Currently viewing the category: "North Dakota Govt"

First, I have made three postings today. There is this report on North Dakota’s General Fund Revenues and Transfers. Below that is the Airline Boardings Report, and finally the most recent Employment/Unemployment report.

Concerning this report, second verse same as the first… Well, at least one thing that can be said about the projections purchased by the state is that they are consistent. That is, the same to be off by the same amount in each category every month.

At least that is the case with the amount they are off for the biennium to date. For a month to month comparison you would find some fairly with swings. For instance, with the individual income tax category they were short by about nine percent. That was blamed on people making the final adjustments on their 2013 income taxes. While that may be a valid reason it means that for the individual income taxes in North Dakota they were off by over 35 percent, and that is too much.

Incidentally, they were off by nearly that exact amount in the same time as the corporate income taxes. Also, in the insurance premium tax.

The worst category was the financial institutions tax. The projections
were off by 100 percent according to the OMB report. That hardly seems possible if any real economic effort was attempted.

Well, ignoring that waste of money, we can be happy that the report continues to very positive concerning North Dakota’s revenue. Even after the legislature’s attempt to cut taxes the state has collected nearly 20 percent more money to date than last biennium. We really are getting to a point where we need to consider some serious tax refunding to this state’s citizens.

 

An interesting month in North Dakota when it comes to airline boardings. Five airports, Dickinson, Williston and Fargo, reported increases. So did Minot and Grand Forks, although just barely.

Dickinson’s although relatively small compared to the biggest five is getting there, and the increase as a percentage was huge, nearly 200 percent. Now what could that be? Oh, yes, oil. It is a good thing that the oil boom is over or there would have been several airplane collisions at the Dickinson airport. Again, the oil industry has entered a new maturing phase. First, they are only drilling holes which have nearly a 100 percent success rate, as fast as the fracking crews and the final set up crews can get to them. To have several hundred non producing wells sitting there waiting for completion makes no sense.

The Dickinson boarding data needs to be read with the North Dakota Department of Mineral Resource report, which is posted on this site when that department releases their data. See the date on that post. That is usually the time of month you can expect the report.

Williston, although only increasing just over 25 percent is also attributable to the oil business, and 25 percent is enough of an increase to make even JFK exuberant. Less than 10 years ago both airports (Dickinson and Williston) had about the same traffic. Williston of course is the more (the state’s most) important oil city. Minot’s slight increase probably can also be attributable to oil.

Grand Forks slight increase is what you would hope for in the part of the state that is slowing down. In fact, my bet if you did a real study the increase came about because of the university especially the Colleges of Engineering and Aero Space, and the unmanned aerial vehicle personnel located both at UND and at the air base.

The interesting data, the one I would look at in more depth if I was serious about knowing my competition is Fargo. The increase is nearly 14 percent. There is nothing here like oil, or government, or any thing that I am aware of other than just a continuing reflection of how fast Fargo is growing. How come? How come it is growing, and especially why is it growing at the speed it is continually, not in fit and starts?

As I have said before, Fargo and Sioux Falls are the Twin Cities furthest out and “newest” suburbs. It is a chicken and egg situation, but they have airplanes coming in from more places and that makes them grow, but they grow because those air planes come from more places.
While they are still small towns by America’s standards they are true urban areas and are regarded as places for corporations to consider for establishing at least part of their businesses. This is the first time that has happened in either state.

 

There is not much to say about this months employment/unemployment table except that all of the northern plains is in relatively good shape.

When I say in relatively good shape the Minnesota unemployment rate has a lot of room for improvement, but compared to much of the nation their unemployment rate is a good improvement over the past three years.

South Dakota, although not as good as their sister state of North Dakota, has a significant improvement over the past few years and usually ranks among the best in the nation. So too Montana, and the oil county I show (Richland) looks like North Dakota.

North Dakota, because of the continuing oil development, remains the best state in the northern plains and the nation in terms of the unemployment rate and the increase in jobs.

That is not just a decrease in unemployment, but a real increase in the number of people working in the state. The other factor different than in most states is that North Dakota continues to have an increase in the average disposable income per capita.

Most states that are back to having the same number of jobs as there was before this recession find that the recovered jobs are paid at a lower rate than the jobs that were lost. In North Dakota, driven by the high wages in the oil patch, essentially all jobs have increased in remuneration. It is probably only those retired on not much more than social security payments whose standard of living has declined. The rest of the population is well ahead from a decade ago.

 

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First, this is the third post I have made to the website today. Below this you will find a posting on U.S./Canadian border crossings, and below that a posting on the city sales taxes in selected North Dakota cities.

NOW, after that terrible winter, after all those announcements from those who couldn’t wait for the fact to occur before they reported it, now it has happened. North Dakota, in April averaged producing over one million barrels of oil per day. Only three other states have ever done that, Texas, California, and Alaska.
Today it is only North Dakota and Texas.

Right now the production in Texas is significantly greater than in North Dakota. Some think that North Dakota can eventually pass Texas in total production. That will take a lot. In 2013 Texas produced in excess of two and one-half million barrels a day.

In the meantime, we will not worry about who is first. Instead, we need to make sure North Dakota production continues to drill new wells on a business like basis, and most importantly that the United States continues to apply new technology in all the oil patches for the good of our economy and for the safety of our armed service members who then will not have to go in places we are not wanted. Let those places sell those barrels to others, or even shut their wells off.

 

Well, all I can say here is that this months border crossing data is confusing, at least to me. As it has been for some time the Canadian dollar has continued to lose its value relative to the the U.S. dollar. In fact by quite a bit over the past year (see last item on the chart). That is considered a significant drop compared to a year ago.

Now we know that the oil boom continues in North Dakota, and that includes the relationship(s) between the North Dakota oil and the Canadian sands oil, so that is part of the increase in traffic.

So too is the improving economy between Canada and the U.S. so that accounts for some of the increase, especially in Fargo and Grand Forks.

However, the increase in the number of people crossing at the border stations, especially Pembina and the smaller crossing in North Dakota and Minnesota is hard to understand. Generally those are private citizens coming for the Canadian “holiday” weekends and for shopping excursions, especially to Grand Forks and Fargo, and to a smaller amount in Minot, Bismarck, and Williston.

Now, with nearly a 10 percent drop in the drop in value of the Canadian dollar relative to the U.S. there was over a 13 percent increase in border traffic. That is a lot in any case, but it is confusing under these circumstances. We will just have to see if this is a one time aberration, or the leading edge of real improvement, which we hope for.