News Releases for December 2002
December 18, 2002
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Hoeven Budget Uses Common Sense Regarding Trust Funds
Budget Sets Strong Financial Position for the Future
BISMARCK, N.D. - Gov. John Hoeven today said his executive budget employs sound budget practices and good sense in using state trust funds for the purposes they were intended before cutting services or raising taxes.
“It’s just common sense to use cash balances for human services, education and other critical state activities before cutting services to the needy or raising taxes on hardworking North Dakotans,” Hoeven said. “The funds we use have been used for the very purposes they were designed and used for in the past.”
Hoeven’s budget uses the state’s Health Care Trust Fund to meet the rising cost of nursing home care and Medicaid costs, which rose more than 13 percent last year. The fund, which was created last session by the Legislature, is already being used in the current biennium to offset the steep increase in long term care expenses. Approximately $34 million will be used from the fund in the current biennium, and Hoeven’s budget proposes using $38 million in the next biennium.
Revenues that go into the Oil Tax Fund this biennium have historically been used to meet state general fund obligations, as proposed in the Hoeven budget.
The State Water Commission operating budget is currently funded by the Water Commission Trust Fund, as proposed in the Hoeven budget. In addition, the state is paying its share of the flood disaster costs from the water funds, because those projects have been completed.
Money from the Student Loan Trust is being put to work in scholarships, research and internships for students. The Student Loan Trust will continue to fund student loans as it has historically done, along with the Bank of North Dakota.
The only bonding in the budget is for ConnectND, a new software system that will be used by all of state government and the university system. It will also link to K-12 schools, and is a major step forward for the state in technology. The bonds will be repaid from user fees. The Hoeven Administration presented the concept to the Budget Section of the Legislature, which supported it, earlier this year.
Unlike most other states, Hoeven’s budget does not borrow against future payments on the state’s tobacco settlement money. “This future revenue stream, combined with North Dakota’s very low debt level, puts the state in a strong financial position,” Hoeven said. “At the same time, the budget makes investments now so that we have the kind of revenue growth in the future necessary to fund the things that North Dakotans need and want.”
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