special session conference 2021 (copy)

Sen. Rich Wardner, R-Dickinson, answers questions from the media prior to a special session of the legislature that convened Nov. 8 to handle redistricting and American Rescue Plan Act funds in this file photo. 

Up to 16 abandoned oil and gas wells will be converted into freshwater supply for livestock, under a plan approved by the North Dakota legislature during the recently concluded special session.

Funds for the $3.2 million proposal are coming from American Rescue Plan Act, or ARPA, and the proposal is just one of several measures the legislature approved that will spend money on projects that benefit the West.

The well conversion program was outlined in SB 2345 as an extension of the 2020 CARES Act Orphan Well Project North Dakota began, otherwise known as Bakken Restart, which was the state’s way of hanging onto a core of highly skilled workers related to oil and gas exploration.

Nine of the 16 highest priority wells are listed as in McKenzie County, six are in Billings, and one is listed in Golden Valley. The proposal from the Department of Mineral Resources listed 32 wells that are candidates for the program, but the approved funds will likely only be enough to fully complete 16 wells.

Work will include plugging the well and completely removing all oil and gas production facilities on the site. The livestock water well would be completed in the Fox Hills formation. The work would include all necessary pump and tubing for an operational water well.

Six wells had already been converted, working with Medora Grazing Association during the Bakken Restart. Colin Madzo, a member of the Medora Grazing Association, was among those submitting written testimony in favor of the program.

“My family has been ranching for four generations, and I have learned the importance and necessity that water is to nature, wildlife, and cattle,” he wrote. “In a year of drought, it has become more and more evident how crucial quality water development and water resources are to strengthening and preserving the National Grasslands.”

Multiple fires occurred throughout the area during the drought, Madzo added, underscoring the vital need for better water sources.

“(That) would greatly benefit our fire departments in their jobs, without having to go great distances to find readily available water,” he wrote.

Also approved as part of the three ARPA bills is a $100 million allocation for counties throughout the state for road and bridge needs in HB 1505.

Williams and McKenzie County will get the maximum allotment allowed, $3 million, while Dunn County will get $2.73 million and Mountrail County gets $2.36 million.

Data from the Upper Great Plains Transportation Institute was used to decide how to distribute the overall $80 million in funds.

Collectively, 75.3 million are being directed to counties directly. North Dakota Department of Transportation will use the remainder for county bridge projects.

Also in the ARPA basket was $150 million to pay down the cost of a pipeline that will run from west to east to more efficiently move Bakken gas throughout the state as part of SB 2345.

State officials believe the pipeline will make the state more competitive when it comes to vying for economic development projects. Supporters of the project have cited instances where the state lost out on developments to other states, despite the fact those states would ultimately be delivering North Dakota gas to the project.

Legislators included language in the provision for the pipeline suggesting they intend to add additional funds to the project during the 2023 legislative session.

Senate Bill 2345 also included $10 million for a project to transport natural gas to areas in Grand Forks County.

Separately from ARPA, income tax credits of up to $350 per year per resident for the next two years were also approved for tax years 2021 and 2022 in House Bill 1515.

The tax credit totals $211 million over the two years. About 300,000 tax payers would qualify for the full credit, while an estimated 140,000 would qualify for a partial reduction. The credit will be paid for out of the state’s general and balance, which has exceeded the estimated ending balance of $710 million by $412 million.

Burgum has already signed the income tax relief bill.

“This bill is a victory for half a million hardworking North Dakotans, providing them with real, meaningful tax relief for this year and the next,” Burgum said. “We are deeply grateful to Rep. Heinert and the entire Legislature for overwhelmingly approving this tax relief and improving upon our original proposal. Our shared approach of conservative fiscal management has allowed us to put money back into the pockets of North Dakotans who kept working through the pandemic and supported our economic recovery, which benefits us all.”

Burgum also signed SB 2351, which exempts Social Security income from income taxes. The exemption will provide an estimated $14.6 million in savings for about 20,000 North Dakotans.

North Dakota is now the 38th state to approve a social security income tax exemption.

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