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Dan Gunderson

Oil, ag losses prompt cuts for North Dakota agencies

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After years of growing revenue, North Dakota state agencies need to trim their budgets in response to a revenue shortfall.

Weakness in the oil and agriculture sectors dropped state revenue more than $1 billion below expectations, prompting Gov. Jack Dalrymple to tell state agencies they need to cut their budgets by $245 million.

"After 15 years of receiving almost entirely good news about the growth of revenues in North Dakota it seems strange to hear that things have gone in the other direction," Dalrymple said, adding the cut of just over 4 percent "was the maximum reduction we could make without causing unacceptable negative impacts on sensitive areas such as medical services and prison security."

The state will add those cuts to $498 million from a budget stabilization fund and a projected $332 million budget surplus to balance the budget.

That means the state will be left with no surplus at the end of the current two-year budget cycle which ends in 2017.

State agencies have about two weeks to decide where to make those cuts.