This is a forfeiture proceeding brought pursuant to Chapter 75D of our General Statutes — this State’s Racketeer Influenced and Corrupt Organizations Act (RICO Act). There is no question regarding the State’s right to a RICO forfeiture of the subject property. The issue which divides the State and the appealing intervening defendant, The New Bern-Craven County Board of Education (Board), concerns how the proceeds of a sale of the forfeited property shall be distributed in light of Section 7 of Article IX of the North Carolina Constitution, which provides:
Sec. 7. County School Fund.
All moneys, stocks, bonds, and other property belonging to a county school fund, and the clear proceeds of all penalties and forfeitures and of all fines collected in the several counties for any breach of the penal laws of the State, shall belong to and remain in the several counties, and shall be faithfully appropriated and used exclusively for maintaining free public schools.
The trial court concluded that this constitutional provision has no application to RICO forfeitures and that proceeds from the sale of RICO forfeited property may be distributed according to the terms of the RICO Act. It ordered that all proceeds from the sale of the forfeited property after payment to the lienholder, intervening defendant First Union Mortgage Corporation, be paid one-half to the State Treasurer and one-half to the State Bureau of Investigation.
The RICO Act provides in section 75D-5(a) that certain described property “is subject to forfeiture to the State. Forfeiture shall be had by a civil procedure known as a RICO forfeiture proceeding.” N.C.G.S. § 75D-5(a) (1990). It provides in section 75D-5(d) that a RICO forfeiture proceeding shall be “prosecuted only by the Attorney General of North Carolina or his designated representative.” N.C.G.S. § 75D-5(d).
*292The trial court’s order concerning distribution of the proceeds of the sale of the RICO forfeited property was entered pursuant to section 75D-5(j) of the RICO Act, which provides:
Subject to the requirement of protecting the interest of all innocent parties, the court may, after judgment of forfeiture, make any of the following orders for disposition of the property:
(1) Destruction of the property or contraband, the possession of, or use of, which is illegal;
(2) Retention for official use by a law enforcement agency, the State or any political subdivision thereof. When such agency or political subdivision no longer has use for such property, it shall be disposed of by judicial sale as provided in Article 29A of Chapter 1 of the General Statutes of North Carolina, and the proceeds shall be paid to the State Treasurer;
(3) Transfer to the Department of Cultural Resources of property useful for historical or instructional purposes;
(4) Retention of the property by any innocent party having an interest therein, including the right to restrict sale of an interest to outsiders, such as a right of first refusal, upon payment or approval of a plan for payment into court of the value of any forfeited interest in the property. The plan may include, in the case of an innocent party who holds an interest in the property through an estate by the entirety, or an undivided interest in the property, or a lien on or security interest in the property, the sale of the property by the innocent party under such terms and conditions as may be prescribed by the court and the payment into court of any proceeds from such sale over and above the amount necessary to satisfy the divided ownership value of the innocent party’s interest or the lien or security interest. Proceeds paid into the court must then be paid to the State Treasurer;
(5) Judicial sale of the property as provided in Article 29A of Chapter 1 of the General Statutes of North Carolina, with the proceeds being paid to the State Treasurer;
*293(6) Transfer of the property to any innocent party having an interest therein equal to or greater than the value of the property; or
(7) Any other disposition of the property which is in the interest of substantial justice and adequately protects innocent parties, with any proceeds being paid to the State Treasurer.
N.C.G.S. §§ 75D.-5(j)(l-7) (emphasis added).
From the trial court’s order the Board appealed, and, because of the importance of the question presented, we allowed the Board’s petition for review prior to determination by the Court of Appeals. Concluding that the constitutional provision controls the disposition of the proceeds of sale and requires that these proceeds be paid to the Board for the support of the New Bern-Craven County public schools, we reverse.
The trial court heard the case and based its order on stipulated facts as follows:
' Theresa M. Bessey (hereinafter “Bessey”) was the sole owner of a house and lot located at 523 “B” Street, Smallwood Subdivision, Bridgeton, North Carolina, which are the subject of this forfeiture proceeding. Between 17 August 1988 and 1 December 1989, Bessey sold from these premises controlled substances on six separate occasions to an undercover agent of the North Carolina State Bureau of Investigation (SBI). On the basis of these six sales, criminal charges were brought against Bessey; and on 28 June 1990 Bessey pled guilty to six separate violations of N.C.G.S. § 90-95 for which she was sentenced to ten years’ imprisonment. At the time Bessey entered her guilty pleas she consented to the RICO forfeiture of the premises from which the illegal sales were made.
