The 2013 North Dakota Legislative Session has reached the half way point known as crossover. That is the point where legislation that has passed the House and the Senate crosses over to be considered by the other legislative body.
Predictably, the first half has been like watching sausage be made. There are lots of options and ideas to grind through. Now, we get to take the best ideas and refine them. Our primary goals for the 2013 legislative session includes meaningful tax relief, sound fiscal management of the state budget, building adequate reserves for the future, and smart investments in our priorities of education and infrastructure.
By the end of the session, we are confident that we will pass a budget and legislation that will serve the best interests of the people of North Dakota for years to come.
One of the big issues we are working on in this session is tax relief, especially property tax relief. As of today, our plan for the next biennium includes over $766 million in property tax relief. We are also cutting personal income by $200 million and corporate income taxes by $50 million. The people of North Dakota will see over $1 billion in tax cuts during this session.
We are also working to reform property taxation in our state. Our plan includes limiting the tax increase on existing property to 3% unless the voters approve a larger increase. We are also requiring local subdivisions give you the information you need to understand the real total property taxes you are being charged and not just the amount remaining after the state buy down program.
Of course there is no bigger issue in this session than the state’s infrastructure plan. Right now, our plan calls for spending a record $4.2 billion on infrastructure including $2.3 billion for roads, $520 million for water and flood control projects, $219 million for oil impact grants and millions more for law enforcement, emergency services, low income housing and wilderness protection. Every corner of our state will benefit from this massive one-time investment.
K-12 education funding has always been a priority for Republican legislators. We are proud of our track record on education and this session will be no different. The plan includes spending $1.1 billion on our children’s schools, an increase of $162 million over the current biennium. Plus, we will be sending $740 million to school districts to buy down property taxes for a total investment in education of $1.8 billion.
One of the most controversial issues this session has been SB2336. Current law allows Bakken and Three Fork wells drilled on old stripper well property to avoid paying the 6.5% extraction tax and eliminates the extraction tax on all oil production completely if price drop dramatically.
By eliminating the stripper well loophole we raise oil taxes by $600 million over the next ten years. Also eliminating the low price trigger could increase oil taxes by $2 billion a biennium. In exchange, the bill will reduce the extraction tax on wells drilled after the state reaches one million barrels of oil production annually by 2%. Essentially, we will lock in the first million barrels of oil produced annually at a higher tax rate in exchange for a slightly lower tax on all oil production increases above one million barrels per year.
We are also working hard to protect your 2nd Amendment rights, ensure integrity of our elections and provide essential services for those less fortunate including expanding Medicaid and increasing funding for Human Services to $2.7 billion.
We’ve worked to create a great business climate in North Dakota which has led to unprecedented economic prosperity and thousands of new good jobs. Now, virtually every sector of our economy is growing. This legislative session is about putting that success to work for the benefit of all North Dakotans and meeting the challenges that come with growth.