North Dakota Senate Bill SB2162

North Dakota 2023-2024 Regular Session

• Introduced: 1/6/23
• Refer: 1/6/23
• Report Pass: 1/16/23
• Engrossed: 1/18/23
• Refer: 2/17/23
• Report Pass: 3/8/23
• Enrolled: 3/15/23
• Passed: 3/21/23

Caption

Oil and gas gross production tax allocations to counties.

Impact

The impact of SB2162 on state laws is significant, as it enforces a clear linkage between county revenue generation through tax levies and the distribution of state tax revenue from oil and gas production. This could incentivize counties to maintain or increase their tax levies for transportation and infrastructure needs. The result could lead to more equitable funding for counties that actively manage their local tax frameworks, which is likely to benefit infrastructure development and maintenance crucial for the oil and gas sector.

Summary

Senate Bill 2162 is an act aimed at amending the allocations of oil and gas gross production taxes to counties in North Dakota. The bill modifies existing provisions in the North Dakota Century Code related to the distribution of tax revenues from oil and gas production. Specifically, it states that a portion of the revenue must be directed to county general funds, but with a stipulation that if a county does not levy a minimum of ten mills for specific road and bridge funds, the revenue will revert to the state general fund. This condition emphasizes the importance of local taxation efforts in receiving state-derived tax revenues.

Sentiment

The sentiment surrounding SB2162 appears to be largely positive among legislators, as indicated by the robust support it received during voting—86 yeas to 7 nays in the House. Supporters argue that the bill fosters a financial tie that ensures counties contribute to their own development, thereby making them eligible for state support in an industry-critical area such as oil and gas. On the other hand, the stipulation could raise concerns among those who feel it may place further fiscal pressure on counties struggling to meet levy requirements.

Contention

Notable points of contention arise from the balance of requiring local funding for state support. Some legislators may view the amendment as a necessary accountability measure, while others may see it as punitive towards counties that cannot meet the threshold due to various economic conditions. This polarization reflects a broader debate within state legislative discussions about local autonomy versus ensuring that counties take responsibility for their financial and infrastructural obligations, which is paramount in a state where oil and gas extraction is a central economic activity.