North Dakota Legislature bumps expected tax collections
BISMARCK, N.D. (AP) — North Dakota’s Legislature slightly increased tax collection expectations Thursday for the next two-year budget cycle due to faith in stable oil prices and increased production.
House and Senate appropriation committees predicted general fund tax collections at just under $4 billion, or just $25 million more than what the GOP-led Legislature used as a budgetary starting point in January.
The general fund, which is financed mostly by taxes on sales, income and energy, is spent on an assortment of programs, including education and human services.
Senate Appropriations Chairman Ray Holmberg called the Legislature’s numbers conservative. They will be used to allow lawmakers to finish their work on the state’s 2019-2021 spending plan.
“We’d rather be conservative at this than to get into trouble with it,” he said in an interview.
Slumping oil and crop prices forced the Legislature to re-evaluate spending plans throughout last session. Those shortfalls were plugged by draining a rainy-day fund, massively cutting most government agencies and skimming profits from North Dakota’s state-owned bank.
Democrat Larry Robinson, a member of the Senate appropriations committee, said the budget numbers were far more positive than two years ago.
“It doesn’t get us out of the woods but it puts in a much better place,” Robinson said.
Lawmakers based their numbers from a pair of competing revenue forecasts presented earlier this week. The tax revenues estimates lawmakers adopted are closer to the forecast done by state budget analysts and Moody’s Analytics, than the one done by the Legislature’s own economic consultancy, IHS Markit.
The forecast done by state budget analysts and Moody’s Analytics showed the state treasury expects to collect about $4.95 billion in oil tax collections for the budget period that begins July 1, or about $1 billion more than the starting point lawmakers set in January.
The Legislature’s expected revenue forecast is now about $100 million less than the state forecast, based on steady oil prices and slightly increased production.