Legislative UpdateLegislative Update

Surge Funding

State DOT$ 450,000,000 Non Oil Townships$ 16,000,000 Top 10 Oil Counties$ 240,000,000 Counties Outside Top 10$ 112,000,000 Cities in Top 10 Counties$ 100,000,000 Boundary Cities$ 10,000,000 Hub Cities$ 172,000,000 $ 1,100,000,000

County Amount Billings $ 12,066,656 Bottineau $ 15,417,768 Bowman $ 12,475,404 Burke $ 12,704,740 Divide $ 9,869,243 Dunn $ 25,768,304 McKenzie $ 47,968,642 Mountrail $ 37,960,549 Stark $ 21,641,039 Williams $ 44,127,656 $240,000,000

County AmountCounty AmountCounty Amount Adams$ 2,203,815Kidder$ 2,572,174Richland$ 2,539,180 Barnes$ 3,899,171LaMoure$ 3,105,730Rolette$ 1,755,642 Benson$ 3,373,924Logan$ 1,724,921Sargent$ 2,595,623 Burleigh$ 3,776,247McHenry$ 3,186,873Sheridan$ 1,756,307 Cass$ 6,272,476McIntosh$ 1,697,523Sioux$ 1,128,328 Cavalier$ 2,957,575McLean$ 3,627,880Slope$ 1,942,587 Dickey$ 2,735,403Mercer$ 2,696,799Steele$ 1,678,886 Eddy$ 1,063,270Morton$ 4,028,489Stutsman$ 4,286,154 Emmons$ 2,169,558Nelson$ 2,285,888Towner$ 1,568,485 Foster$ 1,461,167Oliver$ 1,379,586Traill$ 2,555,677 Golden Valley$ 1,946,309Pembina$ 2,223,409Walsh$ 3,729,747 Grand Forks$ 4,587,116Pierce$ 1,529,415Ward$ 5,177,382 Grant$ 1,964,920ramsey$ 2,395,811Wells$ 2,140,392 Griggs$ 1,817,190Ransom$ 2,099,010 Hettinger$ 2,321,315Renville$ 2,042,646 $112,000,000

CityAmountCityAmountCityAmount Medora$ 714,286Portal$ 821,168Stanley$ 6,636,121 Bottineau$ 3,350,000Powers Lake$ 1,824,818White Earth$ 364,122 Lansford$ 371,212Crosby$ 8,342,329Belfield$ 3,399,674 Maxbass$ 127,273Noonan$ 943,385Gladstone$ 1,015,653 Newberg$ 166,667Dodge$ 1,060,458Richardton$ 2,248,035 Souris$ 87,879Dunn Center$ 1,779,620South Heart$ 1,279,127 Westhope$ 650,000Halliday$ 2,291,565Taylor$ 628,940 Willow City$ 246,970Killdeer$ 9,154,071Alamo$ 523,544 Bowman$ 6,734,694Alexander$ 2,356,298Epping$ 918,499 Rhame$ 689,796Arnegard$ 1,215,131Grenora$ 2,241,136 Scranton$ 1,146,939New Town$ 8,761,682Ray$ 5,437,511 Bowbells$ 2,189,781Palermo$ 336,813Tioga$ 11,297,532 Columbus$ 866,788Parshall$ 4,110,025Wildrose$ 1,010,348 Flaxton$ 430,136Plaza$ 778,310 Lignite$ 1,010,167Ross$ 441,498 $100,000,000

CityAmount Hettinger$550, Reeder$72, Beach$457, Golva$27, Sentinal Butte$25, Mott$323, New England$269, Regent$71, Coleharbor$35, Garrison$652, Max$150, Riverdale$92, Underwood$349, Washburn$559, Beulah$1,402, Golden Valley$81, Hazen$1,083, Pick City$55, Stanton$164, City Amount Zap$106, Glen Ullin$362, Hebron$335, Glenburn$170, Mohall$351, Sherwood$108, Marmarth$61, Berthold$203, Burlington$476, Carpio$70, Des Lacs$91, Donnybrook$26, Douglas$28, Kenmare$492, Makoti$69, Ryder$38, Sawyer$160, Surrey$419, $ 10,000,000

City Amount Williston $ 64,000,000 Dickinson $ 44,000,000 Minot $ 32,000,000 Watford City $ 32,000,000 $ 172,000,000

Funding Formula

Extraction Tax Initiated measure creating the 6.5% Oil Extraction Tax -Formula for distributions changes throughout the years -All funds are for various state funds -Foundation Aid Stabilization Fund -Common Schools Trust Fund -Resources Trust Fund Gross Production Tax (GPT) -Imposed in “lieu” of property tax on oil and gas producing properties -5% rate currently -Formula changed throughout the years

