Republican incumbents in Minot-area District 38 are looking to retain their legislative seats, while a Democratic team of candidates hopes to break into the all-Republican ranks of the Minot delegation.
Republican Sen. David Hogue and Reps. Dan Ruby and Larry Bellew, all of Minot, are challenged in the Nov. 6 election by Clarice Granzotto of Minot, who is running for the Senate, and Mike Rose of Minot and Robert Kibler of Burlington, who have filed for House seats.
Hogue has been an attorney with Pringle & Herigstad in Minot since 1988. He completed 25 years service in the North Dakota National Guard and is a combat veteran, serving a tour in Afghanistan in 2005.
Hogue has been involved in his community in a variety of areas, including serving on the Minot Planning Commission and chairing the MAGIC Fund Screening Committee. He is active with the Minot YMCA Board of Directors and Dakota Boys and Girls Ranch Foundation. Hogue was elected to the North Dakota Senate in 2008. He currently serves as chairman of the interim Taxation Committee and is a member of Legislative Management.
Ruby is a partner in two family business, Circle Sanitation and Noonan Landfill LLC. A life-long resident of Ward County, he was first elected to the House in 2000. He has served on the Industry, Business and Labor Committee and has been chairman of the Transportation Committee. He is a past member of Des Lacs-Burlington Jaycees, receiving an Outstanding Young North Dakotan award from the state organization in 2001.
Bellew, an Air Force veteran, is retired as superintendent of Souris Valley Golf Course. He has been a legislator for 12 years and currently is vice-chairman of the Human Resource section of House Appropriations.
Granzotto grew up on the Linnertz family farm and has been involved with Eureka Township while raising her family.
Rose has spent 40 years in the agricultural industry. As a North Dakota State University Extension Service Agent in Ward County, he led community education programs related to agriculture and horticulture and was involved in economic development work that included leadership roles in major dairy and beef feedlot projects. He also managed and operated his family farm near Langdon for 10 years. He is active with the Minot Lions and in the sport of curling.
Kibler traces his rural and agricultural roots to the 220-year-old family farm in Virginia. He teaches humanities and literature at Minot State University and also trains horses, keeps bees and raises produce sold at the Minot Farmer's Market. He served with the Air Force, assigned as a member of the Special Forces to the 82nd Airborne Division and the 1st of the 75th Ranger Battalion. He has served on the North Dakota State Board of Higher Education, as chairman of the Mid-Dakota Chapter of the American Red Cross and currently serves on the Burlington Planning Commission.
The candidates provided the following responses to questions about state and local issues.
1. Do you support continued property-tax relief in the upcoming biennium?
Granzotto: Yes, I support property-tax relief. With the funds we have in our reserves, I believe we can afford to make adjustments to the property tax. If we do not adjust our property taxes, how many people will not be able to stay in our community?
Rose: We need comprehensive property-tax reform that ensures we keep local control of tax revenue. I support a plan that reduces the property-tax burden for homeowners and farmers by reducing the tax valuation of their residence and farm property. The plan would also give an income-tax credit to renters. This plan will help make housing more affordable for all residents in District 38, which is badly needed.
Kibler: I do support property-tax relief. North Dakota has $3.5 billion dollars in the bank. Banked money is money that is not working, or that is barely working or growing. Further, property owners have a vested interest in their communities. They are the ones who form the backbone of our communities the ones who will not cut and run in a crisis, the ones who build the schools and maintain the community and give it human sustenance. Given our surplus, they most deserve tax relief, and as they spend it, those tax dollars move back into the community, growing wealth. Such property-tax relief should take the form of an across-the-board plan, such as that offered by Ryan Taylor, where the assessed first $100,000 of property value is relieved from taxation. This kind of relief can and should continue for the foreseeable future and is a clear way for every propertied citizen of North Dakota to reap the direct benefit of the oil boom.
