Monday, January 16, 2017

Burgum presents budget proposal to legislators

Governor Doug Burgum released his budget to lawmakers at 5 p.m. Mo day evening.
One highlight that sticks out to counties is his support of the concept of transfering the cost of county social services to the state resulting in tax relief and reform.
Read the release from Burgum's Office below.

BISMARCK – Gov. Doug Burgum presented legislative leaders Monday with an executive budget proposal that recommends additional cuts and realigns spending priorities to spur innovation, creativity and the reinvention of government.

Burgum recommends ongoing spending of $4.62 billion, or about $159 million less than the 2017-19 budget proposed by Gov. Jack Dalrymple in early December.

“Gov. Dalrymple’s budget was a good starting point. Unfortunately, revenues continue to fall short of projections, already lagging more than $15 million behind November’s revised forecast,” Burgum said. “My budget proposal reflects this reality while prioritizing K-12 education and support for our state’s most vulnerable people.”

The structurally balanced budget would cushion the general fund with an ending balance of approximately $100 million, including a $90 million transfer from the Strategic Investment and Improvements Fund (SIIF).

Achieving that positive balance required finding about $100 million in further savings, including an additional 5 percent, $31 million reduction to higher education and an additional $19 million in cuts to state agencies. The total reductions would necessitate eliminating about 633 full-time positions.

To help offset the additional reduction to higher education, Burgum proposes increasing funding from $3 million to $10 million for higher education challenge grants, which will generate $20 million in matching funds through public-private partnerships. 

 In the second year of the biennium, Burgum’s budget would eliminate 1 percent increases in three areas: state and campus employee salaries, the per-pupil payment for K-12 schools and an inflationary adjustment for Medicaid providers.

State employees would pay 5 percent of their health insurance premiums, saving the state $11 million and engaging state employees in the rising costs of health care.

“These measures, while difficult in the short term, will position our state for long-term success with a leaner budget that is more adaptable to volatile swings in commodity prices,” Burgum said.

The budget replenishes the rainy-day Budget Stabilization Fund with a $300 million transfer from the Tax Relief Fund. Dalrymple’s budget had also proposed a $154 million transfer from the SIIF to the Budget Stabilization Fund, but Burgum’s budget removes that transfer, as well as removes a $25 million transfer from the SIIF to Valley City State University for a new Communications and Fine Arts building.

“We need to think strategically during the next interim about how we deliver higher education to students through existing infrastructure,” Burgum said.

Burgum also recommends not using the SIIF to repay the $17 million borrowed from the Bank of North Dakota for costs related to the Dakota Access Pipeline protests. The state will seek reimbursement for those costs from the federal government and other responsible parties.

In addition, his proposed budget reduces the transfer of Bank of North Dakota profits to the general fund from $200 million to $140 million, as the state has previously utilized $100 million to cover revenue shortfalls in the current biennium.

With the flexibility provided by voters through the passage of Measure 2, Burgum also recommends using $200 million from the Foundation Aid Stabilization Fund to maintain state aid to K-12 schools at current levels – an increase of $60 million over the previous executive budget.

At the same time, his budget removes a proposed $200 million transfer from the Foundation Aid Stabilization Fund for school construction loans. Other options are available for school construction financing, including Bank of North Dakota funds, an interest buydown program and bonding.

The budget takes a more conservative approach toward oil, assuming $337 million less in oil tax revenue and an average price of about $48 per barrel, compared with $52 to $53 per barrel in Dalrymple’s budget. The oil production assumption remains unchanged at 900,000 barrels per day.

Oil tax revenue available to the general fund would decrease from $1 billion in Dalrymple’s budget to $900 million in Burgum’s budget.

Highlights from Dalrymple’s budget that Burgum has retained include:

Continued funding of Medicaid expansion.

Support for a long-term care provider assessment, which is used by more than 40 states and will ensure quality care continues in North Dakota’s nursing homes.

A combined $250 million to address behavioral health issues, including funding for adult and youth corrections programs.

SIIF funding for the Williston and Dickinson airports ($24 million), Unmanned Aerial Systems ($2 million) and lignite coal research ($3 million).

Transferring $275 million to transition the cost of county social services to the state, ending the 12 percent property tax buydown. The administration will emphasize the need to find efficiencies in social services as the legislation moves forward. 

