N.D. agencies’ spending

BISMARCK — Gov. Jack Dalrymple directed state agencies Monday to develop hold-even budgets for the 2013-15 biennium and to suggest spending reductions of 3 percent in case savings are needed.

Dalrymple met with state agency leaders in the Capitol to discuss his executive budget guidelines, which are similar to what previous Gov. John Hoeven issued in 2010.

Dalrymple said the guidelines recognize the demands of a growing state but also lay the groundwork for a conservative approach to the budget process.

“We must demonstrate that we are good stewards of the people’s money and that we will do everything we can to operate a highly efficient state government,” Dalrymple said.

This means sticking to the principle that ongoing spending should not exceed ongoing revenue, providing tax relief when possible and maintaining healthy reserves, he said.

“It is during these times of strong economic growth that we must be especially mindful not to create an overly expansive government that burdens future generations,” Dalrymple said. “I am committed to holding the line on ongoing spending while recognizing that we must also meet the needs that come from natural disasters and rapid growth.”

Democratic governor candidate Ryan Taylor of Towner said he was disappointed with Dalrymple’s guidelines.

“His guidelines make one thing clear: He hasn’t listened to the pleas of North Dakotans who are struggling with the critical needs in their communities,” Taylor said in a statement.

The governor is calling for the status quo while the state struggles with workforce shortages and inflated costs, he said.

“The governor wants to continue to collect the windfall of oil revenue for the state, stack those dollars up in Bismarck and force North Dakota communities to deal with the impacts of growth and flooding,” Taylor said in a statement. “Local governments have one option and that’s to raise local property taxes, and it’s clear nobody wants that.”

The guidelines “fall far short of reality” when it comes to making improvements to growing schools, deteriorating roads, the severe housing shortage, and public safety and emergency services, Taylor said.

Growth doesn’t come for free, and it’s unrealistic for communities to keep up the pace without some help and understanding from their governor, Taylor said.

In his speech, Dalrymple said the state is committed to supporting flood relief projects across the state and addressing the challenges of rapid oil development during the 2013-15 biennium.

Dalrymple said there’s a public misconception that North Dakota’s oil tax revenues can solve any budget challenges. The general fund budget can only collect up to $300 million in oil tax revenue, which is less than 10 percent of general fund expenditures, he said.

Voters approved setting aside 30 percent of all oil tax revenue in a Legacy Fund that can’t be spent during the 2013-15 biennium.

The remaining oil tax money is distributed to oil counties and specific state funds, such as the property tax relief fund and the new strategic investment and improvements fund.

The projected $600 million ending balance for the general fund is for one-time needs during in the next biennium, such as infrastructure projects, said Pam Sharp, director of the Office of Management and Budget.

North Dakota’s booming economy also means the state must pick up a greater share of the costs of Medicaid. To sustain the current program, the state will need to make up $91 million in lost federal funds in the new biennium, Dalrymple said.

He encouraged state agencies to find savings but said they can request staffing increases if they face increased workloads

Commerce Commissioner Al Anderson and Department of Mineral Resources Director Lynn Helms said they were comfortable with the governor’s guidelines.

The oil boom in western North Dakota has increased the demands on the Highway Patrol, but Col. James Prochniak said that doesn’t mean the agency can’t look for increased efficiency.

“I think it’s good fiscal management,” he said of the governor’s guidelines.

Teri Finneman is a multimedia reporter for Forum Communications Co.

Tags: north dakota, nd government, news, budgeting, government