Senate Majority Leader Rich Wardner thanks his colleagues and legislative staff in the final minutes of the 2021 session. The Senate adjourned sine die this morning at 12:26 a.m.
Senators Say Bill Lacks Commitment
In one of its final actions of the 2021 session, the ND Legislature approve a so-called "streams" bill, intended to direct areas of future spending of Legacy Fund earnings.
The House and Senate had decidedly different views about the legislation. The original version of HB 1380 introduced by Dickinson Rep. Mike Lefor provided streams for about a dozen categories including percentages devoted to bond repayment, highway funding, school construction loans, an innovation loan fund, the public employee retirement system, career and technical education, clean sustainable energy, housing incentives and economic diversification and research. Lefor's bill was scaled down considerably before passing the House, but the Senate restored much of its original intent.
The bill ultimately agreed upon by a conference committee earmarked dollar amounts instead of percentages, and only specifically targets $150 million for bond repayment and $60 million to the highway fund. Remaining amounts would go to other legislative purposes that may include tax relief, research and support for clean sustainable energy, and to the Strategic Investments and Improvements Fund.
Fargo Senator Ron Sorvaag said members of the Senate felt it was important to provide more of a commitment to specific legislative priorities.
Click here to listen to Sorvaag's comments.
House Majority Leader Chet Pollert defended the House version. Pollert said even though the bill didn't identify specific spending plans, the intent was still clear.
Click here to listen to Pollert's comments.
Beulah Senator Jessica Bell was critical of the House version, which she said mostly established new "savings accounts."
Click here to listen to Bell's comments.
The streams bill was the end result of a series of hearings conducted during the past interim by a Legacy Fund Earnings Committee. Although she wanted to see a more firm commitment, Senator Bell supported the House bill.
Click here to listen to Bell's comments.
The legislation extends the interim committee, which is expected to hold hearings around the state as it did last interim, including a February 2020 meeting in Watford City (see Feb. 21, 2020 newsletter). The bill passed the House 81-9 and the Senate 46-1.
Oil Tax Sharing for MHA Nation
Legislation that establishes a tax-sharing agreement for "straddle wells" around the perimeter of the Ft. Berthold Reservation was signed into law this week in a ceremony at the Capitol.
Gov. Doug Burgum put his signature on SB 2319, which will provide a share of oil tax revenue collected from the oil wells to the Mandan, Hidatsa and Arikara Nation. The state has always received a share of revenue from wells inside the reservation boundary with underground laterals that go outside the boundary, but until now the tribe has not received revenue from wells outside that have laterals that go into the reservation.
State Tax Commissioner Ryan Rauschenberger said it took a long time to find agreement on the issue, but said the result will be a benefit to both the state and tribe.
Click here to listen to Rauschenberger's comments.
MHA Chairman Mark Fox agreed with Rauschenberger's assessment that the comprise is a win-win agreement.
Click here to listen to Fox's comments.
The legislation will provide a direct payment to the tribe, so it will not require a change in the current tax compact between the state and the MHA Nation. Earlier in the session, the straddle bill was nearly killed, and was narrowly spared thanks to an amendment offered by Watford City Senator Dale Patten (see February 26 newsletter).
Money for Pulver Hall, Minot Science Center
The last bill approved by the 2021 Legislature, the appropriations bill of the Office of Management and Budget, includes money for township roads and technical education facilities.
The OMB bill, HB 1015, is considered the catch-all bill to correct errors or oversights in other bills. This session's version is 29 pages long and contains 46 different sections.
House Appropriations Committee Chairman Jeff Delzer said the bill contains a total of $20 million directed to non-oil townships, aiming to support those in eastern North Dakota that experienced severe flooding last year. Delzer said there is another $10 million in the bill that would be available to townships in oil-producing counties that is part of a $100 million appropriation the state hopes to leverage with additional dollars from the federal government.
Click here to listen to Delzer's comments.
The bill also includes $70 million directed to career and technical education centers, with the revenue coming from federal pandemic relief funding. The funds would be used to establish a grant program for CTE construction, expansion, maintenance and equipment. Grants would be capped at $10 million, could be no less than $500,000, and require a 1-to-1 match from a school district or regional cooperative. The program would give preference to districts that collaborate on establishment of a regional CTE facility.
