North Dakota Legislative Budget Section Meeting in Bismarck

NORTH DAKOTA LEGISLATIVE COUNCIL
Minutes of the
BUDGET SECTION
Tuesday, June 23, 2009
Senate Chamber, State Capitol
Bismarck, North Dakota
Senator Ray Holmberg, Chairman, called the
meeting to order at 9:00 a.m.
Members present: Senators Ray Holmberg,
Randel Christmann, Ralph L. Kilzer, Aaron Krauter,
Karen K. Krebsbach, Elroy N. Lindaas, Tim Mathern,
Carolyn Nelson, David O'Connell, Larry J. Robinson,
Bob Stenehjem, Rich Wardner, John Warner;
Representatives Larry Bellew, Rick Berg, Merle
Boucher, Al Carlson, Jeff Delzer, Mark A. Dosch,
Kathy Hawken, James Kerzman, Matthew M. Klein,
Gary Kreidt, Joe Kroeber, Bob Martinson, Ralph
Metcalf, Shirley Meyer, David Monson, Jon Nelson,
Kenton Onstad, Chet Pollert, Bob Skarphol, Ken
Svedjan, Blair Thoreson, Don Vigesaa, Francis J.
Wald, Alon C. Wieland, Clark Williams
Members absent: Senators Bill Bowman, Tom
Fischer, Tony S. Grindberg, Tom Seymour;
Representatives Mary Ekstrom, Eliot Glassheim, Lee
Kaldor, Keith Kempenich
Others present: Jim W. Smith, Director,
Legislative Council
See Appendix A for additional persons present.
The legislative budget analyst and auditor
reviewed the Legislative Council rules of operation
and procedure for the 2009-10 interim.
BUDGET SECTION DUTIES AND
RESPONSIBILITIES FOR THE
2009-10 BIENNIUM
At the request of Chairman Holmberg, the
Legislative Council staff presented a memorandum
entitled Budget Section Duties and Responsibilities for
the 2009-11 Biennium. The memorandum lists the
following Budget Section duties for the 2009-11
biennium:
1. Receive a status report on the State Board of
Agricultural Research and Education (North
Dakota Century Code (NDCC) Section
4-05.1-19(10)).
2. Receive statement from ethanol plants in
operation before July 1, 1995, that received
production incentives (Section 17-02-01).
3. Consider requests for higher education
campus improvements and building
construction (Section 15-10-12.1).
4. Receive report on sources of local funds
received for construction projects of entities
under the State Board of Higher Education
(Section 15-10-12.3).
5. Consider designation of a center of excellence
(Section 15-69-02).
6. Receive annual audits from center of
excellence-awarded funds under
Chapter 15-69 (Section 15-69-05).
7. Consider Game and Fish Department land
acquisitions (Section 20.1-02-05.1).
8. Receive report on annual audits of
renaissance fund organizations (Section
40-63-07(9)).
9. Receive report identifying every state agency
that has not submitted a claim for property
belonging to that agency (Section
47-30.1-24.1).
10. Consider relinquishment of agency rights to
recover property (Section 47-30.1-24.1).
11. Consider requests to change or expand state
building construction projects (Section
48-01.2-25).
12. Receive report on job insurance trust fund
(Section 52-02-17).
13. Receive report on irregularities in the fiscal
practices of the state (Section 54-14-03.1).
14. Consider requests for transfers exceeding
$50,000 (Section 54-16-04(2)).
15. Consider requests to accept and spend more
than $50,000 of federal funds which were not
appropriated (Section 54-16-04.1).
16. Consider requests to accept and spend more
than $50,000 of other funds which were not
appropriated (Section 54-16-04.2).
17. Consider requests for transfers of spending
authority from the state contingencies
appropriation exceeding $50,000 (Section
54-16-09).
18. Receive report on tobacco settlement funds
(Section 54-44-04(23)).
19. Prescribe form of budget data (Section
54-44.1-07).
20. Receive report on specified commodities and
services exempted from the procurement
requirements of Section 54-44.4-02.2.
21. Consider requests by the Information
Technology Department to finance the
purchase of software, equipment, or
implementation of services (Section
54-59-05(4)).
22. Receive a report from the Information
Technology Department (Section 54-59-19).
Budget Section 2 June 23, 2009
23. Receive periodic reports on the status of the
risk management workers' compensation
program (Section 65-04-03.1(5)).
24. Review and report on budget data (Legislative
Council directive).
25. Consider requests by the Board of University
and School Lands to invest in real property
(Section 15-03-04).
26. Consider requests by the Game and Fish
Department to reduce the balance of the
game and fish fund below $15 million (Section
20.1-02-16.1).
27. Consider the provision of contract services by
the Developmental Center (Section
25-04-02.2).
28. Consider a waiver of exemption of special
assessments levied for flood control purposes
on state property (Section 40-23-22.1).
