The approval of Senate Bill 2319 by House lawmakers brought an end to a multi-year disagreement between the state of North Dakota and the Mandan, Hidatsa and Arikara Nation over tax revenues from the Oil wells drilled laterally under the oil-rich Fort Berthold Indian Reservation of the tribe.
“Tough deliberations and tough discussions – we were able to get through these to make the deal fairer,” MHA Chairman Mark Fox said.
The MHA nation, known as the Three Affiliate Tribes, has long argued that the revenues from these straddling wells are rightfully theirs.
Lawmakers expressed concern in this session about a proposal to change the state-tribal tax deal, known as the pact, and debates on the issue were drawn into broader negotiations between the State and tribe on how to handle oil production under President Joe Biden’s climate. targeted administration. Lawmakers and the tribe ultimately came to a compromise that avoided changing the 13-year-old tax pact while sending a cut in tax revenue from the straddling wells to the tribe.
“I’m surprised it ended like this. I thought we would come up with something, but I didn’t know what it would be, ”said Senate Majority Leader Rich Wardner, R-Dickinson.
At certain points in the negotiation process, Fox raised the possibility of putting a tribal tax on oil production from straddling wells, a move state officials have warned could void the state-tribe tax pact and leave an unstable fiscal climate for oil producers.
After deliberation over the past few months, “everyone is happy,” Wardner said.
The final version of the bill resulted in a complex split between the tribal states and the tax revenues from the wells that leave the reserve and extract the oil below. The deal, which is now heading to Gov. Doug Burgum’s office, would send just over $ 7 million from the state to the tribe every two years, nearly half of the amount at stake when negotiations began. .
In recent weeks, Fox has become a strong advocate for the continued operation of the Dakota Access pipeline, which transports most of the oil produced on the Fort Berthold reserve to market. Pipeline operations have been vigorously opposed by another tribe, the Standing Rock Sioux Nation, for years, and North Dakota officials have been worried for months about a possible pipeline shutdown by the Biden administration or a federal court.
Wardner and state tax commissioner Ryan Rauschenberger said Fox’s recent plea for the besieged pipeline was a big factor in bringing the straddling well negotiations to a resolution.
An earlier version of the bill would have forced the tribe to leverage its influence with the White House for looser drilling regulations on two parcels of undeveloped federal land adjacent to their reservation. That part of the deal was left out of the final deal, although state officials and lawmakers have expressed hope that conversations will continue on that front.
Although Fox said he hoped to enshrine the deal in a fiscal compact, which may be more complicated to change than a statute, he said the tribal government felt confident in the compromise the two sides were ultimately reached.
“We’re satisfied. That satisfaction outweighs some of those other minor concerns,” he said.