Hogue: Yes. During my service as chairman of the interim Taxation Committee, we considered six different proposals for state-funded property-tax relief. Four will be recommended to the 63rd Legislative Assembly in January 2013. I support the proposal that will provide property-tax relief to the primary residence of the North Dakota citizens. The proposal would have the state reimburse local political subdivisions for the tax liability on the first $75,000 of true and full valuation on a North Dakotan's primary residence. For residents age 65 and older, the amount would eliminate the tax liability for the first $125,000 of true and full valuation. This proposal and the others are posted at (www.legis.nd.gov).
Ruby: The property-tax relief was primarily on the school district portion of property taxes. While it did increase the state's share of funding education, it did nothing to relieve the other areas of property taxes. Like the current tax relief, any new proposal needs to guarantee a direct reduction in the mills. I also want to reduce the state mandates to the political subdivisions in how the valuations are set and the minimum and maximum mill limits.
Bellew: I will continue to support property-tax relief in the upcoming biennium. I will also support additional residential property-tax credits and additional credits for homeowners that are 65 and older.
2. Do you favor other changes in the state's tax structure?
Hogue: Yes. During the past two sessions, the state Legislature has reduced individual income tax rates by 30 percent. If our current economic prosperity and corresponding revenues continue for another biennium, I would support elimination of the individual income tax. After the rate reductions of the past four years, the vast majority of North Dakotans now pay a state tax of about 2 percent on individual income. We can afford to eliminate this tax if we hold the line on state spending and the oil boom continues.
Ruby: Further reductions in the individual and corporate income taxes will keep more money in the private sector, benefit North Dakotans and keep our economy strong. I would support further changes in these taxes.
Bellew: Yes. In today's economy, I would like to see the individual income tax lowered or eliminated and a reduction in the corporate income tax. This would give some of the tax surplus back to the people.
Granzotto: I believe we have many taxes that need to be reviewed and adjusted with the revenue and growth in our state.
Rose: In a comprehensive approach to tax relief, all sources of revenue and user fees need to be considered. Reducing sales tax on material being used to restore our community from the flood and property tax are priorities.
Kibler: Our sales tax is too high, as is the Minot city tax. Oil can pay for more, and people can pay for less. The oil extraction tax of 6.5 percent, and the gross production tax of 5 percent need to be slightly increased because we are in the middle of the national pack with these levied taxes. The amount of funds brought into state coffers as a result of those taxes needs to be sent down to the cities and townships to do the work previously done by direct taxation of citizens.
3. Should there be changes in the oil tax distribution to cities and counties?
Rose: Areas of the state affected by oil development should keep a greater amount of our state's oil tax revenue. Currently, 11 percent of the oil revenue is kept in this area, but the needs in communities near the oil patch grow on a daily basis. Cities, counties and townships all have great challenges related to law enforcement, child care, affordable housing and roads. Our state has a responsibility to ensure that our communities' needs are met during this period of population expansion.
Kibler: There needs to be a significant increase in the distribution of oil taxes to counties, cities, and townships. My own Kirkelie Township, for example, has not seen an increase in allotted state funds for many years, yet the township grows, and maintenance needs and costs continue to increase. As a result, our roads are often in disrepair. Further, the state does not contribute funds to help schools experiencing dramatic increases in student numbers as a result of the oil boom. It needs to do so. We are a state in change, and our state government needs to help facilitate that growth, not impede it.
Granzotto: Yes, I believe there needs to be an adjustment to the oil distribution tax to the cities, counties AND townships. With the increase in people, use of roads, room needed in the schools, infrastructure needs to be built to support the people and services to these communities. I would support an increase to 40 percent to help with these needs.
Ruby: The current formula is based on oil wells in the counties, which excludes Ward County from most funds unless specific provisions are added each time. The distribution should be based on other factors, such as the impacts of population increases and sales tax revenue.
Bellew: Yes, there needs to be changes in the oil tax distribution to cities and counties. I would like to see the formula change to include not only oil-producing counties and cities, but to include counties and cities that are greatly affected by the oil production.