29. Consider requests to terminate the food stamp
program (Section 50-06-05.1(17)).
30. Consider requests to terminate the energy
assistance program (Section 50-06-05.1(19)).
31. Consider requests for transfers which will
result in program elimination (Section
54-16-04(1)).
32. Consider requests to accept federal funds for
a specific purpose or program which were not
appropriated (Section 54-16-04.1(4)).
33. Receive reports on new correctional programs
which exceed $100,000 of cost during a
biennium (Section 54-23.3-09).
34. Consider requests to use money in the capital
improvements preliminary planning revolving
fund (Section 54-27-22).
35. Consider requests to use cashflow financing
(Section 54-27-23).
36. Receive report on transfers from the budget
stabilization fund (Section 54-27.2-03).
37. Receive reports on purchases of "put" options
(Section 54-44-16).
38. Consider objecting to budget allotments or
expenditures (Section 54-44.1-12.1).
39. Consider the reduction of budgets due to
initiative or referendum action (Section
54-44.1-13.1).
40. Consider requests for the distribution of
Children's Services Coordinating Committee
grants (Section 54-56-03).
41. Receive report on reductions made in
homestead property income tax credit
(Section 57-38-01.29).
42. Consider request to reduce the commercial
property income tax credit (Section
57-38-01.30).
43. Consider extraterritorial workers'
compensation insurance (Section 65-08.1-02).
44. Hold legislative hearings for federal block
grants (2009 Senate Concurrent Resolution
No. 4001).
45. Receive report on the number of employees
receiving bonuses above the 25 percent
limitation (Section 54-06-30 and 2009 House
Bill No. 1030, Section 1).
46. Consider authorization of additional full-time
equivalent (FTE) positions (Section
54-16-04.3 and 2009 House Bill No. 1027,
Section 2).
47. Receive report on the status of the metrology
program (2009 House Bill No. 1008,
Section 3).
48. Receive report regarding any transfers
between line items and between subdivisions
in excess of $50,000 (2009 House Bill
No. 1012, Section 7).
49. Receive quarterly reports regarding the
implementation of the comprehensive tobacco
prevention and control plan and outcomes
achieved (2009 House Bill No. 1015,
Section 38).
50. Receive report regarding reintegration
program expenditures and the program's
impact on service members (2009 House Bill
No. 1016, Section 11).
51. Receive reports regarding the status of the
construction of the Great Plains Applied
Energy Research Center (2009 House Bill
No. 1350, Section 2).
52. Receive quarterly written summary reports
regarding the status of the Veterans' Home
construction project (2009 Senate Bill
No. 2007, Section 8).
53. Receive semiannual reports regarding the
status of implementation of the commercial
vehicle information systems and networks
(2009 Senate Bill No. 2011, Section 7).
54. Receive report regarding emergency snow
removal grants distributed to counties,
townships, and cities before June 30, 2009
(2009 Senate Bill No. 2012, Section 7).
55. Receive reports in the fourth quarter of 2009
and the third quarter of 2010 regarding
emergency disaster relief grants awarded to
political subdivisions (2009 Senate Bill
No. 2012, Section 8).
56. Receive periodic reports regarding the use of
state, federal, emergency, and other highway
funding (2009 Senate Bill No. 2012,
Section 11).
57. Receive summary report regarding the results
of a consultant's evaluation of the Mill and
Elevator (2009 Senate Bill No. 2014,
Section 11).
58. Receive report regarding the status of the
technology-based entrepreneurship grant
program (2009 Senate Bill No. 2018,
Section 13).
59. Receive report regarding tax-exempt property
by school district (2009 Senate Bill No. 2018,
Section 14).
60. Receive report regarding the status of the
centers of excellence program and the centers
Budget Section 3 June 23, 2009
of excellence fund (2009 Senate Bill No. 2018,
Section 28).
61. Receive report regarding the status of the
Veterans' Home exterior finishing construction
projects (2009 Senate Bill No. 2075,
Section 4).
62. Receive report regarding the status of
financing and grants provided to early
childhood facilities (2009 Senate Bill No. 2225,
Section 4).
63. Receive periodic reports regarding the status
of health information technology activities
(2009 Senate Bill No. 2332, Section 7).
64. Receive periodic reports regarding 2009 flood
disaster-related expenditures, transfers,
reimbursements, and general fund deposits
(2009 Senate Bill No. 2444, Section 5).
65. Consider authorizing the expenditure of
additional federal stimulus or fiscal recovery
funds in excess of funds appropriated for
certain state agencies.
66. Consider request for Secretary of State to
borrow up to $3,400,698 from the Bank of
North Dakota for implementation of the North
Dakota business development engine
computer project (2009 House Bill No. 1002,
Section 3).
67. Consider request for the Agriculture
Commissioner to lease additional office space
(2009 House Bill No. 1009, Section 8).
