Actual
& Anticipated County Legislative Issues
MAJOR FUNDING & POLICY ISSUES
Infrastructure Funding
The
“Operation Prairie Dog” bill, we expect, will be the primary road funding
vehicle to be addressed by the legislature.
Ø For major oil producing
counties, this bill would make permanent the gross production tax allocation
provisions that are currently set to sunset.
The bill also redirects some of the “county” funding to hub cities and
targets township funding for those experiencing production impacts.
Ø For non-producing and
minor producing counties, the bill creates a dedicated oil tax fund that would
max out at $100 million to be shared among 44 counties based on relative “need”
as projected by the Upper Great Plains Transportation Institute. Non-oil producing townships statewide would
share an additional $15 million, and a separate fund of $115 million would be
allocated for city infrastructure (sewer & water as well as streets).
Ø The special funds
created for local infrastructure would begin filling sometime after the
beginning of the new biennium and may, or may not, be available for the 2020
construction season.
Ø As part of the
proposal, the Bank of North Dakota would be given additional authority to
provide low interest loans to local government to accelerate the infrastructure
investment.
Ø
Along
with the creation of the dedicated funds, the proposal anticipates adequate
funding for UGPTI to continue its local roads study and maintain the GRIT asset
management system.
This Prairie Dog
proposal has strong support in the Senate and significant support in the House,
however the “fast-track” treatment previously anticipated may not result as
some representatives are less enthusiastic.
This is also a different approach than proposed by the Governor.
It is anticipated that
legislation to increase motor vehicle fees and fuel taxes may also be advanced
this session to better address the long-term funding gap for both state and
local roads.
State Funding of Social
Services ‑ Social Service Redesign
Significant legislative
changes are being proposed to implement the redesign of social service
delivery. In our first review, the bill
contains the following:
Ø The permanent
elimination of the property tax levy for social services and the removal of the
county obligation to fund direct social service costs, including general
assistance and indigent burials.
Ø A provision regarding
the maintenance of county effort with respect to the indirect costs associated
with space, utilities, payroll processing, etc., but also some allowance for
the indirect cost recovery historically received.
Ø
A
requirement to develop and operate social service delivery “zones” that will be
multi-county in nature ‑ except for counties over 60,000, which could be
stand-alone zones.
§ The zones would be
created within the existing multi-county social service district statutes being
used now by four multi-county districts.
§ All zones are to be
developed by Sept. 2019, for operation beginning Jan. 2020.
§ A maximum of 19 zones
are proposed.
§ A multi-county
"zone" board, appointed by the participating county commissioners,
would approve staffing size, ensure coordination of services, review budgets
and expenditures, but not set final budgets.
§ Importantly, the zone
(rather than the county) would become legal custodian of children removed from
the custody of their parents.
§ The State’s attorneys
of the counties within the zones would be required to represent the zones as
they now represent county social services.
§
It
is proposed that the zone director would be a state employee, but all other
zone staff would be employed by the host county of the zone.
Ø Provisions to allow for
the shifting of additional county/zone employees (up to 228) to state
employment for specific services that may be more efficiently delivered on a
broader scale (i.e. child care licensing, subsidized adoption).
Ø
A
“grant funding” mechanism based on existing staff and benefit costs adjusted
for appropriate growth and staffing changes, as well as associated direct
operating costs.
It
seems that the key issues will be the role and authority of zone boards, the
timing for zone creation, and the employment of the zone directors.
County Extension Funding Restoration
The Extension “base”
budget, as proposed by the Governor, did not include funding restoration, and
in fact, is requiring a further $2 million reduction. Their budget request does have an Optional
Adjustment Request (OAR) to return the county-state cost share to its former
configuration.
Property Valuation
& Local Budget Growth Caps
There are indications
that individual legislators will be introducing bills to create caps or limits
on assessments, budgets, or taxes. Our past position, and current resolution,
has been that artificial limitations on valuation growth skews the equity of
the property tax system and depresses economic investment in communities, and
caps on local budget growth or taxation are counter-productive, encouraging
spending and increased property taxes.
