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Dalrymple hints at $100M draw from Bank of ND to balance budget

BISMARCK -- Gov. Jack Dalrymple hinted Tuesday that a Republican plan to solve a $309.5 million budget shortfall during next week's special legislative session could include a $100 million draw from the state-owned Bank of North Dakota.

BISMARCK - Gov. Jack Dalrymple hinted Tuesday that a Republican plan to solve a $309.5 million budget shortfall during next week's special legislative session could include a $100 million draw from the state-owned Bank of North Dakota.

Dalrymple and Republican legislative leaders have not released details of the plan they crafted earlier this month. But during Tuesday's meeting of the state Industrial Commission, which Dalrymple chairs, he mentioned that he and bank President Eric Hardmeyer had discussed the idea of accessing $100 million in bank assets for "interim purposes."

"The bank is extremely strong capital-wise," Dalrymple said.

Hardmeyer said the $100 million figure was "certainly in the ballpark" of what they discussed a few weeks ago. Even with a $100 million draw by the Legislature, the bank would still be in a "very strong" position, he said. The bank posted a record $130.7 million profit in 2015 and is on track for another record year of $135 million to $140 million in profits, he said.

Hardmeyer said the bank has more than $810 million in tier-one capital, and its capital-to-assets leverage ratio - a measure of financial strength - stood at 11.05 percent last quarter, the highest it's been in decades and well above the bank's benchmark of 8.5 percent. With a $100 million draw, the ratio would still be at 10 percent by June 2017, he said.

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Lawmakers will convene Tuesday for the three-day special session called by the governor on July 13.

Dalrymple and leaders of the House and Senate GOP supermajorities have mentioned the bank as a possible source of funding to help balance the $309.5 million shortfall, along with the Budget Stabilization Fund and the Strategic Investment and Improvements Fund. A plan released by Democrats last week would tap all three sources.

Both sides also expect another round of across-the-board budget cuts for most state agencies, with Democrats proposing 2.5 percent and Republican leaders saying it'll be in that ballpark but is still being fine-tuned. Agencies already sustained 4.05 percent cuts in February to help offset a $1.07 billion revenue shortfall as plunging oil and farm commodity prices stifled state tax revenues.

Dalrymple has said the Department of Human Services will be held harmless from additional cuts, and the Department of Corrections and Rehabilitation will receive special consideration.

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