February 15, 2019 -- Hit the brakes!
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The House scoreboard displayed a 46-46 tie vote on HB 1264, which would raise North Dakota's interstate speed limit to 80 mph. The bill needed 48 votes to pass.
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Prairie Dog Bill Pops out of Approps
Legislation that will provide funding to oil-impacted communities and infrastructure dollars to non-oil regions was approved this afternoon by the ND House Appropriations Committee.
The committee voted 19-1 to send
HB 1066, better known as “Operation Prairie Dog,” to the House floor. The “do pass” motion was made by Rep. Bob Martinson, R-Bismarck, and seconded by Rep. Randy Schobinger, R-Minot. The lone dissenting vote on the bill was Committee Chairman Jeff Delzer, R-Underwood, who voiced concern about basing future funding on unpredictable oil tax revenue, and said he would prefer that buckets to non-oil cities, counties and townships be appropriated by each legislative session. The measure does not contain a sunset clause, so changes in the oil tax distribution formula will continue beyond the 2019-21 biennium.
The bill would continue to provide a set amount of funding to the Hub Cities of Dickinson, Minot and Williston to ensure they have adequate funds to service debt incurred related to oil industry impacts in the three communities. It also retains a 70-30 state-local split of remaining revenue generated by the gross production tax.
The bill’s prime sponsor, Rep. Mike Nathe, R-Bismarck, said a lot of thought has gone into the bill to determine how to best target infrastructure money to the non-oil region.
“We devised this bill to help us with the infrastructure needs we have in this state and they are many, they’re in the billions and billions of dollars,” Nathe said. “The county bucket, the city bucket, the formulas, we all worked together with the Association of Counties, with the League of Cities, and everybody’s on board.”
The legislation has been amended to rearrange the order in which the buckets fill, requiring the Strategic Investment and Improvements Fund receive $400 million before the city and county buckets receive any money. As a result, Delzer noted that based on the legislature’s current oil price and production forecast, the city/county buckets would not completely fill, and an airport grant bucket below them would receive no money at all. Legislators will take another look at the revenue production in March.
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Senate Passes Legacy Fund Bonding Bill
The ND Senate today unanimously approved legislation that would create up to a $500 million infrastructure revolving loan fund by buying bonds with Legacy Fund earnings.
SB 2275 would authorize the Bank of North Dakota to use $55 million in Legacy Fund earnings to buy bonds to provide low interest loans to cities and counties throughout North Dakota. Senator Jessica Unruh, R-Beulah, who pitched the bill on the floor as a member of the Senate Tax Committee, said eligible infrastructure projects would match those defined in Operation Prairie Dog legislation.
Click
here to listen to Unruh’s comments.
Unruh said loans would be issued for up to 30 years at a two percent interest rate. She said the savings over market rates has the potential to save local governments more than $500 million in interest payments between 2021 and 2035.
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Legacy Income Tax Reduction Passes
There are only
nine states in the U.S. that don’t levy an income tax, and if the ND House gets its way, North Dakota could soon become the tenth.
HB 1530, introduced by Rep. Craig Headland, R-Montpelier, would transfer half of Legacy Fund earnings each biennium to an income tax reduction fund as long as the amount is at least $50 million.
In the floor discussion, Rep. Vicky Steiner, R-Dickinson, remarked how it would benefit the state. Click
here for Rep. Steiner’s comments.
The bill passed the House 61-31.
“We have the money to eliminate income tax over time so let’s join the other states with no income tax and open doors of opportunity for generations to come,” Steiner said.
Click
here for more comments from Rep. Steiner.
In voicing opposition, Rep. David Monson, R-Osnabrock, talked about property taxes, sales tax and income taxes as a “three-legged stool” providing tax revenue. Monson equated the loss of income taxes as removing one leg of the stool and replacing it with a volatile income source based on the price of oil.
Rep. Josh Boschee, D-Fargo, also spoke in opposition providing a comparison to Alaska as a state with no income tax.
Click
here for to hear Boschee's comments.
The measure now heads to the Senate. Click here for a Fargo Forum
article about the bill.
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Committee Approves School Sales Tax Option
School districts in North Dakota would be given the option of using sales tax revenue to fund school construction projects under a bill approved by a legislative committee this week.
The House Political Subdivisions Committee approved
HB 1437 on an 11-3 vote. The only opposition to the measure came from a group of House members who routinely insist that any new revenue be offset by property tax reductions.
