Excerpts from the North Dakota Supreme Court's decision Monday to reinstate felony criminal charges against Sandy Blunt, a former director of North Dakota's workers compensation agency. Blunt has been accused of misspending more than $18,000 in Workforce Safety and Insurance funds.

The Supreme Court's ruling reversed an August decision by South Central District Judge Robert Wefald, who is referred to in the decision as "the district court" or "the court."

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"Among the alleged improper expenditures … were gift certificates to restaurants, gas stations, shopping malls, and movie theaters given to certain WSI employees; food, beverages, flowers, balloons, decorations, costume rentals, ornaments, and gifts for WSI meetings; costs of paying for legislators to attend insurance conventions; costs of a luncheon for a legislative committee to present WSI's proposed legislative bills for 2005; and bonuses paid to three high-ranking WSI executives."

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"Under the standard employed by the district court, many or most murder charges would be subject to being dismissed at preliminary hearing because it would be "not inconceivable" that the defendant could have acted in self-defense. The state was not required to negate every possible scenario of innocence, but merely to satisfy the 'minimal burden of proof' for probable cause … The district court's speculation that, if the WSI board of directors was aware of the expenditures and did not complain to Blunt, 'it is not inconceivable Blunt understood he was authorized to make these . . . expenditures' does not provide a sufficient basis for concluding there was not probable cause (to prosecute Blunt)."

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"Although the court addressed this issue within the context of the 'risk of loss' element of the offense, the court's finding that the expenditures created a public benefit in the form of happier, more productive workers would more appropriately apply, if at all, to the element requiring proof the expenditures were not authorized. If the court's rationale is that an unauthorized expenditure of public funds creates no risk of loss to the government if there is some tangential benefit to the public, we reject it.

It is axiomatic that if public funds are spent illegally, without constitutional or statutory authorization, there is a clear risk of loss to the state. The people and the legislature, through the constitution and laws of this State, have delineated the parameters of the appropriate expenditure of public funds, and any expenditure in violation of those provisions by definition creates a loss to the government."

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"The critical flaw in the district court's rationale is that it has no limits. If Blunt had used public funds to give every WSI employee a new car, or to take them and their families to Disneyland, presumably the employees would have been happier, and it may have been easier to retain good employees. We doubt, however, that anyone would argue it was an appropriate expenditure of public funds. While most of the expenditures in this case were relatively small on an individual basis, the aggregate alleged amounts to more than $18,000. We do not view that as an insignificant amount of public funds, nor would its misuse be inconsequential."

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"We agree with the State that there is probable cause establishing lump sum payments constituting improper bonuses not authorized under state law. We further note, however, that even if the lump sum payments are characterized as retroactive pay increases, neither Blunt nor the district court has drawn our attention to any constitutional, statutory, or other legal authority allowing an agency head to award retroactive pay increases."