Gov's Budget Includes $20M for ND Centers of Excellence

With an overall projected reserve of about $1.2 billion at the end of the 2011-13 biennium, North Dakota is well positioned to invest in growing economic sectors during a time when most states across the country are cutting programs to fill massive budget deficits. Gov. Jack Dalrymple outlined a budget for the next two years that would capitalize on the state's institutions of higher education and energy industry. Proposals include extending the Centers of Excellence program with an additional $20 million, establishing an Office of Energy Development to focus on the state's growing energy sector, and increasing funding for higher education to hold down tuition.

The governor wants to restructure the state's highly successful Centers of Excellence program by targeting additional funding toward three new centers. In total, $20 million is proposed for the centers, which includes $5 million in carryover funding from current unexpended appropriations. New investments include:

• $10 million for Centers of Research Excellence for commercialization and research talent attraction grants with up to $3 million for infrastructure development grants;
• $5 million to provide assistance to entrepreneurs in the areas of access to capital, marketing, entrepreneur infrastructure, and entrepreneur talent through the Centers of Entrepreneurship Excellence; and,
• $2 million for the Centers of Workforce Excellence (previously known as the workforce enhancement grant program) to allow two-year colleges to respond to the workforce needs of private sector partners.

An impact analysis released earlier this year reported the state's 20 centers were returning $16.56 for each dollar spent with the centers also capturing $115.5 million in match and federal research leverage from the state's initial investment (see the Jan. 13, 2010 issue of the Digest).

The governor's budget would increase higher education funding by $82 million, freezing tuition for two-year institutions and allowing for an increase of no more than 2.5 percent at four-year institutions. Another $5 million would allow the Board of Higher Education to develop a new methodology for funding higher education based on student outcomes. North Dakota joins a growing list of states including Mississippi, Texas and Virginia seeking new funding mechanisms to sustain higher education based on results rather than enrollment.

Within the Department of Commerce, the governor wants to establish a new Office of Energy Development to promote the development of energy resources, work with communities on infrastructure, and manage renewable energy programs. The office would be seeded with $600,000 from the general fund.

The $3.2 billion 2011-13 budget outlined by the governor represents a 5.6 percent increase in expenditures when compared to total 2009-11 appropriations and includes $50 million in new income tax cuts over the next two years. Budget documents are available at: http://www.nd.gov/fiscal/budget/state/