BISMARCK, N.D. (AP) - North Dakota’s Senate killed a resolution Thursday that would have made it tougher for the Legislature to tap earnings from the state’s oil tax savings account.
The Senate voted 46-1 to replace the resolution with another that would form a special committee of lawmakers and others to study potential uses for Legacy Fund earnings before the Legislature meets again in 2021.
Senators used a so-called hog-house amendment to erase the old measure and rewrite it. By doing so, the public can’t comment on the proposal because hearings already have been held on the original measure.
The original resolution sponsored by Democratic Rep. Corey Mock initially had broad bipartisan support from legislative leaders in both chambers. It would have required a two-thirds vote of the House and Senate to spend earnings from the Legacy Fund, which voters enacted in 2010. Mock argued that earnings should be “retained and reinvested” instead of automatically going into the state’s general fund for lawmakers to spend.
Voters would have had to approve the resolution in 2020. It passed the House two months ago.
Republican Sen. Dwight Cook, the chairman of the Senate’s Finance and Taxation Committee and primary author of the replacement legislation, said in an interview that he didn’t think voters would support it.
Cook told fellow senators Thursday that spending Legacy Fund earnings has been the “most discussed topic of the session.” He said his committee liked the idea of putting the fund’s earning back into the principal “but had a hard time swallowing a two-thirds majority vote” to tap them.
Mock said he hoped the measure could go to a conference committee to reconcile differences. He said he would support lowering the two-thirds voting requirement to a simple majority.
“A study is a good thing, but we should not be kicking this can down the road,” Mock said.
The state is required to put 30% of its tax revenue from oil and natural gas production into the Legacy Fund.
The constitutional amendment barred the Legislature from spending any of the fund’s assets until June 2017. Currently, a two-thirds vote of the North Dakota House and Senate is needed to spend any of the fund’s principal. Lawmakers may not withdraw more than 15% of the principal every two years.
Earnings from the fund are now put into the general fund, which is spent on an assortment of programs and projects.
The fund now holds about $6 billion and has grown faster than predicted with increased oil activity in the state. Earnings from the fund increasingly have been targeted for spending, including in 2017 when $200 million of the fund’s earnings was used to balance the state’s budget.
Lawmakers are reviewing several proposals to spend the interest this session.
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