DALRYMPLEDELIVERS20172019BUDGETADDRESS

Zent,JeffreyL.

11:09AM

FORIMMEDIATERELEASE
Dec.7,2016

Contact:JeffZentorAshleyKelsch
701.328.2200

DALRYMPLEDELIVERS20172019BUDGETADDRESS
BudgetReducesSpending,BuildsReservesandFundsPrioritieswithoutRaisingTaxes

BISMARCK,N.D.Gov.JackDalrympletodayreleasedhis20172019ExecutiveBudget,astructurally
balancedplanthatreducesstatespending,yetfundsprioritieswithoutraisingtaxes.

Wehaveproducedabudgetthatisbalancedandsustainable,Gov.Dalrymplesaid.Wemakethenecessary
budgetaryreductions,whileprovidingfundingforeducation,statewideinfrastructureimprovementsandother
priorities.Becausewehavetakenstepsinourpriorbudgetstoprotectagainsttheeventualrevenuedownturn,wecan
fundourprioritiesandstillcarryforwardhealthyreserveswithnotaxincreases.

SOUNDFISCALMANAGEMENT
RevenuesExceedExpenditures

OngoingExpenditures
Dalrymplebeganthebudgetprocessbydirectingallbutafewstateagenciestoidentifytargetedsavingsof10
percentwithintheir20152017appropriations.Indevelopingthe20172019budget,another$60millioninadditional
spendingreductionsweremadebeyondthe10percentsavingstarget.TheGovernorsbudgetcallsfor268fewerfull
timepositionsingeneralgovernment,and315feweremployeeswithinthestateshighereducationsystem.

Overall,the20172019ExecutiveBudgetincludesGeneralFundongoingrevenuesof$4.783billion,while
ongoingexpenditurestotal$4.780billion(Chart1).Thebudgetrepresentsa21percentreductioninGeneralFund
appropriationscomparedtothecurrentbiennium,largelyduetoreductionsinonetimeinvestmentsthatdonotimpact
ongoingoperations.

ReservesfortheFuture
WhileDalrymplesbudgetutilizessomeoilrevenuestosupporttheneedsofagrowingNorthDakota,hisbudget
planleavesthestatesreservefundssignificantlystrongeronJune30,2019.Thebudgetcallsforbuildingthestates
reservefundstoabout$6.32billionbytheendofthe20172019biennium,anincreaseofnearly$1.2billioncompared
tothefundsprojectedbalancesonJune30,2017(Chart2).

The20172019ExecutiveBudgetreplenishestheBudgetStabilizationFund,withaprojected$454million
availableJuly1,2017.Duringthe20172019biennium,theLegacyFundwillincreasetoabout$5.2billionthe
StrategicInvestmentandImprovementFundwillhold$332millionandthebalanceoftheFoundationAidStabilization
Fundwilltotalabout$305million.ThestatesGeneralFundisexpectedtocarryoverabout$44millionintothe2019
2021biennium.TheGovernors20172019budgetdoesnotproposeusingprincipalfromtheLegacyFund,whichwill
growbynearly$1billionduringtheupcomingbiennium


Dalrymplesbudgetcallsfornonewtaxes,carryingforwardunprecedentedpropertytaxreliefandincometax
relief.Since2009andthroughthecurrentbiennium,thestatewillreducepropertytaxesandincometaxesbyaprojected
$4.4billion.

STATEWIDEINFRASTRUCTUREINVESTMENTS
Thoughnotasrobustasinvestmentsmadeinpublicinfrastructureduringtheoilboom,theGovernorsbudget
includesstrongfundingforhighwayandroadimprovementsthroughoutthestate,aswellasfloodcontrolandwater
supplyprojects.Statewideinfrastructureprojectstotalnearly$1.3billion(Chart3).

TheExecutiveBudgetincludes$725millionforhighwayandroadimprovements$319millionforfloodcontrol
andwatersupplyprojectsand$24milliontohonorstatecommitmentsforairportimprovements.Additionally,the
budgetincludesa$200millionfundforschoolconstructionloans.

Dalrympleisrecommendinganadditional$70millionforfloodcontrolprojectsintheMouseRiverBasinandto
assistinhomeacquisitions.Since2011,thestatehasprovidedmorethan$315milliontosupporttheregionsflood
protectionefforts.ToassistwithFargoareafloodprotection,theExecutiveBudgetincludes$66.5million,bringingthe
statestotalappropriationsto$370.5million.Another$11millionisdesignatedforpermanentfloodprotectionalongthe
SheyenneRiverandforthecontinuingoperationoftheDevilsLakeoutlets.

TheExecutiveBudgetalsoincludes$30milliontowardtheGrandForkswatertreatmentplantand$125million
toadvancetheRedRiverWaterSupplyProject,theWesternAreaWaterSupplyProject,NorthwestAreaWaterSupply,
theSouthwestPipelineProjectaswellasothermunicipalandruralwaterprojects.

EDUCATION
K12educationrequiresstrongfinancialsupportevenintimesoflowerrevenue,andDalrymplesbudget
accessestheFoundationAidStabilizationFundtoexemptthestatesK12schoolsfromthe10percentbudget
reduction.TheExecutiveBudgetcallsformoving$140millionfromthefunddirectlytoFoundationAid,whichisless
thanwhatthefundisprojectedtoreceiveinnewrevenueduringthe20172019biennium.

ThestatescommitmenttowardschoolaidandotherK12supportwilltotal$2billionduringthe20172019
biennium.Thestatesperstudentpaymentwillnotriseinthefirstyearofthebiennium,buttheGovernorsbudget
includesfundingforaonepercentincreaseinyeartwo.

NorthDakotahassupporteditsHigherEducationsysteminamajorway,providinganoverallincreaseof26
percentoverthepastfouryears.TheGovernorsbudgetcontinuestofundaportionofeverystudentcredithour
completed,butrecommendsana10percentreductioninGeneralFundsupport,aswellasfurtherreductionsof5
percentthatcanbeoffsetbyanassumedtuitionincreaseofnomorethan2.5percentperyearacrossallcampuses.

FundingisalsoincludedintheGovernorsbudgettoreplacetheCommunicationandFineArtsbuildingat
ValleyCityStateUniversity,whichisinpoorconditionandlocatedontheunprotectedsideofanewfloodprotection
levee.

HUMANSERVICES
IntheExecutiveBudget,theDepartmentofHumanServicesisnotheldtotheentirereductionrequiredofother
agencies.DespitegrowingcaseloadsandrisingMedicaidcosts,theExecutiveBudgetprovidesforNorthDakotaslong
termcarefacilities,veteransandthestatesvulnerablecitizens.

Longtermcareprovidersandothercareprovidersarealsobudgetedtoreceiveaonepercentinflationary
increasethesecondyearofthebiennium.TheGovernorsbudgetalsoincludesfundingtoallowforMedicaidcoverage
ofopioidtreatmentprogramsfundingtocontinuetheSubstanceUseDisordervoucherprogramandfundingforanew
childcarefacilitylicensinganddatasystem.

FundingforMedicaidexpansion,whichisprovidinghealthcareto20,000peopleacrossNorthDakota,is
includedintheGovernorsbudget.

TheExecutiveBudgetalsodirectsalltobaccopreventionprogrammingbacktotheDepartmentofHealth,and
utilizestobaccorevenuetohelppayforadditionalneedsinbehavioralhealth,Medicaidcostsassociatedwithtobacco