Wednesday, May 1, 2019

News Release from Governor Burgum Recaps Legislative Session

Burgum: Session delivers conservative budget, funds priorities and makes strategic investments without raising taxes

BISMARCK, N.D. (April 26, 2019) – North Dakota is making strategic investments in its future, funding priorities and delivering citizens a conservative balanced budget without raising taxes, Gov. Doug Burgum said today after the 66th Legislative Assembly adjourned its regular session sine die.

“Working with the Legislature, we’ve delivered a budget that makes substantial investments in education, infrastructure, behavioral health, economic diversification and other priorities, all while ensuring state government lives within its means,” Burgum said.

Coming off an unprecedented $1.7 billion decrease in the general fund budget for the current 2017-19 biennium, the $4.8 billion budget approved today for 2019-21 represents a 12 percent increase. Still, it’s nearly $2 billion less than the record budget of over $6.8 billion in 2013-15, and it provides nearly $174 million in local property tax relief through the continuation of state funding to cover the cost of county social services.

The state’s overall budget will increase from $13.6 billion this biennium to $14.7 billion in 2019-21, due to significant increases in funding for K-12 and higher education and human services.

“After weathering the storm last session, North Dakota’s future looks brighter than ever, with a healthy balance sheet thanks to a strong economy, collaboration between the executive and legislative branches and the foresight to plan for rainy days,” Burgum said. "As responsible stewards of taxpayer resources, we’re successfully balancing revenues and expenses, encouraging innovation and investing strategically – all without raising taxes."

“However, this session also saw too many missed opportunities to make additional strategic investments in workforce and other areas, to shore up reserves and the state pension fund, and to improve transparency in budgeting, as evidenced by the last-minute transfer of nearly $765 million in oil tax revenue into the general fund to balance the budget,” Burgum added.

Following is a list of some of the legislation supporting priority areas:

  • Senate Bill 2124 will provide nearly $174 million in property tax relief by continuing the state’s responsibility for funding county social services.
  • House Bill 1053 exempts military retirement pay from state income tax. Benefits extend to retired military personnel and surviving spouses of retired military personnel of the U.S. Armed Forces, National Guard and Reserve, effective with the 2019 tax year. This measure, which also was included in the Governor’s executive budget recommendation, honors the courageous service of our military servicemen and women, promotes workforce participation and improves North Dakota’s competitiveness for federal military investments.
  • HB 1174 provides an income tax deduction on Social Security benefits for those with federal adjusted gross income of up to $50,000 for single filers and up to $100,000 for married couples filing jointly.

  • SB 2265 increases the per-pupil payment by 2 percent in each year – putting it above $10,000 for the first time in state history – and will allow school districts to keep more revenue from their state formula payment to help limit the cost of school construction.
  • SB 2215 will create the State K-12 Coordinating Council to organize and disseminate information about innovative best practices that support teachers and students.
  • Overall, state support for K-12 schools will increase by nearly $163 million, supporting teacher pay increases and helping to limit property taxes.
  • Funding for the Higher Education Challenge Fund, which requires a 2-to-1 match and provides grants to support North Dakota’s public colleges and universities, primarily with scholarships, was increased to $9.4 million.
  • The higher education budget also provides up to $100 million in bonding authority and nearly $50 million in direct appropriations for campus infrastructure.
  • Grants for tribally controlled community colleges also were increased by $400,000 to $1 million.

  • SB 2016, the Adjutant General’s budget, fully funds the National Guard Tuition Assistance Program.
  • The bill provides $600,000 to purchase or secure long-term leases for land to expand the National Guard training range at Camp Grafton South, with intent language to fund the expansion next session if securing land is successful. The expansion would create long-term savings by keeping soldiers training in-state and generate revenue by bringing in out-of-state service members for training.
  • The budget, which also covers the Department of Emergency Services, fully funds critical emergency services in 2019-21.

