HUGO, Minn. - It's not always that conservation and economic development go hand-in-hand.

However, the new state director of The Conservation Fund in Minnesota said that's exactly what the nonprofit organization has as its goal: to blend the two together.

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Kim Berns-Melhus, a Minnesota native who had been managing the largest conservation easement program in the federal government for years with the Natural Resources Conservation Service in Washington, D.C., has moved back to her home town of Hugo, just northeast of the Twin Cities to "try to make conservation work for America" by creating solutions that make environmental and economic sense.

Berns-Melhus has her hands full as she is working on a major project in northern Minnesota involving Minnesota School Trust lands within the Boundary Waters Canoe Area Wilderness.

Here's how the land deal involving the 83,000 acres will work:

The initial phase has involved about 30,000 acres or one-third of the school trusts lands in the Boundary Waters.

The U.S. Forest Service and the Minnesota Department of Natural Resources are working on an land exchange involving those acres. Aaron Vande Linde, director of the Minnesota Office of School Trust Lands, said the the trust's Boundary Waters acres will be exchanged for Superior National Forest lands and will eventually provide funds for the school trust fund.

The Conservation Fund is involved with the other 53,000 acres or two-thirds of the school trust lands that are in a checkerboard pattern within the Boundary Waters.

The Conservation Fund has an option to buy about 40,000 acres of Potlach Corp. industrial timberlands outside of the Boundary Waters over a five-year period.

Once acquired, the state and The Conservation Fund will enter into a multi-year land exchange for school trust lands within the Boundary Waters area for the Potlach lands. Finally, The Conservation Fund will sell the former 53,000 acres of school trust lands to the U.S. Forest Service.

In the end, almost the entire Boundary Waters land will finally be under federal control, said Vande Linde.

"It's been a decades old problem," said Vande Lind, with the U.S. Forest Service unable to obtain funding from the federal government to purchase the school lands .

Also, thanks to The Conservation Fund, a national organization with offices in Virginia that depends on philanthropic and foundation donations to operate, Minnesota school trust lands will be timberlands that can be leased out to raise money for Minnesota schools, said Berns-Melhus.

The lands are currently being appraised and the entire project will take years to complete..

Currently, the school fund's land in the Boundary Waters, however, aren't benefiting the fund financially as it can't be used as timberland or for any other economic development purpose.

"It's basically locked up," said Berns-Melhus.

With the land exchanges and purchases, Berns-Melhus said it's "win-win for everyone as it will provide funds for the school trust fund, create jobs and and put land back on the tax rolls" as the school trust fund pays local property taxes, although in a different method.

The school trust, according to its website, is little known and an often misunderstand category of land ownership.

"They are not 'public lands' in the sense" that people think of state parks or forests, said the website. Rather, the lands, mostly through mineral and timber leases or real estate sales, raise money for Minnesota's K-12 public school students. Last year, the fund provided about $33 million to state schools and in the past 10 years has provided about $250 million to schools systems across the state, said Vande Linde.

Created at statehood, the school land trusts were established by the federal government as it set aside land in mostly the western states to provide funds for schools. Many of the states have sold off their school lands, but some such as Minnesota and North Dakota have kept theirs, said Vande Linde. In all, the school trust lands in Minnesota total about 2.5 million acres, with the Minnesota Department of Natural Resources managing the land.