OMB: We're Now "On The Brink" Two days after the primary election, and an upsetting result for establishment Republicans, the truth is finally coming

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OMB: We're Now "On The Brink"

Two days after the primary election, and an upsetting result for establishment Republicans, the truth is finally coming out. The director of OMB now says North Dakota is "on the brink" of needing a special session to address budget issues.

June 16th, 2016

There is good news for North Dakota. It's now safe for the state's government officials to tell you what is really going on, because the election season is over.

The voters, of course, already knew what reality was - even if their elected officials did not want to admit it.

In a shocking series of news reports today, Pam Sharp, director of North Dakota's Office of Management and Budget has reported to the legislature that they may need a special session.

The only people more shocked by this news than Republican legislators may be Democratic legislators that called for a special session months ago.

According to the Fargo Forum report, it is possible that a special session will be needed to reverse more of the legislature's own over-spending during the 2015 legislative session:

North Dakota's bleak budget outlook suffered another blow Thursday with a report that state tax revenues came up $36.4 million short in May, increasing the chances of additional budget cuts and making it likely the state will drain the remaining $75 million from a rainy day fund.

"Obviously this is of concern. We're basically right on the brink," Office of Management and Budget Director Pam Sharp told the Legislature's interim Government Finance Committee.

The May shortfall was the worst yet since Sharp's office adopted a lower revenue forecast in January to adjust for plunging tax revenues blamed on depressed oil and farm commodity prices. Revenues are now $90 million, or 3.6 percent, below that forecast for the two-year budget cycle that ends June 30, 2017.


Depending on what that new forecast shows, she sees three options:

-- If the revenue outlook is positive, it'll be business as usual.

-- If it shows a small additional shortfall, agencies could perhaps absorb a second round of small across-the-board budget cuts.

-- If it projects a large shortfall, the governor could call a special session of the Legislature, which could address the shortfall through targeted cuts or transfers from other reserve funds.

None of this is a surprise. Those watching the situation from an unbiased stand point have known and said this for a year and a half. (See previous budget messages below.)

Ironically, as Dave Thompson with Prairie Public Radio, some legislators are finally adopting the "accept reality" message we have been urging legislators to adopt.

"This administration and the Legislature is a great believer in Edmund Burke's comment about 'Respect Reality,'" said Sen. Raymon Holmberg (R-Grand Forks), the chairman of the Senate Appropriations Committee. "We have the options laid out by the Governor, and that's what's built into the law. It will depend on how the economy continues to evolve."

Holmberg credited the Dalrymple administration for being open and frank about the options.

"They're not doing any political running about and saying, 'We have to have a special session,'" Holmberg said. "They're doing the prudent thing."

Of course the administration was not running around saying that a special session was needed, they were saying the exact opposite.

April 5th, 2016 - Gov. Jack Dalrymple on Tuesday rejected a request from Democrats to call lawmakers back to Bismarck to undo $50 million in recent budget cuts, saying it’s unnecessary and the budget plan for the coming year is “just fine.”

Just fine in April - "on the brink" in June.

The only difference is the election is over.

The truth always gets out eventually.

Elections have consequences.


Dustin Gawrylow, Managing Director

North Dakota Watchdog Network

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