The OMB budget also uses federal money to provide $5.9 million for a children's science center in Minot; $4 million to Dickinson State University for Pulver Hall and development of a meat processing facility, and also addresses repayment of $17.5 million to the Bank of North Dakota for a loan associated with the Theodore Roosevelt Presidential Library.
Per Pupil Payment to Increase "1-and-1"
It took several conference committees to find middle ground, but House and Senate members finally agreed upon a school funding plan that will include a one percent increase in the per pupil payment each year of the coming biennium.
Mott Senator Don Schaible, who chairs the Senate Education Committee, insisted that the increase in K-12 funding through the Foundation Aid formula was necessary to allow districts to provide pay increases to teachers. On the other side was Osnabrock Rep. David Monson, who chairs the Education and Environment Section of the House Appropriations Committee. Monson insisted that because school districts were receiving large amounts of funding from the Elementary and Secondary Schools Education Relief fund (ESSER), there was no need for the state to provide the increase.
In the compromise agreement reached yesterday, Monson proposed an adjustment to "transition maximum" payments (higher than the standard per pupil amount) that go to property-poor districts that struggle to raise revenue to fund schools. Those same schools also receive the largest ESSER payments, with some receiving tens of thousands of dollars per student.
Click here to listen to Monson's comments.
Education funding is part of two separate bills, with the appropriations package contained in HB 1013, and K-12 policies and programs provided in HB 1388. The 1-and-1 increase added about $34 million to the Department of Public Instruction funding bill, which totals just under $3 billion for the biennium.
Schaible said it was important to provide a way for districts to raise teacher salaries, especially considering the additional expectations associated with the pandemic. The legislation requires that at least 70 percent of the per-pupil increase be used to increase wages and benefits for non-administrative personnel.
Eleven school districts will be affected by the reduction in transition maximum payments, most of which have already received hundreds of thousands in ESSER payments, and more money is on the way. Schaible said he expects those districts won't be happy about the adjustment, but said he felt the deal was fair.
Click here to listen to Schaible's comments.
The increase in per-pupil funding will increase the payment to $10,136 per student in the 2021-22 school year, and $10,237 per student the following year. According to a summary from the ND School Boards Association, the policy bill also:• Adjusts the small school district size weighting factors. School districts that do not operate a high school will have their average daily membership divided by .6 to impute an average daily membership to be on the same scale as high school district. The bill also establishes a new weighting factor for districts that have reorganized that operate 2 physical plants over 19 miles apart.
• Provides the ability of a school district to meet instructional time requirements through a virtual instruction program that meets certain criteria established through administrative rules to be adopted by DPI. It also includes provisions to account for virtual instruction in the ADM calculation. The bill also includes an emergency clause regarding the virtual instruction provisions so that districts currently providing virtual learning may continue to do so through the end of the current school year and also meet instructional time requirements.
• Provides for a legislative management study of K-12 funding, including transition minimum reduction impacts on reorganized and consolidated school districts.
Fossil Fuel Research Efforts Included
Bill Stalled by Dispute over BND Employees
The ND Legislature gave its blessing on the final day of the 2021 session to the $266 million budget of the North Dakota Industrial Commission and the various state agencies it governs.
SB 2014 includes appropriations for the Department of Mineral Resources, the Bank of North Dakota, the state Mill and Elevator and the Housing Finance Agency. Among special funding allocations in the bill is $9.5 million to fund research into the development of salt caverns for hydrocarbon storage in western North Dakota. The caverns are formed by injecting water into a salt-bearing formation to dissolve the salt. The resulting brine is then pumped out, leaving a void which can be used to store natural gas or gas liquids, ethylene, propane and butane. Salt cavern storage is a key component in the operation of a petrochemical facility.
Final agreement on the budget was temporarily hung up on additional FTEs requested by the Bank of North Dakota to handle the additional responsibilities assigned to it this session. Senate members of a conference committee supported a request for 9.5 FTEs, but House members were dug in at 7.5 positions. Fargo Senator Ron Sorvaag said it was wrong to deny the bank's request because the bank was profitable and the positions would pay for themselves, but in the end he relented to the House position.