  • In an effort to address the state’s workforce shortage, HB 1171 provides $3 million in skilled workforce scholarships and $3 million in student loan repayments to incentivize college graduates with high-demand degrees to stay in North Dakota. The scholarships were recommended by the state’s Workforce Development Council (WDC), which was revitalized by Burgum and produced a report with recommendations based on a statewide survey of workforce needs.
  • HB 1040 provides $2 million for an automation tax credit as an incentive for businesses to adopt automated manufacturing processes that improve job quality and increase productivity. This also was recommended by the WDC.
  • SB 2306 provides occupation license reciprocity for eligible trailing spouses of military personnel, which also was a WDC recommendation.
  • HB 1073 allows Workforce Safety & Insurance (WSI) to establish pilot programs to assess alternative forms of dispute resolution with the goal of reducing the overall cost burden of litigation and establishing a more efficient dispute resolution process.
  • HB 1188 expands benefits for select injured workers that reapply for benefits post-retirement.
  • For state employees, the budget provides performance-based compensation increases of between $120 and $200 per month in the first year of the biennium and an average increase of 2.5 percent the second year.

  • As proposed in the governor’s executive budget, Senate Bill 2124 will reorganize the current system of 47 county social service units into no more than 19 zones, while maintaining all current access points and allowing the state to respond more efficiently to social service needs.
  • SB 2012, the Department of Human Services Budget, includes health care provider reimbursement increases of 2 percent in the first year of the biennium and 2.5 percent in the second year, with other changes in reimbursement structure to provide additional assistance to long-term care providers.
  • The DHS budget also increases funding for home and community-based services by $7.7 million – $1 million more than recommended in the executive budget – while calling for a study of revised payment methodology for long-term care providers.
  • SB 2347 establishes a Medicaid Fraud Control Unit for the first time in North Dakota, making it a division of the Attorney General’s Office.
  • The North Dakota Medical Marijuana Program had a number of significant changes beneficial for qualifying patients under House Bills 1283, 1417, 1519 and SB 2210.
    • Physician assistants were added to the list of health care providers who can complete written certifications.
    • The requirement that a health care provider express an opinion regarding the benefit to the patient was eliminated, alleviating a concern identified by the medical community.
    • Twelve conditions were added to the list of debilitating medical conditions. Patients 19 and over are authorized to purchase up to 2.5 ounces of dried leaves or flowers in a 30-day period without special authorization from their medical provider.
    • In lieu of a written certification, a veteran receiving treatment from a federal VA entity may submit a copy of their medical records.
    • A manufacturing facility may grow more than 1,000 plants to sufficiently meet the demand.
  • HB 1477 prohibits the sale of flavored e-liquid to minors and increases the fine for selling these products.
  • SB 2196 establishes the panel members and roles of a drug fatality review panel. The panel will examine deaths due to drugs to better understand root-cause issues related to drug fatalities and other substance abuse disorders.
  • SB 2094 ensures that physicians can use telemedicine for FDA-approved opioid prescribing medication-assisted treatment (MAT), an important tool in a rural state like North Dakota where MAT programs are being launched.
  • The Legislature approved the first budget for the newly created North Dakota Department of Environmental Quality, HB 1024, including the resources necessary for DEQ to pursue state primacy over federal air quality standards.

  • HB 1066, nicknamed “Operation Prairie Dog,” passed with broad bipartisan support. The bill changes the distribution of oil and gas tax revenues, creating new “buckets” to set aside revenue for counties, cities and townships in non-oil producing areas to pay for essential infrastructure projects related to water, roads and bridges, electricity and natural gas transmission, airports and communications. Starting in the 2021-23 biennium, the bill will direct $115 million to cities, $115 million to counties and townships, and $20 million for an airport infrastructure fund. The law also preserves allocations for oil-producing areas and removes the sunset on the “hub city” designation that directs additional oil tax revenue to Dickinson, Minot and Williston.
  • SB 2020, the State Water Commission budget, provides $82.5 million for Mouse River flood control in the Minot area and $66.5 million for Fargo-area flood control including the Fargo-Moorhead Area Diversion Project, along with hundreds of millions of dollars for water supply and other flood control projects.