Thursday, January 12, 2017

NDACo Legislative Report #3

Two weeks down and the bills have started to pile up. Some of our old "friends" including value caps and artificial budget limits for local government have also showed up again and will require some serious attention on Wednesday.  A new wrinkle was proposed to restrict government employees from testifying is already creating a considerable stir.  That shows up in HB1168 and will be heard on Thursday.

Tuesday has a hearing on the proposal to fund the local share of a statewide interoperable radio network with a 50-cent increase to the 911 fee on phones.  A separate proposal to add an administrative fee on traffic offenses is expected in the coming weeks.

Still plenty of work on appropriations bills of interest to counties is schedule for the coming 
week, particularly DHS, OMB, and the land board budgets – not to mention the two separate appropriations bills for new election equipment. 

This past week (in addition to the earlier posts) included a solid overview of the proposal to fund county social services with state funds made to the House Appropriations subcommittee addressing the DHS Budget. It gets confusing however as this concept is spread out among three separate bills. The DHS budget (HB1012) has the money, the OMB budget (HB1015) transfers the funds, (both in the house) and a senate bill as yet to be numbered contains the formula for reimbursing counties.  Lots of talk and interest in this proposal, particularly after Governor Burgum stated that there needs to be an “off ramp” for the 12% property tax by-down.

Get this report and the hearing schedule for next week in the weekly reports to the left, or at the link below.

State Funding of Social Services Frequently Asked Questions

Wednesday, January 11, 2017

One Plate Bill Dies in House

After lengthy debate in the House over whether or not North Dakotan's need one license plate or two on their vehicles, Representatives voted to kill the bill. The bill would have required drivers to only display one drivers license plate on their vehicle as opposed to the two that is currently law. 19 states currently allow for a single license plate on vehicles. The carrier of the bill said two license plates are unnecessary. Those who opposed the bill talked about how having two plates help law enforcement better identify vehicles involved in crimes.
"Having one license plate is as detrimental to law enforcement as having only one handcuff on a set of handcuffs," said Rep. Chuck Damschen. 
"So someone doesn't like the way a plate looks on the front of his vehicle, are we passing laws now for vanity reasons?" said Representative David Monson.
The bill failed by a vote of 34-57

Tuesday, January 10, 2017

Lawmakers Hear Proposal for Law Enforcement Tuition Waiver

Fargo Chief David Todd Testifies on Tuition Waiver Bill
Law enforcement testified in support of a tuition waiver that would be available for officers who have been on the job for more than two years. The proposal was heard before the Senate Education Committee Tuesday morning. Senator Diane Larson brought the bill forward as a way to assist law enforcement in recruiting and retention. "We all benefit from well educated officers," she told committee members.
Larson testified that the National Guard told her the promise of a tuition waiver is the best recruiting tool the National Guard has. Tuition waivers are available for National Guard members, Highway Patrol Troopers and many other programs, too many to list during the hearing. While it is difficult to estimate how many officers may take advantage of this program. Larson told committee members there are only 447 sworn officers eligible for the tuition waiver as proposed. Several Sheriff's were in attendance and were represented by Billings County Sheriff Rummel who spoke in support of the measure.

Law Day at the Capitol

It was Law Day at the Capitol Tuesday. This gave the Sheriff's and other law enforcement in the state the opportunity to visit with lawmakers about their issues. You could see many instances of legislators thanking officers for the job they do every day. Top on law enforcement's list of priorities for this legislative session is gaining support for a new statewide interoperable radio system. North Dakota's radio system is in dire need of replacement, the state is being left behind by other state's who have made improvements and our officers need and deserve the capabilities to simply communicate. There are a couple bills that propose different funding mechanisms to get started on this project. We will keep you posted on their developments.

Senate Kills Marriage Bill

Senators Tuesday voted to kill a bill that would have updated North Dakota's Century Code by referencing to marriage in gender neutral language. The bill came out of the interim in response to the U.S. Supreme Court ruling to allow same-sex marriages nationwide. The bill sought to change numerous places in North Dakota Century Code where marriage is referenced to "husband and wife" to individuals. The bill was voted down 15-31.

151 same sex marriages have been recorded in North Dakota since they became legal in 2015.