68. Consider request for Department of Human
Services to borrow $8.5 million from the Bank
of North Dakota for medical assistance grants
(2009 House Bill No. 1012, Section 4).
69. Consider authorizing the spending of any
additional federal funds that may be made
available to this state under the American
Recovery and Reinvestment Act of 2009
(2009 House Bill No. 1487, Section 1).
70. Consider request for annual tuition increase of
more than 4 percent (2009 Senate Bill
No. 2003, Section 30).
71. Consider request from the Department of
Emergency Services to spend funds for
matching federal disaster relief (2009 Senate
Bill No. 2012, Sections 6 and 8).
72. Consider request for 1 FTE position relating to
minerals management (2009 Senate Bill
No. 2013, Section 6).
73. Consider a contingent appropriation if federal
funds are not available for costs associated
with a statewide longitudinal data system
(2009 Senate Bill No. 2021, Section 3).
74. Consider conducting budget tours and
receiving budget tour group reports.
75. Receive federal funds report.
STATUS OF THE STATE GENERAL FUND
Chairman Holmberg called on Ms. Pam Sharp,
Director, Office of Management and Budget, to
present a report on the status of the general fund. A
copy of the information presented is on file in the
Legislative Council office.
Ms. Sharp presented the following information on
the status of the state general fund for the 2007-09
biennium based on revenue collections through
May 2009:
Unobligated general fund
balance - July 1, 2007
$295,541,176
Add
General fund collections
through May 2009
$2,561,941,484
Forecasted general fund
revenue for the remainder
of the 2007-09 biennium
160,790,321
Total estimated general fund
revenue for the 2007-09
biennium
$2,722,731,805
Total available $3,018,272,981
Less
2007-09 biennium general
fund ongoing
appropriations
($2,317,447,307)
2007-09 biennium general
fund one-time
appropriations
(139,526,649)
Contingent appropriation
(Section 50 of Senate Bill
No. 2200)
(5,000,000)
Supplemental (deficiency)
appropriations
(112,339,319)
Total appropriations ($2,574,313,275)
Estimated transfer to the
budget stabilization fund1
($124,936,548)
Add
Estimated unspent
authority
62,224,701
Estimated general fund
balance - June 30, 2009
$381,247,859
1Transfer based on the required balance in the budget stabilization
fund as determined by total appropriations approved by the 2009
Legislative Assembly.
Ms. Sharp said the supplemental 2007-09
deficiency appropriations approved by the 2009
Legislative Assembly totaled $112 million, including
approximately $60 million for distributions to the state
and political subdivisions for weather-related costsharing
and a $43 million transfer to the state disaster
relief fund. Estimated unspent authority relates
primarily to the Department of Human Services.
Ms. Sharp said the June 30, 2009, general fund
balance estimated at the close of the 2009 Legislative
Session was approximately $321 million, $60 million
less than the current estimate. She said the increase
is the result of greater than anticipated revenues
during January through May 2009.
Representative Boucher requested information on
the status of the state's major trust funds, including
information on each fund's current balance compared
to two years ago and the effect of any investment
gains or losses on each fund during the past two
years. Chairman Holmberg asked the Office of
Budget Section 4 June 23, 2009
Management and Budget to provide this information to
the Budget Section at its next meeting.
Ms. Sharp presented the following information on
the status of the permanent oil tax trust fund for the
2007-09 biennium:
Beginning permanent oil tax trust fund balance -
July 1, 2007
$143,270,662
Add
Revenue collections through May 2009 460,414,586
Forecasted revenues for the remainder of the
2007-09 biennium (based on 2009 legislative
forecast assumptions for oil price and production)
17,633,786
Total estimated funds available $621,319,034
Less expenditures and transfers
Authorized by the 2007 Legislative Assembly (145,716,541)
Authorized by the 2009 Legislative Assembly (250,000)
Estimated permanent oil tax trust fund balance -
June 30, 2009
$475,352,493
Ms. Sharp said North Dakota oil production for
April 2009 was 196,383 barrels per day, up slightly
from 195,700 in March 2009. She said the current oil
price is approximately $60.40 per barrel and the rig
count is 41, 34 fewer rigs than were operating in the
state one year ago.
Ms. Sharp presented information on general fund
revenue collections for May 2009 and the 2007-09
biennium to date. She said compared to the original
2007-09 legislative forecast, actual sales tax
collections for May were $6 million less than
estimated, but for the biennium to date sales tax
collections exceed the legislative forecast by
$132.7 million or 15.3 percent. She said individual
income tax collections exceeded the legislative
forecast for May by $18.5 million and are $184 million
or 38.3 percent more than the original legislative
forecast for the biennium to date. She said total
revenues collected for the month exceeded the
original legislative forecast by $15.4 million and
biennium to date are $463.9 million or 22.1 percent
more than the legislative forecast. She said the
increase is primarily due to biennium to date
increases in sales tax and individual and corporate
income tax collections. She said corporate income
tax collections have exceeded the biennium to date
forecast by $84.9 million or approximately
63.1 percent.
