ND Oil Patch leaders trying to avoid nightmare scenario; economic summit explores growth, needs
WILLISTON, N.D. – When he was just 13, Dan Kalil had a dream foreshadowing the changes triggered by western North Dakota’s oil boom.
In the terrifying nightmare, he could see from his window the steady procession of lights and trucks, and an “orangish bright glow to the southwest,” that lured him to the scene where drilling rigs and scrapers were illuminated.
“It was pandemonium. It terrified me,” the third-generation farmer and chairman of the Williams County Commission said Wednesday at an economic development summit, where investors, developers and oil and gas industry professionals gathered to learn about growth of the Williston area.
The dream has had a profound effect on him, guiding him as he tries to lead Williams County, said the 20-year commission veteran.
“This isn’t going away. This isn’t the ’70s boom, this isn’t the ’50s boom. This is more sustainable,” Kalil said.
Rep. Bob Skarphol, R-Tioga, joined with Kalil and Williston City Commissioners Brad Bekkedahl and Tate Cymbaluk in a call for more assistance from Bismarck and in expressing the importance of informing legislators and those living outside the Oil Patch of the tremendous needs.
Skarphol said the legislation relating to oil and gas gross production tax allocation and the impact aid program, is the “best vehicle” for oil-producing counties. In the last session, that bill provided funding for building infrastructure, fixing roads, providing law enforcement and emergency medical services and more.
But Skarphol, like other western legislators, says this isn’t enough. They will meet Sept. 12 to begin work on a bill that, he said, would address how much oil tax revenue would go back to local governments. Oil Patch leaders have been lobbying for a split of 60 percent for local governments and 40 percent for the state.
Currently, 75 percent of the oil tax revenue goes to the state, while 25 percent goes to political subdivisions.
Skarphol said some people say a 60 percent share of oil tax revenue for local governments is too much.
In making the case for a greater share for local government, Bekkedahl said Williston has more than tripled its size from 7,000 to 22,000 acres. As of this summer, the city’s permanent resident population based on sewage flows is 36,000.
By 2020 the permanent population of the Williston region (Williams, McKenzie and Divide counties) will grow by 50,760, with a projection of more than 24,000 additional housing units needed, he said.
A study by Advanced Engineering and Environmental Services Inc. has provided a six-year roadmap for Williston’s capital and operational needs, identifying the financial gap for the city to seek outside funding support.
Bekkedahl said that from 2015 to 2020, the study projects capital improvements alone – such as public facilities, wastewater and transportation – would total $1.04 billion.
“The next session is critical. We’re under stress, the residents are under stress. We have to work through it,” Bekkedahl said, who is running for a seat in the state Senate in the November election.
Kalil said Williams County is “blessed” and “not as challenged” as Williston. The city’s annexation of thousands of acres has taken the pressure off the county and allowed it to focus on keeping its road system passable.
“Unlike the city, Williams County is not carrying a huge debt load. We’re carrying very little bond debt,” he said. “We’re only spending money we have. … We’re trying to stay on a pay-as-you-go basis.”
Kalil said the county and city are teaming up for a 1 percent sales tax to provide funding to public safety departments, law enforcement and emergency services, which will be on the ballot in the Nov. 4 general election.
The tax is projected to take in more than $30 million annually, according to Williams County.
In an Aug. 25 memo to county public safety agencies and departments, Kalil wrote that many departments can’t wait another year or more for the Legislature to do the right thing, adding that the tax would avoid raising property taxes.
“We can’t roll the dice on what’s going to happen this legislative session,” he said.