AUDITOR/TREASURER IDENTIFIED ISSUES
Special Assessment Refunds
A bill will be
introduced by the interim Taxation Committee to require the calculation (by
special assessing entity) to calculate individual parcel reimbursements if
funds in excess of the special assessment costs are collected. The County would then be required to credit
those individual amounts on subsequent property tax statements. While it would expand the administrative
burden for counties somewhat, it would be tremendously time-consuming to credit
small amounts, generally by the cities using specials. It is also likely impossible in cases where
several assessment projects are bundled into a single bond issuance. The Cities will be strongly opposing this and
have asked for county support. The Auditor’s Legislative Committee moved to
oppose this legislative as well.
Special Assessment Voting
A bill that was
rejected by the interim Taxation Committee will likely be introduced by an
individual legislator to remove any public lands benefiting from a special
assessment from joining in a protest of the assessment district. This is to eliminate the public entities from
“diluting” the private ownership percentage, but also would prohibit a local
government from weighing in on an issue impacting their budget.
Election System Replacement
An appropriation bill
will be introduced, probably in the neighborhood of $9 million of State funding
and $3 million of federal revenues to fully fund the replacement and on-going
maintenance of election equipment (scanners, ADA devices, e-pollbooks) with the
counties remaining responsible for election programming and ballot printing
costs. The governor included $11 million in his budget for new election
equipment.
Publication Requirements
The interim Judiciary
Committee studied the various publishing requirements for state agencies and
political subdivisions. NDACo identified 142 various notices which counties are
required to publish. The Auditors Association identified five areas worthy of
review. The committee has moved a bill draft forward that includes some of the
Auditors recommendations, however the Auditors will be pursuing legislation to
address areas not included. Auditors will be looking at changing the
requirement to publish official election results; adjusting the requirement to
apply only if the county is unable to publish the results on the county’s
website. The other change relates to the listing of expenditures; auditors are
seeking language to remove the listing of expenditures as part of the minutes.
Centrally Assessed Deadline
Counties, and all other taxing entities, depend on the
accuracy of centrally assessed properties when computing their budgets.
Therefore, it is paramount this information is complete and reported to
counties in a timely manner. The Auditors Association will be seeking
legislation to adopt a hard deadline for centrally assessed properties and any
changes made after that date would be applied to the following year.
SHERIFFS & DEPUTIES ASSOCIATION ISSUES
Decriminalization of Marijuana
It has been widely
publicized that a bill will be introduced legalizing the personal use and
possession of marijuana. The North Dakota Sheriff’s and Deputies Association
believes this bill should only focus on personal use amounts of marijuana and
possession. They will be closely monitoring the bill with particular
concentration on penalties as they relate to minors and the manufacture and
delivery of marijuana. NDSDA also has concerns with penalties not aligning with
penalties for alcohol offenses. The draft includes a study for the 2019-20
interim to study the legalization of marijuana, specifically relating to the
regulation, commercial controls, and tax implications associated with
legalization. This study aligns with Resolution 2018-13.
Public Safety Radio ‑ SIRN 20/20
The Governor’s Budget
includes $40 million to begin the SIRN project.
The procurement committee hasn’t yet completed its work to determine
what should be the direction, but this is expected early in the Legislative
session.
Measures to Promote Traffic Safety
Counties have
historically supported law enforcement, the cities, and others in attempts to
increase traffic fines, particularly for speeding and distracted driving. This year we expect to see the return of
similar legislation as well as a proposal for primary enforcement of seatbelt
laws.
Jail & Prison Reform/Reinvestment
County officials have
supported the careful review and very selective changes to our state’s
sentencing practices to more appropriately address offenders’ needs, without
increasing jail inmate counties. The priority must be the expansion of
behavioral health services that provide more appropriate response to mental
health and drug addiction factors that are driving our jail & prison inmate
population. The shifts in the correction system as proposed in the governors’
budget will also be of interest.
