ut-20261001-R848-1: R848-1. Trust Beneficiary Administration, Council Representation, and Distribution Oversight

1. Agency Information

Title catchline: School and Institutional Trust Beneficiaries' Advocacy Council, Administration Building: Advocacy Office Street address: 310 S Main Street, #1275 City, state: Salt Lake City, UT 84101

2. Contact Persons

Name: Phone: Email: Liz Mumford 801-635-5123 lizmumford@utah.gov Jessie Stuart 385-315-1892 jpstuart@utah.gov Please address questions regarding information on this notice to the persons listed above.

A. Rule or section catchline:

R848-1. Trust Beneficiary Administration, Council Representation, and Distribution Oversight

B. Purpose of the new rule or reason for the change:

A 2024 Office of the Legislative Auditor General (OLAG) audit and subsequent legislative evaluation led to statutory changes in SB 43, passed in the 2026 General Session, which went into effect on 07/01/2026. Utah Code now requires the Advocacy Council to adopt a rule for oversight of the trust distributions by institutional beneficiaries in the School and Institutional Trust System.

C. Summary of the new rule or change:

This rule establishes the procedures and accountability requirements governing interactions between the School and Institutional Trust Beneficiaries' Advocacy Office and trust beneficiaries. It defines the necessary standards for designating institutional liaisons, managing representation, planning expenditures, financial reporting, conducting compliance oversight, and resolving disputes. 4. Legislative Action Information

B. If yes, any bill number and SB 43 (2026 General Session)

session: 5. Fiscal Information Provide an estimate and written explanation of the aggregate anticipated cost or savings to:

A. State budget:

No anticipated cost or savings. UTAH STATE BULLETIN, October 01, 2026, Vol. 2026, No. 19 219 NOTICES OF PROPOSED RULES The intent of this rule is to create transparency and ensure distributed funds impact the end user. Trust distributions will continue to follow the statutory formula. Compliance will be monitored by existing staff in the Advocacy Office with no new appropriation or FTE changes.

B. Local governments:

This rule does not apply to any local government entities and subsequently there will be no fiscal impact on local governments.

C. Small businesses ("small business" means a business employing 1-49 persons):

This rule does not apply to any small businesses and subsequently there will be no fiscal impact on small businesses.

D. Non-small businesses ("non-small business" means a business employing 50 or more persons):

This rule does not apply to any businesses and subsequently there will be no fiscal impact on any type of business. E. Persons other than small businesses, non-small businesses, state, or local government entities ("person" means any individual, partnership, corporation, association, governmental entity, or public or private organization of any character other than an agency): There are no additional costs or savings anticipated for any school systems, institutions, or programs that are affected by this rule.

F. Compliance costs for affected persons:

Based on discussions with finance personnel at the beneficiary institutions, there are no additional costs anticipated for compliance. Existing staff at institutions will provide information as part of regular duties. There will be no change to the statutory distribution formula, and it is expected that the improved transparency and accurate reporting will increase the effectiveness of distributions for the designated end users. 6. Regulatory Impact Summary Table Enter the cost or savings in the relevant cell. If there is no cost or savings, enter, "$0." If a cost or savings is inestimable, enter, "inestimable." Fiscal Cost FY2027 FY2028 FY2029 FY2030 FY2031 State Budget $0 $0 $0 $0 $0 Local Governments $0 $0 $0 $0 $0 Small Businesses $0 $0 $0 $0 $0 Non-Small Businesses $0 $0 $0 $0 $0 Other Persons $0 $0 $0 $0 $0 Total Fiscal Cost $0 $0 $0 $0 $0 Fiscal Benefits FY2027 FY2028 FY2029 FY2030 FY2031 State Budget $0 $0 $0 $0 $0 Local Governments $0 $0 $0 $0 $0 Small Businesses $0 $0 $0 $0 $0 Non-Small Businesses $0 $0 $0 $0 $0 Other Persons $0 $0 $0 $0 $0 Total Fiscal Benefits $0 $0 $0 $0 $0 Net Fiscal Benefits $0 $0 $0 $0 $0 220 UTAH STATE BULLETIN, October 01, 2026, Vol. 2026, No. 19 NOTICES OF PROPOSED RULES 7. Regulatory Impact Analysis Approval The Chair of the Advocacy Council, Richard Ellis, has reviewed and approved this regulatory impact analysis. 8. Family Impact Information

A. The agency has considered this rule's impact on family health, stability, and formation: ☒

9. Citation Information Provide citations to the statutory authority for the rule. If there is also a federal requirement for the rule, provide a citation to that requirement: Subsection 53D-2-302(2)(e) 11. Public Notice Information The public may submit written or oral comments to the agency identified in box 1.

