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Biggest bumps in budget all have links to oil boom

BISMARCK — Put North Dakota’s state spending surge under the microscope, and you’ll find winners and bigger winners.

The price of North Dakota’s government has risen by nearly $9 billion since 2001 — $5.1 billion of that in state general fund money. Though the growth has been spread unevenly across the nearly 80 state agencies, virtually all of them are pulling in more money.

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There is perhaps no bigger winner than the state’s Department of Transportation, which received no money from the state back in the biennium starting in 2001. Thanks to a $1.5 billion appropriation from the general fund this biennium, transportation has overtaken Health and Human Services — generally the largest area of spending in North Dakota and nationally — as the largest area of state government spending.

Add in federal funds, and the Department of Transportation’s total budget has doubled since just the past biennium.

Traditionally a federally funded department, state lawmakers felt the money from Washington, D.C., wasn’t enough to address the state’s infrastructure needs, particularly roads in western North Dakota being pummeled by truck traffic driven by oil drilling.

About three-quarters of its $1.5 billion appropriation from the state is earmarked for improvements in oil-affected areas, Director of Transportation Programs Steve Salwei said.

“It’s really allowed us to be more proactive in making improvements to roadways, bridges and transportation infrastructure across the state,” especially the roads in western North Dakota that weren’t designed to carry heavy loads, Salwei said.

The Department of Human Services looks like a big winner on paper, but that comes with a big twist. A large chunk of its new cash is dedicated to cover Medicaid payments that the federal government no longer pays for.

Thanks in part to revamping the higher education funding formula this past session, the state’s 11 colleges are all receiving more money from the state. Williston State College is the clear winner among them — the $26.3 million the two-year college will receive in general funds this biennium marks a 380 percent increase since 2001.

President Raymond Nadolny said new money has allowed the school to increase its faculty salaries — a crucial step to recruiting and keeping staff where the cost of living is high and housing is scarce. So scarce that Nadolny has housed staff members in his basement for the past three years, he said.

The school has also started a petroleum production program, built additional housing, increased security and hired a full-time counselor.

It should be no surprise that the Department of Trust Lands, which leases millions of acres of state-owned oil- and gas-bearing lands, has been a budget winner.

Commissioner Lance Gaebe said the influx of cash has helped the department get a handle on the frenzied requests for easements and rights of way. The department has added the equivalent of more than 12 full-time workers since 2001, when there was very little drilling in North Dakota.

“There was sort of a race to get things drilled,” Gaebe said.

Kyle Potter
Kyle Potter is an enterprise reporter at the Forum. He came to Fargo-Moorhead in May 2013 after stints at the Associated Press, the Las Vegas Review-Journal, the St. Paul Pioneer Press and the Minnesota Daily. 
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