The bill, introduced by Rep. Pat Hatlestad, R-Williston, would allow schools to request their city and/or county put a sales tax proposal on the ballot that would require 60% voter approval. Hatlestad said a sales tax of up to one cent would be an option for districts that have had to build new facilities to accommodate population growth.
“We thought that the school districts with rapid enrollment that have accumulated significant debt and property tax - not being a very popular issue - some people would rather pay a penny or two at a time versus the tax bill,” he said.
The sales tax was previously an option for districts, which Williston used to fund a middle-school project in 2003. The taxing authority was taken away by the 2007 Legislature. Hatlestad’s bill will be considered by the full House next week.
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Responders Describe Need for SIRN 2020
The inability of first responders to communicate with one another during emergencies is driving the push for legislation to fund development of a Statewide Interoperable Radio Network.
Two Bismarck-area first responders described the need for the system known as SIRN 2020 during an interview this week on the radio program,
Energy Matters. Jason Stugelmeyer, deputy chief of the Bismarck Police Department, said the need for interoperability is not a new problem. He said it’s been a topic since he started in law enforcement nearly 20 years ago.
Click
here to listen to Stugelmeyer’s comments.
Some local jurisdictions have expressed doubts whether the statewide system would deliver the interoperability it promises. But Mike Dannelfelzer, communications director at Central Dakota Communications Center, said the technology is already used and is working in many other states.
Click
here to listen to Dannenfelzer’s comments.
The ND Legislature is considering
HB 1435, which would provide a total of $120 million toward development of the system. The bill has received the endorsement of the House Government and Veterans Affairs Committee, and is awaiting action in the Appropriations Committee.
Stugelmeyer said there is strong support among first responders because the problem is urgent.
Click
here to listen to Stugelmeyer’s comments.
Click
here to read a fact sheet about the SIRN 2020 project. Click
here and advance to the 00:30 mark to listen to the full
Energy Matters interview with Dannenfelzer and Stugelmeyer.
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Record Oil & Gas Production in December
December oil production came in at 1.4 million barrels per day creating a new all-time record. Natural gas production was also a record-breaker at 2.65 billion cubic feet per day, besting the October record of 2.56 Bcf/day.
The volume of flared natural gas statewide rose slightly to 81 percent from November to December up from the 80 percent previously reported. Lynn Helms, director of the Department of Mineral Resources in his monthly “Director’s Cut” report, said by the end of 2019 he expects operators to meet the 88 percent capture goal because more gathering and processing facilities will be completed in the coming months.
Helms said operators “self-restricted” oil production by nearly 35,000 barrels per day in an attempt to reduce natural gas flaring.
“Oil production has surpassed 1.4 million barrels per day, this is a big accomplishment. We have reached this milestone by utilizing new technology allowing us to recover more oil from each new Bakken well,"
said Ron Ness, president of the North Dakota Petroleum Council in a news release. "
We are proud of what we’ve done in North Dakota to help the United States become the largest crude oil producer in the world and continue the push to become a net exporter of crude oil and petroleum products.”
The number of producing wells in North Dakota in December stands at 15,351, just one short of the all-time record set in October 2018.
“All in all, oil prices are definitely strengthening,” Helms said. But with U.S. crude oil inventories now above the long-term average he doesn’t expect to see a big price increase in the next two years.
Rig count has remained relatively flat and was down three from November to December but jumped up three from December to January. Right now, rig count is down two from January to today. The Director’s Cut report indicated that operators have shifted from running the minimum number of rigs to incremental changes based on gas capture, completion crew availability, and oil price.
Click
here for the full Director’s Cut report.
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Tribal Tax Bill Advances to Senate Floor
Legislation that would establish a new tax sharing agreement from oil produced on the Fort Berthold Reservation is headed for the North Dakota Senate.
SB 2312, introduced by Senator Jordan Kannianen, R-Stanley, received a unanimous 14-0 do pass vote today from the Senate Appropriations Committee. The legislation will be considered by the full Senate next week.
The bill would change the current 50-50 tax split between the state and the Three Affiliated Tribes so that 80 percent of the tax from new wells on trust lands would go to the tribe and 20 percent would go to the state. The shares would be the opposite on fee land, with 80 percent going to the state and 20 percent to the tribe.
