Senate appropriations panel reviews Commerce budget; committee discusses restoring FTE pool, salary cost-to-continue and development fund staffing

Chairman Wanzek convened the Government Operations division budget review and directed staff to walk the committee through the Commerce long sheet line by line.

The committee examined ongoing budget changes that include restoring amounts previously removed as part of the 2023–25 new and vacant FTE pool, proposed salary increases, and information technology cost adjustments. "Anytime you're authorizing salary increases, there's always a cost to continue that in the following biennium," staff member Levi said, describing the "cost to continue" calculation used to reflect salary increases in the 2025–27 biennium. He added that restoring last session's FTE pool can make the percentage increase over base appear larger even when the net effect is to restore prior funding.

Why it matters: Restoring pulled FTE pool dollars into individual agency budgets affects percentage-change math used in public comparisons of budgets and can change how year‑to‑year increases are perceived. Committee members asked staff to clarify the difference between one‑time and ongoing funding and requested time to review emailed reports that staff had just circulated.

On pay and benefits, committee staff explained both governors proposed a 3% salary increase in each year of the upcoming biennium and the health insurance premium treatment is consistent across proposals. Levi said that the committee would see a separate line showing the agency-wide salary increase and that new FTEs would be added at base level; "the additional 3% and 3% increase for that FTE will be shown in that line that says salary increase," he said.

The committee pressed the Commerce team about several specific staffing requests. The Armstrong recommendation adds funding for a full-time North Dakota Development Fund position and a procurement officer; staff said both governors included those positions in their executive budgets. Rich Garman told the panel the Development Fund is "operating 1 short" and that workload is "overwhelming and backing up." He said the fund currently has an approved but vacant FTE and that the agency is actively recruiting and has had candidates leave for higher offers: "It's been open in excess of 6 months," he said.

Committee members asked for detail on the new position's cost and for confirmation of space and office needs. Garman said the position includes salary and benefits; when asked about the 3% raises, Chairman Wanzek and staff noted those raises apply to new FTEs as well and that the 3% is applied to the base-dollar costs (Levi: "it would be 3% of that $257,408"). Committee discussion clarified the Development Fund currently includes a deputy director who works on the fund, a CEO, and two financial analysts.

Commerce staff walked the committee through other base-level adjustments, including IT cost increases requested during agency budget submissions based on anticipated rates from the state information technology department and reorganization of operating expense lines across fund sources. Staff described a number of federal grant programs that fluctuate from biennium to biennium (AmeriCorps, weatherization, community development and community services block grants) and explained the budget adjusts spending authority to match anticipated federal receipts.

The committee discussed the Northern Plains uncrewed aircraft systems (UAS) test site account and a continuing appropriation that has existed since the program began. Levi explained the agency and OMB recommended removing the on‑budget line for the UAS fund because fees deposited into the UAS fund may already be spent under the existing statutory continuing appropriation, and keeping both on‑budget authority and the fund created an appearance of duplication.

The Office of Legal Immigration was another focal point. Staff said the office received $2,000,000 in one‑time operating funds in the prior biennium and that ongoing salaries for two FTE—described in the discussion as $4,185,000—are included in the base. The current proposal includes $250,000 of ongoing operating funding and an additional $1,750,000 of one‑time authority (a $250,000 one‑time operating piece and $1,500,000 one‑time for grants) as presented in the long sheet.

The session ended with committee members asking for more time to review the reports that had been emailed and scheduling a demonstration of the Office of Management and Budget financial transparency website to help members check fund balances and appropriation details.

Discussion versus decision: The hearing recorded staff explanations, member questions and requests for follow‑up. No formal committee motions or votes on budget lines were taken during the segment covered in the transcript.