Municipal Infrastructure Fund

Medium

House Bill 1066 allocates up to $115,000,000 per biennium to cities in non-oil-producing counties for "essential infrastructure projects".

Amounts:

The total distribution amount will be allocated to cities in non-oil-producing counties based on a number of factors spelled out in NDCC 57-51.1-07.7.  These factors include population, percentage increase in population, and percentage increase in taxable property valuation.  Additionally, for cities with a population of 1,000 or more, there will also be a set amount included as a density factor.

The actual calculation will be based on the most recent data as of the time the infrastructure bucket fills.  Therefore, since the data being used to calculate the allocation amounts isn't available yet, the actual distribution amounts are not yet available.

Eligible Projects:

HB 1066 defines "essential infrastructure projects" as follows...

"Essential infrastructure projects" means capital construction projects to construct new infrastructure or to replace existing infrastructure, which provide the fixed installations necessary for the function of a city. Capital construction projects exclude debt repayments and routine maintenance and repair projects, but include the following:

  1. Water treatment plants;
  2. Wastewater treatment plants;
  3. Sewer lines and water lines, including lift stations and pumping systems;
  4. Water storage systems, including dams, water tanks, and water towers;
  5. Storm water infrastructure, including curb and gutter construction;
  6. Road and bridge infrastructure, including paved and unpaved roads and bridges;
  7. Airport infrastructure;
  8. Electricity transmission infrastructure;
  9. Natural gas transmission infrastructure; and
  10. Communications infrastructure, excluding fiber optic infrastructure.

Timing:

The timing of these distributions will be dependent on when the specific infrastructure bucket is filled during the biennium.  For cities with populations of 1,000 or more, a set density amount based on population will be distributed when the first $29,875,000 is deposited into the Municipal Infrastructure Fund.  Based on current forecasts, this is estimated to happen during the fourth quarter of calendar year 2020.

The remainder of the city distributions will occur the month after the fund reaches its biennial cap of $115,000,000, or at the end of the biennium if it doesn't fill completely.  Original forecasts showed distribution of these funds would happen during the second quarter of calendar year 2021.

NOTE:  Current oil & gas tax revenues are significantly lower than originally forecasted amounts.  Based on the Office of Management and Budget's updated forecast, it does not appear that the large second bucket of the Municipal Infrastructure Fund will be reached this biennium.  Therefore, there is not expected to be a distribution to the cities beyond what is paid out from the first bucket (cities with populations of 1,000 or more).

Reporting Requirements:

By November 30, 2022, each city that receives a distribution from this fund is required to provide a report to the Office of State Treasurer on the usage of the funds received.  This reporting will be done online via the Office of State Treasurer's website and will provide for review of the reported information by the general public.

Failure to report in a timely manner or in the correct format will make said city ineligible for funding during the subsequent biennium.  Using the funding in a manner inconsistent with the requirements for eligible projects will reduce any future grants to that city by the amount spent on ineligible projects.