North Dakota tax commissioner: North Dakota's oil tax revenue could top $3.5 billion when the state's current two-year budget period ends in June.
Spurred by rising production, North Dakota's oil tax revenues could top $3.5 billion when the state's current two-year budget period ends in June, the state tax commissioner says.
Oil prices have stayed reasonably close to the Legislature's forecasts, but production has been considerably greater, according to budget data and the Department of Mineral Resources, which regulates North Dakota's oil industry.
When they finished the state's 2011-13 budget in the spring of last year, lawmakers estimated that western North Dakota's oil producers would eventually pump 425,000 barrels a day. In May, the average daily output was almost 640,000 barrels, and state oil regulators expect a continued rise.
"It's astounding. It's significant," Tax Commissioner Cory Fong told The Forum newspaper (http://bit.ly/PWJ5Gb ). "It's been, in some cases, challenging to forecast what's going to happen."
State Sen. Raymon Holmberg, R-Grand Forks, the chairman of the North Dakota Senate's Appropriations Committee, says the extra revenue is not necessarily available for the Legislature to spend.
Thirty percent of the money goes into a state oil tax trust fund, approved by North Dakota voters in 2010, that cannot be touched for another five years.
A share of the money goes to trust funds that benefit schools and water projects. A slice goes to a state fund that is dedicated to reducing property tax rates, and another portion is allocated to local governments in the western counties where the oil is produced.
"So even though this (oil tax revenue) number grows exponentially ... it's not $1.6 billion of accessible money," Holmberg said.