North Dakota 2025 Legislative Session Recap

The 69th North Dakota Legislative Assembly adjourned “sine die” during the early morning hours on Saturday, May 3.  The Legislature completed its work on the 74th legislative day.  This leaves six additional days (of the Constitutionally-allowed 80 days) for the Assembly to call itself back into session before the end of 2026 should it need to address additional issues.

The session was marked by the passage of pieces of landmark legislation in areas such as property taxes, healthcare, education, and energy.  Additionally, policymakers approved a record biennial state budget of more than $20 billion while maintaining healthy fiscal reserves in case of any economic fluctuations.  

Below is an overview  of the key issues of interest to the legislature.  Please feel free to contact Primacy Strategy Group should you need any additional information or have any questions.

North Dakota Enacts $409 Million Property Tax Relief and Reform Legislation

North Dakota lawmakers have passed – and Governor Kelly Armstrong has signed into law –  a sweeping $408.9 million property tax relief package, positioning it as the most significant tax reform of the 2025 legislative session and a cornerstone of the Governor’s inaugural legislative agenda.

The legislation was the product of months of negotiation and was co-sponsored by a bipartisan group of lawmakers, including House Majority Leader Mike Lefor, Senate Majority Leader David Hogue, and members of key finance and taxation committees.

The newly enacted measure, House Bill 1176, more than triples the state's existing primary residence property tax credit from $500 to a maximum of $1,600 per year. Funded entirely by earnings from North Dakota’s $12 billion Legacy Fund, comprised of oil tax revenue, the program is designed to provide immediate relief to homeowners while limiting future tax growth by capping annual levy increases by local governments at 3%. The cap includes a provision allowing taxing districts to opt out by holding a public vote to lift the restriction for up to four years.

“This bill provides real relief and real reform for taxpayers,” said Gov. Armstrong during a signing ceremony at the State Capitol. “It’s responsible, affordable and durable. It creates Legacy Fund buy-in, and it’s the single most impactful thing we could do for North Dakota citizens this session.”

Passed unanimously in the Senate and by a vote of 86-4 in the House, the final version of HB 1176 emerged from a conference committee just hours before the 2025 legislative session adjourned. The bill excludes the controversial “skin-in-the-game” provision—initially proposed by the Senate—that would have required every homeowner to pay at least 25% of their tax bill regardless of credits received.

“This is truly a landmark bill when it comes to property taxes,” said Rep. Mike Nathe, R-Bismarck, the bill’s primary sponsor. “Probably historic.”

The legislation also includes $30 million in gap funding to ensure school districts subject to the cap can still meet the state's minimum funding thresholds, with oversight provided by the Department of Public Instruction.

Despite the broad support, not all lawmakers were satisfied. Rep. Scott Louser, R-Minot, who sponsored a competing property tax bill (HB 1168), announced his intention to file an initiated measure for the 2026 ballot. Louser’s proposal would have the state fully buy down all public school property tax levies—at a projected cost of $720 million—expanding relief to agricultural, commercial, and centrally assessed properties.

The House ultimately rejected HB 1168, while the Senate defeated HB 1575, leaving HB 1176 as the sole major property tax measure enacted.

Though signed into law, HB 1176’s appropriation will require reauthorization by the 2027 Legislature, offering lawmakers a chance to evaluate its performance and consider expansions. Governor Armstrong and several lawmakers have expressed hopes that the Legacy Fund will support broader relief in future sessions, potentially paving a path to eliminating property taxes for many North Dakotans.

“This is an unbelievably great and historic package,” Armstrong said. “It’s going to have real, meaningful results for the citizens of North Dakota—particularly for primary residential homeowners.”

North Dakota Enacts Major Prior Authorization Reforms

In a significant victory for healthcare advocates and patients across North Dakota, Governor Kelly Armstrong signed Senate Bill 2280 into law on Wednesday, April 23, 2025, marking a landmark step forward in reforming the state’s prior authorization system.

