North Dakota's Infrastructure Gets Funding from Oil Rebound

Aug. 4, 2022
North Dakota will see funding this year from the legislation

In 2019, North Dakota passed "Operation Prairie Dog", a bill providing $250 million in every two-year budget cycle for counties, cities and airports in non-oil producing areas for such things as roads, bridges and airport projects. For the first time since the legislation was passed three years ago, infrastructure projects are on pace to be fully funded.

The bill assumed oil production and prices would hold though the two-year budget cycle.

Unfortunately, “due to the pandemic-related collapse in global oil price and the resulting drop in North Dakota oil production,” oil tax revenue was only $3.6 billion, or 25% lower than had been projected for the last budget period, said Joe Morrissette, the state’s top budget writer.

With that in mind, the 2019-2021 budget period saw $29.9 million being distributed, putting municipalities with higher populations at the head of the line based on the legislation's funding formula.

The Legislature distributed more than $300 million in federal coronavirus relief funds for statewide infrastructure projects during its special session in November, noted Morrissette.

Because of the rise of oil prices and the steady production, oil revenues during the budget cycle that ends next year already are over $730 million more than forecast, based on state budget data.

Morrissette said if oil revenue continues at the current rate, Prairie Dog would be fully funded and distributed early next year.

Senate Majority Leader Rich Wardner developed Operation Prairie Dog, confident that the $250 million in funds would come through this year.

All but the eight oil-producing counties are eligible for the funds. The bulk of the money, $169.2 million, is to be shared between municipalities and counties and townships for infrastructure. Counties and townships get an additional $30.4 million, as do municipalities. Another $20 million is set aside for airport infrastructure to be used mainly to match federal funds for projects, Wardner said.

“Every incorporated city in non-oil counties will get something,” Wardner said. “They will be able to do things they haven’t done before.”

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Source: Associated Press