Hogue: Yes, there should be two changes. First, the amount of the distribution is simply inadequate for the demands placed on infrastructure and local government. The formula does not take into account the second and third order effects of energy development, e.g., the local government that has to pay its personnel more to retain them or pay them more because the cost of housing has dramatically increased in the past four years. Second, the formula unfairly funnels substantially all impact aid based on where the oil came out of the ground. Where the oil came from is an important indicator of impacts, but there are other objective indicators such as traffic counts, aviation traffic, human services claims that tell us which communities have additional burdens. I support broadening the formula to account for these objective impacts.
4. To what extent does the state have responsibility to help oil-affected communities with housing, law enforcement, roads, child care and impact-related concerns?
Bellew: Our state has an oil and gas impact grant fund. The money in this fund is disbursed by the Land Department as grants to local units of government affected by oil and gas development. Last biennium, this fund was increased to $100 million and an additional $30 million was added during the special session. I believe this fund is where the oil-affected communities can apply to receive grants and to use the money as they see fit for things such as housing, law enforcement and child care.
Hogue: Adequate roads and law enforcement are core governmental responsibilities of state and local government. So, yes, the state should contribute in these areas. The state has and will continue to increase funding for law enforcement and roads in affected counties. It's not always as easy as appropriating more money, however. I recall discussions with representatives of the executive branch last session who explained it's one thing to have the money to hire more state highway patrolmen, quite another thing to find housing for them. So, the state made sure there was funding to address the housing of its proposed new hires. I am open to observing the state's subsidy of a child-care facility in an oil community. I view it as an experiment, but as general policy matter I don't think that's an appropriate use of state resources.
Ruby: The state is benefiting from increased sales and income taxes as well as oil-related taxes. One of the oil taxes is a tax intended to replace property taxes and should be returned to the communities that would have had the benefit of those funds to address their needs as they see fit. They can prioritize their needs and the state has the responsibility to let that happen.
Kibler: When a state is flush, it is time to address issues of need, and we have big needs. Cities and towns in the oil patch have heavy trucks driven by the oil boom wearing out their roads passing through. These cities and towns should not have to bear the financial burden of this traffic on their own. Nor should cities like Minot suffer a dearth of child care, when we have the funds to help people. We simply must use tax dollars as a means of investing in the future of our children in daycare and to help build schools, fix roads and subsidize education K-16.
Granzotto: The state needs to have major involvement for the needs in the oil-affected areas. These people and concerns would not be here if not for the exploration and development. Too bad we didn't have the insight to start earlier.
Rose: The state has a responsibility in helping our community with these issues, which in District 38 are often tied to both the oil expansion and the flood. Developers, non-profit organizations and the state can work together to develop more affordable housing. The state can reduce our property-tax burden to make housing more affordable. Since public safety is the government's duty, the state should ensure our law enforcement services are fully staffed with salaries that are competitive with private-sector jobs. Child care and roads should also be further addressed by our state legislators during this time of rapid growth.
5. What should be the state's priorities for the budget surplus?
Granzotto: Property-tax relief, assist flood victims including renters, funding for police, firefighters, judicial system, infrastructure, housing for those not receiving the oil-related incomes, education, child care.
Rose: Our top priorities should be property-tax relief, assistance for flood victims, infrastructure needs for the oil development area, increased funding for law enforcement and the judicial system and our educational system. Our economy is extremely strong right now because of oil development and agriculture, so we can and should focus on these growing pains to preserve the quality of life we value. But we also need to think long term, and it is vital that we have an educational system that will prepare all of our students to be productive members of our community.
Kibler: Property-tax relief, strengthened judicial system, subsidized day care, improved roads, expanded judicial system, education reform for K-16, in that order.
Hogue: First, the state should give some of the surplus back to the taxpayers. So far, the state Legislature has given a portion back through reduced income tax rates and direct property-tax relief. I support this approach. Second, the state should use another portion of the surplus to shore up the financial condition of communities impacted by rapid energy development. The impact fund went from $6 million to $100 million and the state also increased the amount distributed to political subdivisions. The focus should be on one-time expenditures that repair or improve infrastructure used by the Bakken play. Third, as directed by the North Dakota Constitution, we should save a portion of the surplus for the end of the oil boom, when revenues will likely decline.