Click here to listen to Sorvaag's comments.
The budget also funds other research efforts. It appropriates $500,000 from the Oil and Gas Research Fund to support an EERC study of the development and implementation of hydrogen energy in the state. It would examine the timeline to develop infrastructure for hydrogen energy and the use of public and private partnerships to assist in the development.
The budget also includes $4.5 million from the Lignite Research Fund for a study aimed preserving existing lignite production and industry jobs, or lead to increased development to create new jobs and economic growth. The state will contract for an independent lignite marketing feasibility study focused on areas where market-driven projects or activities will generate private industry investment.
Landowners Sportsmen in Agreement
One of the more controversial and emotional issues to confront the ND Legislature the past few years may have finally been resolved this session.
SB 2144, a bill that will allow electronic posting by landowners during hunting seasons, was signed into law by Gov. Doug Burgum during a ceremony at the Capitol. Burgum told a crowd gathered for the signing that electronic maps can be printed from the website, and various apps will have the information as well.
Click here to listen to Burgum's comments.
The bill's prime sponsor, Senator Robert Erbele of Lehr, said getting sportsmen and landowners actively engaged in an interim study was key to resolving the issue.
Click here to listen to Erbele's comments.
Watford City Senator Dale Patten, a co-sponsor of the legislation, said improved technology was the thing that finally allowed the different interests to agree on the legislation.
Click here to listen to Patten's comments.
Mandan Rep. Todd Porter, who chairs the House Energy & Natural Resources Committee, said he was gratified to see landowners and sportsmen come together to resolve the issue.
Click here to listen to Porter's comments.
The bill received overwhelming approval, clearing the House 89-3 and passing the Senate 44-2. State game officials expect the program to be online in this spring, although the law doesn't go into effect until August 1.
Self-Funding Used to Recover Shortfall
The ND Public Service Commission was given the go-ahead by the legislature to assess additional fees to make up for a $700,000 shortfall in its budget.
The PSC proposed to make-up the deficit by funding a portion of its operations with an annual fee on regulated electric and natural gas utilities proportionate to their operating revenues. Additional fees would also be assessed on applicants seeking permits to construct energy or transmission facilities.
The authorization is contained in the PSC's budget bill, HB 1008, which was approved by the legislature earlier this week. In addition to fees on energy companies and related projects, the PSC will also keep all revenue generated from weights and measures plus increase fees for various services. The legislation places a cap of $1.1 million on self-funded revenue.
HB 1008 also approves the creation of a third natural gas pipeline inspector position. PSC Chair Julie Fedorchak, in testimony before the Senate Appropriations Committee, said this is the third budget cycle in which they requested the position due to increased workloads.
Jamestown Senator Terry Wanzek, who explained the bill on the Senate floor, said the position was important in order to preserve federal funding from the Pipeline and Hazardous Materials Safety Administration.
Click here to listen to Wanzek's comments.
PSC operations are also affected by SB 2313, a bill aimed at ensuring electric grid reliability that has been signed into law by Gov. Burgum. The bill allows the the PSC to consider "qualitative benefits" in its evaluation of integrated resource plans from utility companies. The IRPs describe the utilities' long-term plans for energy generation and distribution. The PSC plans to hire a consultant for the work, which is authorized in a different measure, HB 1067, which has also been signed by the governor. Utilities opposed the legislation because they argue it will artificially increase costs to utility customers.
Lawmakers Reduce Scholarship Budget
Legislation to continue funding North Dakota Career Builders, a program established by the 2019 Legislature, was signed into law by Gov. Doug Burgum on Tuesday.
The Career Builders funding in SB 2272 continues a skilled workforce scholarship and student loan repayment program aimed at attracting people into high demand and emerging occupations in the state. The program targets workforce needs of North Dakota with the goal of recruiting and retaining talent in skilled workforce jobs. Even though usage suffered through the COVID-19 pandemic and distance learning challenges, lawmakers agreed to continue funding the initiatives at slightly lower levels.
