North Dakota is on track to reach a record billion - yes, that's with a "b" - in its school land trust fund this year.

If the markets shaped up, it'd be a little bit closer now.

But if Jeff Engleson, who directs the fund investment for the State Land Department, were a betting man, he'd bet to close the distance this year.

As of December, the trust fund total was at $950 million.

The permanent trust holds income from 700,000 school land acres owned by the state, spread around nearly every township across the state.

None of the trust fund can be spent; only its earnings, which last year amounted to about $34 million.

Engleson said most of the earnings from interest and dividends go to support elementary and high schools.

The $950 million in the trust fund is down about $23 million from October, reflecting the slide in various market funds where the money is invested.

School lands generate income for the permanent trust from oil and coal, grazing and cropland leases, like from the mineral auction Tuesday.

The trust dates back to statehood in 1889, when the federal government granted two sections from every township to the state to create a permanent fund for education.

At statehood, the state had 3.5 million school land acres, but it has sold them off over the years until now it has 700,000.

However, the state did a better job retaining mineral acres than surface acres and still has 2.5 million, Engleson said.

Engleson said the trust fund started out empty and it will have taken 119 years to reach the $1 billion mark if it makes it this year.

Besides leases, the fund is also paid oil royalties on one-sixth or one-eighth share of each barrel of oil produced under a state lease, now on 400 wells, according to the department's Web site.

Those royalty payments are now totaling $3.5 million a month, he said.

While $1 billion may seem like a lot, Texas' school trust fund contains $30 billion, Engleson said.