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North Dakota Legislature Adjourns With a Budget Issue Remaining

The House and Senate were unable to reach a final agreement this week on several policy issues contained within the state's Retirement and Investment Office and Public Employees Retirement System budget, which means the governor may call a special session.

By Nick Smith

North Dakota lawmakers adjourned the 2015 Legislature sine die Wednesday afternoon, leaving one agency budget still unresolved as well as the possibility of a special session being called at some point in the months ahead on the table.

Neither lawmakers nor the governor were aware of a time when a session adjourned under such circumstances.

Lawmakers left Bismarck after a 78-day session, in which they crafted a record $14.4 billion budget for the 2015-17 biennium, up from the $13.7 billion budget for 2013-15.

General fund spending was down from more than $6.8 billion in 2013-15 to just over $6 billion for 2015-17. A general fund budget surplus of $211 million is projected for when the biennium ends on June 30, 2017.

The House and Senate were unable to reach a final agreement this week on several policy issues contained within the state's Retirement and Investment Office and Public Employees Retirement System budget.

The House passed the budget, but the Senate refused to agree to amendments. With no progress being made to reconcile differences, both chambers agreed to adjourn.

House Majority Leader Al Carlson, R-Fargo, said the issue with the final budget bill can be resolved and that it isn't a personal issue between the chambers.

"This isn't war with the House and the Senate, this is ... a philosophical difference," Carlson said.

Senate Majority Leader Rich Wardner, R-Dickinson, said it was better to adjourn since lawmakers could have debated the issue for days and ended up getting nowhere.

"We can take care of it at some point," Wardner said. "We're not going to leave that office unfunded."

The amendments to the final budget bill originated in separate legislation that passed the House by a wide majority but was rejected unanimously in the Senate.

Democratic-NPL Party leadership was quick to pounce on the session's unique end.

Senate Minority Leader Mac Schneider, D-Grand Forks, laid the blame squarely at the feet of Carlson.

"The Legislature left town without getting its work done," Schneider said.

Options to address the issue are limited.

Lawmakers or the governor could call a special session. There may also be the option of providing funding through a continuing appropriation. The attorney general's office will review the option to see if there is the legal authority to do so in state law.

Gov. Jack Dalrymple said he was unsure if he'd call a special session, saying the attorney general's review of the continuing appropriation option should be completed first.

"If not, we'll go from there," Dalrymple said.

Dalrymple said in his time as a legislature from 1985-2000, as lieutenant governor from 2001-2010 and as governor, he'd never seen a session end the way it did Wednesday.

"I didn't see it coming," Dalrymple said. "It is, you know, interesting to look back and say 'where did this train go off the tracks?'"

Session accomplishments

Republicans say they were were pleased with the session's work after being faced with low oil prices and billions less in projected revenue since arriving in January. Democrats expressed disappointment in the majority party's priorities in tax legislation and infrastructure funding levels.

A total of $397.2 million in tax cuts were passed this session. Of this, $274.2 million consisted of property tax cuts and $123 million in individual and corporate property taxes.

The property tax cuts came from $250 million to continue a 12 percent state-paid property tax credit, $23 million for the state to take over a portion of county social services and a $1.2 million expansion of the homestead property tax program.

"We did a great job of funding our priorities, of giving money back to the taxpayers and to make sure that we have some reserves left for what could be some rainy day," Carlson said.

Funding for oil patch infrastructure was a major accomplishment, Wardner said.

"Those people out there are grateful. They are grateful for what we've done," Wardner said.

Early in the session, lawmakers approved $1.1 billion in early surge spending largely for oil patch communities and roads. A bill increasing the share of oil tax revenue going to oil patch communities from 25 percent to 30 percent was also passed.

House Minority Leader Kenton Onstad, D-Parshall, said more should have been done with the formula bill, which, as originally introduced, had 60 percent going to the oil patch.

"We can't be continuing to do the same old thing," said Onstad, adding that a bill that cut the state's oil extraction tax rate from 6.5 percent to 5 percent was also shortsighted.

Schneider said the failure of a bill in the House that would have banned discrimination in housing and employment based on sexual orientation was a sign of that chambers' leadership being "out of touch with a changing North Dakota."

Democrats praised the passage of legislation expanding pre-kindergarten programs in the state as well as laws to address human trafficking.

Gov. Jack Dalrymple said lawmakers' ability to meet infrastructure, education and water needs while still carving out a budget surplus with less revenue available was impressive.

"I think the session as a whole was very successful," Dalrymple said. "If you look at it in the context of the adjustments and forecast along the way ... I think it's really good news in the end."

(c)2015 The Bismarck Tribune 

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