The Tax Foundation Ranks North Dakota #31

• August 16, 2006

The Tax Foundation has ranked North Dakota #31 in Business Friendly Climate.

The full report can be found here but the results are clear.
North Dakotans are over taxed. The amount that we are over taxed as of yesterday is $527 million.
It’s time for North Dakota’s Republicans to stand up and do 1 of 2 things this session: Either use this surplus to solidify North Dakota’s tax structure for next decade, or give the over taxed amounts back to the people that paid it in.
As I wrote on March 18th, this surplus is obscene. The state of North Dakota is reaping obscene profits off the backs of hard-working North Dakotans. While North Dakotans have to adjust their budgets to heat their homes, send their kids to college and fill up their gas tanks, the state is bragging that it has so much money in reserves it doesn’t know what to do with it.
If this money is to be spent rather than sent back to it’s rightful owners, this surplus must be used to help create long term sustainable tax policy. Tuition rates should be frozen for at least 4 years, and general taxation should be frozen for at least 6 years, if not longer.
And speaking economically, how can the State of North Dakota be sitting on $527 million more than it needs while sitting in 31st place in terms of business-friendly environment? Clearly, we could be doing more to encourage business in North Dakota in terms of cutting taxes and regulations.
We can do better. If we want this economic boom we’re riding to continue we must do better.

Tags: North Dakota News

http://Array robert108

A moment of economic clarity. Bravo! We should be saving our own money; after all, we earned it. The govt should only collect the money they need to do their job of serving us. In fact, if they don’t do their job, they should not get paid. That’s the way a real “govt of the people” would work.
davoarid

I just don’t get why people on the left are so against tax cuts.

It’s because they hate freedom.
http://www.freerepublicans.com/ FreeRepublicans.com

Baloney. I say double the size of the “rainy day” fund to $200 million and then give the rest back in an income tax cut.

The State DOES NOT need to be sitting on a 20% rainy day fund. Unless they are getting at least 5% interest.

The idea that the State needs to “sit on money” is insane and not conservative in nature.

If everything is fully funded, then taxation should cease.

End of story.
http://www.freerepublicans.com/ FreeRepublicans.com

And the train can only go back and forth once…maybe twice a day.

Your assuming theres only one train. Or 1 set of tracks.

With modern rail tech the cost to put tracks in is the cost of steel and the cost of building the bed. Once you have the bed, there very little difference between 1 track or 4.

You could have an Express that goes from Bismarck to Fargo then straight to the Cities. 200 miles is far enough for a MagLev even, so your talking 300 mph+

Then you could have 200 mph trains going between Bismarck and Jamestown, Jamestown to Fargo, a spur that services Grand Forks…basicly the only way it would work would be to build a network servicing a large area.

The point is, you make it so that you could live anywhere in the state and work in the cities.

Anyways, that’s too forward thinking for this state so it will never happen and the money will get blown on something frivelous.
Puzzlefeet

Yeah,rightR108,let’s give the oil companies a rebate and see how long it takes for the gas prices to come down. . . like that will ever happen.
robert108

Rob: I’m not that familiar with the details of Alaska’s plan, but it certainly sounds promising. You have to run ND’s numbers and see how it would play out. If the people are presented with it, and they vote for it, and it is implemented the way it’s promised, it might go…
robert108

P: “Yeah,rightR108,let’s give the oil companies a rebate…”

It’s not a rebate; they confiscated too much money in the first place. The only honest thing to do is to give it back. What’s right is right.
http://www.freerepublicans.com/ FreeRepublicans.com

Why would a fast train increase the demand to be in either place, all by itself?

Don’t you think parent’s would be willing to commute 3 hrs daily to have their kids grow up in a decent place rather than the city?

How would those folks get around once they got to their destination?

They could park their car there. Or yeah, public transport.

Are people in either place just dying to go there, but haven’t the time?

People keep moving further and further out.

This concept, which is not new at all – it’s been bantied about since I was a kid – basicly turns the entire state of ND into a Suburb.

