New Bill Proposes Change to Oil Extraction Tax

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With a maximum of 10 days left in this legislative session a new bill has entered the game, which if passed will restructure the oil tax formula.

"This is changing the extraction tax if the trigger triggers, from 6.5 percent to 9.5 percent," said Sen. Rich Wardner, R-Dickinson.

Republicans say the bill will create a safety net for the state's oil revenues, should the large trigger come into play. But the minority party says it will actually have grave consequences.

"What was proposed today was a whopping 30 percent permanent cut to the oil extraction tax," said Sen. Mac Schneider, D-Grand Forks. "That is going to cost North Dakota tens of billions of dollars in the coming decades."

He added that this should have been proposed earlier on, so lawmakers and industry leaders would have more time to discuss it.

"I really think introducing a multi-billion dollar intergenerational proposal on day 70 of a limited 80-day session is abuse of the legislative process. This is a power tactic which absolutely has no place in policymaking in North Dakota," said Sen. Schneider.

However, the majority leader in the House says that's not the case and there is still time to hear this piece of legislation.

"There is no right or wrong time for this. It has no fiscal affect on this biennium. We're not changing one thing in our budgets because we have a supposed trigger in place. This is about the future of the state and the oil industry, and that's what we're addressing today," said Rep. Al Carlson, R-Fargo.

He added that this bill was a collaborative effort between members of the legislature, tribal leaders and the oil and gas industry.

The bill will be heard Monday in a joint finance and tax committee hearing.