N.D. Senate Update- March 25, 2019

First, Congratulations to the New Rockford-Sheyenne Rockets for their Consolation Championship at the State B Basketball Tournament. It was exciting to watch the team on TV and listen on the radio when I could not be there. There are also many other important events and activities taking place in our D-23 schools with our students and staff that bring so much pride to our schools and develop lifetime skills. Congratulations on a successful 2018-19 school year. Graduation will soon be here.

I was also proud to have Sandra Larson and Logan Munson from the New Rockford-Sheyenne High School serve as Pages for the Day in the Senate Monday. They took the opportunity to meet legislators, visit committees, and watch Senate action from a bird's eye view. Thank you for taking time to participate in your North Dakota Legislature.

Continuing to take pride in our D-23 schools, I also want to congratulate Dakota Prairie and Midkota schools, students, and staff for applying for and receiving a grant from the Governor's office for (YES), Youth Ending Stigma Challenge programming. These funds would be dedicated to help students eliminate social stigma including addiction and mental illness. I know how hard schools and students are working to make sure students have the tools they need to stay healthy and engaged in their schools and communities. We in the legislature need to continue to do our part to provide funding for important programs and activities to keep these programs moving forward.

This week, Mother Nature let us all know that while we think we are in charge of our weekly schedules, she tells us different. The legislature was held on time because the weather in Bismarck was not as severe as in the middle and eastern portion of the state. As committee hearings were held on schedule, Committee Chairmen were encouraged to hold hearings open for those across the state who wished to testify on specific bills. Please check with your local legislator to see if you can still provide testimony for specific hearings.

I started the week with meetings with Appropriations members and leadership from both chambers to hear the revenue forecast from Moodys for the upcoming biennium. The first forecast was held Monday morning. Tuesday morning, we heard a second forecast from IHS Markit. Both forecasts were strong on oil and weak on agriculture. There were differences in expected revenue from sales tax. Moody's predicts $172 million more in sales tax and IHS expects $130 million less. IHS may be low because they predicted fewer rigs drilling. Each drilled well produces significant revenue in sales tax from the products purchased for the well. The two projections are over $200 million apart with IHS providing an optimistic forecast and a pessimistic forecast. Moody's total General Fund Revenues is expected to be $4.294 billion and IHS Markit's is $4.057 billion for the 2019-21 biennium. These numbers were then used by Appropriations to set biennium levels at a conservative level of $3.998 billion. Those numbers reflect an expected price per barrel of oil (North Dakota price) of $48 to $48.50 with production of 1.4 to 1.44 million barrels per day. With those numbers, the total revenue in the upcoming biennium from oil and gas taxes is expected to be $4.851 billion with only $300 million of that going to the General Fund. Those revenue numbers reflect an estimated increase of $1.3 billion more to be deposited in the Legacy Fund in the next biennium. It was also interesting that the House decided to only allow $100 million from the Legacy Fund interest to be figured into the upcoming budget. That leaves over $200 million available and we will have to see how that plays in to the final numbers as the session moves along.

Monday I also had the privilege of presenting an overview of the session to a state conference of county commissioners. If we push too many unfunded mandates down to the county level, the only choice commissioners have is to raise mill levies. That increases property taxes. I am working with other legislators to determine if additional snow removal funds are needed this spring.

In other news this week, I testified in favor of HB 1268 which would provide direction for the Department of Health Emergency Services funding formulas. This bill remains in committee. I am working with stakeholders and the committee to determine appropriate amendments to make law and intent clear. I appreciate the contacts from rural emergency services on how this formula should distribute funds for the 2019-21 biennium.

I also presented SCR 4017 to the House Energy and Natural Resources Committee. This resolution would ask for Legislative Management to consider studying the differences in the ways Tribal Historic Preservation Officers and the State Historical Society identify historic sites.

An additional meeting that I attended was with House Minority Leader Boschee and Governor Burgum and his staff. We conferred about ideas on how to fix the issue with the Treasurer's Office placing money in the incorrect funds for several years. It is my belief that we must fix the confusion going forward and also replace the $240 million that was not deposited in Constitutional funds. The Constitution is clear that the tax from oil extraction receipts in North Dakota must be deposited (10 percent in the Common Schools Trust Fund, 10 percent in the Foundation Aid Stabilization Fund, and 20 percent in the Water Resources Trust Fund). I have amendments prepared to offer to the Senate Finance and Tax Committee when they consider this bill in committee work.

As I prepare for the upcoming week, I am encouraged with the temperatures and spring winds in the air. Winter needs to leave, now!

Have a great week. You may reach me at [email protected] or by calling (701) 302-0355.