Wednesday, May 3, 2017

NDACo Legislative Report



For the past four months North Dakota’s county officials and the NDACo Legislative Team have been entrenched in the 65th Legislative Assembly. As we reflect, we feel very positive about the end result. We knew going in that this would be a difficult session, especially when it came to any funding issues. Of course, the counties greatest accomplishment is the passage of social service funding as the mechanism to deliver tax relief to North Dakota citizens. Establishing funds for a new statewide radio network was also another great achievement. But there are many other issues you need to know about. After all, your NDACo Team tracked approximately 436 of the 832 bills introduced this Session.  We were successful with 84 percent of the top priority bills we identified. Below you will find a summary of priority issues this Session.

Budget Overview
According to North Dakota Governor Doug Burgum, the $4.3 billion general fund budget for 2017-19 represents a more than 28 percent decrease from the current two-year budget cycle, which ends June 30.  The state’s overall budget, which includes substantial federal funds, will decrease from $14.2 billion to $13.6 billion.

Social Service Funding
For more than a decade, North Dakota Counties have worked on plans to transfer the cost of social services to the state. Finally, with the passage of Senate Bill 2206, this initiative is closer to being accomplished. The landmark legislation will provide the final step in funding state- and federally-mandated programs provided by counties. The funding will eliminate a counties levy authority for human services, up to 20 mills. The state will assume the costs statewide for a two-year pilot program in calendar years 2018 and 2019 and deliver local property tax relief by doing so. The total appropriation for this two-year pilot is $160.7 million.

Statewide Interoperable Radio Network 
The state took the first step in creating a statewide interoperable radio network (SIRN) by adopting HB 1178. 911 fees will increase .50 per line. In addition, legislators authorized a $15 million loan from the Bank of North Dakota to get the project jump started. Under this plan, revenues from the 911 fee will be pooled into the SIRN fund. All equipment purchased under this plan will be compatible; therefore solving many communications issues for law enforcement, fire and ambulance employees and volunteers. 
 
Transportation Issues
For the first time in several years, there was no one-time funding approved for transportation projects. That is quite a change from last session when a record $1.2 billion was allocated for state, city and county roads and bridges. 

In an effort to save $2 million, the North Dakota Department of Transportation (DOT) will close eight section shops in rural North Dakota. However, local governments have the opportunity to take over the sites and equipment in the 2017-2019 biennium.  The section shops to close are in Gackle, Courtenay, Litchville, Fessenden, Finley, New England, Mayville and Starkweather. The DOT will negotiate a lease with either the county, city or township, in that order.  The political subdivision may also have the opportunity to buy the DOT snowplow if it is one that the Department intends to dispose of. Under the bill, if the local government does lease the building, it would be required to assist the DOT if an emergency occurs in or around a section site and a DOT crew is unable to respond.

HB 1255 directs the DOT to establish a limited transportation network of designated highways with higher truck weight limits, allowing shippers to be more efficient and make less trips.
Local road authorities will be allowed to continue to retain the fines collected for overweight trucks on their own roads. SB 2045 removed the language that would have allowed the provision to sunset June 30, 2017.

In recognition that township roads in non-oil counties have continued to struggle, the Legislature approved $10,000 for each non-oil township in the state to a total of $16 million. However, Governor Burgum vetoed this funding following the session.

Oil Tax Distribution Changes
Lawmakers altered the formula used to distribute oil tax revenues to oil impacted communities. By changing the definition of “mining and employment,” the three communities of Dickinson, Williston and Minot will be defined as ‘hub cities’ for the 2017-2019 biennium.  Not only will fewer communities benefit from the ‘hub city’ revenue, but funding levels have also been cut. SB 2013 also includes an interim study of oil and gas tax revenue allocations to hub cities and hub city school districts. 

Corrections Reform
In response to the behavior and mental health crisis in the state, the Department of Corrections and Rehabilitation (DOCR) budget includes $7 million to provide substance abuse treatment across the state. The goal here is to address these needs and provide treatment options outside of prison. The overarching message this session has been that prison should be for violent offenders. The community-based programs will be established in partnership with the Department of Human Services in hopes of reducing the number of inmates with behavior health issues who are sentenced to prison because there are few other options. This is a major piece of the Justice Reinvestment Initiative that was studied during the interim.

Probably one of the most concerning provisions of the Legislature, from the counties perspective, is that SB 2015 authorizes DOCR to refuse inmates sentenced to prison if the prison is at capacity. Counties expect this to impact their jails, as inmates may be held there until space is realized. DOCR will develop a prioritization of admissions based on sentence. The DOCR budget also allows correctional facilities, including county jails, to adopt an inmate population management plan and to provide alternatives to jail time. 

Other reform bills passed with the intention of slowing the rise in prison and jail populations include:
  • HB 1041 reduces the drug possession charge from a Class C felony to a Class A misdemeanor for first-time offenders. It also establishes probation as the presumptive sentence for low-level, nonviolent felonies and has other provisions designed to free up limited and costly jail and prison space.
  • HB 1269 reduces the minimum mandatory penalties for drug offenses, giving the courts broader sentencing discretion that can result in more meaningful and cost-effective sentencing.

Public Safety
The Legislature responded to numerous issues that came to light as a result of protest activities related to the Dakota Access Pipeline. Several bills were proposed to assist law enforcement in responding to protest-like situations. Lawmakers enhanced penalties for riot offenses and gave law enforcement the option of issuing citations and fees for trespassing. Another bill makes it a misdemeanor crime to wear a mask while committing a crime.