Extraction Tax 6.5% Gross Production Tax 5 % Legacy Fund 30% of All Collections 11.5% Total O&G Tax Tribal Share 50% of All Tribal Production Oil & Gas Research Fund $10 M Constitutional & Statutory Distributions -Foundation Aid Stabilization -Common Schools Trust Fund -Resources Trust Fund -Energy Conservation Fund -Renewable Energy Fund Oil & Gas Communities Distributions -Counties -Cities -Townships -Schools -Hub Cities -Hub City Schools State Distributions -General Fund -Property Tax Relief -General Fund -Strategic Investment Fund (SIF) -State Disaster Relief Fund Remaining Funds -Legacy Fund -Strategic Investment Fund (SIF) 1/54/5 Impact Grant Fund Hub Cities Distributions -Hub Cities ($375k/1% O&G) -Hub City Schools - ($125k/1% O&G) O&G Communities $10M 75%25% Statutory Distributions -O & G Stabilization Fund -Outdoor Heritage Fund -Abandoned Well & Site Reclamation fund Extraction Tax Distribution Gross Production Tax (GPT) Distribution

Change Impacts only the Gross Production Tax GPT Equals 43% of the Oil and Gas Tax Change Impacts 4/5 (80%) of the GPT 35% of Oil and Gas Tax is effected by the formula 60% Equals approximately 25% of all Oil and Gas Tax

Change the GPT formula split from 75/25 to 40/60 Provide for GPT dollars for school construction to not be deducted from the Foundation Aid funding formula Increase the Hub City Funding from $375,000 to $500,000 and Hub City School District Funding from $125,000 to $150,000 per percentage point of employment Change employment category from mining to Job Service category of Oil and Gas Related Employment Create $120 million Grant Fund for Non Oil Counties $139 million for Impact Grant Fund

Extraction Tax 6.5% Gross Production Tax 5 % Legacy Fund 30% of All Collections 11.5% Total O&G Tax Tribal Share 50% of All Tribal Production Oil & Gas Research Fund $10 M Constitutional & Statutory Distributions -Foundation Aid Stabilization -Common Schools Trust Fund -Resources Trust Fund -Energy Conservation Fund -Renewable Energy Fund Oil & Gas Communities Distributions -Counties -Cities -Townships -Schools -Hub Cities -Hub City Schools State Distributions -General Fund -Property Tax Relief -General Fund -Strategic Investment Fund (SIF) -State Disaster Relief Fund Remaining Funds -Legacy Fund -Strategic Investment Fund (SIF) 1/54/5 Impact Grant Fund Hub Cities Distributions -Hub Cities ($375k/1% O&G) -Hub City Schools - ($125k/1% O&G) O&G Communities $10M 75%25% Statutory Distributions -O & G Stabilization Fund -Outdoor Heritage Fund -Abandoned Well & Site Reclamation fund Extraction Tax Distribution Gross Production Tax (GPT) Distribution 40%60%

Change the GPT formula split from 75/25 to 70/30 Removed the school construction funding section Change employment category from mining to Job Service category of Oil and Gas Related Employment Floor of 7.5% for city to be considered a Hub City Changed distribution of funds to local political subs Create $112 million Grant Fund for Non Oil Counties $140 million for Impact Grant Fund

Extraction Tax 6.5% Gross Production Tax 5 % Legacy Fund 30% of All Collections 11.5% Total O&G Tax Tribal Share 50% of All Tribal Production Oil & Gas Research Fund $10 M Constitutional & Statutory Distributions -Foundation Aid Stabilization -Common Schools Trust Fund -Resources Trust Fund -Energy Conservation Fund -Renewable Energy Fund Oil & Gas Communities Distributions -Counties -Cities -Townships -Schools -Hub Cities -Hub City Schools State Distributions -General Fund -Property Tax Relief -General Fund -Strategic Investment Fund (SIF) -State Disaster Relief Fund Remaining Funds -Legacy Fund -Strategic Investment Fund (SIF) 1/54/5 Impact Grant Fund Hub Cities Distributions -Hub Cities ($375k/1% O&G) -Hub City Schools - ($125k/1% O&G) O&G Communities $10M 75%25% Statutory Distributions -O & G Stabilization Fund -Outdoor Heritage Fund -Abandoned Well & Site Reclamation fund Extraction Tax Distribution Gross Production Tax (GPT) Distribution 70%30%

Strategy

House Bill 1176 Hearing in front of Senate Appropriations TBD Will be scheduled after March 18 Western Legislators and the NDAOGPC will work on amendments to the bill to submit to committee

Talk to Legislators about the importance of proper funding for Western North Dakota Provide letters of support for committee hearing Be present at hearing to show support Be supportive of community leaders Work with NDPC, NDAOPGC, GNDC, NDACo, League of Cities and others to keep the message strong

Contact Information Brent Bogar Jadestone Consulting Research and Communications Consultant to NDAOGPC