  • In one of the centerpiece proposals from the governor’s executive budget, HB 1018, the Department of Commerce budget, provides $28 million to create a statewide infrastructure network to support the operation of unmanned aircraft systems (UAS) beyond visual line of sight, or without a chase plane. The bill also provides $2 million to the Northern Plains UAS Test Site in Grand Forks and $3 million for an enhanced-use lease grant with the Grand Sky UAS business park located at Grand Forks Air Force Base.
  • SB 2001 represents a significant boost to North Dakota’s tourism industry by creating a $50 million endowment for the proposed Theodore Roosevelt Presidential Library and Museum in Medora if $100 million in private donations is first raised for construction of the facility on the doorstep to Theodore Roosevelt National Park. The $50 million endowment will be managed by the state Department of Trust Lands. Earnings from the endowment will be used for operations and maintenance of the library and museum, which has the support of the Roosevelt family.
  • HB 1097 repeals the statewide ban on Sunday morning shopping. On August 1, 2019, many retailers will have the ability to decide whether or not to sell to customers on Sunday mornings.

  • HB 1015, the Department of Corrections and Rehabilitation budget, provides an additional $7 million to expand Free Through Recovery, a community-based behavioral health program designed to increase recovery support services for individuals involved with the criminal justice system who have behavioral health concerns. The additional money will allow for expanding the program to youth under the care of DOCR and those who have completed probation until they no longer require services. An additional $4 million for the program in the Department of Human Services budget will expand the program beyond corrections.
  • The budget bill also includes $755,000 for a pretrial services pilot program in three judicial districts, designed to reduce the need for incarceration during the pretrial phase through greater focus on risk assessment and supervision.
  • Legislative Management also will conduct a comprehensive study of DOCR’s adult and youth corrections systems, including an assessment of facilities and preferred locations for incarcerated men and women, with findings and recommendations to be reported to the 2021 Legislature.

  • The first bill signed in the 2019 legislative session, HB 1183, removes mandatory minimum sentences for certain drug-related offenses. Removing mandatory minimum sentences for certain offenses gives the legal system more room to apply appropriate methods of justice.
  • The cybersecurity strategy bill, SB 2110, makes North Dakota the first state to authorize a central, shared service approach to cybersecurity across all aspects of state government. The state network has 252,000 daily users and over 400 entities, and this milestone legislation will help defend against 5.6 million cyberattacks per month. More than $15 million was also invested to enhance the state’s cybersecurity software and initiatives.

  • SB 2312 ratified a historic compact the governor signed with Mandan, Hidatsa and Arikara Nation Chairman Mark Fox in February to change how the state and tribes share tax revenue from new oil and gas activity on trust and fee lands. The bill resulted from nearly two years of dialogue and work by the interim Tribal Taxation Issues Committee, which was created by the 2017 Legislature and chaired by Burgum.
  • SB 2257 enables tax agreements to be signed by a tribe and the governor for a per capita distribution of alcoholic beverages wholesale tax, tobacco wholesale tax and alcoholic beverages gross receipts.
  • SB 2258 authorizes the governor to enter state-tribal agreements for sales, use and gross receipts taxes.

  • HB 1439 provides an economic incentive to use carbon dioxide captured from North Dakota’s coal-fired power plans for enhanced oil recovery by injecting the carbon dioxide underground. This will support innovative projects such as Project Tundra by transforming emissions into a valuable commodity, extending the viability of North Dakota’s important lignite coal industry and strengthening the state’s economy.
  • SB 2037 provides a framework for disposal of high-level radioactive waste, prohibits high-level radioactive waste unless superseded by the federal government and provides for local input in the permitting process.
  • HB 1014, the North Dakota Industrial Commission budget, includes a pilot project for underground gas storage and a study of produced water recycling.
  • HB 1388 allows the formation of extended family partnerships and LLCs for farming and ranching to include second cousins.
  • HB 1202 provides a framework for public input when a waterbody is determined to be navigable.
  • HB 1020 includes $1.1 million for an agribiome initiative to enhance crop and livestock production. 


Friday, April 26, 2019

NDACo Final Priorities Approved in Last Hours of Session

The 66th Legislative Assembly wrapped up its business at 10 p.m. Friday on Day 76. The final day marked the completion of several remaining ND County priorities. 

