Committee hears bill to boost Legacy Fund earnings share for highway distributions; county and township groups urge sustained support

Senator Brad Beckettall, sponsor of Senate Bill 2372, told the Industry and Business Committee the measure would change the formula used to calculate annual Legacy Fund earnings available for distribution. Under current statute, the Legacy Fund’s earnings distribution is computed as a percent of the five-year average market value. SB 2372 would raise that percent from 7% to 8% and direct the additional 1% into the Highway Distribution Fund (HDF).

Beckettall said the change was informed by the governor’s earlier budget proposal and legislative fiscal projections: “Since the 1% distribution is tied to the overall POMV, the funding this bucket should increase every biennium to keep up or exceed inflation rates in its distributions.” He estimated the immediate effect to be about an $87,000,000 increase to the highway distribution fund in the first biennium the change would take effect with an emergency clause.

Beckettall and committee members discussed how money in the HDF is currently split: 60% to the Department of Transportation, 28.5% to counties and cities through an existing formula, 10% to townships, and 1.5% to transit projects. He and fiscal staff said changing the POMV to 8% would provide a predictable, rising stream for roads and bridges rather than one-time grants.

Representatives from local government testified in support. Aaron Burst of the Association of Counties said keeping the bill available for further work was sensible given fiscal uncertainty elsewhere this session. Scott Meske, for the North Dakota Township Officers Association, called the bill “a good use of legacy fund earnings” and cited a rural infrastructure needs study: “We’re looking to the tune of somewhere 12 and a half billion dollars over the next 20 years,” he told the committee, noting the state maintains more than 54,000 miles of rural roads through counties, townships and small cities.

Committee members asked about how the change interacts with other legacy mechanics and recent public measures. Beckettall and staff explained the POMV approach provides a known annual distribution based on a five-year market-value average, rather than relying on a variable ‘realized earnings’ calculation. Members also discussed the public-residence tax-credit proposals moving in separate bills and how buckets in the Legacy Fund interact with that work.

No committee vote was recorded on SB 2372 in the transcript; the hearing closed after supporters and senators discussed technical questions about the bill’s repealer clauses and the timing of distributions. The sponsor and staff asked for time to supply additional drafting and fiscal details and for affected stakeholders—particularly securities administrators and insurance-sector contacts—to weigh in before further action.

Ending

Senator Beckettall asked staff and interested industry groups to provide follow-up materials; committee members indicated they would wait for additional information before deciding whether to amend or advance the bill.