North Dakota state budget

From Sunshine Review

National Taxpayers Union
Transparency in your state Public employee salary States with spending online Collaborative transparency projects Model transparency legislation #statebooks on Twitter SMTS on Twitter
Action center
Sign up for e-updates Take action

North Dakota neither faced a budget deficit for its 2007-2009 biennium nor for its 2009-2011 biennium. 2007-2009 General Fund revenue was $2.5 billion. 2009-2011 biennium General Fund revenue is forecast to be $2.6 billion. State reserve fund total balance for June 30, 2011 is estimated to be:^[1]

• General Fund $64 million
• Budget Stabilization Fund $311 million
• Permanent Oil Tax Trust Fund $603 million

Total $978 million

Gov. John Hoeven's budget recommendation for the 2009-2011 biennium included no tax increases, no fee increases and no borrowing or bonding with $400 million in tax relief. In total, the general fund budget recommendation was $3.111 billion and the entire budget recommendation, including federal and special funds, was $7.710 billion. The 2009 Legislative Assembly increased the Governor’s total budget by $1.139 billion or 14.8 percent. A large part of the increases from the Governor’s recommendation to the legislative appropriation is a result of the the federal stimulus package. Those dollars were incorporated into appropriation bills.^[2]

The North Dakota Legislative Assembly increased the General Fund 2009-2011 biennium to $3.25 billion and Total Funds to $8.49 billion. Unlike most states that have included furloughs and layoffs to balance their budgets, North Dakota approved compensation package raises for state employees that include funds for a 5 percent average salary increase with a minimum increase of $100 per month effective July 1, 2009, and another 5 percent average salary increase with a minimum increase of $100 per month effective July 1, 2010.^[3]

[edit] Budget Background

The 2009-11 biennium began July 1, 2009, and ends June 30, 2011. After gathering information from state agencies regarding their requested budget for the upcoming biennium, the Office of Management and Budget completed the Governor’s recommended budget, which was presented to the legislature in December of 2008. The legislature convened from January 5 through May 5, 2009 to consider the Governor’s budget and enact the appropriations bills which set the budget for the upcoming biennium.^[4]

North Dakota’s Legislature meets for up to a total of 80 days beginning in January and usually concluding in April of each odd-numbered year. Prior to the completion of the Governor's recommended budget the Governor takes into account individual agency requests, prior budget figures and projected revenue data. Both the House and the Senate receive the Governor’s executive budget recommendation during its organizational session in the December preceding the legislative session. Once passed by both chambers of the Legislature, each bill is delivered to the Governor for signature. According to the North Dakota Century Code, which includes the State Constitution, states that the Emergency Commission has the authority to approve agency requests for line item transfers, for acceptance of additional federal and other funds, and for use of state contingencies appropriations. ^[5]

• NOTE: The figures for FY 2009 won't be finalized until the end of the fiscal year.
• See North Dakota state budget (2008-2009) for more information.

[edit] Accounting Principles

The North Dakota Office of the State Auditor (OSA) is divided into three operational divisions.^[7]

• 1. Division of State Audit
• 2. Division of Local Government Audit
• 3. Division of Royalty Audit

The OSA publishes its audit reports online. The State Auditor is a constitutionally elected state official. Robert R. Peterson has been State Auditor since his election in 2000.^[8]

The Institute for Truth in Accounting (IFTA) rates North Dakota “Timely” in filing the state’s Comprehensive Annual Financial Report (CAFR) – The annual report of state and local governmental entities. IFTA rated 22 states timely, 22 states tardy, and 6 states as worst. IFTA does not consider North Dakota's CAFRs, and those of the other states, to be accurate representations of the state’s financial condition because the Generally Accepted Accounting Principles (GAAP) basis does not include significant liabilities for the pension plans and for other post employment benefits, such as health care.^[9] North Dakota's CAFRs are prepared and published online by the [North Dakota Office of Management and Budget] and is prepared by the Fiscal Management Division.^[10]

