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The North Dakota Legislative Review
A comprehensive review of the 2011 North Dakota Legislative Session The North Dakota Legislative Review is a comprehensive look at how state legislators voted during the 2011 legislative session. This analysis includes appropriations bills and bills that incorporated ideas put forth in Moving Forward, our policy guide, to give citizens a look at how their legislators voted on the issues most important to the North Dakota Policy Council. The NDPC tracked twenty-four bills during the legislative session that ranged from nullifying the new federal health care law to tax increment financing (TIF) reform. There were also dozens of appropriations bills that were debated in each chamber, totaling more than $10 billion in spending. Those bills varied in size from $2.2 billion to as little as $4,000. steps to combat the effects of Obamacare on North Dakotans, passing three bills doing so: HB1165 makes it illegal to compel North Dakotans to purchase health insurance; SB2309 declares Obamacare to be unconstitutional and protects the rights of North Dakotans to purchase medical services free from government interference;
Income Tax Cuts HB1047 passed the legislature providing North Dakota taxpayers with $145 million in personal and corporate income tax cuts. Though income taxes should be eliminated, all tax cuts are good tax cuts. Obamacare The state legislature took significant
Chart 1: This is a list of the bills tracked by the NDPC during the 2011 legislative session.
HCR3016 is a resolution encouraging the US Congress to repeal Obamacare. Unfortunately, the House of Representatives did not pass HCR3014, the Health Care Freedom Act state constitutional amendment, which would have put a state constitutional measure on the 2012 statewide ballot that had similar language to HB1165 and SB2309. A constitutional amendment would have been better because it would have been much harder to undo in the future. The House also rejected HB1291 which would have directed the governor to enter into an interstate compact with all other willing states to eliminate the effects of Obamacare on North Dakotans. Tenth Amendment The NDPC's third annual Free Market Forum took place in September 2010. "Defending the Tenth" was the theme of the event, which featured speakers Barry Goldwater, Jr. and Dr. Thomas Woods. The legislature acted on the message from that event and took several steps - albeit small ones - toward defending North Dakotans from federal government overreach. They passed the previously mentioned bills dealing with Obamacare and HCR3015, demanding the federal government to only exercise the powers granted to it in the US Constitution. The legislature also passed SCR4007, which is an application submitted by the state to the federal government initiating an amendments convention to amend the US Constitution to require any increase in the debt ceiling be approved by a majority of the states. This bill is probably more of a
political statement than something that will actually occur, but - even so - the political statement is strong. Unfortunately, though, the legislature rejected HB1287, which would have required the EPA to get state approval to impose any regulations. Property Rights The legislature passed SB2204 which requires legislative approval of all money given to the Northern Plains National Heritage Area, a federal program designed to enact local government land use changes via federal grants of money. TIF Reform In response to the North Dakota Policy Council's lawsuit against the City of Bismarck, the legislature passed SB2050 reforming tax increment financing laws. Agricultural-assessed land can no longer be considered blight - a prerequisite for the inclusion of property in a TIF district - and the property tax siphoned away from school districts, counties, and other taxing jurisdictions will have to be periodically adjusted, shifting more property tax dollars towards those entities and away from TIF slush funds. Taxpayer-Funded Lobbying The legislature passed SB2327, prohibiting the use of government resources to advocate for or against initiated measures.
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Pension Reform The House of Representatives narrowly rejected HB1228 and thoroughly rejected HB1258 which would have reformed the state employees' pension system and teachers' retirement fund from definedbenefits program to a 401k-style definedcontribution programs eliminating any future burden on taxpayers when the liabilities in the fund grow faster than the money in the fund. In other words, these bills would have eliminated future taxpayer bailouts of public pension systems. Economic Development SB2057 easily passed the legislature, appropriating $133 million for corporate welfare subsidies and other politicallymotivated "economic development" benefits. Article X, Section 18 of the North Dakota Constitution specifically prohibits the state from giving loans or handouts to corporations, and this bill is full of those types of programs. In addition, taxing productivity to run the revenue through an expensive and inefficient bureaucracy only to spend that money on politically-favored projects and industries is anathema to free-markets and constrains economic growth. Higher Education Despite an interesting attempt by the House of Representatives to reduce the size of the increase of the
university system's budget from 20% to 15%, the legislature ultimately passed HB1003 which appropriated $754 million to the university system and restored most of what the House tried to cut.
Budget Increase The 2011-13 budget passed by the legislature totaled more than $4 billion, an increase of 25% over the previous budget. The general fund budget has now increased 125% since the 2003-05 budget. To put that into perspective, the federal budget has increased 68% over the same time period. Using dramatic state revenue as an excuse to massively increase spending, again, the legislature has put the state budget on an unsustainable path should revenue stagnate. But even if state revenue continues to skyrocket, there is little justification economically or morally - for such budget increases.
Chart 2: Including the recently passed budget, general fund appropriations have increased 125% since 2003.
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Property Tax Reform Extension While it seemingly remains popular, the legislature overwhelmingly supported the extension of former Gov. Hoeven's property tax relief program whereby the state buysdown school district property tax mills. The program cost 16% more than originally anticipated by the state.
50 40 30 20 10 0
ND Senators "Vote Against" % By Category
>20% 10%-20% 1 5 41 <10%
Number of Legislators
Chart 3: 41 of 47 state senators voted against less than 10% of spending.
