Amendment To Let State Of North Dakota Write Checks To Individuals Fails


It’s a bit ironic that HCR3036 failed today. The constitutional amendment, introduced by Rep. Vicki Steiner, would add to the Article X Section 18 state constitution the following language allowing the state government to cut checks directly to individuals.

The legislative assembly may provide by law for direct general allocations of state funds to North Dakota resident individuals upon eligibility terms and conditions established by law. An allocation authorized under this section must be in a uniform amount for each eligible individual. The legislative assembly shall establish a minimum period of continuous residency in this state immediately preceding eligibility for an allocation, but that residency period may not be less than one year.

Strangely, the amendment would have left in language which states “neither the state nor any political subdivision thereof…make donations to or in aid of any individual.” That language makes it illegal, currently, for the state to write checks to individuals. Rep. Steiner’s new language directly contradicts that language, but would have left that language in place.

It would have created a paradox in law in which the same section of the constitution would contradict itself. And what’s ironic about the bill’s failure is that the State of North Dakota and political subdivisions thereof already walk all over this part of law. Because that section also currently prohibits the State of North Dakota from giving loans, credit or donations to corporations. And yet, government-run and taxpayer-funded “economic development” is big business in this state.

But I digress. A majority in the House voted down the resolution, and for the right reasons. Here’s the floor debate:

It was interesting to hear a number of legislators reference the State of Alaska and the Permanent Fund Dividend. I was born in Alaska and collected, along with every other citizen, the PFD checks. But it’s worth remembering that the funds those checks draw on aren’t tax funds. Most of the oil development in Alaska happens on state land. The checks are funded by the state’s share of oil royalties, not other people’s taxes.

That would be a much different situation here in North Dakota where most of the oil development happens on private land, and where the surpluses are made up of tax dollars paid by other people (the state’s royalties go into a constitutional trust fund reserved for schools). We should not open the door to voters being able to vote themselves checks paid for with other people’s money.

“I’d rather work hard on keeping the money in the taxpayers’ pocket,” said Rep. Rick Becker, “instead of having them give it to us for redistribution.”

“Whose money is it?” asked Rep. Craig Headland. “Is it the state’s money to give back freely?”

Obviously, if the state has an excess of funds, the appropriate thing to do is to reduce taxes. The State of North Dakota has more money than it knows what to do with. A revenue update issued by the Office of Management and Budget earlier this week indicated that the state tax collections have exceeded last year’s collections, biennium to date, by a whopping 64.6%. Collections have exceeded legislative projections by 41.5%.

That means we need some serious tax relief, and so far there is some in the hopper. The House passed a mammoth half-billion income tax relief plan for individuals and businesses, and though Democrats are opposing it (with some cooked projections) there is also tax relief coming from the oil industry.

We can argue about the degree of tax relief in these areas – I’d like to see legislators be more bold – but they are trying to implement tax reductions across the board.

That, instead of wealth redistribution, is how you handle surpluses.