[edit] Accounting transparency checklist

Comprehensive Balanced budget Timeliness Usability

[edit] The good

• The website has Comprehensive Annual Financial Reports (CAFR) dating back to 1997.^[12]
• An independent auditor’s report is published on page 17 of the document.^[13]
• It provides supplements to the budget workup, starting on page 119.
• The budget is posted using organized and consistent methods of financial reporting.
• North Dakota law requires a balanced budget and a deficit is forbidden.^[14]
• It includes all costs incurred by the government, including long-term liabilities, starting on page 23 of the document.^[13]
• The CAFR compares estimated and actual budgetary numbers, such as on page 119 of the document.^[13]
• The North Dakota office was timely in submitting the budget.

[edit] The bad

• The CAFR is posted in a PDF format, so it’s not searchable online.

[edit] The state of the economy

• In 2007 the oil industry brought more than $8 billion to the state in revenue but since then revenues have dropped significantly. Oil was trading at $100 a barrel, hitting an all-time high of $140 in the summer of 2008. The number of oil drilling rigs totaled 98 in the state but since the end of 2008, the rig count has dropped over 40-percent. ^[15]
• In part to the state's diversified economy, North Dakota's state revenue and unemployment rates have not dipped as low or increased as significantly as other states. Standard & Poor's Ratings Services in March 2009 upgraded the state's issuer credit rating to "AA-plus" from "AA," citing in part its "ability to generate surpluses with little impact from the current economic downturn." ^[16]
• Revenue exceeded projections over the last four months and the state is looking to end its current fiscal 2008-09 biennium with a $1 billion surplus, according to Pam Sharp, North Dakota's budget director. According to Sharp, North Dakota's economy includes more than just energy and agricultural sectors, it has a stable housing market that did not take a hit from the subprime mortgage crisis and conservative financial management. ^[16] The state's surplus consists of $64 million in the General Fund Ending Balance, $311 million in the Budget Stabilization Fund and $603 million in the Permanent Oil Tax Trust Fund.^[17]
• The lowest mortgage delinquency rates were found in North Dakota at 1.21 percent as compared to the highest rate in Florida at 9.52 percent. Additionally North Dakota has seen a decline in it's rate since the 2008 fourth quarter. The average national mortgage debt per borrower rose slightly, 0.26 percent, to $192,789 from the previous quarter's $192,287. ^[18]

[edit] Economic Stimulus Package

North Dakota is expected to receive approximately $650 million of the $787 billion dollar economic stimulus package. ^[19] According to White House officials the package is expected to create approximately 8,000 jobs. ^[20]

According to preliminary reports North Dakota is expected to receive:

• $485,000 for senior nutrition programs ^[21]
• $32 million for education funding ^[17]
• $175 million for transportation infrastructure ^[17]
• $76 million towards Medicaid ^[17]
• $19 million for Clean Water ^[22]
• $25 million towards weatherization ^[22]
• $10 million for energy efficiency and conservation ^[22]

[edit] Budget transparency

North Dakota currently has no statewide, official spending database online, although in May 2009, legislation (Senate Bill 2018) passed that mandates a website be created by June 30, 2011.^[23]

On March 3, 2009, Joshua Culling, State Government Affairs Manager for showmethespending.com Coalition member the National Taxpayers Union, issued a letter to support transparency in North Dakota. Representative Thoreson's transparency legislation, House Bill 1377, mandated that the Director of the Budget create a searchable online database of state expenditures by January 1, 2010. This bill passed the ND House in the spring of 2009, but did not move past the Senate. The bill that the governor signed in May 2009, North Dakota Senate Bill 2018, requires that a website be created by June 30, 2011.^[23]

[edit] Website evaluation

Budget Usability Elected Officials Administrative Officials Ethics Audits Contracts Lobbying Public records Taxes

ND.gov is the website for the state of North Dakota.