In response to a question from Senator
Christmann, Ms. Sharp said the consumer price index
has decreased 1.3 percent from one year ago,
indicating it is unlikely the increases in sales tax
revenue are the result of inflation. She said the Office
of Management and Budget will work with the Tax
Department to provide information on the individual
economic sectors showing growth.
TOBACCO SETTLEMENT PROCEEDS
Ms. Sharp presented information on the status of
tobacco settlement proceeds received by North
Dakota. She said the state received its most recent
tobacco settlement payment in April 2009. She said
the total payments received to date are $272.3 million
and the next payment is anticipated to be received in
April 2010. She said funds were deposited into
two accounts as directed in the initiated measure
adopted by voters in November 2008. She said the
April 2009 payment totaled $39.1 million, of which
$25 million was deposited in the tobacco settlement
trust fund and $14.1 million was deposited in the
tobacco prevention and control trust fund. A copy of
the report is on file in the Legislative Council office.
IRREGULARITIES IN THE FISCAL
PRACTICES OF THE STATE
Pursuant to NDCC Section 54-14-03.1, Ms. Sharp
presented information on irregularities in the fiscal
practices of the state. A copy of the information
presented is on file in the Legislative Council office.
Ms. Sharp said the state agencies with fiscal
irregularities include:
Agency Amount Reason
Office of Management
and Budget
$600 Temporary work to perform
duties of vacant receptionist
position
Aeronautics
Commission
$5,088 Temporary increase for interim
director of the agency
Game and Fish
Department
$1,200 Temporary additional work for
two individuals to share game
warden supervisor duties
Department of
Human Services
$34,000 Severance pay resulting from a
settlement agreement
EQUITY POOL ALLOCATIONS
Ms. Sharp presented information on the 2009-11
biennium salary equity pool allocations. She said
$15.9 million, of which $9 million is from the general
fund, was allocated to 37 agencies. She said the
executive recommendation provided equity
adjustments in agency budgets totaling $24.3 million,
of which $14 million was from the general fund. She
said the Office of Management and Budget reviewed
the executive recommendation, occupational and
market disparities, economic growth areas, internal
pay equity, recruitment, retention, and equity received
in the 2007-09 biennium to determine the salary
equity allocations.
Representative Berg requested the Office of
Management and Budget provide a report comparing
the salary equity pool allocations to equity amounts
recommended in the 2009-11 Governor's budget.
Later, Ms. Sharp provided the report and said nine
agencies which would have received equity funding
under the executive recommendation did not receive
equity from the salary equity pool. A copy of the
information presented is on file in the Legislative
Council office.
Representative Carlson asked that additional
information be provided on selected agencies that
have had pay and market equity concerns, including
specific information on how salary equity increases for
the 2007-09 and 2009-11 bienniums have affected the
Budget Section 5 June 23, 2009
salaries of the affected employees and how the
general salary increase funds were distributed to
these and other employees within the agency.
Chairman Holmberg asked the Office of Management
and Budget to provide this information at the next
Budget Section meeting.
Representative Berg asked for information
summarizing how general salary increases were
distributed among employees for each agency and the
effect these distribution methods have had on salary
compression issues of agencies. Chairman Holmberg
asked the Office of Management and Budget to
provide this information at the next Budget Section
meeting.
Senator Warner asked for information on federal
stimulus funds being retained by agencies for
administration purposes. Chairman Holmberg asked
the Office of Management and Budget to provide this
information at the next Budget Section meeting.
AGENCY REQUESTS AUTHORIZED BY
THE EMERGENCY COMMISSION
Chairman Holmberg directed the Budget Section to
consider agency requests which have been
authorized by the Emergency Commission and
forwarded to the Budget Section pursuant to NDCC
Sections 54-16-04.1, 54-16-04.2, and 54-16-09. The
information relating to the requests was provided to
the Budget Section prior to the meeting and is on file
in the Legislative Council office.
Department of Agriculture (Request #1698)
Mr. Wayne Carlson, Program Manager,
Department of Agriculture, provided information
regarding a request to increase the grants line item by
$1 million to accept federal funds ($750,000) and
funding from the Office of Management and Budget
($250,000) to assist livestock producers affected by
severe winter conditions and spring flooding. The
$250,000 of funding from the permanent oil tax trust
fund was appropriated to the Office of Management
and Budget for the 2007-09 biennium in Section 3 of
2009 House Bill No. 1015. He said 301 applicants
submitted claims totaling $2.3 million. He said three
types of claims were accepted--transportation of feed,
flooded feed, and snow removal.
In response to a question from Representative
Meyer, Mr. Carlson said documentation of loss was
accepted from county agents, bankers, and other
individuals. He said the program ends July 3, 2009,
with payments to be made by July 15.
