No Blank Checks For Western North Dakota

In a show of rank parochial politicking, the Williston Herald praises Democrats for their efforts to “restore” oil impact funding to legislation after it was stripped from a bill by Senator Dwight Cook.

“In Williston, we live in the most conservative corner of the state. Each of our state legislators is Republican, in the last general election, we voted for Republicans across the board,” writes the Herald’s editorial board. “But this week, North Dakota Democrats are fighting for us. After the Republican majority stripped much of the financing out of a bill designed to help the oil-impacted counties, the Democrats stood up and pledged to fight to return the money.”

The problem is that the Herald is taking the “more money is better” position on this issue, and Democrats are just opportunists engaging in a bit of pandering. Senator Dwight Cook is trying to be a prudent steward of statewide tax revenues, and he’s being attacked for it.

That’s wrong.

The local governments have done a good job of putting statewide leaders in the hot seat on fiscal issues. The state’s problems with the property tax – levied and collected at the local level – have been effectively punted into the legislature’s lap and the end result has been the state showering money down on the local governments and calling it “tax relief.”

The same is happening with oil impact funds. Local governments want more statewide tax dollars to spend. Because it’s easier to spend tax dollars you don’t have to raise yourself.

Communities that are managed competently should maintain a sustainable base of tax revenues. Yes, economic and social expansion require more infrastructure and services from the city, but let’s not ignore that said expansion also increases revenues from local taxes. Every new house built, every new business opened, means more revenues for the local governments.

Where is all that new revenue in the west going? There’s been far too little scrutiny on that issue (Williston committing a sales tax hike to the parks district, and an extravagant new rec center, is the most egregious example), which is why it’s prudent that the state not simply throw money at western cities and counties.

“I understand there are impacts and those impacts mean improvements to infrastructure and personnel,” a reader wrote to me in an email this morning reacting to my Valley News Live segment last night. “However, isn’t the oil impact money really meant as a backstop to assure the locals that there will be a stream of money for them in case the boom goes bust? It’s not meant to replace how they should operate a normal growing city?”

That’s exactly right. Expecting local governments to survive on local taxes is an accountability measure. Local governments that want to spend more must ask local residents to pay more in taxes. Allowing local governments to stick their hands into the statewide piggy bank unfetters them from that accountability.

That would be a terrible move.

We often hear local government leaders talk of the importance of “local control,” but that’s a two-way street. Local control also means local responsibility.