BISMARCK — North Dakota Gov. Doug Burgum signed a massive $680 million bonding bill into law Wednesday, April 21, that he said will touch all of North Dakota by getting major water infrastructure projects off the state's books and freeing up funding for smaller communities.
The Republican governor agreed with lawmakers who passed House Bill 1431 that bonding for cash is "the fiscally conservative thing to do" since interest rates are low and rising inflation rates could make infrastructure projects more expensive in years to come.
North Dakota lawmakers have historically been leery of borrowing funds, but Republican leadership threw its weight behind the plan, which draws on earnings from the state's $8.3 billion oil tax savings account, known as the Legacy Fund, to pay back the bonds to investors in 20 years or fewer. The unique method of repaying the bonds means the state can complete critical projects without raising taxes on residents, Burgum said.
The bonding package includes:
- $435.5 million for the Fargo-Moorhead flood diversion project.
- $74.5 million for a Minot area flood-control project.
- $70 million for highway repairs.
- $50 million for infrastructure loans to cities and counties.
- $50 million for renovations on Harris Hall, a North Dakota State University agriculture building.
The state has already put about $434.5 million toward the ambitious Fargo flood-prevention endeavor, but the money committed through the bill will fulfill the state's pledged $750 million share of the project's cost and boost its total contribution to $870 million. Other funds for the $2.75 billion project are due to come from the federal government and sales taxes levied in Cass County.
Joel Paulsen, executive director of the Diversion Authority, said the passage of the package provides assurance for a project that has been a long time in the making.
"(The funding) gives us the certainty that we can get this project done in seven years and that we won't have any delays and that we have all the financial resources necessary to provide that permanent, reliable flood protection for the Fargo-Moorhead-West Fargo community," Paulsen said.
Leaders also lauded the funding for the makeover of the NDSU agriculture building as a major win for all North Dakota farmers and ranchers. The state's agricultural products can be properly shown off to outsiders on trade missions in the remodeled building, they said.
Senate Majority Leader Rich Wardner, R-Dickinson, said the bonding bill will give concrete proof to the public that the Legacy Fund is being used to better their lives. Wardner said the bill is part of "a trifecta" of proposals considered this session to harness the oil tax piggy bank — two other pieces of legislation aim to invest more of the fund in North Dakota and divvy up earnings from the fund in future years.