It was moved by Representative Kerzman,
seconded by Representative Kroeber, and carried
on a roll call vote that pursuant to NDCC Sections
54-16-04.1 and 54-16-04.2 the Budget Section
approve the request from the Department of
Agriculture, which has been approved by the
Emergency Commission, to increase the grants
line item by $1 million to accept federal funds
($750,000) and funding from the Office of
Management and Budget ($250,000) to assist
livestock producers affected by severe winter
conditions and spring flooding. Senators
Holmberg, Christmann, Kilzer, Krauter, Krebsbach,
Lindaas, Mathern, Nelson, O'Connell, Robinson,
Stenehjem, Wardner, and Warner and
Representatives Bellew, Berg, Boucher, Delzer,
Dosch, Hawken, Kerzman, Klein, Kreidt, Kroeber,
Metcalf, Meyer, Monson, Nelson, Onstad, Pollert,
Skarphol, Svedjan, Thoreson, Vigesaa, Wald,
Wieland, and Williams voted "aye." No negative votes
were cast.
Veterans’ Home (Request #1699)
Ms. Sharp presented information regarding a
request by the Veterans' Home to transfer $25,000
from the capital assets line item to the operating
expenses line item and to increase special funds
spending authority in the operating expenses line item
by $75,000. She said the transfer and additional
special funds spending authority are for increased
operating expenses related to contract nursing and
other operating costs, including utilities, travel, and
supplies.
In response to a question from Representative
Delzer, Ms. Sharp said the special funds are from fees
charged nursing home residents.
In response to a question from Representative
Skarphol, Ms. Lori Laschkewitsch, Budget Analyst,
Office of Management and Budget, said collections
have been more than budgeted for the 2007-09
biennium resulting in additional special funds being
available.
Representative Delzer asked the Office of
Management and Budget to provide information
regarding the actual amount of Veterans' Home
special funds carryover to the 2009-11 biennium
compared to the anticipated amount of special funds
carryover.
It was moved by Senator Robinson, seconded
by Senator Wardner, and carried on a roll call vote
that pursuant to NDCC Section 54-16-04.2 the
Budget Section approve the request from the
Veterans' Home, which has been approved by the
Emergency Commission, to transfer $25,000 from
the capital assets line item to the operating
expenses line item and to increase special funds
spending authority in the operating expenses line
item by $75,000. Senators Krauter, Krebsbach,
Lindaas, Mathern, Nelson, O'Connell, Robinson,
Wardner, and Warner and Representatives Boucher,
Hawken, Kerzman, Klein, Kreidt, Kroeber, Martinson,
Metcalf, Meyer, Monson, Nelson, Onstad, Wald, and
Williams voted "aye." Senators Holmberg,
Christmann, Kilzer, and Stenehjem and
Representatives Bellew, Carlson, Delzer, Dosch,
Pollert, Skarphol, Svedjan, Thoreson, Vigesaa, and
Wieland voted "nay."
Budget Section 6 June 23, 2009
Valley City State University (Request #1701)
Dr. Steven W. Shirley, President, Valley City State
University, presented information regarding a request
by Valley City State University for $276,596 from the
2007-09 state contingencies appropriation to increase
the capital assets line item for repairs needed to the
W. E. Osmon Fieldhouse. Dr. Shirley said the
university had allocated $100,000 of its 2009-11
deferred maintenance appropriation for the repair, but
the total cost is now anticipated to be at least
$500,000. He said the university had also requested
$125,000 from the 2009-11 state contingencies
appropriation which, when combined with the
$100,000 deferred maintenance appropriation and the
$276,596 contingency request, would have totaled
approximately $500,000, but that request was not
approved by the Emergency Commission.
In response to a question from Representative
Carlson, the legislative budget analyst and auditor
said Valley City State University received
appropriations of approximately $1.5 million for
extraordinary repairs; $1 million for the development
of a campus master plan and other campus repairs;
and $800,000 for support of strategic campus goals,
including capital needs for the 2009-11 biennium. The
legislative budget analyst and auditor said the
2007-09 biennium appropriation for extraordinary
repairs was approximately $796,000.
In response to a question from Representative
Skarphol, Ms. Trudy Sipe-Collins, Vice President for
Business Affairs, Valley City State University, said
deferred maintenance needs at the university total
$7.2 million.
It was moved by Senator Robinson, seconded
by Senator Nelson, and carried on a roll call vote
that pursuant to NDCC Section 54-16-09 the
Budget Section approve the request from Valley
City State University, which has been approved by
the Emergency Commission, for $276,596 from the
2007-09 state contingencies appropriation to
increase the capital assets line item for repairs
needed to the W. E. Osmon Fieldhouse. Senators
Holmberg, Krauter, Krebsbach, Lindaas, Mathern,
Nelson, O'Connell, Robinson, Wardner, and Warner
and Representatives Bellew, Boucher, Hawken,
Kerzman, Klein, Kroeber, Metcalf, Meyer, Nelson,
Onstad, Pollert, Wald, and Williams voted "aye."
