Lower oil prices continue to drag on North Dakota's budget.

On Thursday the state lowered revenue expectations for the remainder of the current biennium and predicted lower tax receipts than previously thought for 2017-2019.

"The challenges before this Legislature, as everyone knows, are historic," Governor Doug Burgum said in a statement. "The decisions are going to become even more difficult."

Burgum said that for the biennium ending June 30, the state will have general fund revenues of $4.78 billion, about $46 million less than lawmakers predicted in January. The forecast for the 2017-2019 general fund is $103 million below the January assumptions, he said.

In an effort to deal with shortfalls, Burgum wants lawmakers to reconsider some of his budget proposal. Burgum proposed a budget in January that included $4.62 billion in general fund spending.

He is asking lawmakers to increase the cap on the amount of oil tax revenue that goes into the general fund from $300 million to $900 million.

He also called for state employees to cover 5% of the cost of state-paid health insurance premiums, which are projected to increase roughly 17% in 2017-2019.

North Dakota is among the oil producing states that has been hit hard by the volatility in oil prices.

On Feb 19, North Dakota lost its AAA issuer credit rating from S&P because of the impact of falling oil price on the state's economy. The rating was cut one notch to AA-plus.

 

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