The bill is the product of extensive discussions among state, legislative and tribal leaders, industry representatives and the state tax department, according to Lt. Governor Brent Sanford. During an interview on the radio program
Energy Matters this week, Sanford said he expects the tax certainty the bill would provide will be reflected in additional industry investment in North Dakota.
Click
here to listen to Sanford’s comments.
If the legislation is ultimately approved, it would still have to be formalized in a new compact between the state and tribe. Sanford said that effort is going on behind the scenes, and will likely be ready if and when the legislation is enacted.
Click
here and advance to the 27:10 mark to listen to the full interview with Sanford.
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House "No Go" on Speed Limit Increase
Floor Discussion Slams DOT's Fiscal Note
Looks like if you want to drive 80 mph on interstate highways, you need to go somewhere other than North Dakota.
HB 1264, which would have increased the speed limit to 75 mph on divided four lanes and 80 mph on interstates, was voted down by a 46-46 tie vote. House rules require 48 votes for passage.
Those supporting the bill touted state highways as “corridors of commerce” and the state’s need to modernize rules. Those opposed cited mostly safety concerns.
The house floor discussion on the bill, however, took a nasty turn in criticizing the fiscal note intended to estimate the costs to implment the higher speed limits. Rep. Ben Koppelman, R-West Fargo, felt the NDDOT cost figures were exaggerated.
Click
here for to to listen to Koppelman's comments.
Rep. Rick Becker, R-Bismarck, also ripped into the fiscal note saying he had seen examples of their use as a lobbying tool. Click
here to listen to Becker's comments.
In concluding his remarks, Rep. Becker called for a renewed commitment to accuracy in fiscal note preparation. Click
here for Becker’s comments.
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Skilled Workforce Bills See Action
This week the House passed a bill (
HB 1171) to establish a skilled workforce student loan repayment program.
The bill creates a grant program through the Bank of North Dakota to train individuals for professional or technical skills in high demand. The bill grants up to $17K over two years and requires the recipient to work in the state in a high demand occupation for three years.
There are two related bills in the Senate.
SB 2039 has passed and moved over to the House Education Committee. The measure would implement a skilled workforce scholarship fund appropriated to the state board of higher education. The higher education board, working with the Bank of North Dakota, would develop policies to administer the program.
SB 2341 also passed the Senate. This bill requires the Division of Workforce Development to work with the Department of Public Instruction to develop an apprenticeship training program. Grants for training are also included in the bill.
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NDPC to Kick Off New Safety Effort
The North Dakota Petroleum Council is planning a kickoff meeting next Tuesday to launch its “ONE BASIN- One Way!” program, an effort to streamline oil industry safety training.
The event will be held in advance of the North Dakota Safety Council’s
annual conference, scheduled February 20-22 at the Bismarck Event Center.
NDPC Vice President Kari Cutting said the program is aimed at reducing the redundancy in safety orientation programs. During an interview on the radio program,
Energy Matters, Cutting said standardization will greatly improve the efficiency of current safety training efforts.
Click
here to listen to Cutting’s comments.
Cutting said the training will be delivered by the North Dakota Safety Council, TrainND Northwest and Diamond B. The kickoff meeting will include an overview of the program, a review of the curriculum, and presentations from the training providers. Click
here for more information.
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ND Reclamation Conference Coming Up
It will be here before you know it! The 7th Annual North Dakota Reclamation Conference "Reflecting on Reclamation" is scheduled for Dickinson February 25-26.
Information and registration can be found
here.
Please register through a web browser other than Internet Explorer. For additional information about the conference, contact
Brenda Schladweiler or
Toby Stroh.
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Community Wins Big with Chili Cook-Off
More than 1,100 people had the chance to try 25 different types of chili at the 38th Annual Chili Cook-off hosted by the Williston Basin Chapter of API. But the event is so much more than just spice and beans; it’s a major fundraiser for the community and generated over $60,000.
The money raised goes back into the community in the form of scholarships along with pledges to Giving Hearts Day, Dakota Boy’s Ranch, Boy Scouts, American Cancer Society Relay for Life, Salvation Army, Trinity School, Make-A-Wish, Upper Missouri Ministries and March of Dimes.
“We are so lucky to have the best oil and gas and energy-related companies in the Bakken come together for a great cause and help raise money,” said Ken Callahan, president of the Williston Basin Chapter of API. “The money we raised will help us get closer to reaching our goal of giving one million dollars since our inception. We hope to get to this point later this year.”