Senators Christmann, Kilzer, and Stenehjem and
Representatives Berg, Carlson, Delzer, Dosch, Kreidt,
Martinson, Monson, Skarphol, Svedjan, Thoreson,
Vigesaa, and Wieland voted "nay."
UNIVERSITY OF NORTH DAKOTA -
ACCEPTANCE OF DONATED ASSET
Chairman Holmberg called on Mr. Rick Tonder,
Associate Director of Facilities Planning, University of
North Dakota, to present information regarding a
request to accept a $1.3 million addition to Harrington
Hall (Jodsaas Center) on the University of North
Dakota campus pursuant to NDCC Section
15-10-12.1. Mr. Tonder said in October 2007 the
Budget Section approved the university's request to
accept and spend $1.3 million in donated funds for an
addition to Harrington Hall. He said the University of
North Dakota is requesting the Budget Section to
approve this request to allow the university to accept
the gift in the form of a completely constructed
building rather than the gift of donated funds as
previously approved by the Budget Section. He said
the project is being financed and constructed by the
University of North Dakota Alumni Foundation. A
copy of the information presented is on file in the
Legislative Council office.
It was moved by Representative Wald,
seconded by Senator Robinson, and carried on a
roll call vote that the Budget Section pursuant to
NDCC Section 15-10-12.1 approve the University
of North Dakota request to accept a $1.3 million
addition to Harrington Hall. Senators Holmberg,
Christmann, Kilzer, Krauter, Krebsbach, Lindaas,
Mathern, Nelson, Robinson, Wardner, and Warner
and Representatives Bellew, Berg, Boucher, Dosch,
Hawken, Kerzman, Klein, Kreidt, Kroeber, Martinson,
Metcalf, Meyer, Monson, Nelson, Onstad, Pollert,
Skarphol, Svedjan, Vigesaa, Wald, and Wieland voted
"aye." Representative Delzer voted "nay."
UNIVERSITY OF NORTH DAKOTA -
CHANGE IN SCOPE OF PROJECT
Mr. Tonder presented information regarding a
request to increase the authorization for construction
of the Northern Plains Center for Behavioral Research
from $3,900,000 to $3,913,697. He said the 2005
Legislative Assembly approved construction of the
Northern Plains Center for Behavioral Research
based on the estimated construction cost of
$3.9 million. He said the request was made prior to
the award by the National Institute of Health. He said
the final funding award exceeded the estimate by
$13,697. He said the university is requesting an
increase in authorization to accept and expend the
additional funds available. A copy of the information
presented is on file in the Legislative Council office.
It was moved by Senator Mathern, seconded by
Representative Monson, and carried on a roll call
vote that the Budget Section pursuant to NDCC
Section 48-01.2-25 approve the University of North
Dakota request to increase the authorization for
construction of the Northern Plains Center for
Behavioral Research from $3,900,000 to
$3,913,697. Senators Holmberg, Christmann, Kilzer,
Krauter, Krebsbach, Lindaas, Mathern, Nelson,
O'Connell, Robinson, Wardner, and Warner and
Representatives Bellew, Berg, Boucher, Delzer,
Dosch, Hawken, Kerzman, Klein, Kreidt, Kroeber,
Metcalf, Meyer, Monson, Nelson, Onstad, Pollert,
Skarphol, Svedjan, Thoreson, Vigesaa, Wald, and
Wieland voted "aye." No negative votes were cast.
Budget Section 7 June 23, 2009
STATE AGENCY UNCLAIMED PROPERTY
Chairman Holmberg called on Ms. Linda Fisher,
Administrator, Unclaimed Property Division, Land
Department, to present a report regarding state
agencies that have not submitted a claim for
unclaimed property belonging to that agency pursuant
to NDCC Section 47-30.1-24.1.
Ms. Fisher said the 2003 Legislative Assembly
enacted NDCC Section 47-30.1-24.1 in an effort to
resolve the issue of state agency unclaimed property.
She said this section provides that within one year of
receipt of state agency property, the administrator of
unclaimed property is to notify the agency by certified
mail; the commissioner of University and School
Lands is to present a report to the Budget Section
identifying every state agency that has not submitted
a claim for property belonging to that agency within
one year of the receipt of the date of the certified mail
receipt; and upon approval of the Budget Section, the
agency relinquishes its right to recover its property.
She presented the Budget Section a list of the six
state agencies that did not respond to the certified
mailing, which is attached as Appendix B. A copy of
the information presented is on file in the Legislative
Council office.
