House passes new oil tax allocation formula

Feb 26, 2015

The House has passed a change in the oil tax distribution formula.

But it isn’t what Governor Dalrymple proposed.

The current formula on oil tax is – 75 percent goes to the state, 25 percent to local governments. Dalrymple and oil patch Republicans wanted to make that formula 60-40 – 60 percent to local governments, 40 percent to the state. Instead, the House passed what it called the 70-30 plan – 70 percent to the state, 30 percent to local governments.

House Democratic Minority Leader Kenton Onstad (D-Parshall) says he’s reluctantly supporting the proposal.

"It's unfortunate that we're at a time when we had high expectations coming into the session," said Onstad. "The revenue forecasts have been affected. We should have done a better job four or five sessions ago."

House Republican Majority Leader Al Carlson (R-Fargo) says the Legislature has nothing to apologize for.

"We have proven, with the surge bill and with our past commitments, with this bill it's about $4 billion, since 2011" said Carlson. "That's a lot of money."

Rep. Jon Nelson (R-Rugby) opposed the bill. He says one of his objections was including Mandan as a “hub city” for impact revenue. He says the House Appropriations Committee was told the reason for that is because Mandan has the Tesoro refinery.

"That refinery has been there for 60 years," said Nelson. "And either we're awful slow in recognizing the impact of that refinery, or there's something wrong with this system."

The bill passed 70 to 18. It will now be considered by the Senate.

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