Free, how often would the trains go to the twin cities? Once a day? Twice a day? I don’t care how fast the train is, that’s not a very practical commute.

Well, people would move to Fargo if they could get to the Cities in 60-90 minutes.
http://www.freerepublicans.com/ FreeRepublicans.com

Hope they don’t get paid in the “out” years.

They get something like $3,800 in-session + hotel allowance and travel expenses (5 months max every 2 years).

They they get like a $350/mo “retainer” when no in session just incase a special needs to be called.
http://www.freerepublicans.com/ FreeRepublicans.com

Ok fine.

*All numbers are fictional, but the concept remains

Lets use it to build a high speed rail line from Bismarck to Fargo, get Minnesota to build from Moorhead to Minneapolis.

250 mph, with stops at 100 mile intervals.

Be able to commute from Bismarck to Minneaplis in under 4 hrs.

Sell yearly passes for $1,500.

Boost the tax base because people would love to be able to commute from Fargo to the Cities in under 90 minutes.

You’d see an influx of people that would make the Homestead Act look like nothing.

Foot the infrastructure costs now. Set it up so it operates on it’s own. Watch the population and tax base skyrocket.

The right-of-way already exists next to the interstate so Emminent Domain isn’t an issue.

100,000 people would move to the state within 2 years.
robert108

Free: Very enterprising of you.(pun intended)
Question: How would those folks get around once they got to their destination? More public transportation? Don’t forget to factor in those costs. Taxicabs? That might skew the cost/benefit toward driving there in the first place. You say it will increase traffic, but won’t that just shift traffic(if the cost/benefit works) from the Interstate? Why would a fast train increase the demand to be in either place, all by itself? The speed alone might increase demand, maybe just temporarily. You would have to do some very hardcore studies to prove it out. Are people in either place just dying to go there, but haven’t the time? You could offer me a quick trip from the little paradise where I live to Fargo, but that wouldn’t necessarily make me want to go there. Good initial concept, though. Why not follow through on it?
robert108

Rob: Sorry, hit the Post button by mistake. To continue:

“But tell me what you think of this, robert. What if the ND government gook a big chunk of this surplus and invested it?Would that be a one-time thing, or a continuing surplus? To me, if they are going to keep the money, the least they should do is invest it, and give dividends to the taxpayers, but then, why not just give it back to them and let them invest it themselves? If it’s a continuing surplus, to me that is immoral. Something like Alaska’s permanent fund from oil revenues? But instead of paying out dividends to citizens the government used the dividends to fund government while simultaneously lowering taxes as appropriate.

Thing something like that could work?No, for several reasons. Govt doesn’t have an incentive to be efficient in it’s use of resources the way individuals do. Secondly, even if they got the same return rate as a private citizen could, there is the expense of the govt infrastructure to collect it and administer it. It would have to be handled right – like added to the state constitution – so that greedy politicians didn’t take the dividend money and tax the hell out of citizens…but that concern aside, wouldn’t that be a unique way of funding the government?”

To tell you the truth, Rob, I have racked my brain for longer than I care to admit, trying to find a way to “marketize” govt(make it pay for itself) and have come to the conclusion that govt is an expense to the taxpayers, and that’s that. All we can do is to minimize that expense, make it manageable, and get value for our money. Perhaps someone else can figure out how to do it, but I haven’t been able to.
Having said that, govt is a necessary expense. In addition to national defense and the interstates, govt does do a few regulatory things that make sense, one of which is to provide a stable currency. With no structure at all, the market would be on huge chaotic auction, with no long range planning possible. The trick is to keep it so that it serves us, and not the other way around.
robert108

Free: Make it go, dude!
robert108

Rob: For what it’s worth, here’s my thinking:

“As for the government saving money, you’ve got to remember that ND has an economy that can be very volatile at times. This state runs on agriculture, which can cause some ups and downs in the economy and thus tax receipts.

We’re experiencing a boom right now thanks to increased activity in our oil fields, but who knows how long that will last?