Lawmakers passed “Andrew’s Law,” which establishes protections for confidential drug informants. The bill prohibits law enforcement from using a juvenile 15 years or younger as a confidential informant (CI). Those over 15 but under the age of 18 may also not be used except under special exemptions highlighted in the bill. The bill also sets forward training requirements for law enforcement who wish to use CIs.

Legislators addressed the dangers of distracted driving by passing HB 1430. Under this bill an individual can be cited and fined $100 if he or she causes an accident or commits a traffic offense. This law expands the current texting law to include any distraction that impairs the driver from safely operating the vehicle.

There were numerous bills related to individual gun rights. Probably the most notable is the bill that will allow for North Dakotans to carry a concealed handgun without a permit. Those wishing to constitutional carry must have a North Dakota driver’s license or state ID card for at least a year. Those convicted of a felony or violent crime will not be granted this right. The law will take effect August 1.  

Medical Marijuana
While the public approved medical marijuana in the November election, lawmakers amended the initiative to correct some technical and regulation concerns. The North Dakota Department of Health will establish and implement the program; they will authorize cards for qualifying patients. The Department will also authorize and regulate those who produce and distribute medical marijuana and where those sites can be located. Under the bill, manufacturing facilities are limited to two in the state and there will be a limit of eight dispensary sites. The bill establishes how much product a patient can purchase and possess. The program is anticipated to be operational in approximately one year.

Public Health
As with all the agencies and departments, local public health experienced many changes this session. The biggest is a funding change as a result of the elimination of the Center for Tobacco Prevention and Control, or BreatheND. The local public health units will receive level funding in the 2017-19 biennium for tobacco prevention efforts. This funding, which has previously been provided from the Tobacco Prevention and Control Executive Committee, will now come through the Department of Health. All tobacco funding is from the Tobacco Prevention and Control Fund, the Community Health Trust Fund and the federal government. The local public health units will also receive an additional $1 million in state-aid funding from the Tobacco Prevention and Control Fund.
Uniform Tax Notice
In an effort to increase transparency in the budget and tax process, legislators approved a uniform tax notice. The county will send a joint notice that will include tax data from the city, schools and parks. The notice will include the hearing dates and times for each taxing jurisdiction’s budget hearing. This notice will streamline and simplify the notice process, reducing the overall cost to government, but increase the value of information provided to taxpayers. This notice will replace the current truth in taxation notice in 2018.  

New Voter ID Law
With the passage of HB 1369, if a voter's information on their ID is outdated, they will be allowed to provide other supportive documents like a current utility bill, bank statement, government-issued check, paycheck or government document to supplement the ID. For those who do not bring an ID, the voter can fill out their ballot and have it "set aside" until their eligibility is confirmed. The voter has six days to show evidence of their identification. Only then will the ballot be counted. This bill was filed in hopes of satisfying a federal court case against North Dakota’s current voter ID law.

No Funding for Election Equipment
The effort to replace failing voting equipment failed in the House, and efforts to get the equipment funded in other bills were unsuccessful. There were two separate bills for new election equipment. HB 1122 would have put electronic poll books into all counties. HB 1123 would replace the current inventory of ballot scanners and AutoMarks with new updated voting equipment. The fiscal note was $12 million for both bills. House members remarked that while this equipment may be needed in the near future, the money is not available now. Numerous counties have identified equipment failures with the current system. The equipment is wearing out and counties have been able to swap problematic equipment with spare machines or cannibalize existing equipment for working parts. Auditors feel a crisis with voting equipment is impending. 

Guardianship Funding
Since 2013, the Legislature has appropriated General Funds in the OMB budget for distribution to the private agencies and private individuals that serve as public guardians for indigent adults – relieving the counties of this statutory responsibility. The caseload for this program has grown from 160 four years ago to 320 today. NDACo requested an increase in funding in anticipation of continued growth in the coming biennium. Both of the Governors’ budgets actually reduced the current $3.8 million appropriation significantly. NDACo, with significant help from the public guardians themselves, were successful in restoring the current funding level but were unable to secure an increased appropriation. Freezing the funding will likely create a waiting list for guardians in the coming two years.

Property Tax Caps Defeated
Senators voted unanimously to kill the bill to cap property taxes (HB 1361). The bill would have automatically capped all property taxes on existing property at 3 percent growth permanently (except for schools) – unless voters allowed a time-limited increase. Our position was that this bill was unworkable. We also demonstrated that in most cases it is unnecessary. Senator Lonnie Laffen told senators they heard no evidence in committee that taxing jurisdictions were taxing to a point where caps were necessary. While some years a county or city may need to increase taxes at a higher rate to recover from snow or flooding emergencies or specific needs, the average increase for most jurisdictions is less than 3%.  A reporting requirement included in this bill was added to the Office of Management and Budget bill. Counties will report tax levy and valuation data to the State Tax Department who will prepare a statewide report to be provided to legislators. This report will ultimately show the success counties have had in controlling property taxes. This bill and others that limited valuation increases were vigorously opposed by the counties, cities and parks.

Limiting Legislative Participation
Fortunately, lawmakers defeated a bill to prohibit “public employees,” which includes locally-elected officials, from attending legislative hearings while receiving publically-funded expenses or salary. 

‘Team County Effort’
We thank you for your assistance during the past four months, whether it was traveling to Bismarck to testify, filling a committee room, or by sending an email to your Senator or Representative. Our team effort is effective and you are the reason your priority bills were, for a large majority, successful. North Dakota counties definitely made an impact on this Legislative Session.

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