Behavioral Health Services
Counties have expressed
concern with the lack of behavioral health services across the state. The
governor recognizes this state has a behavioral health crisis and has
identified several new initiatives along with funding to address the needs of
North Dakotan’s. His proposals include expanding community-based services
through the Free Through Recovery program by extending it beyond the criminal
justice system to other individuals in our communities. Programs like this will
more than likely have an impact on the jail inmate population. The executive
budget also proposes building a new behavioral health hospital and clinic.
STATE’S ATTORNEY ISSUES
The ND State’s
Attorneys Association (NDSAA) will focus much of its efforts in 2019 engaged in
legislative activities. Historically, almost a quarter of legislative bills
revolve around the criminal justice system and this next legislative session
looks to be no different. Significant public policy issues, such as access to
mental health and chemical dependency services, must be addressed in both urban
and rural counties if North Dakota truly wishes to provide meaningful criminal
justice reform. Although incarceration rates seemed to have stabilized
recently, without additional services, recidivism rates look to only increase.
The State’s Attorneys
will be working with all the stakeholders to improve this outcome for 2019.
The State’s Attorneys
will also be looking to address the DUI statutes as court cases continue to
make prosecution of DUI’s difficult with so many different hoops for officers
to jump through. The goal would be to streamline officer’s investigation while
at the same time protecting the accused’s constitutional rights.
LOCAL PUBLIC HEALTH ISSUES
Public Health State Aid (SACCHO ‑ City/County Health)
Counties saw an overall
decrease in state funding for public health in 2017, and the Executive Budget
recommendation contains a further reduction of $525,000 (out of a $6.5 million
total) The restoration of this funding is the number one priority of the health
units to avoid shifting additional costs to the property tax.
TAX ASSESSING OFFICIAL ASSOCIATION ISSUES
Farm-Residence Exemption
We
anticipate a bill draft that would:
Ø Remove the blanket
farm-residence exemption while preserving the exemption for all non-residential
structures that are currently exempt.
Ø Preserve the residence
exemption for already retired farmers and surviving spouses that are getting
the exemption
Ø
Create
a new residence exemption for beginning farmers that is time limited (5 years?)
but also exempts them from all state income tax for the period.
WATER RESOURCE DISTRICT ISSUES
Snagging
& Clearing of Natural Waterways.
The Water Boards have asked for county
commission support on their effort to reverse a change made by the Legislature
in 2017. In 2001, the Legislature
overwhelmingly passed legislation that allowed for State Water Commission cost
sharing for clearing dead trees and other obstructions from natural waterways. In 2017 the Legislature passed a bill
including many other issues, but that also removed this cost-share
ability. If the SWC can’t cost share in
this program, the burden falls entirely on farmers, townships, local water
resource boards and county commissions.
OTHER FUNDING & POLICY ISSUES
Guardianship/Public Administrator Funding.
Again, due to budget
instructions, we don’t expect the OMB base budget to contain the necessary
funding for public guardianships, but we have been informed that there is an
OAR proposed for the full amount necessary for the upcoming biennium. This may also be built into the DHS budget
for long-term administration in the future.
Fire & Tornado Fund Administration
The ND Insurance Dept.
budget anticipates contracting with NDIRF to administer the Fire & Tornado
Fund which provides property insurance coverage for most public buildings. This move is viewed very positively by county
officials that have dealt with both administrations in the past.
2019 LEGISLATIVE LEADERSHIP
There are new leaders in the House. Chet Pollert of Carrington is the new House Majority Leader and Josh Boschee from Fargo is the new Minority Leader. Several committees in both the House and Senate saw changes in leadership as well. New leaders are shown below in bold. Complete committee membership and contact information can be found at https://www.legis.nd.gov/assembly/66-2019/regular