It was moved by Representative Klein,
seconded by Senator Wardner, and carried on a
roll call vote that pursuant to NDCC Section
47-30.1-24.1 the Budget Section approve the list
provided by the Land Department of state
agencies relinquishing their rights to recover
unclaimed property. Senators Holmberg,
Christmann, Kilzer, Krauter, Krebsbach, Lindaas,
Mathern, Nelson, O'Connell, Robinson, Wardner, and
Warner and Representatives Bellew, Berg, Boucher,
Delzer, Dosch, Hawken, Kerzman, Klein, Kreidt,
Kroeber, Metcalf, Meyer, Monson, Nelson, Onstad,
Pollert, Skarphol, Svedjan, Thoreson, Vigesaa, Wald,
Wieland, and Williams voted "aye." No negative votes
were cast.
DEPARTMENT OF HUMAN SERVICES
Status of Medicaid Management
Information System
Ms. Maggie Anderson, Director, Medical Services
Division, Department of Human Services, presented
information regarding the status of the Medicaid
management information system project. She said
the agency anticipates provider enrollment will be
available November 2009 and full implementation is
scheduled for May 2010. She provided the following
project funding summary through May 2009:
Description Budget
Spent Through
May 2009 Remaining
General fund $3,643,133 $2,621,960 $1,021,173
Federal funds 55,218,418 27,960,250 27,258,168
Other funds 3,667,820 1,007,603 2,660,217
Total project $62,529,371 $31,589,813 $30,939,558
A copy of the report is on file in the Legislative
Council office.
In response to a question from Representative
Skarphol, Ms. Anderson said the project has been
delayed 10 months.
In response to a question from Representative
Nelson, Ms. Anderson said the number of Medicaid
claims currently in the process of being paid is
approximately 37,000.
In response to a question from Senator Mathern,
Ms. Anderson said the vendor contract includes a
penalty clause requiring the vendor to pay for certain
additional expenses resulting from the delay.
In response to a question from Representative
Dosch, Ms. Anderson said the agency does not
anticipate the project will exceed the budgeted
amount.
TOBACCO PREVENTION AND
CONTROL COMMITTEE
Chairman Holmberg called on Ms. Kathleen
Mangskau, Chair, Tobacco Prevention and Control
Executive Committee, to present information
regarding the implementation of the comprehensive
tobacco prevention and control plan pursuant to 2009
House Bill No. 1015. Ms. Mangskau said the
committee has conducted a series of meetings to draft
the five-year tobacco prevention and control state
plan, convened public forums to gather input on the
draft plan, and revised the draft plan based on input
received at the forums and from the Tobacco Free
North Dakota website. She said the plan will be
released in July 2009.
Ms. Mangskau said the committee has allocated
$6.1 million to provide grants to local public health
units to implement the Centers for Disease Control
and Prevention-based best practice programs in local
communities. She said the committee has worked
with the Division of Tobacco Prevention and Control at
the State Department of Health to develop the funding
formula and has developed grant review process
guidelines and review forms. She said a special
initiative grants program is being developed to provide
funding for special projects and to the tribes and other
groups with high tobacco use rates.
Ms. Mangskau said the committee met with the
Office of Management and Budget to finalize a line
item budget, a copy of which is attached as
Appendix C. She said the committee is developing
the position descriptions for staff and is seeking rental
space and office furniture.
A copy of the report is on file in the Legislative
Council office.
WEATHER-RELATED
COST-SHARING FUNDS
Chairman Holmberg called on Ms. Kelly Schmidt,
State Treasurer, to provide information regarding
weather-related cost-sharing funds distributed to
cities, counties, and townships pursuant to 2009
Senate Bill No. 2012. Ms. Schmidt said a total of
Budget Section 8 June 23, 2009
$59.9 million was distributed to political subdivisions
on June 23, 2009, as follows:
• Ten million dollars to townships;
• Forty-one million four hundred thousand dollars
to counties and cities;
• Seven million five hundred thousand dollars to
the state highway fund; and
• One million dollars to the public transportation
fund.
Ms. Schmidt said information regarding the
amounts paid to the individual cities, counties, and
townships is available on the State Treasurer's
website. A copy of the report is on file in the
Legislative Council office.
Representative Carlson asked why the
distributions were not made earlier and why the State
Treasurer did not provide a listing to the Budget
Section of actual distributions to each political
subdivision.
Ms. Schmidt said because of general fund
cashflow issues and because computer system
changes were necessary, the distributions were
unable to be made until June 23. She said the report
listing each political subdivision's distribution is very
large; therefore, she said an Internet link to the State
Treasurer's website is provided for Budget Section
members to access the information.
Senator Krauter asked the State Treasurer to
provide a written report detailing the payments
received by each political subdivision to the Budget
Section.
