritize investment in North Dakota, even if there are better returns available through investments in other parts of the world.

Schmidt says she's not against investing in North Dakota, and argues that the State Investment Board hasn't been against it either, but she worries about the Legislature mandating types of investment that might have a too-dramatic impact on the Legacy Fund's earnings.

Some in political circles have suggested that Schmidt's opposition to this proposal may be born of a potential job waiting at one of the money management firms the state uses for Legacy Fund investments. Schmidt denied this, calling it a "lie," though she didn't entirely close the door on that sort of gig.

She said her plan now is to spend time with her family but added, "if God has a plan for me moving forward I may be open to that, but there are no offers on the table."