- Associated Press - Friday, March 3, 2017

BISMARCK, N.D. (AP) - North Dakota’s expected tax collections have dropped more than $50 million so far this year, prompting an advisory group of lawmakers, state officials and business leaders on Friday to recommend lowering expectations.

A huge drop in North Dakota tax collections due to depressed oil and farm commodity prices has the state scrambling to make up for potential shortfalls to the state treasury for the past two years. Expected revenue from tax collections has missed the mark by hundreds of millions of dollars since then due to a state economy that has slid with a dramatic drop in oil drilling.

State budget analysts and the economic consultancy Moody’s Analytics on Thursday are slated to present new North Dakota tax collection forecasts to Legislature, which has idled major spending bills this session until the economic assumptions are released. Analysts compile information from North Dakota’s Tax Department, budget office and Moody’s Analytics to estimate the state’s tax collections for the next two years and gauge the health of North Dakota’s economy.

Thursday’s estimates will provide to lawmakers a fresh set of numbers, although they only include three months’ worth of new data.

“I can’t stress enough how much caution policymakers should be taking into the next forecast,” Moody’s economist Dan White said.

House Majority Leader Al Carlson, a Fargo Republican, said the big dose of austerity is not lost on lawmakers and the next revenue forecast needs to be “on the nose.”

“We don’t need to shift this burden somewhere else - and that’s on the backs of taxpayers,” he said.

Oil prices are a key contributor to the state’s wealth. The November forecast predicted North Dakota oil would fetch about $48 a barrel this year, but the advisory group lowered it by a dollar. North Dakota crude was getting about $47.50 on Friday.

State tax officials estimate every dollar that a barrel of oil either increases or decreases has a more than $33 million impact on the state treasury annually.

The panel also assumed that farm commodity prices, sales tax, income tax and motor vehicle tax collections would remain mostly flat compared to the earlier projections.

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