A. Comments will be accepted until: 11/02/2026

12. Effective Date Information This rule change MAY become effective on: 11/09/2026 (NOTE: This is the date the agency anticipates making the filing effective. It is NOT the effective date) 13. Agency Authorization Information Agency head or Liz Mumford, Advocacy Office Director Date: 09/04/2026 designee and title: R848. School and Institutional Trust Beneficiaries'Advocacy Council,Administration. R848-1. Trust BeneficiaryAdministration, Council Representation, and Distribution Oversight. R848-1-1. Purpose. (1) This rule establishes the procedures and accountability requirements governing the interaction between the School and Institutional Trust Beneficiaries'Advocacy Office and trust beneficiaries. (2) This rule defines the requirements for designating institutional liaisons, managing representation, planning acceptable expenditures, financial reporting, conducting compliance oversight, and resolving disputes. R848-1-2. Authority. This rule is required under Subsection 53D-2-302(2)(e) as enacted under Title 53D, Chapter 2, School And Institutional Trust Beneficiaries'AdvocacyAct. R848-1-3. Definitions. As used in this rule: (1) "Advisory group" means a standing committee or focus group of stakeholders, established by a beneficiary institution, tasked with reviewing trust distribution planning that incorporates feedback from the impacted end users. (2) "Advocacy Office" means the School and Institutional Trust Beneficiaries'Advocacy Office. (3) "End user" means the students, patients, residents, or other specific populations served by a trust beneficiary who are the intended recipients of the programs, services, or infrastructure supported by trust distributions. (4) Institutional beneficiary means a trust beneficiary that is not subject to the School LAND Trust Program administered by USBE. (5) Primary representative means the liaison for the trust beneficiary designated in statute or their official designee, which trusts include: (a) publicschools,representedbythestaffmemberwhoadministerstheSchoolLANDTrustProgramattheStateBoardofEducation; (b) Schools for the Deaf, represented by the superintendent for the State Board of Education, or the superintendent's designee; (c) Schools for the Blind, represented by the superintendent for the State Board of Education, or the superintendent's designee; (d) University of Utah, represented by the president of the University of Utah or the president's designee; (e) College of Mines and Earth Sciences, represented by the Dean of the College of Science at the University of Utah, or the dean's designee; (f) Colleges of Education, represented by the chair of the Utah Council of Education Deans, or the chair's designee; (g) Utah State University, represented by the president of Utah State University or the president's designee; (h) Miners Hospital, represented by the director of the Craig H. Neilsen Rehabilitation Hospital, or the director's designee; (i) Utah State Hospital, represented by the superintendent of the Utah State Hospital, or the superintendent's designee; UTAH STATE BULLETIN, October 01, 2026, Vol. 2026, No. 19 221 NOTICES OF PROPOSED RULES (j) Juvenile Justice and Youth Services, represented by the director of the Division of Juvenile Justice and Youth Services, or the director's designee; (k) reservoirs, represented by the director of the Division of Water Resources, or the director's designee; and (l) public buildings, represented by the executive director of the Capitol Preservation Board. (6) "Spend plan" means the annual document outlining the specific goals, planned uses, and projected impacts of trust distributions for an upcoming fiscal year. (7) "Trust beneficiaries" means the schools and institutions listed in statute. (8) Trustee agencies means the School and Institutional Trust Lands Administration (TLA) and the School and Institutional Trust Funds Office (SITFO). R848-1-4. Beneficiary Liaisons. (1) To facilitate orderly communication, representation, advocacy, and reporting, the Advocacy Office shall maintain a trust system contact database. (2) Each trust beneficiary shall identify and provide contact information of the primary liaison for trust system matters. (a) If the individual listed as the liaison for a trust beneficiary in statute chooses to delegate responsibilities to a designee, the individual listed in statute must complete an affidavit to document the assignment. (b) Trust beneficiaries may also identify secondary contacts with expertise in: (i) legal matters; (ii) finances and accounting; (iii) public relations; (iv) real estate management; or (v) legislative affairs. (c) Each trust beneficiary shall confirm contacts annually and inform the Advocacy Office about intermediate