North Dakota's billion-dollar surplus just keeps getting bigger.
Thanks in large part to a boom in oil production, the state's budget reserves are expected to top $2 billion by the end of June 30, 2013, the end of the two-year budget cycle, according to new figures released earlier this week by the state Office of Management and Budget.
Broken down by category, the state expects to have a surplus of almost $850 million in its general treasury in June 2013. In March, the prediction was $592 million, The Associated Press reported.
Another $1.2 billion is now in four reserve funds. Specifically, a budget rainy-day fund currently has $386 million; an oil tax trust fund has $352 million; a school aid fund has $204 million; and a fund for local property tax relief has $261.8 million, according to the report OMB Director Pam Sharp provided to lawmakers on Tuesday (June 19).
The budget surplus and property taxes are already issues in this fall's governor's race. State Senate Minority Leader Ryan Taylor, the Democratic challenger who hopes to defeat Republican incumbent Governor Jack Dalrymple, this week outlined his three-part plan for reducing property taxes, paid for by the state's surplus.
North Dakota this month voters had the chance to become the first in the country to end property taxes, but decisively defeated a ballot measure to do so.
But as Stateline has reported, even with a defeat at the polls, the debate on property taxes is far from over. Even after moving to lower property taxes in 2009 and 2011, North Dakota lawmakers are already debating various new ways to reduce property taxes when the legislature reconvenes in 2013. For example, one proposal that's gained some traction would exempt the first $75,000 in value of every primary residence from property taxes.
The $1.2 billion in reserve funds are not immediately accessible, the AP noted in its report. None of the oil-tax "Legacy Fund," for example, may be spent until 2017, according to restrictions included in the North Dakota constitutional amendment that established the fund two years ago, the AP said.
North Dakota's sales tax collections were nearly 53 percent more than originally projected through May and individual income taxes were 60 percent higher than expected, according to the state OMB report.
North Dakota recently became the country's No. 2 oil producer, surpassing Alaska and following only Texas.