CHICAGO — While other states struggle with shortfalls, North Dakota’s fiscal position is strong enough that the state’s new governor has proposed funding nearly $1 billion of projects with cash and boosting reserves to $1.2 billion by the end of 2013.

The state is enjoying the largest oil boom in its history thanks to the Bakken Formation, the largest oil field in the U.S. But officials from the petroleum-producing part of the state are increasingly pressing the state for assistance in rebuilding roads and other infrastructure that has taken a beating from the growing oil industry.

Gov. Jack Dalrymple, a Republican who took office in early December, has proposed a $9 billion all-funds budget that includes $1.7 billion for statewide infrastructure projects.

Of that, $956 million is reserved for projects to rebuild local roads and highways in so-called oil country.

“There’s a considerable amount to get done in the 17 oil- and gas-producing counties, a lot of road rebuilding,” said Dalrymple spokesman Jeff Zunt.

The spending plan would mark the third straight two-year budget that ­includes no borrowing and relies on cash to fund most non-higher-education ­related projects.

“Our general philosophy is if we have the cash and are sitting in a really good financial position, we’re going to use that cash instead of bonding,” said Pam Sharp, director of the Office of Budget and ­Management.

The bulk of the money needed to finance $958 million of new projects will come from oil revenue, which is generated by two taxes.

Boosted by rising oil prices and ­increased production, North Dakota has seen oil-related revenue quadruple over the last five years. Officials are ­expecting another big bump for the upcoming biennium. Gross oil-related revenue for the current two-year period, which ends in June, is expected to total $1.4 billion. That is expected to climb to $2 billion by the end of 2013, Sharp said.

The state received $802 million in ­oil-related revenue during the 2007-2009 ­period.

North Dakota law dictates that only the first $71 million of oil-related money goes into the general fund. The rest of the revenue goes into the Oil Permanent Tax Trust Fund.

“Our rationale is that we are spending revenues directly from oil and putting it directly into infrastructure needs that the oil industry has,” Sharp said.

Dalrymple’s budget also features $350 million in property tax cuts, $150 million of income tax cuts, and a proposal that would build reserves to $1.2 billion. Reserves currently total around $1 billion, according to Zunt.

In 2007, the Legislature created the North Dakota Pipeline Authority and gave it the power to issue up to $800 million of bonds for oil-related infrastructure work.

So far the state has not directly issued any of the debt and doesn’t anticipate doing so, according to Karlene Fine, executive director of the North Dakota Industrial Commission, which oversees several of the state’s bond-issuing agencies.

“The private sector has stepped in and is building a number of pipelines,” Fine said.

Lawmakers returned to Bismark for the 2011 session Tuesday. So far only one bond-related bill has been introduced — relating to higher-education funding — but legislators have until early February to file their proposals.

North Dakota is rated AA-plus by Standard & Poor’s and Aa2 by Moody’s Investors Service.

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