The path to enactment was not without significant discussion among lawmakers regarding how it related to spending in other scholarship legislation including HB 1375, which directs the State Board of Higher Education to administer a dual-credit tuition scholarship program. A dual credit course is one in which a high school student takes a course through a two- or four-year institution, earning one college credit and a half unit of high school credit.
A conference committee hammered out conflicts between the two bills, both of which draw funding from the Bank of North Dakota. Senate Education Committee Chairman Don Schaible said to maintain funding and not draw additional money to the programs, the committee reduced funding in both bills, which reduced Career Builders funding from the original $6 million to $4.5 million.
Click here to listen to Schaible's comments.
Language in the legislation indicates that if there are any dollars in the skilled workforce scholarship fund and the skilled workforce student loan repayment fund which have not been committed as of Dec. 31, 2022, the State Board of Higher Education may award up to 50% of the uncommitted balance for dual-credit tuition scholarships. The bill also sets up a legislative management study of all scholarship programs in the state.
Industry, Counties to Discuss Transportation
There's still time to register for a Western Energy Roundtable that will bring together oil industry leaders and county road managers to discuss issues of concern and brainstorm solutions.
The gathering is scheduled Thursday, May 6 at 9:00 a.m. MDT at the new Dunn County Highway Shop in Halliday. The event is co-sponsored by WDEA and the Upper Great Plains Transportation Institute's Local Technical Assistance Program.
The agenda includes presentations and Q&A sessions with NDDOT Director Bill Panos, Lt. Governor Brent Sanford, and a panel of industry representatives including ND Petroleum Council President Ron Ness. Attendees will also hear a tribal roads update from MHA Nation CEO Scott Satermo, a LoadPass Permits update from Brent Bogar and Joelle VanderLinden, and a discussion of the latest roads and bridges needs study with Alan Dybing from UGPTI.
Registration is free, but is required to get an accurate meal count. Click here to register. Lunch will be provided compliments of Dunn County.
Click here to see the agenda.
Trade Show Sold-out with 270 Exhibits
The agenda for the 2021 Williston Basin Petroleum Conference features an impressive array of over 70 speakers and presenters, each sharing insights on the latest issues impacting oil and natural gas development and what the future holds for the Williston Basin.
Along with an exciting agenda, WBPC features a world class trade show. This week, conference organizers announced the exhibit hall is full with over 270 exhibiting companies. Click here to view the exhibit hall floorplan.
The conference, scheduled for May 11-13, is the largest conference in North Dakota with major networking opportunities for energy industry professionals.
"The WBPC is one of the top oil conferences in the country. We have an incredible lineup of speakers," said Ron Ness, President of the North Dakota Petroleum Council, the lead organizer of this year’s conference. "We are excited to feature the latest technologies that have helped turn the Bakken into a world-class resource and discuss the way forward to help take the Bakken and Williston Basin to the next level."
The conference will feature some of the industry’s top authorities on issues that impact the Williston Basin. The conference stage will include Bakken CEOs and experts on markets and industry outlooks, innovation and technology, geology, regulatory issues and more. Key speakers include:
- Mike Pompeo, former U.S. Secretary of State – “Value of American Energy to the World”
- Bob Phillips, CEO of Crestwood Midstream – "Building Gas Capture Infrastructure"
- Chris Kendall, CEO, Denbury Resources – "EOR at Cedar Hills in Bowman County"
- Dan Clark, VP of ConocoPhillips Great Plains Business Unit
- Kelcy Warren, Executive Chairman of Energy Transfer LP
- Mike Sommers, President and CEO of API – "The State of American Energy"
- Wade Hutchings, Chief Operating Officer of Enerplus
WBPC will be a COVID-Conscious conference and will follow all recommended protocols from local officials and facility management. Conference organizers understand this is a changing environment and plan to monitor the situation and take recommended precautions to ensure the health and safety of all conference attendees.
Extreme Category Covers Much of State
Extreme drought conditions now cover more than 80 percent of North Dakota as unusually dry conditions persist.
The state is already in a drought emergency declared by Gov. Doug Burgum earlier this month (see April 9 newsletter), and conditions have not improved as central and western parts of the state continue to receive little, if any, moisture.