Ruby: The surplus should be used to assist in flood recovery and flood protection for at-risk areas of the state. Oil impact and infrastructure development are other priorities for the surplus.
Bellew: First of all, it is not a budget surplus. It is a tax surplus. My priorities are as follows: a. Infrastructure. This includes road repair, water and sewer upgrades, and lagoon upgrades and landfill expansion if necessary; b. Tax relief, especially property-tax relief; c. Flood relief for flood victims.
6. Do you support the Three-Tier System Access Plan for the University System? Are you satisfied that the Board of Higher Education is on the right track or do you believe there are areas where the Legislature should be more involved?
Bellew: The Board of Higher Education is not on the right track. Since the so called "round table," the Legislature gave the board more authority, and since then tuition and fee rates have sky-rocketed. Tuition and fees now are set by the Board of Higher Education, which I do not believe is constitutional. The Legislature needs to set tuition and fee rates as stated in the State Constitution (Section 2 of Article 8).
Hogue: I have fundamental disagreement with the state Board of Higher Education on several issues. Most North Dakotans who learn for the first time that more than 52 percent of the students at UND and NDSU are non-residents are genuinely shocked and disappointed. General fund appropriations for higher education have increased from $491 million for the 2005-2007 biennium to $656 million for the current biennium. During that same time frame, the number of students graduating from North Dakota high schools has declined. Why is there a significant funding increase in an environment of declining high school students? It's because the state Board of Higher Education has permitted the universities to continue with substantial, implicit subsidies to out-of-state students, all at the expense of North Dakota taxpayers. That should be changed.
Ruby: My initial reaction is that the Three-Tier System makes sense. There are differences in the various universities and this proposal can help in prioritizing missions and needs for each level. The Legislature needs more involvement in the University System. The appointed board is not directly accountable to the voters, and if legislators are going to get blamed for issues related to the universities, we should have more say in issues such as tuition levels.
Kibler: From my experience, I can say that it is a challenge for the State Board of Higher Education to find the right track. Not only do they have to deal with far more paperwork than any one person can actually read, but they are also political appointees. Rarely do they have any professional understanding of how education functions. At the same time, legislators have even less understanding about this strange institution called the North Dakota University System. So many attempts at improvement actually hurt rather than help. For example, the legislative push to tie college funding to graduation rates is doomed to result in faculty being forced to lower standards and elevate grades, so that more and more students pass easily through the system in short order, but knowing less. Unless we bring true competition back into the University System, and unless we realize that college is not for everybody, and unless we realize that a system of education cannot be tucked into a nice business model, what have become traditional problems of low academic engagement and achievement will continue. I am in favor of a State Board of Higher Education comprised of a measured mix of elected educators, elected community leaders, elected business men and women, and appointed state legislators. As for the Three-Tier system, Minot State University. MSU has moved with rapidity over the past 10 years away from the local or regional college model in a way the Tier System does not seem to understand. As an entire community, we should be walking arm in arm to Bismarck to protest our, yet again, being discounted as a community. We have the future, and the state increasingly will be riding on our coattails. And yet our university will get a formal demotion. I object strongly to it.
Granzotto: No, I am amazed there was not research into how this Three-Tier System would affect Minot State University. Everything Minot State University has worked toward the last 10 years will be shut down by this system.
Rose: I do not support the Three-Tier System for the University System. By classifying universities, the Board of Higher Education is demoting Minot State University, which is disheartening after the university and community worked hard to make the school a first-class facility. Minot State is very important to this part of the state, and the tier system could have a negative impact on our community if it affects enrollment.
7. To what extent should the Legislature consider assisting Minot with flood recovery or flood protection?
Rose: The Legislature needed to do more and still could do more to help the flood victims of the Mouse River area. During the special session, legislators had an opportunity to help flood victims by reducing their sales tax obligation but failed to do so. Also, the majority party stood in the way of filling a $158 million gap in disaster relief when they had the chance. Meanwhile, families are struggling to recover from the flood and find affordable housing.
