BISMARCK — How much money North Dakota’s oil- and gas-producing counties should get to help pay for all the needs that have come with rapid growth promises to be one of the biggest issues of the 2013 legislative session. (Click on image to enlarge).
Western North Dakota officials have spent recent months letting legislators know they need more money to address oil and gas impacts despite the $1.2 billion set aside to help the 17 counties with road, water, housing and other needs during the 2011-13 biennium.
One topic certain to generate discussion during the 2013 Legislature is whether the oil counties should be able to keep more of the tax revenue generated by their oil activity.
A complex formula now determines how much gross production tax revenue goes back to the counties and how much goes into assorted state accounts, including a voter-approved state Legacy Fund that collects 30 percent of oil tax revenue for the future.
Williston City Commission Vice President Brad Bekkedahl said the issue with the current formula is that as production grows, the state gets a higher percentage of the revenue.
With the level of production Williams County has currently, the state gets 90 percent of the gross production tax and 10 percent goes back to the county.
City leaders hope legislators will adjust the formula during the next session, said Bekkedahl, who is the city’s finance commissioner.
“It makes little sense to us out here that deal with the impacts that you get busier but you get less of the money,” Bekkedahl said. “It’s not enough to keep up with what’s happening.”
House Appropriations Chairman Jeff Delzer, R-Underwood, said potential changes to the tax formula will depend on the makeup of the Legislature after the fall election.
There are two ways to approach the oil counties’ financial needs: revising the tax formula to let more money go directly to the counties or having the Legislature determine how much state money to spend on western infrastructure and needs, he said.
“I’m sure there will be people on both sides of that issue,” Delzer said. “In general, as long as the revenue keeps coming in the way it is, there’s certainly going to be spending on infrastructure whether it’s done through the counties or through the state.”
Amy Dalrymple contributed to this report.