Minot has recorded just a trace of moisture in the month of April, compared to an average of 1.4 inches. The story is much the same in Dickinson, which has received just .03 inches in April, and Hettinger just .05 inches. Williston is wet by comparison with .54 inches, but even that amount is less than half what the city would normally expect. Unusually warm temperatures in the 80s today and tomorrow will only make matters worse.
The National Weather Service has issued a Red Flag Warning for western and much of central North Dakota, as very dry, windy, and warm conditions move in. The NWS Storm Prediction Center also noted that a large part of Montana and North Dakota will be under elevated fire risk. Meteorologists predict some precipitation is on the way, but it could be a double-edged sword as thunderstorms produce lightning and ignite dry vegetation.
Fire crews were battling another wildfire in the western Badlands this week. The Roosevelt Creek Fire covered about 900 acres in Billings County. The fire started Wednesday about 6 miles north of Wannagan Campground, north of the South Unit of Theodore Roosevelt National Park. The cause wasn't known. The small Ward County town of Carpio was also evacuated as a precaution today as fire crews battled a grass fire threatening the town.
Agriculture Commissioner Doug Goehring has reactivated the Drought Hotline, primarily aimed at connected ranchers who need hay with those who have some to sell.
“We are also appealing to individuals who are available to move hay to contact the hotline,” Goehring said. Those with hay to sell or pasture or hayland to rent are asked to call 701-425-8454.
The Ag Department has set up an interactive hay map that allows users to find information about available hay, pasture and hayland in their area.
Based on the latest crop progress report released by the United States Department of Agriculture for the week ending April 25, North Dakota’s topsoil moisture supplies were rated at 80% short or very short. Subsoil moisture was rated at 78% short or very short. Stock water supplies were rated 69% short or very short.
Lifted South of Highway 2
Effective today, load restrictions will be lifted on most state highways south of Highway 2 to the South Dakota border.
Information about local road restrictions in counties that participate in WDEA's LoadPass Permits system is available in an interactive and searchable map. Users can click any area of the map to get a quick rundown of restrictions in that area.
LoadPass also features a detailed county-by-county notification list of load restrictions.
Detailed load restriction information for state roads is available by calling 511 or online at ND Roads.
Motorists are always encouraged to check state and county load restriction information as restrictions may change quickly due to adverse weather.
Motorists Urged to Always Use Seat Belts
With vehicle fatalities trending higher in 2021 than the past two years, Vision Zero campaign organizers are urging the public to increase awareness of seat belts, to not drive while under the influence, and to avoid excessive speed.
So far in 2021, the state has recorded 26 fatalities. There were nine fatalities for the same period in 2020, while 2019 had 22 fatalities.
Of the 100 fatalities in 2020:
- 42 were not wearing their seat belt, an increase of 23.5% from 2019.
- 39 were alcohol-related, a decrease of 13.3% from 2019.
- 25 were speed-related, an increase of 4.2% from 2019.
- 60 were lane departure-related, an increase of 11.1% from 2019.
- 17 were motorcyclists, an increase from 11 in 2019.
- 8 were pedestrians, an increase from 5 in 2019.
To learn more about the Vision Zero strategy and its traffic safety campaigns, click here. Visit the North Dakota Crash Memorial Wall to view memorials built on the hope of preventing deaths on North Dakota roads.
Application Deadline: June 1
The ND Petroleum Foundation is accepting applications for the Al Golden Memorial Scholarship from students pursuing a career in the energy sector.
The scholarship fund was established in 2008 to support students pursuing work in geology, engineering, processing plant technology, science, technical skills or other careers related to the oil and gas industry. The scholarship is named after the North Dakota oil pioneer Al Golden, the first member of the North Dakota Petroleum Council’s Hall of Fame.
The ND Petroleum Foundation will award nine $2,000 scholarships each school year. Recipients receive $1,000 for the fall semester and $1,000 for the spring semester. The scholarship is open to full-time students who have a 3.0 GPA or higher.
Applicants must also have completed ONE of the following:
- At least six months of work and/or internship experience in the oil and gas industry.