Kibler: In Canada, every citizen impacted by the flood was given a significant outlay of funds. When Grand Forks flooded, the federal government did a lot to help that city recover because the state was economically strapped. Now, the state is flush, yet still our representatives complain that the federal government is not doing enough when really, we must be doing a lot more. We should be doing what is necessary to make every citizen and business owner impacted by the flood whole again. Completely whole. How we help people in crisis says a lot about our character as individuals and as communities.
Granzotto: With the NEED in the Minot area after the flood, it is imperative that the Legislature assist in its restoration. This was a Rainy Day occasion.
Hogue: The Legislature should help any community recover from a natural disaster. Federal agencies have an explicit mission to help Minot, but the state has an over-arching responsibility to make sure no part of Minot's finances or infrastructure slips through the federal programs. Last fall, the Legislature got off to a good start on providing for flood recovery. We supplemented spending for the Water Commission and the State Adjutant General. Along with the Senate and House majority leaders, I was very proud to have cosponsored SB 2173. Among other things, SB 2173 established the Home Rebuilders Program through the Bank of North Dakota. That gave affected homeowners an opportunity to repair their homes with an additional $30,000 on an unsecured loan bearing 1 percent interest. Since the redistricting session in November 2011, other needs for Minot, Burlington and Ward County have been identified and quantified with hard numbers. The Legislature will provide for those needs. The state was providing financial assistance to Grand Forks 10 years after the 1997 flood. Minot and Ward County needs will emerge and be funded over a similar period of time.
Bellew: I would work to get the Bank of North Dakota loan program ending date extended and see if more money would be available for the program. I would like the state to assist financially, not only with Minot, but Ward County as well, with flood protection.
Ruby: Minot, Burlington, and Ward County need funds for flood protection such as buy-out funds and funds to support plans for flood prevention. Continuing support for infrastructure will help with recovery, but further assistance for people and businesses with low-interest loans is needed. One immediate priority will be to extend the timeframe to apply for the loan enacted in the special session.
8. Are there issues on which you feel strongly and would like to see legislation?
Ruby: The burden of taxes on people and businesses have always been important to me. I want to see legislation that reduces that burden. It is also important to me that we don't increase our on-going expenditures to a level that is unsustainable sometime in the future. Protection for the pre-born has also been important to me and will continue to be.
Bellew: I would like to see the state help Minot and Ward County with flood recovery. I would also like to see the Legislature set tuition and fee rates for higher education as stated in our constitution and I would like to see property-tax reform along with property-tax relief.
Hogue: Yes, I am concerned about the initiated measure process. I think it needs reform, particularly for measures that propose significant expenditures of state revenues.
Rose: I decided to run for this office because the citizens of District 38 are facing many challenges due to the flood and oil expansion, and I felt they deserved more from their representatives. Besides addressing those challenges, we must not forget about the most vulnerable people in our district young children. Child care, domestic violence, the Children's Health Insurance Program and Head Start are examples of issues and programs that should not be overlooked. With our expanding population, policies that affect children need renewed attention.
Kibler: I feel strongly that oil tax dollars need to make their way down to local communities. I feel strongly that now is the time for our educational system to become competitive on a national level, and that using our oil dollars to make that happen constitutes a responsible investment that we can make in the future. I feel strongly that property tax must be reduced, and that the cost of reduction be born by oil funds. And I feel strongly that we need to safeguard our environment while keeping vigilant oversight of the oil patch because the people drilling wells out there will only be as vigilant about our environment as we compel them to be. Legislators who take part of creating such safeguards can take pride in doing so, and I intend to be such a legislator.
Granzotto: I am concerned for our young adults trying to establish a life in the oil country not working for oil wages. We need this group in our community. The expenses of housing, food, child care and education keep going up. How many people have to work multiple jobs to make ends meet? This affects our families and the quality of their lives. We also need more funds going into the Headstart, CHIPS and daycare programs. I see many issues we need to address with the growth in our city and state. I have three young adult children, and I would like to see our community grow in a way to support them and their future families. North Dakota is at a point that what we do now will affect the future of all the citizens of North Dakota and the United States. I want to be a voice for our community to grow to be a place where we can be proud of its accomplishments.