North Dakota Income Projected To Fall 15.4% Due To Energy, Ag Industry Slow Downs

This from the North Dakota Taxpayer’s Association via email:

The Minneapolis Federal Reserve Bank is now predicting that personal income in North Dakota will fall by 15.4% in the coming year. This prediction brings into question the wisdom of increasing total state spending by 26% as proposed by Govern Hoeven’s budget (including one-time spending).
If this predicted decline in personal income is correct, it also defines a need to return at least 15.4% of the surplus to the taxpayers in the form of direct tax cuts – just to stay even with last year.

I agree with the conclusions above.
The proponents of big spending increases in the state seem to be rallying behind recent reports that the state’s tax revenues are going to remain strong. But as I pointed out yesterday, that report isn’t quite as cheery as some are making it out. There’s a projected 28% decline in tax revenues from the oil industry, with corresponding drops in income and sales tax revenues that over the last several years have been pumped up by heavy oil industry activity.
There’s also a rather nonsensical claim that tobacco tax revenues will pick up despite the last election having created a permanent anti-smoking government agency, and the legislature considering banning smoking in hotels and bars, leaving us with the rather absurd spectacle of the government telling us tobacco tax revenues will go up even as the government attempts to crush tobacco use under the boot of regulation.
So when you couple that less-than-positive report on tax revenues with this report about state incomes declining (again thanks to a projected slow down in the oil industry) one gets the idea that perhaps our political leaders should be spending less time figuring out how to spend our money and more time figuring out how to give it back.