personnel transitions and agency changes that are relevant to the trust. R848-1-5. Beneficiary Representation. To represent the trust beneficiaries and to advocate for, monitor, and protect the trust beneficiaries' rights and interests, theAdvocacy Office shall: (1) maintain direct relationships and open communication with each trust beneficiary liaison; (2) facilitate the cooperative formulation of protocols for interactions with trust beneficiaries; (3) serve as an official intermediary through which information can be provided to or received from trust beneficiaries and to which the trustee agencies can give notice to a beneficiary; (4) report in person to a trust beneficiary upon request; and (5) speak on behalf of trust beneficiaries about activities related to the beneficiaries' trusts, unless a trust beneficiary notifies the Advocacy Office in writing that the trust beneficiary will speak on the trust beneficiary's own behalf involving a specific issue or matter. R848-1-6. Advocacy CouncilAppointment. (1) The Advocacy Council shall appoint, with the consent of the state treasurer, an individual to serve on the Advocacy Council representing the institutional beneficiaries according to Subsection 53D-2-303(1)(e)(ii). (a) Only a primary liaison listed in statute or their official designee is eligible for this position on theAdvocacy Council. (b) The term of service is four years in length, beginning on July 1, staggered with other terms on the council. (c) The Advocacy Office shall provide prompt notice of a vacancy, and at least 90 days of notice for an expiring term, to the institutional beneficiaries and seek eligible nominees. (i) TheAdvocacy Office shall facilitate a consultation process with the institutional beneficiaries. (ii) Applications for interested individuals for the vacancy will be considered during a closed meeting of theAdvocacy Council. (iii) Final votes appointing an individual to be considered by the state treasurer for final consent will take place during the open portion of anAdvocacy Council's public meeting. (d) If a vacancy occurs during an appointed member's term, the Advocacy Office will facilitate the process described in Subsection (c) to appoint a replacement for the unexpired term. (e) Upon the expiration of an appointed member's term, the individual is eligible for one consecutive reappointment by theAdvocacy Council. R848-1-7. Distributions:Acceptable Uses and Planning. To support transparent planning of acceptable expenditures and financial accountability for trust distributions, each institutional beneficiary shall: (1) annually consult with its advisory group to adopt and maintain a list of acceptable expenditures as formal internal guidance that: (a) demonstrates relevance and impact for the end user; (b) is consistent with enabling grant language, applicable statutes, and relevant case law for the respective trust beneficiary; and (c) may include a contingency reserve for risks associated with providing services to end users; (2) consult with its advisory group to develop a spend plan based on the projected distribution for the upcoming year; and (3) provide documentation to the Advocacy Office demonstrating official internal approval of the acceptable expenditure document and annual spend plan. 222 UTAH STATE BULLETIN, October 01, 2026, Vol. 2026, No. 19 NOTICES OF PROPOSED RULES R848-1-8. Distributions:Accounting and Financial Oversight. (1) Each institutional beneficiary shall maintain clear, verifiable records of trust distributions and expenditures. (2) An institutional beneficiary may not commingle trust distributions with other institutional funds in a manner that compromises historical record keeping or tracking. (3) An institutional beneficiary shall assign unique tracking codes within its adopted accounting system to facilitate detailed financial reporting upon request for compliance reviews by theAdvocacy Office or formal audits. R848-1-9. Carryover Balance and Fund Reimbursement. Tosupporttheprincipleofintergenerationalequityinthetrust,preservationandlong-termgrowtharemanagedthroughthepermanent fund's investment policy, and distributions to trust beneficiaries are intended for immediate impact. (1) Institutional beneficiaries shall deploy distributions to support current end users in a timely manner and limit carryover balances between fiscal years. (2) The carryover balance of trust distributions for institutional beneficiaries shall not exceed an amount two times the prior year distribution to the respective trust beneficiary. (3) Any carryover balance of trust distributions for institutional beneficiaries shall be designated for a purpose consistent with the adopted spend plan; including (a) an operational reserve for programs, services, reasonable