EMERGENCY SNOW REMOVAL GRANTS
Chairman Holmberg called on Major General David
Sprynczynatyk, Adjutant General, to provide
information regarding emergency snow removal
grants distributed to counties, townships, and cities
pursuant to 2009 Senate Bill No. 2012. Major General
Sprynczynatyk provided maps illustrating the
percentage of normal snow depth and snow removal
grant funding by county. He said grants were
provided to those counties and cities that during the
first quarter of 2009 spent more than 200 percent of
their average cost for snow removal for the same
period over the past five years. Major General
Sprynczynatyk said a total of $7.7 million has been
distributed to 123 cities, 39 counties, and 2 tribal
regions. He said 15 cities, 13 counties, and 2 tribal
regions either did not request assistance or did not
qualify. He said the final distribution total may be
slightly higher. A copy of the report is on file in the
Legislative Council office.
FLOOD DISASTER-RELATED
EXPENDITURES
Major General Sprynczynatyk presented
information regarding 2009 flood disaster-related
expenditures, transfers, reimbursements, and general
fund deposits pursuant to 2009 Senate Bill No. 2012.
He said he anticipates the federal match for most of
the flood response and flood recovery costs to be
90 percent, resulting in a $130.7 million federal share,
$3.5 million local share, and $14.5 million state share.
He said because the state is providing one-half of the
local share, the local share will be approximately
3 percent rather than 6 percent of the total. He said
Federal Emergency Management Agency cost-share
reimbursements to date total $8.3 million. He said to
date $5 million has been transferred to the National
Guard emergency fund, and there have been no
general fund deposits. A copy of the report is on file
in the Legislative Council office.
USE OF STATE, FEDERAL, EMERGENCY,
AND OTHER HIGHWAY FUNDING
Mr. Francis Ziegler, Director, Department of
Transportation, presented information regarding the
anticipated use of state, federal, emergency, and
other highway funding during the 2009 construction
season pursuant to 2009 Senate Bill No. 2012. He
said the state will bid approximately 292 projects
totaling $383 million for the 2009 construction season.
He said the department has received $170.1 million
for roads and bridges through the American Recovery
and Reinvestment Act of 2009, of which $157 million
will be used for roads, $8 million for bridges, and
$5.1 million for transportation enhancements. He
estimates the department will spend $93 million of
American Recovery and Reinvestment Act funding on
projects in 2009. A copy of the report is on file in the
Legislative Council office.
BUDGET STATUS REPORT FOR
THE 2009-11 BIENNIUM
At the request of Chairman Holmberg, the
legislative budget analyst and auditor presented the
Legislative Council report entitled 61st Legislative
Assembly Budget Status Report for the 2009-11
Biennium. The report provides information on the
status of the general fund and estimated June 30,
2009, ending balance, legislative changes to general
fund revenues, and legislative appropriation changes
to the executive recommendation.
LEGISLATIVE CHANGES TO THE
GOVERNOR'S RECOMMENDED
APPROPRIATIONS
At the request of Chairman Holmberg, the
legislative budget analyst and auditor presented the
Legislative Council report entitled 61st Legislative
Assembly Legislative Changes to the Governor's
Recommended Appropriations for the 2009-11
Biennium. The report provides information on
legislative changes to the executive budget and is a
compilation of the statements of purpose of
amendment for action taken on appropriation bills
during the session.
Budget Section 9 June 23, 2009
ANALYSIS OF LEGISLATIVE CHANGES
TO THE EXECUTIVE BUDGET
2009-11 BIENNIUM
At the request of Chairman Holmberg, the
legislative budget analyst and auditor presented the
Legislative Council report entitled 61st Legislative
Assembly Analysis of Legislative Changes to the
Executive Budget 2009-11 Biennium. The report
provides information on legislative changes to the
executive budget, FTE positions, ongoing and onetime
general fund appropriations, federal fiscal
stimulus funding, one-time funding, major programs,
and related legislation for each state agency. The
report also includes an analysis of major special funds
and statistical information. The legislative budget
analyst and auditor said the reports are available
online at the Legislative Council website.
VETERANS' HOME REPORT
Chairman Holmberg announced that the
Legislative Council staff distributed to each member a
written summary report from the Veterans' Home
administrator regarding the status of the Veterans'
Home construction project pursuant to 2009 Senate
Bill No. 2007. A copy of the report is on file in the
Legislative Council office.
COMMITTEE DISCUSSION
AND STAFF DIRECTIVES
Chairman Holmberg announced future meetings of
the Budget Section are tentatively scheduled for
Tuesday, September 15, 2009, December 15, 2009,
and March 11, 2010.
It was moved by Senator Robinson, seconded
by Representative Klein, and carried on a voice
vote that the Budget Section meeting be
adjourned subject to the call of the chairman.
Chairman Holmberg adjourned the meeting at
12:05 p.m.
___________________________________________
Sheila M. Sandness
Fiscal Analyst
___________________________________________
Allen H. Knudson
Legislative Budget Analyst and Auditor
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