Monday, July 18, 2016

Special Session to Address Revenue Decrease


North Dakota Legislators will return to the Capitol in August to address necessary General Fund budget adjustments for the 2015-2017. Governor Jack Dalrymple issued an executive order, calling for the special session to begin August 2, at 9 a.m.

The state's latest revenue forecast projects that without corrective action the General Fund would fall $310 million short by the end of the current biennium.

The Governor only has the authority to make across-the-board cuts to budget. That is why a special session is necessary. Lawmakers have the power to make more targeted budget cuts and adjustments. They also will have the authority to authorize the use of dollars in other funds. It is important to note that the State has $9 billion in various other funds, some of which can be accessed.
 
The Governor and majority leaders said the shortfall can be remedied without any reductions to K-12 school funding and without further budget reductions within the Department of Human Services. Additionally, the Department of Corrections and Rehabilitation will also receive special consideration in the budget plan.

“I have talked with legislative leaders from both parties and we all believe a combination of some targeted, short-term budget adjustments and the use of some contingency funds offers the best path forward to ensure that the budget is balanced when the biennium comes to an end a year from now,” Dalrymple said. “We are fortunate in North Dakota that our Legislature had the foresight to guard against a major revenue downturn by focusing on one-time capital investments rather than ongoing appropriations, and by setting aside strong cash reserves.

Dalrymple said he will be working with the Office of Management and Budget to identify additional savings that will minimize impacts on public services. He will forward his recommendations for reductions to the Legislature.

NDACo's assessment of the recent updated forecast reveals some promising indications for the future. The revised projections show an increase in oil tax revenue compared to the forecast released in January. This will mean an increase is expected in state trust funds as well as oil tax revenue that flows to producing counties.

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