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ND officials want to spur participation in $131 million college savings program

Bank of North Dakota building in Bismarck. Special to The Forum

FARGO – So far North Dakota families have contributed $131 million to a college saving program administered by the Bank of North Dakota, but bank officials say participation in the program should be much greater.

The state-owned bank has a 529 higher education savings plan, called College SAVE, with earnings that grow free of state and federal income taxes.

Withdrawals to attend a North Dakota college under the program have increased substantially, from $234,053 in 2012 to $637,549 this year, according to bank figures. So far, 21,574 accounts have been opened under the program — a number that could be much larger, according to Eric Hardmeyer, president of the Bank of North Dakota.

Hardmeyer recently briefed the State Board of Higher Education on various financial tools that are available to students in North Dakota, or to graduates with student loans who live in North Dakota. The message is, "You have a friend in the Bank of North Dakota," Hardmeyer said.

The bank's College SAVE plan assets have grown from $59.8 million in 2013 to $131 million today.

"That's not by accident," Hardmeyer said, adding that bank officials have been working to strengthen the financial programs, reinvesting profits. "That's by design."

For every dollar that the Bank of North Dakota invests in a matching grant program, residents have saved $7, Hardmeyer said.

Bank officials are targeting new parents, so they have many years to save toward their children's college education. Thus far, 4,854 North Dakota matching grants and 4,654 Children FIRST accounts have been opened over the past several years — figures that amount to a small share of the approximately 8,000 newborns each year, Hardmeyer said.

"We're only getting about 10 percent of them to start saving," he said.

The vast majority of North Dakota's college students borrow to help pay for their college costs. Ninety-four percent obtain federally guaranteed loans and 26 percent private loans, including from the Bank of North Dakota, Hardmeyer said.

North Dakota ranks 42nd in the nation in the debt load of its college graduates, which averaged $25,815, according to figures compiled by By comparison, neighboring South Dakota ranks fifth, with an average debt burden of $31,518 and Minnesota ranks sixth, with an average indebtedness of $31,342.

Over the past several years, the Bank of North Dakota has awarded an average of $100,000 per year in scholarships. The bank has 62,000 active borrowers under its student loan portfolios, including 8,000 added this year, Hardmeyer said.

One of its most attractive options is a student loan consolidation program for North Dakota residents called DEAL One. The average loan under the program is $48,723, and the bank has refinanced $524 million since 2014.

"This program is a game-changer," Hardmeyer said. One woman, who works in Fargo, had $40,000 in student loans, with interest rates ranging from 4 percent to 15 percent. After refinancing, her monthly loan payments were reduced by more than half, from $500 to $212, he said.

"This is typical," Hardmeyer added. "This is what we see."

Employers, including Microsoft in Fargo, can use the program to help recruit and retain employees. "This is a workforce issue," he said.

Don Morton, chairman of the higher education board, said he is a fan of the program. When Morton was the top executive of the Microsoft campus in Fargo before he retired, the bank's refinancing program was popular. One employee, a Connecticut native, saved enough that she no longer needed a roommate for her downtown Fargo apartment, he said.

Chancellor Mark Hagerott said the college savings programs can help "shift the paradigm," from one of heavy debt to a greater reliance on savings, enabling students to graduate with lower debt loads.

For more information on Bank of North Dakota student loan and savings programs, visit

Patrick Springer

Patrick Springer first joined the reporting staff of The Forum in 1985. He can be reached by calling 701-241-5522. Have a comment to share about a story? Letters to the editor should include author’s name, address and phone number. Generally, letters should be no longer than 250 words. All letters are subject to editing. Send to

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