DUSTIN GAWRYLOW: ND TAXPAYERS ASSOCIATION DECEMBER 2010 UPDATE
Governor Dalrymple's First Budget Proposal North Dakota's newly inducted governor, Jack Dalrymple, presented his first state budget proposal last week. At first glance, the proposal is very appealing compared to Governor Hoeven's last two budgets (each increased spending 20%). Once we started digging into it, something seemed strange - the numbers just didn't add up. After closer review, it turns out things don't add up because of the creative way budget developers applied the state's special "fund accounting" technique. Fund accounting makes it very easy to shift money around and make spending levels look better than they really are. For instance, Governor Dalrymple's budget proposes that $380 million for state and county roads be appropriated from the Permanent Oil Trust Fund (POTF). While this spending is legitimate, the issue is accounting. Previous expenditures like this would come from the General Fund with other money transferred into the General Fund to pay for it. However, Governor Dalrymple's budget proposal excludes this spending from the General Fund's bottom line because it is being spent directly out of the POTF. The same holds true for the proposed $370 million to fund the Property Tax Relief Stabilization Fund. In previous budgets, this was funded out the General Fund and financed via transfers from the POTF. These two situations alone remove $750 million of spending from the General Fund's bottom line. So when you hear about how "conservative" this budget is, remember that you are not hearing the whole story.
Weak on Clarity and Transparency
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State Spending Driving Graduates Away
The North Dakota Policy Council released a video and summary about its upcoming study into whether and how state higher education funding might negatively affect North Dakota's economic and population growth.
NDTA has long worked to increase accountability in higher education and will work with the Policy Council to convince legislators to evaluate current spending and objectively investigate whether current funding delivers the intended results.
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Federal Judge Strikes Down Healthcare Law
The process of overturning the unconstitutional "ObamaCare" healthcare laws is taking shape.
RICHMOND, Va. - A Federal Judge in Virginia has declared the Obama administration's health care reform law unconstitutional.
U.S. District Judge Henry Hudson is the first judge to rule against the law, which has been upheld by two others in Virginia and Michigan.
(Source: The Associated Press)
"Neither the Supreme Court nor any federal circuit court of appeals has extended Commerce Clause powers to compel an individual to involuntarily enter the stream of commerce by purchasing a commodity in the private market," he wrote. "In doing so, enactment of the individual mandate exceeds the Commerce Clause powers vested in Congress under Article I of the Constitution." -U.S. District Judge Henry Hudson
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Five Reasons the "Tax Compromise" Falls Flat
All the talk the past couple weeks has been about the so-called "tax compromise Obama has agreed to support. But the reality is, the bill is a mess (like all bills have been lately):
Here are Five Reasons to Oppose this Lame-Duck Spend, Borrow, Earmark Deal:
Where are the Spending Cuts?: Our current and long-term fiscal situation is untenable, and the U.S. is quickly headed for a debt crisis on par with what is being witnessed by our allies in Europe. Instead of cutting spending, the Obama tax deal extends for 13 months additional unemployment benefits that were meant to be temporary-without any offsets. These benefits were enacted as part of the President's flawed trillion dollar "stimulus" plan, and if extended yet again, the additional unemployment benefits spawned by the stimulus would total $185 billion-fast resembling a permanent new entitlement. President Obama should not be allowed to use the present situation to leverage an extension of his own spending habits. Makes Tax Relief Only Temporary: The U.S. will not witness sustained, robust economic recovery unless government gets out of the way and there is certainty in the economy, particularly with regard to tax policy. A two-year extension does not amount to such tax certainty and does not provide the sort of assurance needed for families and job creators to plan, invest, and take risks that grow the economy. Conservatives in Congress should stand for a permanent extension of current tax rates, as proposed in legislation by Senator Jim DeMint and Congressman Mike Pence, and then begin the vital work to reform a complicated tax code. Such tax reform cannot happen if conservatives have to fight against a tax increase every two years. Fails to Permanently End the "Death Tax": The death tax is currently zero. And while the death tax is scheduled to return under current law at a high confiscatory rate, this is a tax increase no different than the other scheduled tax increases under the tax code. We are alarmed that negotiators felt the need to create a special dispensation for this particular tax increase whereby its current level (zero) is not also extended for two years but raised. A death tax punishes families and job creators, taxes a second time wealth that was already taxed once, and is fundamentally immoral in that it makes death a taxable event. Earmarks were added after the "compromise" was announced: On Monday, December 6 the "compromise" framework was announced and it contained no earmarks. But by Thursday, December 9 when the legislation was made public there were goodies and favors-also know as earmarks-for an array of special interests. This is exactly the type of Washington DC deal making the American People rebelled against on November 2nd: The deal is premature. By striking a "compromise" in a lame duck Congress, negotiators are essentially ignoring the will of the American electorate as expressed in last month's elections. Given the term of the deal, Members who have been voted out of office will be allowed effectively to participate in setting major policy even after their own electorates made clear that they preferred different representation.
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NDTA Audio Clips
1. November 12th, 2010 Segment on KFGO with Joel Heitkamp regarding the results of the election and the debate over earmarks. (Click here)
2. November 22nd, 2010 Segment on AM1100 The Flag with Chris Berg regarding the need for reform of the state's public pension funds. (Click here)
3. December 1st, 2010 Segment on AM100 The Flag with Scott Hennen regarding earmark reform. (Click here)
4. December 6th, 2010 Segment on KFGO with Mike McFeely regarding the City of Bismarck's decision to buy a strip mall next to the Civic Center. (Click here)
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