NEWS for North Dakotans
Agriculture Communication, North Dakota State University
7 Morrill Hall, Fargo, ND 58105-5665
May 18, 2000
State government expenditures in North Dakota totaled $2.5 billion in 1998, a 4.2 percent increase from $2.4 billion in 1997. The largest proportion, 32 percent, went for education while another 18.3 percent went toward public welfare and 12.7 percent went to highways, according to the recent Economic Brief released from the North Dakota State Data Center at North Dakota State University.
"The rising cost of government in North Dakota is largely due to the state's small population base and large land area. It simply costs more to provide services to residents in a sparsely population state. For example, the cost of education has risen 37 percent since 1990, and the cost of maintaining our roads has increased by 59 percent during the same period," says Richard Rathge, data center director.
State government revenue totaled $3.1 billion in 1998, with the largest proportion coming from taxes (34.5 percent). Since 1990, North Dakota's selective sales tax has risen 10 percent per year, on average, while individual income tax has increased by 6.7 percent per year and corporate income tax 9 percent per year.
"North Dakota's 1998 total taxes, per capita, rank 23rd in the nation. However, the ranking varies greatly depending on the type of tax you are talking about," Rathge stresses. "For example, North Dakota ranks relatively low--41st--in individual income tax, at $279 per capita, which accounts for only 16 percent of tax revenues. On the other hand, North Dakota ranks 3rd in the nation for selective sales taxes, at $471 per capita, which accounts for 28 percent of tax revenues."
Selective sales taxes include liquor, gas, tobacco and other specific taxes, Rathge explains. Another 29 percent of North Dakota's tax revenue is produced by general sales taxes, for which North Dakota ranks 32nd in the nation, at $484 per capita.
Total state expenditures have increased 4.9 percent per year, on average, during the past 10 years, Rathge says. While the proportion of state expenditures for parks and recreation is small (less than 0.5 percent), the amount has risen nearly threefold since 1990 and has been increasing an average of 23 percent per year. Meanwhile, expenditures for correction and health rose an average of 10 percent per year since 1990, but salary and wage increases averaged only 1.4 percent per year.
Per-capita state government expenditures in North Dakota totaled $3,959.02 in 1998, placing the state in the No. 12 ranking nationwide, Rathge says. Alaska ranked first with $9,451 and Hawaii was second with $4,912. New York was third at $4,805.
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Source: Richard Rathge (701) 231-8621
Editor: Dean Hulse (701) 231-6136
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