staffing and administrative costs, equipment, or devices; or (b) a capital reserve for maintaining, refurbishing, acquiring, or building infrastructure. (4) An institutional beneficiary shall keep allowable carryover balances from trust distributions in appropriate reserve accounts invested under Title 51, Chapter 7, State Money ManagementAct. (5) An institutional beneficiary which accrues a carryover balance of trust distributions more than the allowable amount under Subsection (2) shall return the excess amount to its respective permanent fund. (6) An institutional beneficiary may seek and receive a reduced distribution by the SITFO if significant carryover is anticipated in the upcoming year after consultation with theAdvocacy Office and written approval by the state treasurer. (7) Distribution reductions or funds returned to a permanent fund become part of the principal formula for future distributions and may not be withdrawn in addition to the annually calculated distribution. R848-1-10. Reporting Requirements and Public Timeline. (1) The Advocacy Office shall publish an annual School and Institutional Trust System report by December 31 of each year as a summary of the prior fiscal year. (a) The annual report shall summarize the income, assets, fund balance, distribution, and uses for each trust beneficiary. (b) TheAdvocacy Office shall maintain the annual report and additional information about each trust beneficiary on its website. (c) TheAdvocacy Office shall distribute the annual report in accordance with Subsection 53D-2-402(2)(l). (2) Each trust beneficiary shall annually contribute necessary information and documentation at the request of theAdvocacy Office consistent with a provided template or form. R848-1-11. Compliance Reviews. (1) The Advocacy Office shall annually review a trust beneficiary's compliance with applicable law, including rules adopted by the Advocacy Office in accordance with Title 63G, Chapter 3, UtahAdministrative RulemakingAct. (2) TheAdvocacy Office may: (a) consult with the liaison and staff of a trust beneficiary to discuss distribution uses, receive information, offer suggestions, provide training, and answer questions; (b) consult with the governing body or advisory group of a trust beneficiary to review policies or compliance requirements; and (c) recommendcorrectiveactionconsistentwiththisruleifaninstitutionalbeneficiaryfailstocomplywithdistributionaccountability requirements. (3) TheAdvocacy Office shall: (a) direct an institutional beneficiary toreimbursethe respective permanent fund for any distributions found to be spent inconsistently with the institutional beneficiary's approved spend plan or this rule; and (b) refer fraud, waste, abuse, or recurring noncompliance directly to the StateAuditor. (4) The Advocacy Office shall periodically provide a report to the Advocacy Council on compliance review findings and other compliance issues. R848-1-12. Dispute Resolution. (1) To support productive and effective interactions in the trust system, the Advocacy Office shall facilitate the cooperative formulation of protocols for interactions between the Advocacy Office and the trustee agencies and the trust beneficiaries in accordance with Subsection 53D-2-402(2)(b). (2) In the event of a conflict or dispute among trust beneficiaries or with a trustee agency, the Advocacy Office may provide an impartial forum to facilitate informal resolution, upon the affected entities' consent in accordance with Subsection 53D-2-402(3). (3) TheAdvocacy Office may utilize any of the following methods most appropriate for the severity of the conflict or dispute: (a) initial conversations and informal information gathering sessions; (b) issuance of a formal letter to the affected entities detailing the specific areas of concern; (c) informal mediation or structured conferencing facilitated by theAdvocacy Office between the affected entities; UTAH STATE BULLETIN, October 01, 2026, Vol. 2026, No. 19 223 NOTICES OF PROPOSED RULES (d) issuance of a formal recommendation of corrective action outlining necessary remediation steps and timelines in consultation with theAdvocacy Council; (e) recommendation of obtaining legal counsel to consider action when a dispute cannot be resolved through internal administrative remedies; or (f) other resolution processes mutually agreed upon in writing by theAdvocacy Office and the affected entities. KEY: Advocacy Council. Advocacy Office, trust beneficiary, trust distribution, beneficiary distribution, carryover, beneficiary rights and interests, trust land funds, school trust lands, permanent fund Date of Last Change: 2026 Authorizing, and Implemented or Interpreted Law: 53D-2 NOTICE OF SUBSTANTIVE CHANGE TYPE OF FILING: Amendment Filing ID: 58228