So, right now it’s economically more productive to concentrate on the oil industry than the agriculture. Ag land could be used for infrastructure, like refineries, depots, transportation centers and housing for the oil industry workers.

But tell me what you think of this, robert. What if the ND government gook a big chunk of this surplus and invested it? Something like Alaska’s permanent fund from oil revenues? But instead of paying out dividends to citizens the government used the dividends to fund government while simultaneously lowering taxes as appropriate.

Thing something like that could work? It would have to be handled right – like added to the state constitution – so that greedy politicians didn’t take the dividend money and tax the hell out of citizens…but that concern aside, wouldn’t that be a unique way of funding the government?”
robert108

Free: Four trains are four times as expensive as one train, so the demand curve would have to work for that configuation. The cost of support, fuel and maintenance also increases. You have to take all that into account, but before you start looking around for investors, determine the demand. Without knowing that, you are dancing in the dark.

Rob: As far as Alaska is concerned, it depends on what they started with, and what the yearly return is. Big total numbers sound good, but the rate of return is the important number, and it has to be calculated per capita. That’s the net rate, btw. If you can do better(net) yourself, then it’s a misallocation of resources, even if the politicians can resist the temptation to dip into it in some way, which is almost impossible to prevent in the long run. All sorts of shenanigans can be done on the administrative level, without any public legislation being passed. Labor unions are famous for this, with their pension funds. Just a few thoughts.
http://www.freerepublicans.com/ FreeRepublicans.com

Free, the vast majority of that money was brought in by oil taxes, so they would get the refund, not you and I unless you want their share.

I’ll have to look up the figures. But I agree, the people would never see that money if it was given back.

In that case, suspend the gas tax for a while and use the oil tax portion of the surplus to make up for that cut.
WOOF

WHy not do what Alaska does?
Cut every resident a check.
http://www.bikebubba.blogspot.com/ Robert Perry

Usually I get to argue the other side with gentlemen like Robert108, but this time I’ll remind the forum of his point; in general, one cannot trust government to plan for the long term. Apart paying off bonds early, paying cash for projects instead of issuing bonds, and making infrastructure “to last” instead of “to make do,” there isn’t a lot that NoDakGov can do to reduce costs for the long term.

Here in #38 MN, however, I’d like to see this kind of thing done. We’re also hoping for a surplus, and it would be really nice to see fewer bonds issued instead of Democrats (and sigh, GOPers too) spending it all on MPR or pouring it down a “light rail” rathole.
http://wizbangblog.com/ Jay Tea

Oh, look, New Hampshire’s in the Top 10. In fact, we’re #6, and one of only two east of the Mississippi. Gosh, we’re positively blushing up here…

J.
Puzzlefeet

Free, the vast majority of that money was brought in by oil taxes, so they would get the refund, not you and I unless you want their share.
robert108

P/Free: Your flawed Marxist reasoning assumes that “the oil companies” are all acting together, and aren’t competing with each other. I have two gas stations on my block, and they are constantly competing with each other with prices. The one on my corner even reduces its prices 10 cents a gallon every Sunday, and they get the lion’s share of the business on that day. Otherwise, they are about the same, and five or six cents lower than other stations that don’t have any close competition. The reality is that if anyone is overtaxed by the govt, they should get the money back, no matter who it is. I know you guys are socialists, and believe in “targeted tax cuts” which favor one group of citizens over others, but that isn’t the American Way. If one company can lower its prices, the rest have to follow suit, or lose market share. That is how the market works. Announcing it in the papers, along with the current oil prices helps a lot. Remember: Perfect knowledge and perfect mobility. Information is the key to getting any market working better.
http://peatbog.net/ Sphagnum

My home, CA, actually was 40th. I’m darn near impressed!
robert108

Robert: The only real solution to the problem of overtaxation is to reduce taxes.

