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Wardner OK with House’s oil tax formula, but seeks other changes to bill

Sen. Rich Wardner, R-Dickinson, speaks Sept. 17 at a meeting in Bismarck over proposed funds for western North Dakota. House Bill 1176 goes before the Senate Appropriations Committee Monday, and Wardner, one of the leading proponents of a new 60-40 tax revenue split, said legislators are "leaving the formula alone." (Katherine Lymn/The Dickinson Press file photo)

BISMARCK – A bill that’s anticipated to be one of the most debated of the legislative session is headed for an overhaul next week, but not in the way western North Dakota officials hoping for a greater share of oil tax revenue were expecting.

State law currently taxes oil production at 5 percent and divides fourth-fifths of that revenue through a formula that sends 75 percent to the state and 25 percent to political subdivisions.

When House members voted Feb. 26 to bump the local share up to 30 percent in House Bill 1176, Senate Majority Leader Rich Wardner said his chamber would “start a little higher than that.”

It was Wardner who rolled out a plan by western lawmakers last September to flip the revenue split to 60 percent local, 40 percent state.

But North Dakota’s revenue outlook has dimmed substantially since then, with nearly $5 billion less in oil and gas tax revenue and $419 less in general fund revenue expected in 2015-17 compared with the December forecast used in Gov. Jack Dalrymple’s budget.

Now, with the Senate Appropriations Committee set to hear HB1176 on Monday, “We’re leaving the formula alone,” Wardner said Friday.

The new plan is to pursue other changes to direct more money for specific needs and give locals more flexibility. Wardner said they specifically want to take $112 million in funding designated for “county major collector” roads in non-oil-producing counties and instead tie it to current needs, making it available for more types of roads and bridges.

“It gives the counties more flexibility to use it where they want,” he said.

The other major change is in the energy impact grant program. The House approved about $139 million in funding, designating roughly $41 million of that for specific purposes and leaving the other $98 million to be awarded through the state Land Board’s grant application process.

Wardner wants to categorize and designate purposes for all but $8.8 million of the money, including $48 million for airports, $10 million for law enforcement and $10 million for critical access hospitals.

House Bill 1377, which would change how oil and gas tax revenue flows into various state funds, also could see changes benefiting oil-producing counties, he said.

Regardless of how the bills come out of conference committee, the debate over how to distribute oil tax revenue will continue.

“There’s no question. It needs to be looked at every session,” Wardner said.

Discrimination bill vote expected

Members of the House Human Services Committee ran out of time Wednesday on Senate Bill 2279, which would outlaw discrimination based on sexual orientation when it comes to housing, work, public accommodations and personal business transactions.

Work on the bill will resume Tuesday, with a possible recommendation that day and a floor vote as early as Wednesday, said Rep. Robin Weisz, R-Hurdsfield, the committee’s chairman.

One proposed amendment would remove public accommodations from the bill, addressing a concern of opponents. But Rep. Joshua Boschee, D-Fargo, a bill sponsor, said he doesn’t know if that will be enough to convince the House to pass the bill. Similar legislation died in the 2009 and 2013 sessions.

“It’ll be a tough lift,” he said.

Senate to mark Vietnam War

On Monday, the Senate will commemorate the 50th anniversary of the Vietnam War. Sen. Richard Marcellais, D-Belcourt, who served as a communication specialist in the U.S. Army during the war between November 1968 and November 1969, will address the chamber.

On a related note, the Senate Appropriations Committee on Tuesday will take up HB1372, which would provide $75,000 for an outreach program to help identify and provide services to North Dakota veterans who were exposed to the defoliant Agent Orange during the Vietnam War.

The original bill had $100,000 from the general fund, but it was cut by $50,000 in the House. The Senate Government and Veterans Affairs Committee added $25,000 from the Environment and Rangeland Protection Fund.

Reach Nowatzki at (701) 255-5607 or by email at mnowatzki@forumcomm.com.

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