For more information on the winning teams,
click here.
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North Dakota Sweet Crude in a Bottle
“Frackin’ Good Liqueur Available for Sale
From a family recipe handed down from his great-grandfather who farmed north of Zap, North Dakota, Arthur Weidner is now working to spread a tasty liqueur named in honor of the Bakken’s primary product.
Weidner says the product is now available at off-sale locations in Bismarck, Dickinson, and Regent. In creating the distribution network, Weidner says all he needs to do is have people try a taste. “It sells itself,” he says.
A sip gives a taste of cinnamon and complex layers of flavors including ginger, lemon grass, and citrus. The flavors are first brewed like tea and then mixed with caramelized sugar. Weidner says he enjoys it on ice but also likes a “White German,” which is Kahlua, sweet cream, and North Dakota Sweet Crude.
Weidner and brother had been making it in their home kitchens for years and when they would go hunting, they would bring bottles for friends and landowners. As the requests grew over the years, they realized they had an interesting product with broad appeal.
Weidner is a mechanical engineering graduate from North Dakota State University and lives in West Fargo. Sweet Crude is distilled by Du Nord Craft Spirits in Minneapolis and Weidner is the distributor.
For distributor information, contact
Arthur Weidner. For product information, click
here. The product
Facebook page lists locations where you can find “North Dakota Sweet Crude.”
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Write it Down!
WDEA Annual Meeting
Get this on your calendar! The Annual Meeting of the Western Dakota Energy Association will be held:
October 30 - 31, 2019
Grand Hotel
Minot, ND
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Quick Connect
- ND Senate committee advances constitutional ethics bill -- Fargo Forum
- ND State Senate passes amended Pioneer Village bill with less funding -- Minot Daily News
- Senate approves Legacy Fund money for university research at NDSU and UND -- Fargo Forum
- EOG Resources lays off nearly 100 contractors and employees at Stanley -- KFYR-TV
- North Dakota lawmakers consider bills related to oil, gas royalty deductions -- Bismarck Tribune
- Stark Co. Sheriff’s office dedicating time to rural schools and community service -- KXMB-TV
- North Dakota prepares lawsuit for $38M in Dakota Access protest costs -- Bismarck Tribune
- Divide Co. school board seeks staff and community input for 4-day week -- Journal Tribune
- District 8 waiting on new enrollment projections before making bond decision -- Williston Herald
- North Dakota bill would keep ethics complaint process largely secret until final -- Fargo Forum
- Extreme cold leads to several saltwater brine spills at North Dakota wells -- Associated Press
- North Dakota needs workers. Why doesn't the state offer cash to move here? -- Fargo Forum
- North Dakota House defeats bill for pilot project on hedging oil tax revenue -- Bismarck Tribune
- NDDOT seeks comments on Statewide Transportation Improvement Program -- NDDOT
- Legislature: No collective bargaining for firefighters and law enforcement -- Minot Daily News
- US expects record domestic oil production in 2019, 2020 and lower prices -- Associated Press
- Energy independence: 2018 Texas oil production breaks 1970s record -- Houston Chronicle
- Meridian Energy Group to build new Permian Basin Refinery in Texas -- Globe Newswire
- With Iran squeezed out, U.S. oil production companies take on new rivals in Europe -- Reuters
- The Green New Deal: Have Democrats Declared a War on Farting Cows? -- Inside Sources
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Factoid of the Week
Think there's growth in Williston? Look at this from the
Williston Herald
: Birth rate has nearly doubled from 445 in 2007 to 835 in 2018; Williston High School had 240 grads last year and expect 284 for 2019; and NDSU estimates that Williston needs to add 500 homes every year for the next five years to keep up with expected population growth.
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February 16
Dickinson
February 19
Capitol
February 25-26
Dickinson
February 25 - Fargo; February 27 - Williston
February 26 - Bismarck; February 28 - Minot
March 5
Capitol
March 14
Fargo
March 27
Watford City
April 3 - 4
Bismarck
April 30 - Stanley; May 1 - Grand Forks; May 2 - Jamestown
July 16-17
Bismarck
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Oil prices and rig count
February 15, 2019
WTI Crude: $55.59
Brent Crude: $66.25
Natural Gas: $2.63
North Dakota Active Rigs: 64 (up 1)
2/15
/2018
-- 57 rigs
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Geoff Simon
Editor/Executive Director
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