• Main article: Evaluation of state websites

[edit] The good

• Site has a search function and is fairly easy to navigate.
• Audit reports are published.^[24]
• Elected officials are listed with contact information under respective office.^[25]
• Administrative officials are listed with contact information under respective agency.^[26]
• State tax information is posted.^[27]
• Budget is published.^[28]
• Current state contracts are available.^[29]
• Includes list of registered lobbyists^[30]

[edit] The bad

• Does not provide information on state-paid lobbying and agency lobbying contracts.
• Provides a Citizen's guide to ND open records, but it doesn't have contact info for making records requests.^[31]
• Does not provide information on ethics.

[edit] Legislation

In the spring of 2009, North Dakota's Governor signed a bill requiring a transparency website to be placed online by June 30, 2011.^[23]

[edit] Government tools

The following table is helpful in evaluating the level of transparency provided by a state spending and transparency database:

[edit] Economic Stimulus Transparency

• The American Recovery and Reinvestment Plan of 2009 designated $787 billion to be spent throughout the U.S. Of that $787 billion stimulus package, it is estimated that 69%, or over $541 billion, will be administered by state governments.^[32]

• North Dakota will receive an estimated $460 million. ^[33]

• Lawmakers on the appropriation committees in the legislature have been meeting to discuss plans with the state's ARRA funds.

[edit] Error in ARRP

On November 16 and 17, 2009, many errors were found in the $747 billion plan that showed the plan set aside money for districts that do not exist. According to Recovery.gov, the plan shows its funds will go to 884 Congressional Districts, though there are only 435.^[34][35]

The ARRP website reports that more than $2 million was given to the 99th District of North Dakota, a state that has only one Congressional District. In order to qualify for 99 districts, North Dakota would have to have a population of about 60 million people, almost 24 million more people than California. The non-existent Districts received $119,260,169 to "create/save" 264.2 jobs.^[36]

[edit] Independent transparency sites

The North Dakota Policy Council sponsors a website on school transparency, www.sunshineonschools.org.

[edit] Public employee salary information

• A listing of the North Dakota state payroll from 2008 is posted here.

[edit] See Also

North Dakota taxpayer-funded lobbying

[edit] External links

[edit] Additional reading

• Gov. Hoeven,"2009 State of the State Address," January 6,2009
• Gov. Hoeven,"2009-2011 budget address," December 3,2008
• State of North Dakota,"Revised revenue forecast," February 9,2009

[edit] References

v • d • e State Budgets Cost of state transparency websites • State budget issues, 2009-2010 • Pubic employee salaries • States with spending online • Glossary of state budget terms Alabama • Alaska • Arizona • Arkansas • California • Colorado • Connecticut • Delaware • Florida • Georgia • Hawaii • Idaho • Illinois • Indiana • Iowa • Kansas • Kentucky • Louisiana • Maine • Maryland • Massachusetts • Michigan • Minnesota • Mississippi • Missouri • Montana • Nebraska • Nevada • New Hampshire • New Jersey • New Mexico • New York • North Carolina • North Dakota • Ohio • Oklahoma • Oregon • Pennsylvania • Rhode Island • South Carolina • South Dakota • Tennessee • Texas • Utah • Vermont • Virginia • Washington • West Virginia • Wisconsin • Wyoming •

	v • d • e State of North Dakota Bismarck (capital)
Transparency	Open Records Statute | Transparency Checklist | Government corruption reports | Transparency Legislation | Open Records procedures | Transparency Advocates | Transparency blogs | State budget | Taxpayer-funded lobbying associations |
Divisions	State | List of Counties | List of Cities | List of Towns | List of School Districts | Evaluation of county websites | Evaluation of city websites | Evaluation of township websites | Evaluation of school district websites |
Government	North Dakota State Constitution | Executive | House of Representatives | Senate |
Judiciary	North Dakota Supreme Court | Court of Appeals | District Courts | Municipal Courts | Judicial Nominating Commission | Judicial news |
Ballot Measures	Ballot measures | List of ballot measures by year | Procedures for qualifying an initiative | Laws governing the initiative process in North Dakota | Signature requirements | History of direct democracy | Campaign finance requirements | Vote fraud |