North Dakota State Legacy Fund Establishment, Measure 1 (2010)

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North Dakota State Legacy Fund Establishment, Measure 1 was a November 2, 2010 statewide ballot measure as a legislatively-referred constitutional amendment where it was approved.

The proposal called for the creation of a state legacy fund, for the deposit of certain oil and gas tax revenues in the fund.

Election results

See also: 2010 ballot measure election results

Measure 1 (State Legacy Fund)
Result		Votes	Percentage
a Yes		141,783	63.6%
No		81,245	36.4%

Source: North Dakota Secretary of State. The results were certified by the North Dakota State Canvassing Board on November 16, 2010.

Text of measure

According to the North Dakota Secretary of State, the ballot title read:

This measure establishes a North Dakota legacy fund, provides for deposit of certain oil and gas tax revenues in the fund, and imposes limitations on use of moneys in the fund.

YES – Means you approve the measure as stated above. NO – Means you reject the measure as stated above.

Constitutional changes

See also: North Dakota Measure 1 (2010), constitutional text changes

Measure 1 added a new section to Article X of the North Dakota Constitution. The new section can be read here.

Background

See also: North Dakota Oil Tax Trust Fund, Measure 1 (2008)

For the second time since 2008, North Dakotans saw a measure on the ballot to create ta state legacy fund. The 2008 question involving the creation of a oil tax trust fund failed on a 2 to 1 margin.

The 2010 Legacy Fund measure called for 30 percent of the state's oil revenues to be deposited into the fund, if the measure was approved by the voters. Money that was deposited into the Legacy Fund could not be withdrawn until 2017. In order to withdraw funds, the Legislature was required to approve the withdrawal with a two-thirds vote in both chambers. This could not happen after 2017. The state was only allowed to spend $15 million at one time if the withdrawal was approved by the Legislature.

The difference between the 2008 Oil Tax Trust Fund and 2010 Legacy Fund measures was that the state treasurer was given full authority to determine the amount of money to be deposited into the fund if the 2008 measure was approved. The 2010 measure has a fixed requirement of 30 percent.

Both of the measures considered in 2008 and 2010 were amendments to the North Dakota Constitution passed by the Legislature.

Support

The proposed measure was supported by a coalition of state officials, the North Dakota Farm Bureau and the North Dakota Education Association, according to reports. The measure also received support from state farm, teacher and business groups.

Arguments

• In an editorial Eric Aasmundstad, the president of the North Dakota Farm Bureau, said, "Measure 1 on the ballot will create a North Dakota Legacy Fund utilizing the oil and gas taxes that are accumulating at record levels...It makes sense to save some of the oil money, put it to work in sound investments and let the fund grow for future generations...And now is the right time to do it, without raising taxes or creating a new tax."

• "This is a once-in-a-lifetime happening. We have a chance to be proactive, progressive, get money in this fund and provide for our children and grandchildren forever," said state Sen. Arden C. Anderson.

• NDEA president Dakota Draper said, "What we really want to do is try and make North Dakota a better place, and I think this Measure One will do that well into the future. But my worry is that voters are in such an anti-mood about everything they’ll just look at Measure One and click the ‘no’ box without thinking about it, and what an opportunity they’ll be missing if they do that."

Opposition

The North Dakota Farmers Union opposed Measure 1. According to the organization's president Robert Carlson members were opposed to the measure because they felt money should be spent on infrastructure in areas negatively affected by the "oil boom." Additionally, Carlson noted that the measure was poorly timed and the state needed to focus on needed improvements before thinking of creating a savings fund. Improved infrastructure, he said, could attract more people to the state.

Other perspectives

In a legal opinion requested by Rep. Kari Conrad, Attorney General Wayne Stenehjem said that the amendment could affect the amount of funds other oil tax recipients receive but would not change spending formulas already in place.

Specifically, the amendment would take 30% of the total collections of both the extraction tax and production tax. The oil revenue currently goes to cities, counties and schools in oil-producing areas; a resources trust fund; a permanent oil and gas trust fund; and an impact fund. According to reports, however, the largest portion of oil revenue goes towards the state's general fund.

"It is premature to speculate on what changes may ultimately be made to the statutory programs and (oil tax) allocations, as well as to the general fund," said Stenehjem. In an interview with the Associated Pres he said that there was nothing in the measure that would make things "inconsistent" or unworkable.

Media editorial positions

See also: Endorsements of North Dakota ballot measures, 2010

Support

• The Bismark Tribune supported Measure 1. In an editorial, the board said, "There are those who wish to spend now, investing in the future. Unfortunately, that path leads to spending patterns that require more and more revenue, to the point that the state might not be able to sustain the spending without increasing taxes. The case for a "yes" vote on Measure 1 is that it's better to save for the future."

• The Forum of Fargo-Moorhead supported Measure 1. "The Legacy Fund is an excellent mechanism to ensure wise management of the state’s oil and gas wealth. It will lend stability to funds generated by an industry that is notoriously unstable...The fund’s 'legacy' is a brighter economic picture for future generations. It’s smart management of natural resource dollars. North Dakotans should vote 'yes' for Measure 1," said the editorial board.

• The Grand Forks Herald supported Measure 1. They say, "Alaskans get checks each year thanks to their Alaska Permanent Fund. Wyoming likewise sets mineral-tax money aside; as a result (and among other good works), the state’s generous Hathaway Scholarship program now helps Wyoming students attend the state’s colleges and universities. North Dakotans now have their own chance to set up such a historic fund. Vote yes on Measure 1."

• The Jamestown Sun supported Measure 1. They say, "The Legacy Fund is an excellent mechanism to ensure wise management of the state’s oil and gas wealth. It will lend stability to funds generated by an industry that is notoriously unstable. The fund can be a major factor in ensuring stability to sources of support for vital state programs...The fund’s 'legacy' is a brighter economic picture for future generations. It’s smart management of natural resource dollars."

Opposition

There was no known opposition to Measure 1 from editorial boards.

Path to the ballot

See also: Amending the North Dakota Constitution

According to the North Dakota Constitution an amendment proposed by either the House or the Senate required only majority approval.

See also

Suggest a link

• 2010 ballot measures
• North Dakota 2010 ballot measures

Similar measures

d North Dakota Oil Tax Trust Fund, Measure 1 (2008)

Articles

• Voter-approved North Dakota State Legacy Fund effective June 2011
• State Legacy Fund succeeds while Hunting Ban falls in North Dakota
• North Dakota officials analyze Measure 1's impact on spending
• North Dakota officials finalize 2010 ballot following court ruling

External links

• House Measure No. 3054
• HCR 3054 full text

Additional reading

• The Grand Forks Herald,"Supporters of locking up some N.D. oil money cross party lines, ideology," October 6, 2010
• The Bismark Tribune,"Voters to decide on two measures," September 12, 2010