Lawmakers Restore Funding to County Extension Program; Increase Funding for Road Study
Lawmakers Friday approved HB 1020. This bill included $875,000 funding for the Upper Great Plains Transportation Institute study. This study is necessary to provide the level of detailed data needed to identity local road project funding priorities across the state. The UGPTI road study has also been used as a basis to calculate the distribution of county road funds in the past as was as in the future through HB 1066, Operation Prairie Dog, which was approved earlier this session. 

The bill also includes $870,000 that will go to restore the funding formula between Extension and Counties for County Extension Agents. Due to the budget cuts in 2017 and allocations, Extension was left with a shortfall. Counties negotiated a one-year agreement to increase their portion of the funding. The restoration of these funds will allow the formula to be returned to a more equitable level. 

House and Senate Approve Bill that Improves Asset Forfeiture Process
HB 1286 has had many transformations since being introduced. As introduced in the House, law enforcement opposed the bill. However, they worked diligently through the process to offer suggestions for improvements. The Senate made many changes to the bill, many of which law enforcement saw as positive. The conference committee expanded on the improvements made in the Senate. Overall, the bill increases transparency of the asset forfeiture process by: 
  • Requiring an annual report
  • Providing additional oversight of funds from forfeited property by requiring them to be deposited into the local political subdivisions asset forfeiture fund that can only be appropriated by the local political subdivision
  • Increases the burden of proof to the highest level possible to “beyond reasonable doubt” the property was used in the commission of a crime or involved in criminal activity, for situations where there is no conviction
Lawmakers Approve Increase to Public Guardianship Program
Legislators approved an increase of $400,000 for the public guardianship program to bring the total funding to $1.95 million. Although the request was for $2.33 million, this funding is a considerable increase to the current $1.32 million appropriation in this biennium. Public Guardians provides assistance to the state's most vulnerable adults. These are individuals who the district court has determined are incapacitated and unable to adequately make decisions on their health, finances and other affairs due to their age, dementia, physical disability, mental illness, addiction, etc. The current funding level has remained level for the past three bienniums. Due to that, caseloads have been frozen at 205, it is estimated there are about 150 additional individuals who would qualify for the assistance who are unable to receive it due to the lack of funding. 

DOCR Facility Changes to be Studied
During the Governor's budget speech, he introduced major shifts in Department of Corrections and Rehabilitation (DOCR) system which included moving inmates from facilities and shutting down one of the prisons. Lawmakers instead voted to study a plan to conduct an assessment and review of the DOCR facilities and report it's findings to the 67th Legislative Assembly. This will allow DOCR and the State to thoroughly study the facilities available, the needs and best options for the future. 
The DOCR Budget also includes $750,000 and 7 FTE's to establish a pre-trial services pilot program.   

Legislators Approve Small Increase to Infrastructure Loan Fund 
The conference committee for the Industrial Commission Budget rejected the proposed $500 million bond to enhance the local government infrastructure loan fund. The bill however now contains a mechanism  to supplement the existing Bank of ND $150 million 2% interest revolving loan fund with an additional $40 million from the SIIF.  This addition will be after the balance of this oil royalty and tax fund reaches a $750 million balance, so it is essentially the “final bucket” and likely won’t be filled until near the end of the upcoming biennium.

House Rejects Change to Posted Land
The private property rights bill, SB 2315, failed in the House after lengthy discussion. The bill essentially closed all land except for to hunting. Posted signs would still be required to close land to hunting.  However, the ITD budget includes a provision to study access to private and public lands including trespass violations and penalties as well as explore a land access database with the capacity of electronic posting.

Tuesday, April 23, 2019

Day 73 Update

Compromises Reached on Feed Lot Zoning Regulation
Both chambers approved a bill relating to animal feed lot zoning regulation, HB 2345. This bill makes a change from the House version. The House originally struck the counties ability to vary setback distances as established under State law but after some negotiations the county’s 50% variation was restored. The only change in the final bill is that the county must establish by compelling evidence the need for the variation and that decision can be reviewed by the Agricultural Commissioner and the Attorney General. It also retains the "shot-clock" for decisions at 60 days.