The legislation — which passed the North Dakota Senate by a 43-4 margin and the House unanimously — enacts the first comprehensive set of legal protections for patients and providers navigating prior authorization processes in the state’s healthcare system. Prior authorization is the practice by which insurers require pre-approval for certain treatments, medications, or procedures before they are provided. Originally designed to manage healthcare costs, the system has increasingly come under fire for causing care delays, increasing administrative workloads, and contributing to physician burnout.

Prior to SB 2280, North Dakota was one of only a dozen states that lacked any statutory framework protecting patients and providers from excessive or inappropriate prior authorization practices. Healthcare professionals frequently reported spending an average of between 12-14 hours per week dealing with insurance hurdles — time that could otherwise be spent caring for patients. Studies and testimony cited during legislative hearings indicated that these delays were often linked to worsened patient outcomes, especially in cases requiring timely intervention.

Recognizing the urgent need for reform, a coalition of over 20 organizations across North Dakota — including pharmacists, chiropractors, dentists, physicians, hospitals, and advocacy groups for seniors, children, individuals with cancer, bone and joint issues, and those with intellectual and developmental disabilities — came together to champion SB 2280. Their combined efforts were instrumental in crafting the bill and driving its overwhelming bipartisan support.

The legislation was introduced by Senator Scott Meyer (R-Grand Forks), and co-sponsored by Senators Jeff Barta (R-Grand Forks), Brad Bekkedahl (R-Williston), Sean Cleary (R-Bismarck), and Representatives Jonathan Warrey (R-Casselton) and Jon Nelson (R-Rugby). It emerged from a comprehensive 2023–2025 interim legislative study that examined how prior authorization impacts patient care and provider operations across North Dakota.

SB 2280 establishes several key reforms to the prior authorization process. It requires insurers to respond to urgent prior authorization requests within 72 hours and non-urgent requests within 7 days, ensuring patients receive timely decisions about their care. The law mandates that any denial of a recommended procedure, medication, or treatment must be made by a licensed physician with relevant clinical expertise, rather than by artificial intelligence systems, algorithms, or non-clinical business analysts. It also introduces conflict-of-interest safeguards to prevent financial incentives from influencing prior authorization decisions, helping to prioritize patient welfare over cost considerations.

Supporters say these reforms are essential to reducing bureaucratic red tape, easing the burden on healthcare providers, and — most critically — ensuring patients receive medically necessary care without unnecessary delays.

"This legislation strikes the right balance," said advocates at the signing ceremony. "It allows insurance companies to manage care responsibly, but places overdue protections around the patients and doctors who should be at the center of healthcare decisions."

With the Governor’s signature, North Dakota now joins a growing number of states enacting patient protections in response to mounting concerns about the prior authorization process and insurance provider abuses. Healthcare providers, patient advocacy groups, and lawmakers alike hailed the passage of SB 2280 as a milestone achievement that will improve the quality, efficiency, and humanity of healthcare delivery across the state.

Healthcare Accessablity

North Dakota lawmakers have taken significant steps toward improving health care affordability for residents, particularly those living with chronic illnesses and life-threatening conditions. Three major bills aimed at curbing high out-of-pocket medical costs, House Bills 1216, 1283, and 1114. All three saw significant legislative work, and two of which have been signed by the Governor following their passage. 

House Bill 1216, will end the use of copay accumulator adjustment programs, which currently allow insurance companies and pharmacy benefit managers (PBMs) to exclude third-party copay assistance from counting toward a patient’s deductible or out-of-pocket maximum. This has left many patients paying their deductibles twice—once with copay assistance, and again out of pocket. Sponsored by Rep. Karen Karls (R-Bismarck), the bill passed the North Dakota Senate on a 30-14 vote, now the bill is heading to Governor Kelly Armstrong’s desk. 

Senators Dick Dever (R-Bismarck), Judy Lee (R-West Fargo), and Ronald Sorvaag (R-Fargo) were credited with helping turn the tide on the Senate floor, emphasizing the human impact of the policy. One powerful moment came when the chair of the Senate Human Services Committee invited a local parent affected by the policy to sit beside her during the debate.

