For the first and perhaps only time in our state’s history, we can meet the needs and opportunities of the present and steward the development of an extraordinary and permanent resource for the future.
In November 2013, the Great Plains Institute convened a diverse group of North Dakota public, private, community and nonprofit leaders and citizens to develop a consensus vision and policy recommendations to guide the purposes, governance, investments and future expenditures of the state’s oil and gas Legacy Fund.
North Dakota’s Legacy Fund is special. It differs from other constitutional and state special funds in that North Dakota voters established the Legacy Fund to safeguard a portion of oil and gas revenue and grow it for the future. With 30 percent of oil and gas tax revenue flowing into the Fund, the balance of the Legacy Fund has grown substantially and now stands at more than $2.2 billion. Legislative forecasts predict that the Legacy Fund balance will grow to at least $6 billion by 2017. Under the state’s Constitution, the earnings from the Legacy Fund become available for expenditure by North Dakota’s legislature in 2017.
State officials estimate the earnings from the Fund will be at least $300 million annually by 2017, and those earnings will be deposited into the state general fund. After July 1, 2017, the state legislature can spend up to 15 percent of the principal balance of the Legacy Fund per biennium, if two-thirds of each house of the legislature agrees to the spending.
North Dakota stands at a critical juncture. There has not yet been a broad public conversation in North Dakota about the future of the Legacy Fund since its inception.
Legacy Fund Initiative participants studied national sovereign wealth funds and state-level natural resource funds to gain insight into the purposes and management of various funds. In addition, project participants considered a number of scenarios for the management of North Dakota’s Legacy Fund in coming decades.