P: “They” is us. This isn’t a Marxist class warfare situation with “Big Business” opposed by ordinary citizens. The taxes paid by oil companies come out of our pockets, so when they are reduced, our gas prices come down. They are giving us something we want, unlike govt, which only takes.
robert108

Rob: That’s kinda cute, having a state legislature that doesn’t meet every year. Hope they don’t get paid in the “out” years. Seriously, planning is one of the things they get paid for, so if they need some monstrous “rainy day” fund, they might not be doing their job as well as they should. I just think the govt “saving” money is all wrong.
http://sayanythingblog.com robport

Saving some of the money seems like a very good idea to me. These high tax revenues may not last forever. The rainy day fund has come in handy in the past, why not keep it?

Fiscal responsibility is a very conservative principle, and don’t you lecture me on conservatism mister progressive conservative. You’re the one who was just agreeing with Puzzle and her conspiracy theories about the gas industry…and saying that tax cuts wouldn’t make it back to the people.

Again, I say double the rainy day fund and give the rest back in an income tax cut. That’s the fiscally conservative thing to do.
http://sayanythingblog.com robport

Robert, I disagree. Having a fund of money available if needed is smart in a state where the legislature doesn’t meet every year. We need that buffer.

Free’s just got his head up his butt, as usual.
http://sayanythingblog.com robport

the people would never see that money if it was given back.

Baloney. I say double the size of the “rainy day” fund to $200 million and then give the rest back in an income tax cut. Or maybe an income tax cut/property tax cut.

The people would see it then.
http://sayanythingblog.com robport

Robert, my thinking was basically to use a one-time large surplus to set up an invested fund the dividends from which could eventually alleviate a lot (if not all) tax burden from citizens.

In Alaska the permanent fund was set up with a big, one-time investment back in the 1970′s. It is written in the state constitution that a certain percentage must remain in the fund so that it grows with another percentage of dividends going to the citizens. Right now that fund is up to 32 billion and still growing.

What if ND did that…but used the dividends to fund roads, etc.? The fund wouldn’t be able to alleviate a lot of taxes right away, but if managed correctly it could alleviate a lot of burden on taxpayers.

As a citizen, I wouldn’t mind seeing a big one-time investment of my tax dollars in such a fund if it meant that me and my progeny would be less burdened by taxes in the future.

The key, as you pointed out, is making sure that government is able to manage such a fund efficiently and actually use it to alleviate tax burden.

I’m not married to this idea, of course. Mostly just brainstorming…
http://sayanythingblog.com robport

Well, people would move to Fargo if they could get to the Cities in 60-90 minutes.

But you’re talking about a train across the whole state of ND. I don’t care how fast the train is, that’s a lot of commute time. And the train can only go back and forth once…maybe twice a day.

I don’t see it working, but it’s an interesting idea.
http://sayanythingblog.com robport

They do get paid out of session, but they also handle quite a bit of communication from constituents. Our legislators are very accessible in this state, and that’s a good thing. They don’t get paid much, but I think their compensation level is about right.

As for the government saving money, you’ve got to remember that ND has an economy that can be very volatile at times. This state runs on agriculture, which can cause some ups and downs in the economy and thus tax receipts.

We’re experiencing a boom right now thanks to increased activity in our oil fields, but who knows how long that will last?

But tell me what you think of this, robert. What if the ND government gook a big chunk of this surplus and invested it? Something like Alaska’s permanent fund from oil revenues? But instead of paying out dividends to citizens the government used the dividends to fund government while simultaneously lowering taxes as appropriate.

Thing something like that could work? It would have to be handled right – like added to the state constitution – so that greedy politicians didn’t take the dividend money and tax the hell out of citizens…but that concern aside, wouldn’t that be a unique way of funding the government?
http://sayanythingblog.com robport

Free, how often would the trains go to the twin cities? Once a day? Twice a day? I don’t care how fast the train is, that’s not a very practical commute.

Maybe day trips to the cities…but I think you’re living in a fantasy land.
http://sayanythingblog.com robport

I just don’t get why people on the left are so against tax cuts.

SayAnythingBlog.com

The Tax Foundation Ranks North Dakota #31

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