The supposed benefits of the relief plan were first seen in 2009, but according to an NDPC analysis, if the current trends continue, governments across the state will be collecting the same amount of money via property taxes in 2013 as they did in 2009, when citizens were upset. However, the state will also then be spending $400 million to keep it at those levels. Government Transparency In 2009, taxpayers had a major victory as the legislature passed a law mandating the North Dakota Office of Management and Budget to post ND every state expenditure on a 50% searchable website. In 2011, the 40% legislature rejected a similar 30% measure that would have required all local governments to do the 20% same. 10%
The North Dakota Senate voted on 9 policy bills that were of particular interest to the NDPC, with five senators - Randal Christmann, David Hogue, Oley Larsen, Joe Miller, and Bob Stenehjem - receiving a perfect score. Margaret Sitte also received a 93.94%. It's worth noting that Sen. Stenehjem and Sen. Christmann are the Senate Majority Leader and Senate Assistant Majority Leader, respectively. The Senate generally passed spending bills with little or no voting dissent. In fact, 54 of the 65 spending bills that passed were passed unanimously. Only 6 of 47 Senators
Senate: Policy & Spending
0% 0% 50% Policy % 100%
Chart 4: State senators generally supported free-market policy ideas more than spending restraint.
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voted against more than 10% of the total amount of money that came across their desk, while 33 of 47 voted against less than 5%. At $10.2 billion, Democrat Senator Mac Schneider gets the dubious distinction of being the biggest spending in the ND Senate. Democrat Sen. David O'Connell voted to spend the least amount of money in the ND Senate at $7.7 billion. Chart 3 shows that 41 of 47 Senators voted against less than 10% of all spending. Each dot on Chart 4 represents a Senator. Generally speaking, the further up and to the right on the chart, the more they supported free markets during the legislative session. As we see, Senators are more likely to vote for free market policy ideas than they are against spending. ND House
ND Representatives "Vote Against" % By Category
80 60 40 20 5 0 Number of Legislators 1 2 19 67 >40% 30%-40% 20%-30% 10%-20% <10%
Chart 5: 67 of 94 state representatives voted against less than 10% of spending?
50% 40% Spending % 30% 20% 10% 0%
ND House: Policy & Spending
50% Policy %
Chart 6: State representatives generally supported free-market policy ideas more than spending restraint.
The North Dakota House of Representatives voted on 22 policy bills that were of particular interest to the NDPC, with only one - David Weiler - receiving a perfect score. Dan Ruby and Larry Bellew both scored above 90%. The House generally passed spending bills with more voting dissent. However, only 27 of 94 Representatives voted against more than 10% of the total amount of money that
came across their desk, while 54 of 94 voted against less than 5%. Republican Rep. Gary Sukut voted to spend more money than any of his colleagues in the ND House at $10.2 billion. At $5.4 billion, Republican Rep. David Weiler voted to spend the least in the ND House. Chart 5 shows that 67 of 94 Representatives voted against less than 10% of all spending. Each dot on Chart 6 represents a Representative. Generally speaking, the
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further up and to the right on the chart, the more they supported free markets during the legislative session. The same pattern we saw in the ND Senate is also evident in the ND House. Representatives are more likely to vote for free market policy ideas than they are against spending.
citizens and state legislators big, long-term policy objectives while also providing lawmakers with short-term ideas to put North Dakota on the path towards the longterm objectives. For each "yea" vote on a long-term policy idea, legislators were given 3 points. For each correct vote on a short-term policy idea, legislators were given 2 points. There were also several bills that touched on issues the NDPC finds important but were not in the policy guide. Each legislator was given 1.5 points for the correct vote on those bills. Note that a "yea" vote was not always what we consider the correct vote. Legislators received 1 point for the correct vote on non-binding resolutions. Votes were weighted more heavily towards the long-term policy ideas, indicating support for the long-term vision held by the NDPC. Earned points were added up and divided by the total possible points to reach a percent. Missed votes were not counted in either as points earned or as possible points. Spending Bills Every legislator was given credit for spending the entire amount of every appropriations bill on which they voted "yea." The amount of money voted to spend for each "yea" vote was then added up and divided by the total amount of money in every bill on which they voted "yea" or "nay" to reach a percent.
While supporters of free markets in North Dakota should be happy about the good things the legislature did to defend economic freedom in North Dakota, the legislative session – in its entirety – was rather disappointing. The good things the legislature did, such as reforming TIF and protecting North Dakotans against Obamacare, were far overshadowed by the dramatic increase in the size and scope of state government and the opportunities that were not seized upon, such as public pension reform and the elimination of income taxes. Fiscal conservatives have their work cut out for them. While the mood of the country seems to be headed towards austerity, the growth in state government in North Dakota has exploded over the past several bienniums and there appears to be no end in sight.
Policy Bills Moving Forward, the NDPC's policy guide, breaks down proposed policy ideas into two major categories, long-term and short-term. The guide was put together that way to give
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There are several points worth noting: 1. The spending analysis does not distinguish between types of spending. All types of spending are represented in the overall amount of spending analyzed, meaning that needed government spending is not differentiated from spending on wasteful government programs. 2. The spending analysis does not take motivation into account. It is well known that legislators will vote against a spending bill because it was either not spending enough money or it did not include a particular program. In these cases, legislators were given credit for not spending the money when, perhaps, they wanted to spend more than what was in the bill. In other words, this analysis does not necessarily indicate the upper limit of how much each legislator wanted to spend. 3. Comparing the House of Representatives to the Senate is problematic because they voted on different bills. While the House voted on 22 policy bills that were tracked, the Senate only voted on 9 policy bills. The reason has to do with which chamber the bill was introduced into and whether or not that bill passed that chamber and actually moved onto the other chamber. The same goes for spending bills; each spending bill that was voted down in each chamber was different.
4. Legislators may have voted for the same idea twice. For instance, a spending bill may have been killed in one form and brought back and passed in a slightly different form. Those who voted for each bill would be credited with having voted for the same idea twice.
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