BISMARCK, N.D. – North Dakota Gov. Doug Burgum today announced the state’s general fund ended the 2015-17 budget cycle with about $66 million more than projected, but he cautioned budgeting for next biennium will be tight unless revenues significantly improve.
The 2015-17 biennium ended June 30 with $97.2 million in the general fund, versus an ending fund balance of $30.8 million that was projected when the Legislature adjourned in late April. Of the $97.2 million, $65 million remains in the general fund and the remaining $32.2 million was transferred to the Budget Stabilization Fund as required by state law.
“Our cabinet leaders and agencies did a commendable job of ratcheting back spending, making judicious staffing decisions and tightly managing their overall budgets. Their hard work leaves us better positioned for the future,” Burgum said. “Still, unless tax revenues rebound significantly, the state will have very little cushion heading into the budgeting process for the 2019-21 biennium. It’s essential we continue to take a conservative approach to spending and staffing and focus on reinventing government to make it more efficient and responsive.”
Among the factors that contributed to the higher ending fund balance were June revenue collections that came in $28 million above the projection for that month.
In addition, money turned back from agencies to the general fund totaled $97.8 million, or $39.5 million more than estimated. The largest turnback amounts were $37.1 million from the Department of Public Instruction, which experienced lower enrollment growth than projected, and $27.3 million from the Department of Human Services, which spent less on Medicaid than expected and achieved savings by holding vacant positions open.
The $4.3 billion general fund budget approved for the current 2017-19 biennium represented a more than 28 percent decrease from the 2015-17 budget.
During the 2015-17 cycle, $572.5 million was drained from the Budget Stabilization Fund to offset revenue shortfalls and help balance the budget, and other reserves were tapped as well. Heading into 2017-19, the Budget Stabilization Fund has a balance of only $38.3 million.
The $65 million ending balance for the general fund, which becomes the beginning balance for the 2017-19 biennium, compares to a beginning balance of $729 million in the 2015-17 biennium.
“With the 2015-17 beginning balance of $729 million and the $572.5 million Budget Stabilization Fund, the state entered last biennium with a substantial cushion that won’t be available next time around, highlighting the need to be cautious on spending,” Burgum said.
“While we were fortunate to end the 2015-17 cycle on a positive note, we still must be prepared for another challenging budgeting process for next biennium,” said Pam Sharp, director of the Office of Management and Budget. “It’s encouraging that we are beginning to replenish the Budget Stabilization Fund, and our balance sheet remains strong.”