October 3, 2008

Oil impact taking its toll

Oil impact taking its toll

Oil and gas activity are taking a heavy toll on Mountrail County’s infrastructure and one way for the county to keep pace with a rapid expansion in production, is that oil impact revenue be increased.

Gov. John Hoeven and Democratic candidate for governor, Tim Mathern, are both in favor of lifting the cap and increasing revenue. Each has a slightly different view of how funds would be distributed, but both are in favor of getting more money to the counties.

Hoeven recently visited the Stanley area, toured some of the county roads and saw the impact of oil and gas activity first hand. He said something has to be done to alleviate the situation.

"There’s a lot of activity and that’s what we want, but it brings challenges," Hoeven said. "One thing we talked about was getting money back to the counties and communities."

Mountrail is one of 16 oil and gas producing counties in North Dakota. They are all capped in production tax revenue and oil impact revenue, according to Hoeven. He said the Legislature raised the caps by $1 million in the last biennium, but it’s not enough.

From July 2007 through June 30, 2009, the amount turned back to the 16 counties is approximately $110 million. But since the counties, communities and schools share in the production tax revenue, the governor suggested a 10-mill levy on roads that would raise another $1 million specifically for that infrastructure in each county.

Prior to this biennium, the amount turned over to the counties was $60 million.

Hoeven said with confidence he wants the Legislature to mandate a raise in the amount of oil and gas revenue going to counties like Mountrail so they aren’t strapped for cash when it comes to fixing roads.

"We’ve increased it significantly, but there’s a lot of impact," Hoeven said. "We’ll increase it again."

The Weather Network