Are Western North Dakota Leaders Really Doing All They Can To Address The Oil Boom?

Last night on Chris Berg’s 6:30 Point of View members of the North Dakota Association of Oil and Gas Producing Counties, including executive director and Republican State Rep. Vicky Steiner, talked about whether or not North Dakota needs a special legislative session as Democrats have called for. According to Steiner, her group is still deciding whether or not to join Democrats in calling for a special session which.

We’ve heard the arguments from Steiner and others before (read Steiner’s op/ed here on SAB), but I’m not sure they make a lot of sense.

For one thing, if a special session happened this spring or summer, it would mean a group of lame duck legislators meeting to create potentially huge new spending obligations just months before newly-elected legislators are seated for a regular legislative session in January.

For another thing, HB1358 passed in the last legislative session (albeit with a sunset date, which was a mistake) increased the share of the gross oil and gas production tax going to western oil counties by more than a quarter billion dollars in 2014 (below is a spreadsheet circulated to legislators showing the increase over the previous formula):

That more than $250 million increase is just a part of the appropriations lavished on the west be it through legislative appropriations or grants from the state’s various special funds. There is a lot of money flowing to the west, and I don’t think it’s at all clear that the west has even spent all the money they’ve already been given.

And here’s something that ought to make everyone not living in western North Dakota angry: Western property owners don’t have a lot of skin in the game on the property tax. While western local leaders scream for more money, demanding that the rest of the state send it post haste, they’re leaving a lot of property tax revenues on the table.

For instance, in Ward County (Minot), Burleigh County (Bismarck) and Cass County (Fargo) a residential home valued at $100,000 would pay $1,121.11, $1,289.79, and $2,209.23 in property taxes, respectively.

A similarly valued home would pay just $513.40 in property taxes in McKenzie County (Watford City).

That home in Williams County (Williston) would pay just $834.39.

I’m no fan of the property tax, but for better or worse it’s the law of the land in North Dakota right now. Is it really fair that people living outside of the oil patch pay as much as double in property taxes as people in the oil patch and foot the bill for more appropriations to the west when those counties demand more money?

Especially when local leaders have some bizarre spending priorities? Where’s this “local control” we hear so much about? Or are we to believe that local control doesn’t come with local responsibility?

Williston, as an example, has built a $70 million indoor water park while issues like roads and law enforcement are underfunded. Watford City is pushing a $50 million bond issue that is ostensibly about expanding school capacity, but is pretty lavish including a 525 seat auditorium and gigantic sports facilities.

It’s a little hard to believe that the project is just about education.

Those things are nice, but should they really be the priority right now if things are as desperate in Watford City as local leaders say (“We’re sticking our fingers in the dike, holding back the water,” says the city’s always intemperate Mayor Brent Sanford, seen previously blaming traffic fatalities on state leaders).

During the interview with Berg, Rep. Steiner says western counties are “doing all they can” to address oil impacts. But with some bizarre spending priorities, and some of the lowest property taxes in the state, is that really true? Or are western leaders engaging in some rank opportunism, using the “oil impacts” trump card to beat back scrutiny and accountability?

When has ever local government in North Dakota, in any part of the state, ever been satisfied with the amount of money they’re getting from the state?

I absolutely think there’s more the State of North Dakota needs to do for the west. But we need some scrutiny on how western North Dakota elected leaders are governing.