It appears bonding will be a major area of discussion during the 2021 North Dakota Legislature.
Gov. Doug Burgum, Senate Majority Leader Rich Wardner (R-Dickinson) and Senator Tim Mathern (D-Fargo) all have bonding proposals at the ready.
House Majority Leader Chet Pollert (R-Carrington) said he can accept some bonding proposals.
"I'm in support of some bonding, but not to the level the executive budget is asking for," Pollert said.
The executuive budget seeks $1.25 billion in bonding for infrastructure projects.
"I'm in support of some water projects we're going to have out there, that we're going to take a serious look at," Pollert said. "We aren't going to have the cash on hand for that."
Pollert said those kinds of projects are 30, 40 and 50-year projects.
Pollert said he will not vote for proposals to bond for what would normally be a general fund obligation.
As for his House GOP caucus, Pollert said opinions on bonding are all over the board.
"I would say there will be some of those folks who don't want to do any bonding at all," Pollert said. "There's folks that support doing $1 billion of bonding. And there are folks in the middle."
Many of the proposals use earnings from the Legacy Fund to pay back the bonds. But Pollert said with a tight state budget, he wants to tread carefully in using Legacy Fund profits.
"Regrettably, we're going to need some of these Legacy Fund earnings to fill these gaps," Pollert said.
Pollert said with some of the budget proposals, the question becomes how to pay for everything.
"Are we going to raid the Budget Stabilization Fund, and the Strategic Investment and Infrastructure Fund?" Pollert said.
For the Legacy Fund, Pollert said he would like to see a matrix applied.
"Some of it should go back into the principle, to keep that going," Pollert said. "Will there be fracking and all that 30 years from now? That's a good question. So we need to have these funds for the future generations, and not now."
Mathern: $2 billion bonding bill
Sen. Mathern's bill is a $2 billion bonding bill. He said it has four purposes. One is to fully fund the “Prairie Dog” local infrastructure bill.
"We passed the bill in the last Legislative session without enough money in it," Mathern said. "We promised a lot of people money, and this bonding would pay for that, so that these organizations woujld get that money."
Mathern said a second purpose would be for other infrastructure needs, as identified by the Upper Great Plains Transportation Institute.
"That has measured township roads, county roads, state roads, federal roads," Mathern said. "We would put money towards those projects going forward."
Other identified purposes would be to put money into a fund for infrastructure for schools – from kindergarten through college. Mathern said that fund would provide loans at two percent interest. And the other purpose would be for the Housing Finance Agency to build more low income housing.
"The payment of the bond would come from the Legacy Fund, or Bank of Nortgh Dakota profits, depending upon what the Legislature wants to do," Mathern said.
Mathern said it takes advantage of the relatively low prices for bonds right now.
"It creates jobs," Mathern said. "Those jobs are highly paid, safer ikn a COVID environment, and it creates jobs across the state."
Mathern said bonding also evens-out state spending, by spreading payments out over 25 years.
