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    Oil and gas development goes a long way funding our state’s priority and future.

    At more than $3.25 billion paid in taxes, oil and gas production and extraction taxes accounted for 54 percent of all taxes collected by the state in 2014. This is an increase of 1,699 percent since 2006.

    Oil and gas tax revenues accounted for 54% of all tax collections in 2014. Source: "2014 State and Local Taxes: An Overview and Comparative Guide," North Dakota Tax Department

    Oil and gas tax revenues accounted for 54% of all tax collections in 2014. Source: “2014 State and Local Taxes: An Overview and Comparative Guide,” North Dakota Tax Department

     

    A majority of these tax revenues are directed toward funds used to fund specific priorities including:

    Schools

    The industry paid a total of $157 million during the 2014 fiscal year to the Common Schools Trust Fund. Ten percent of oil extraction taxes are also deposited each month into the Foundation Aid Stabilization Fund, which had a balance of $588 million as of April 1, 2015.

     

    Roads and Infrastructure

    $325.9 million in fiscal year 2014 were deposited into the Strategic Investment and Improvements Fund, which helps provide one-time expenditures relating to improving state infrastructure or for initiatives to improve the efficiency and effectiveness of state government. Up to $240 million may be deposited into the Oil and Gas Impact Fund, a portion of which is awarded as grants to eligible counties, cities, and ambulance districts for needs resulting from impacts from oil and gas development activities.

     

    Future

    Thirty percent of oil and gas extraction and production taxes are deposited into the Legacy Fund to provide for North Dakota’s future. As of April 22, 2015, this fund included more than $3 billion. Principal and earnings from this fund may not be speant until after June 30, 2017 and spending of the principal of this fund cannot be approved without vote of at least two-thirds of the state legislature.

     

    Property Tax Relief

    Oil and gas taxes also fund the Property Tax Relief Fund, which helped fund education mill levy reduction grants, which, in turn, were meant to reduce property taxes. Although the fund was suspended for the 2013-2015 biennium, the fund contained $657 million as of April 1, 2015.

     

    Wildlife and Natural Resources

    Oil and gas taxes help fund up to $15 million of the Outdoor Heritage Fund, which provides grants:

    • Provide access for sportsmen to public and private lands
    • Create habitats for fish and other wildlife
    • Improve, maintain and restore water quality, soil conditions, plant diversity and animal systems
    • Support stewardship practices to support farming and ranching
    • Conserve natural areas for recreation.

    Another 20% of oil extraction taxes are deposited into the Resources Trust Fund, which assists with the construction of water-related projects and programs for Energy Conservation. This fund received $390 million in oil extraction taxes during the 2011-2013 biennium.

     

    Preparation

    Up to $22 million of oil and gas production and extraction taxes are deposited into the State Disaster Relief Fund, which provides funding for disasters in the state. As of April 1, 2015, the fund had a balance of $84 million.

     

    General Fund

    A portion of oil and gas taxes that aren’t designated into special funds such as those listed above go into the State’s General Fund, which is also used to fund roads, infrastructure, schools, law enforcement and other priorities.

    For more information about the distribution of oil and gas taxes, visit the North Dakota State Treasurer’s Site.

     

    State-wide Impact

    While many of these funds are directed toward impacts in western North Dakota, all of North Dakota’s counties benefit from oil and gas taxes:

    All North Dakota counties have received distributions from funds wholly supported by oil and gas taxes.

    All North Dakota counties have received distributions from funds wholly supported by oil and gas taxes.