Legislature Approves Health Department BudgetThe Department of Health budget, HB 1004, passed both houses Monday after adopting the conference committee report. As when first introduced in the House, the question regarding vital records fee increases was brought forth. It was explained that fees for vital records have been stagnant for a few decades and that the increase aims for a break even scenario. The bill provides for excess funds to go the general fund. On the Senate side, the only change from the version that was previously passed was the addition of authority to apply for a CDC grant. The conference committee members decided to remove the CDC grant because of attached CDC requirements. The passage of this budget bill provides level state aid funding from the previous biennium to the local public health units.

Senate Defeats Firearms BillSenators defeated SB 2172, which had been changed to allow certain individuals to carry in public. The Senate bill was introduced to allow only retired Judges to carry in public, but was amended heavily in the House and later changed in conference committee. In the latest version, the bill allowed retired judges, staff members of the Attorney General's office, a member of Congress, and paramedics or emergency responders while on duty to carry in public buildings and public events. This would include county buildings, courtrooms, schools, school events and churches. There was a requirement for these individuals to obtain the same level of firearms proficiency as is required of law enforcement by the Peace Officer Standards and Training board. The bill failed with a 4-43 vote.

Counties Invited to Ceremonial Bill Signing for Social Service Redesign
The signing of the Social Service Redesign bill is an event worth celebrating! NDACo President Scott Ouradnik, Kim Jacobson of Agassiz Valley Social Services Director and NDACo Executive Director Terry Traynor were invited to a ceremonial signing of SB 2124. Special thanks to our partners who worked diligently on this important legislation. This bill will improve the quality of services, increase the speed of delivery, reduce cost and continue to provide property tax relief.

Friday, April 19, 2019

Lawmakers Approve SIRN Funding and other updates

Day 71...And Counting
We are in the last leg of the Legislative Session. We expect lawmakers to wrap up their work late next week.  Friday was Day 71. The Legislative Session is limited to 80 days, and it has been the goal of the legislature to avoid using all 80 days.
There are still several bills being worked out in conference committees. The NDACo legislative team has been busy sitting in these meetings monitoring the negotiations and helping to educate where we can. There are still a few of our issues yet to be decided. Funding for Public Guardianships (SB 2015) and funding for NDSU Extension & Upper Great Plains Transportation Institute (HB 1020) are two of the top budget bills we are watching. Asset Forfeiture reform (HB 1286) has had three conference committee meetings, but little movement. Overall there are about 50 bills we are tracking that we are still awaiting final action on.

SIRN funding bill, HB 1435, receives final approval
The House and Senate both gave final approval to HB 1435, the bill that authorizes the funding for the entirety of the Statewide Interoperable Radio Network (SIRN). The bill includes $40 million of state funds, which was a great accomplishment. NDACo and other public safety associations articulated the importance of state funding to demonstrate the state's commitment to the project. The project will be financed by a .50 9-1-1 fee that was approved during the 2017 Legislative Session, along with local dollars. The passage of this bill will result in an interoperable and dependable radio network for our public safety officials.

House defeats Cottage Foods bill
Lengthy and lively discussions concerning the state’s cottage food laws eventually led to the defeat of Senate Bill 2269 yesterday on the House floor.  The bill was initially brought forth to clarify language in the cottage food law which passed in 2017.  After amendments were made on both sides, the bill was further amended in conference committee and passed in the Senate.  Representatives in the House took issue with some of the final changes and felt the bill ultimately placed too many restrictions on cottage food producers.

Other updates
Governor Burgum signed the Social Service Redesign (SB2124) bill .This has been a top priority for ND Counties and has been an issue we have worked on for more than a decade. Here is the Governor's news release on the bill: Governor Burgum's Release on 2124

Also this week, the Senate defeated a bill that would have printed constitutional measures up to 500 words on the ballot. Auditors opposed this bill because of how this would make ballots longer in length or possibly multiple page ballots. 

A publication related bill was passed by both chambers. The bill shifts the cost of election notices for commodity groups to those commodity associations. The bill also included a date change for a notice for financial statements. 

Monday, April 15, 2019

Social Services Redesign Heads to Governor

One of the greatest legislative priorities for ND Counties this session has been to continue the Legislature's efforts to fully fund the direct costs of county social services with state resources rather than property taxes. We are pleased to report that the legislature has made it's final action on SB 2124, the Social Service Redesign bill. The Senate voted to "concur" with the House changes with a vote of 46-1. The bill now goes to the Governor for his signature.

