BISMARCK-The heads of the North Dakota Legislature's tax committees expressed little interest this week in adjusting recent federal tax law changes that are expected to cut into state revenues.

In what Tax Commissioner Ryan Rauschenberger said was the most comprehensive breakdown of the new law's effects, his office estimated the state would lose $4.9 million in the current two-year budget cycle, which ends in mid-2019, and nearly $28.9 million in the 2019-21 biennium. That would represent about a 3.6 percent drop in income tax collections for a full two-year budget cycle.

Rauschenberger, a Republican, said Tuesday, March 20, the analysis was "static" and didn't account for any economic growth. Still, the projections came almost a year after lawmakers closed a session that saw general fund spending cut by more than 28 percent.

"This is going to be something we're going to pay a lot more attention to, I think, because of what we went through in the last session," said Democratic state Sen. Jim Dotzenrod, a member of the Senate Finance and Taxation Committee.

North Dakota is one of 18 states, along with the District of Columbia, that has "rolling conformity" with the Internal Revenue Code and will automatically align with the new federal tax law, according to the Tax Foundation. State lawmakers could "decouple" from certain provisions to diminish the revenue blow, Rauschenberger said.

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But Republican Rep. Craig Headland, chairman of the House Finance and Taxation Committee, said "that revenue reduction ends up in the pockets of our taxpayers."

"I don't know if I have any issues with that," he added.

Headland's counterpart across the hall, Republican Sen. Dwight Cook, echoed that sentiment.

"We'll talk about it more as we ... get closer to the session, I'm sure," he said. "I would see any fix to that as a tax increase, and there's not a lot of appetite for increasing taxes."

Several major features of the Republican-backed law won't affect state income taxes, such as reductions in individual and corporate tax rates, Rauschenberger said. His analysis pointed to a new 20 percent business deduction as the biggest culprit for the estimated reduction in revenue.

Rauschenberger's analysis says a section of the new tax law that gives "special treatment for customers of (farming) cooperatives" may affect state income taxes if it's not "corrected."

Rauschenberger said he still supports the new tax law because, he argued, it boosts the economy.

"Just because states might have to make a few law changes does not deter my support for the federal changes," he said.

Kylie Oversen, the Democratic-NPL chairwoman and candidate for tax commissioner in this year's election, said "We should be concerned about the impact on our budget," but she was unsure of an "appropriate" legislative response.

"We've got to have a better and more comprehensive response to how we are handling the budget situation in this state," she said.