Associated Press Writer

By DALE WETZELBy DALE WETZEL

North Dakota lawmakers have proposed adding $1.2 billion in spending increases and tax cuts to Gov. John Hoeven's proposed budget, which legislators say will make the job of balancing the state's books even tougher.

The 2007 Legislature's tally so far includes proposals to provide income and sales tax breaks, subsidize local property tax bills, freeze college tuition, and provide money for renewable energy initiatives, coal projects and building construction.

They come on top of Hoeven's budget recommendations to the Legislature, which requested $2.47 billion in state general fund spending over two years - an increase of $479 million - and a total budget of $6.33 billion.

"It seems like a huge number to trim down," said Sen. Randy Christmann, R-Hazen, the Senate's assistant majority leader. "Our revenues are good, but they're not that spectacular that we can just go wild here, and do everything that anybody wants."

North Dakota's healthy fiscal outlook will make it more difficult to turn down lawmakers' ideas for new programs, said Sen. Raymon Holmberg, R-Grand Forks, the chairman of the Senate Appropriations Committee.

"The expectation is that there is money there," Holmberg said. "Therefore, why are you dragging your feet on my spending bill?"

General fund spending is financed mostly by state taxes on income, sales and energy. The total budget figure includes federal aid, an assortment of fees, and state tax collections on motor fuels.

North Dakota's treasury is expected to have a surplus of at least $538 million when the state's current budget period ends June 30. Hoeven's proposed budget, while it increases general fund spending by 24 percent, also includes a reserve of about $413 million.

Sen. Tim Mathern, D-Fargo, said it was not surprising that "there are a lot of ideas coming out of the woodwork. I don't think there is anything wrong with that. In fact, the more ideas, the better."

"There are special interest groups that are here all the time. They're making sure their proposals are coming forward," Mathern said. "Let's make sure that other folks out there, who have ideas, are coming to the table at the same time."

The Legislative Council, which is the Legislature's research arm, compiles a weekly roster of bills that affect state revenues and spending, and are not included in Hoeven's budget recommendations.

The most recent report lists $410 million in potential revenue losses, mainly from proposed tax cuts and exemptions, and $789.3 million in spending increases. The numbers are likely to rise, because the potential cost of some recently introduced legislation is still being calculated.

It isn't unusual, a month into the Legislature, for spending proposals to greatly outstrip available revenues, and several initiatives have overlapping financial effects.

For example, legislators have introduced several bills to restrain property taxes and provide state subsidies to limit their growth. Each one's potential cost is included in the $1.2 billion tally, but the Legislature is likely to meld them into one bill, with a smaller price tag.

Three property tax measures alone, two introduced by lawmakers and one written by the Legislature's interim Finance and Taxation Committee, would have a collective impact of $282 million.

"A lot of the bills that are in, cover the same issues," said Rep. Rick Berg, R-Fargo, the House majority leader. "This is just the stage where we're going to have to sort through that … We're far from saying, 'Here is our final budget.'"

Sen. John Warner, D-Ryder, calls the process "creative ferment. There are ideas percolating around here all the time."

"There's very good discussions about not only how to reconcile the numbers, but there are new discussions about directions that the state should be going," Warner said. "We've been so careful not to go outside the box for so long."