We have reported at length on this legislation, but it goes beyond just permanent state funding, it redesigns the system allowing for enhancements to be made in delivering services across the state. The Social Service Directors worked tirelessly with the Department of Human Services on this bill through the session and during the interim to develop the redesign plan.
Some highlights include:
The development of up to 19 multi-county zones
Local decision-making in zone creation
Zones to be approved and implemented by Jan. 1, 2021
Employment and salaries of existing employees will be preserved

This bill is the culmination of more than a decade of work. The work will now shift to guiding counties and social service departments to implementing the changes set forward in SB 2124. Thank you to all of you who have been involved in providing input and dedicating time to guide the legislative effort.

The House approved the Secretary of State budget, SB 2002 with a vote of 84-6. This bill includes the $12 million requested for election equipment. The bill also included an emergency clause so the work to purchase the equipment can start as soon as the Governor signs the bill. The Secretary of State's office has said counties will be provided training and the equipment will be ready for use for the June Primary. There are not many changes between the Senate and House versions, it is unknown at this point if the bill will go to conference committee. 

Thursday, April 11, 2019

Legislative Update for 4-11

Next week will be very busy with conference committee action. As this schedule is very fluid, it is difficult to plan ahead. Below is the schedule for Friday and Monday. You will notice two of our priority bills are listed. HB 1435 - SIRN funding will have it's first hearing at 11:00 Friday. HB 1286 - Asset Forfeiture Reform will be heard for the first time in conference committee 9:30 Monday morning.  See updates on other action below the schedule...

The House Thursday afternoon divided SB 2315 which relates to private property and posting. All private land is automatically posted unless you are hunting. Because this version is different from the Senate version, we expect it to go to conference committee.

The House also passed SB 2172 - which they amended to allow for a new class 1 exempt firearms license to allow those individuals to carry in public buildings and public events including courthouses, schools and churches. This bill will go to conference committee.

This week, the House Appropriations began a discussion of the extraordinary road costs incurred by some local governments due to heavier than normal snowfall. Struggling with an appropriate means to address the concern, the Adjutant General/DES Budget (SB2016) was amended to include a $5,000 allocation out of the Disaster Relief Fund for each non-oil township. As with such past allocations, we understand that the amounts for unorganized townships would be granted to the county. We suspect there will be much more discussion of this in conference.

Also this week, the Senate Appropriations Committee amended the Industrial Commission Budget (HB1014) to add Sen. Wardner’s local government infrastructure loan program that was killed as SB2275 in the House. Obviously a big conference committee debate to follow.

House Appropriations passed out SB2012, the DHS Budget, with a new section segregating the funding for county social service for the first time. The bill now contains $173.7 million as appeared to the $161 million allocated for the current biennium. This correlated with the fiscal note approved with SB2124, the Redesign bill.

SB2124 has not made it to the Senate floor with the house amendments, but there are indications that the Senate is likely to “concur” and not take it into conference.

On the other hand the Senate has decided to Not Concur with the House changes to SB2345, regarding feedlot zoning. Amendments are being drafted to restore the 50% variance on setbacks allowed to counties and township zoning authorities. The role of the Ag Commissioner in reviewing and mediating zoning conflicts is expected to also change. This may take a rapid response if changes aren’t made as hoped.

The House passed its amended version of SB 2139 which clearly restores eligibility for state cost share for snagging and clearing of watercourses. Supporters are urging the Senate to concur with the House version.

Monday, April 8, 2019

House Passes Feedlot Bill Restricting Local Zoning

House members voted 71-19 to pass SB 2345 which relates to animal feeding operations. Amendments made in committee restricts local zoning authority by repealing the 50% variance on setbacks that is currently allowed and requires a local decision within 60 days. During floor debate, members of the House Agriculture Committee acknowledged the push back on the setback changes but stressed that they would like the chance to address this concern in conference committee. 
Several members expressed that they would be voting against 2345 because of the restriction this would have on local control. The bill will now more than likely end up in a conference committee with house and senate members.