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Ryan Johnson, Published December 05 2012

Officials react to Dalrymple’s budget plan

BISMARCK – The time is right for North Dakota to invest its bounty from booming energy production and a strong economy, Gov. Jack Dalrymple said as he prepared to unveil his $12.8 billion budget proposal for the next two years.

Dalrymple told The Forum on Tuesday it’s a “very special time” in the state because economic prosperity has enabled it to address “pressing” needs while enhancing its services and infrastructure in a fiscally sound way.

“This is going to be a time of great growth and expansion, and it’s really a new chapter in our entire state’s history,” he said.

“I think that now’s the time to put our prosperity to work for us.”

Dalrymple delivered his proposal Wednesday at the Capitol building in Bismarck during a joint meeting of the House and Senate, unveiling his plan that will guide legislators as they draft a budget when the session begins Jan. 8.

The plan includes

$102 million for Fargo-area flood control projects, something Mayor Dennis Walaker said will help the city continue intermediate protection projects to get to the point of being able to withstand Red River flood crests up to 42.5 feet within the next five or six years.

“I still think that’s probably our most important process is to continue with that program because of one simple thing: Until Congress sees some light in funding their share of the major diversion project, we have to do something in the interim,” Walaker said.

House Majority Leader Al Carlson, R-Fargo, said Dalrymple’s plan serves as a “10,000-foot overview” of what the governor supports.

“I think for the most part, our priorities line up pretty well with his,” he said. “The end result, obviously, is that his job is to propose and our job is to finance and to sort through.”

Carlson said the top priorities in Dalrymple’s budget – property tax relief, infrastructure investment, education and public safety – all are mirrored by what Republicans want in the next session.

But Senate Minority Leader Mac Schneider, D-Grand Forks, said Dalrymple missed the mark for what Democrats would like to see the state invest in during prosperity.

“I think the bottom line is more can be done to live up to North Dakota’s potential,” he said.

Schneider said the budget continues the same approach to property tax relief that lawmakers have approved in the past two sessions – increasing state funding for K-12 education in exchange for lowering local property taxes. While Democrats back tax relief, he said, the budget “needlessly” pushes for $25 million in corporate tax reductions that wouldn’t be available to most small businesses here because of their tax structures.

“We’re talking about tax cuts for Wal-Mart,” he said. “We think those tax cuts should go to North Dakota property owners.”

Schneider said Democrats would instead prefer a tax credit for renters, many of whom have not seen a break as their landlords received property tax reductions in recent years. He said they also want to see more funding for early childhood education, Head Start and pre-kindergarten in the final budget.

“We think with North Dakota doing very well financially, we could do more by North Dakota’s youngest citizens,” he said.

But he said Dalrymple’s proposal includes some priorities Democrats have long pushed for, including an expansion of the homestead tax credit and additional day care funding, and they’ll look to the governor to help fight to get these ideas into the final budget.

Fargo Public Schools Superintendent Jeff Schatz said Dalrymple’s proposal to not only expand property tax relief, but make it permanent by adding it to the K-12 state funding formula, could make it easier for local districts to forecast their revenues.

But he said the details of the proposal will determine if it will get the backing of education officials.

Carlson said Republicans are committed to further property tax relief. But he said it’s too early to know if the K-12 funding change will earn their support.

“You have to realize we just got the budget today like everybody else did,” he said Wednesday. “We need to fully understand the implications of that.”


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Readers can reach Forum reporter Ryan Johnson at (701) 241-5587