Say Anything Blog

Currently a group of legislators in North Dakota are pushing to get a revision to the state’s permanent oil tax trust fund passed on the ballot in November.  The revision would, essentially, make it harder politicians to spend the money in the fund.  From the measure’s website:

Currently, the Trust Fund is merely a reserve fund and is used as a slush fund for various issues during each session. Under this bill, the first $100 million, plus an annual inflationary adjustment of the state’s share of oil and gas production taxes, would go to the state’s general fund. Additional oil and gas tax revenues would be set permanently aside to earn interest. The state could spend the interest earned each biennium. The principal amount of the Trust Fund would be off-limit. However, 20% of the principal could be spent per biennium but would require a three-fourths majority vote of the House and Senate.

At the recent NDGOP convention, state Republicans adopted a resolution supporting this measure.  It reads:

RESOLUTION NUMBER 12: PERMANENT OIL TAX TRUST FUND

WHEREAS: Increasing oil and natural gas prices, new technology, and North Dakota’s business climate have caused a resurgence of activity in North Dakota’s oil and gas industry; and

WHEREAS: Oil and natural gas are depletable, natural resources; and

WHEREAS: Oil and natural gas prices are cyclical in nature; and

WHEREAS: Other large oil producing states and nations, incuding Alaska, Wyoming, Texas, New Mexico, Alabama, Louisiana and Norway have set aside a portion of their oil and gas tax revenues to generate large substainable revenue sources used for government funding, tax reduction, or to provide rebates to citizens today and in the foreseeable future; and

WHEREAS: It is good fiscal policy to ensure a dependable and stable source or revenue for the long-term, well-being of the state; and

WHEREAS: If this measure is approved in November 2008, the initial $100 million in revenue from oil and gas production will be deposited into the general fund; and

WHEREAS: Any revenue above $100 million will be deposited in the Permanent Oil Tax Trust fund and a three-fourths vote of both houses is needed to approve expenditures from the fund; and

THEREFORE BE IT RESOLVED: That the North Dakota Republican Party supports Constitutional Measure One, which will create a constitutionally protected, permanent oil tax trust fund as a way of creating a legacy for the benefit of all North Dakota’s citizens today as well as for future generations of North Dakotans.

This is a direct, unambiguous endorsement of the Measure One reforms to the permanent oil tax fund from North Dakota Republicans.  Yet even as the NDGOP passes this resolution, the state’s highest ranking elected Republican is opposed to it.  That’s right, Governor Hoeven doesn’t want this measure passed.  Why?  He says it’s because we’d have to cut school funding if we passed it (though why ND schools need more money is beyond me), but my guess is it’s because he likes being able to raid the current permanent oil tax fund for all his special projects:

In the last three budgets, Governor Hoeven and the legislature has raided our trust funds [to the tune of] $238 million dollars. Thirty-six million dollars have been for those less than satisfactory Center’s for Excellence alone. How much would there be in our trust fund if Bismarck would just leave it alone? I imagine they structured it this way so they can blame the tax relief for the missing money rather than blame the over spending that’s been going on.

It should be noted that Governor Hoeven also opposed a proposed initiated measure that would cut state personal income tax rates by 50%, and state corporate income tax rates by 15%.  Meaning that not only does the Governor want to keep taxes high, he also wants to keep raiding oil trust fund money to fund his pet projects.

But hey, what more do you expect from a guy who was a Democrat until he decided to run for Governor?