This RICO forfeiture proceeding was begun by a civil complaint filed 11 June 1990. The RICO complaint alleged Bessey’s underlying criminal offenses occurring on the subject premises as the basis for the RICO forfeiture. Bessey answered, consenting to the forfeiture. The Board, after being permitted to intervene, answered and alleged that under Article IX, Section 7, it was entitled to any “clear proceeds” which might result from the sale of the forfeited property. The Board moved for summary judgment in accordance with its answer. Plaintiff moved for summary judgment that the subject property be forfeited and sold and that the *294net proceeds from the sale be distributed one-half to the State Treasurer and one-half to the State Bureau of Investigation (SBI). The trial court granted plaintiff’s motion for summary judgment.
We first disagree with plaintiff’s contention that the RICO Act directs that the proceeds from the sale of RICO forfeited property may be distributed to entities other than the State. While the RICO Act provides for a number of alternative dispositions of RICO forfeited property, it consistently, and in every instance, requires that the proceeds of any sale of such property “shall be paid to the State Treasurer.” §§ 75D-5(j)(l-7).
Since the RICO Act provides for distribution to the State of the proceeds of any sale of RICO forfeited property, Article IX, Section 7, requires that those proceeds be paid directly to the public school fund. Mussallam v. Mussallam, 321 N.C. 504, 364 S.E.2d 364 (1988). In Mussallam, we held that the disposition of proceeds from a civil appearance bond forfeiture were governed by Article IX, Section 7. Id. at 510, 364 S.E.2d at 367. The appearance bond’s terms provided that the sureties were bound to pay the State of North Carolina if the principal failed to appear. We concluded that whenever the proceeds resulting from a forfeiture were required to be paid to the State, Article IX, Section 7, required that they be paid to the public school fund. We stated:
We interpret the provisions of Section 7 relating to the clear proceeds from penalties, forfeitures and fines as identifying two distinct funds for the public schools. These are (1) the clear proceeds of all penalties and forfeitures in all cases, regardless of their nature, so long a$. they accrue to the state; and (2) the clear proceeds of all fine's collected for any breach of the criminal laws.... Thus, in the first category, the monetary payments are penal in nature and accrue to the state regardless of whether the legislation labels the payment a penalty, forfeiture or fine or whether the proceeding is civil or criminal.
Applying this reasoning to the bond at issue here, it is clear that the superior court judge set the bond to ensure the husband’s appearance. The punishment for his failure to so appear would be immediate forfeiture of the bond. The terms of the bond specifically made its proceeds payable to the State of North Carolina should it be forfeited. The bond therefore falls within the parameters of the first category.
Id. at 508-09, 364 S.E.2d at 366-67 (emphasis added).
*295Mussallam's analysis relied on Hodge v. R.R., 108 N.C. 17, 12 S.E. 1041 (1891), and Katzenstein v. R.R. Co., 84 N.C. 688 (1881). Katzenstein was an action by a shipper of goods against the Raleigh and Gaston Railroad brought pursuant to a statute which made it unlawful for a railroad company to allow freight to “remain unshipped for more than five days.” 84 N.C. at 689. The statute also provided that “any company violating this section, shall forfeit and pay the sum of twenty-five dollars for each day said freight remains unshipped, to any person suing for the same.” Id. Defendant railroad appealed from a verdict for plaintiff, contending among other things that plaintiff could not sue under the statute because the Constitution (then Article IX, Section 5) gave, as it does now, the “clear proceeds of all penalties and forfeitures” to the county school fund. This Court, finding no error below, concluded that the constitutional provision applied only to penalties and forfeitures which accrued to the State, saying “there is a distinction between those [penalties and forfeitures] that accrue to the state, and those that are given to the person aggrieved, or such as may sue for the same, and no doubt this distinction was in the contemplation of the framers of the constitution . . . .” 84 N.C. at 693.
Conversely, Hodge was an action brought by the State on the relation of W.T. Hodge against the Marietta and North Georgia Railroad pursuant to a statute which assessed a $500 penalty against corporations for failing to make certain reports, “to be sued for in the name of the State of North Carolina in the Superior Court of Wake County.” 108 N.C. at 18, 12 S.E. at 1041. This Court affirmed the trial court’s sustaining of defendant’s demurrer to the complaint on the ground that only the State could bring the suit, not the State on the relation of some individual. The Court, distinguishing Katzenstein, said: “But here the statute imposing the penalty provides for its recovery by the State, and the Constitution devotes such penalties and forfeitures to the school fund.” Id. at 19, 12 S.E. at 1041.
Under our analysis in Mussallam, Katzenstein, and Hodge, Article IX, Section 7, requires that clear proceeds accruing to the State from any forfeiture must be paid to the public school fund. The RICO Act provides that the proceeds from the sale of RICO forfeited property accrue to the State. Such proceeds must therefore be paid to the public school fund.
The trial court erred in granting plaintiff’s motion for summary judgment as to the distribution of the proceeds of sale of the *296RICO forfeited property. It should have' granted summary judgment for the Board on this issue. The decision of the superior court is ■ therefore
REVERSED.
Justice Parker did not participate in the consideration or decision of this case.