North Dakota Considers Drilling Its Way Out Of Property Taxes
June 26, 2012
On June 12, voters in North Dakota went to the polls to decide if they would become the first state to abolish its property tax. Though the measure was rejected, that it was a possibility speaks to the incredible economic opportunities afforded to the state's residents by its recent oil boom, says Investor's Business Daily.
Tapping the enormous Bakken Shale Formation, oil drillers have enormous extraction opportunities in the state that are making it one of the leading oil producers in the country.
- Professor Mark Perry reports that North Dakota pumped another record amount of oil during the month of March at a rate of 575,490 barrels per day.
- In so doing, it replaced California as the nation's number three oil-producing state, behind Texas and Alaska.
- At its current rate of production growth, North Dakota will likely top Alaska sometime this year.
- Continental Resources, an Oklahoma-based oil company that operates 10 percent of the drilling rigs in North Dakota, estimates there are more than 900 billion barrels of oil in place.
- Though only 27 billion to 45 billion barrels are actually recoverable with today's technology, that's still a sizable amount that will only get bigger as technology advances.
This incredible boom in in-state production has an unsurprising effect on the local economy: flush with revenues, oil producers are injecting new life into the job market.
- While the nation's economy languishes, North Dakota has the nation's lowest unemployment rate at just over 3 percent.
- Ten North Dakota counties posted jobless rates at or below 2.5 percent in March, and Williams County boasts the lowest jobless rate in the country at just 0.7 percent.
- North Dakota oil revenues generated an estimated $839 million in fiscal 2011 and are expected to deliver more than $2 billion over the next two years.
- State per-capita income is $4,000 above the national average and, according to the Bureau of Economic Analysis, increased last year to $45,747 from $25,952 in 2000.
The opportunities available to North Dakota residents could be expanded to the entire nation, were the Obama administration to free up the energy sector. Blocking the Keystone oil pipeline and largely prohibiting drilling access from federal properties prevent this potential benefit.
Source: "North Dakota Drills Its Way Out Of Property Taxes," Investor's Business Daily, June 12, 2012.
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