- Completed at least 12 hours in geology, earth science, geological/petroleum engineering, chemistry, math, or safety.
- ND adjourns following session marked by record budget, pandemic -- AP
- Recapping North Dakota's 67th legislative session -- KXMB-TV
- Burgum signs $25 million bill aimed at ‘carbon neutral’ power -- KFYR-TV
- ND legislature overrides veto of lawmakers’ spending control -- Associated Press
- AG: Lawmakers’ spending control may not stand up in court -- Associated Press
- Major ND election bill clears legislature, heads to governor -- Bismarck Tribune
- Gov. Burgum veto spotlights power struggle with ND lawmakers -- Dickinson Press
- Funding increased for ND fire districts; some want new funding method -- Bismarck Tribune
- District 36 elects new chair showing disappointment with state GOP -- Dickinson Press
- Governor greenlights health and human services merger -- Dickinson Press
- Bill gives lawmakers seven days to see audits before public -- Bismarck Tribune
- Burgum signs bill allowing fire, EMTs to carry concealed weapon -- KXMB-TV
- Judge wants U.S. Corps of Engineers to weigh in on DAPL -- Williston Herald
- DAPL wants review from United States Supreme Court -- Associated Press
- Continental ramping up Bakken operations, adds Powder River rigs -- Reuters
- ND landowners and oil industry butt heads over pore space -- Dickinson Press
- Equinor completes $900M sale to Grayson Mills announced in Feb. -- Williston Herald
- Energy makes a difference: API focuses on community service -- Dickinson Press
- Underground salt cavern storage: Helping ND's propane shortages -- Williston Herald
- Enbridge-funded account reimburses $500,000 to law enforcement -- Fargo Forum
- Drought prompting fracking innovations; production outlook good for state -- Williston Herald
- North Dakota native tapped to lead Williston State College -- Williston Herald
- Mark Pierce, ND Faces of Coal Founder, gets a distinguished honor -- Beulah Beacon
- State making pandemic learning program available for 2 more years -- Bismarck Tribune
- North Dakota's population soars 16% to 779K in census count -- Bismarck Tribune
- Montana to gain 2nd U.S. House seat after census count -- KFYR-TV
- Longtime Bank of ND chief, Eric Hardmeyer, announces retirement -- Bismarck Tribune
- Construction plans move ahead for $5.2 million Dickinson town square -- KFYR-TV
- Williston Mayor to talk finances, re-election plans at state of the city -- KFYR-TV
- North Dakota counties earn high grades for low air pollution levels -- Fargo Forum
- 2021 Norsk Høstfest canceled again, new president to take over -- KFYR-TV
- McKenzie County commits $40M to new Ag Expo for new fairground -- McKenzie County Farmer
- Local taxable sales decline reflects dire state of industries -- Tioga Tribune
- Drought doesn't dampen plans; remain optimistic one farmer says -- The Journal
- Biden administration offers $8.25 billion in loans for power grid -- Reuters
- Biden's risking energy independence for 'unattainable' green goals -- Inside Sources
- Earth Day: Let's celebrate the real drivers behind improved environment -- IER
- Are ESG funds really a good long-term investment these days? -- National Review
- Fossil fuel divestment: A costly and ineffective investment strategy -- RealClear Public Affairs
- Halliburton back in black as North America stages 'healthy recovery' -- NGI
- Why fixing the Texas power grid and ERCOT mess is so complicated -- Forbes
- Oil pipeline disputes raise tensions between U.S. and Canada -- Associated Press
- Hess Corp profit tops estimate as tanker storage bet pays off -- Reuters
- Potentially coming this summer: Gas stations running out of gas -- CNN
- Who will pay for energy transition from fossil fuels to zero emissions? -- Reuters
- Wind-energy sector gets $176 billion worth of crony capitalism -- National Review
Factoid of the Week
Dunn County Highway Shop - Halliday
Virtual and In-Person
Bismarck State College
April 30, 2021
WTI Crude: $63.58
Brent Crude: $67.25
Natural Gas: $2.93
North Dakota Active Oil Rigs: 15 (Unchanged 0) 4/30/2020 -- 31 rigs