Another measure by Rep. Karls, House Bill 1283, passed the House on a 66-26 vote and failed in the Senate. This bill would have eliminated out-of-pocket costs for medically necessary breast cancer diagnostics and supplemental imaging on all state-regulated insurance plans.

While North Dakota boasts strong mammogram rates—72% of women over 40 and more than 80% of women over 50—many patients require expensive follow-up imaging not covered by basic screenings. The legislation would cover diagnostic mammograms, ultrasounds, and MRIs when deemed medically necessary by a physician.

States like Montana have already enacted similar measures, finding both cost savings and improved outcomes.

House Bill 1114 was approved by the Senate 39-7 after earlier passing the House 59-27. Sponsored by Rep. Carrie McLeod (R-Fargo), the bill caps the monthly out-of-pocket cost for insulin and associated supplies at $25 each for those on fully insured health plans—extending a successful pilot program originally implemented for public employees.

Sen. Sean Cleary (R-Bismarck), who carried the bill in the Senate, said the pilot program showed “clear results,” with PERS members saving around $80 per month on insulin and a modest impact to the system overall—just $2 per member per month. The broader commercial rollout is expected to be even more affordable, with proponents claiming estimated costs as low as 30 cents to $1 per member monthly.

Opposition to these measures has come primarily from insurers like Blue Cross Blue Shield of North Dakota, who argue that cost reforms should be left to the market. They warn that expanding mandates could lead to higher premiums or reduced flexibility for employers.

Still, proponents argue that the financial impact is small compared to the lives improved—or saved.

With 1114 & 1216 signed by the governor’s desk, in addition to SB 2280, North Dakota has implemented significant advance patient centered health care reform.

Public Charter Schools Become a Reality in North Dakota After Landmark Legislation

Public charter schools are officially coming to North Dakota following the enactment of Senate Bill 2241, a historic school choice measure signed into law by Governor Kelly Armstrong.

The legislation passed both chambers of the North Dakota Legislature with supermajority votes, 40-7 in the Senate and 64-29 in the House, driven by the overwhelming demand for expanding educational options in the state. SB 2241 marks a major shift in North Dakota’s education policy and is part of a broader nationwide movement that has reshaped public education over the past three decades.

“This is so exciting, to think about the potential of what this could do in North Dakota,” said Senator Michelle Axtman (R-Bismarck), the bill’s chief sponsor. “This is about giving families options.” Governor Armstrong and Lt. Governor Michelle Strinden, both strong advocates for the bill, celebrated its passage as a critical step toward empowering parents and improving educational outcomes for students.

Under the new law, publicly funded charter schools will operate independently of traditional school districts but remain under the oversight of the Department of Public Instruction. They will be governed by their own independent boards and held to the same academic and financial standards as traditional public schools, while maintaining greater flexibility in their curriculum, instruction, and management.

Charter schools in North Dakota will receive state per-pupil funding — estimated at approximately $8,200 per student for the 2024–25 school year — but they will not be permitted to levy local taxes or access the state’s school construction fund. Additionally, they are prohibited from charging tuition, teaching religious content, or discriminating in admissions. Schools must meet or exceed statewide academic benchmarks, and they risk closure if they fail to deliver adequate educational results.

Supporters have praised SB 2241 as a long-overdue innovation that will introduce new models into the public education system, such as dual-language immersion programs or specialized schools designed for at-risk students. Rep. Dori Hauck (R-Hebron), who carried the bill in the House, described public charter schools as “public schools with a great deal more flexibility” to meet students' diverse needs. “Parents should be the ones directing their children’s education—not the system,” added Rep. Ben Koppelman (R-West Fargo).

Supporters also pointed to the opportunity to reengage thousands of licensed teachers who are currently not employed in the education system, offering them new avenues to return to the classroom under a more flexible model.

With the signing of SB 2241, North Dakota becomes the 47th state to authorize public charter schools.

Education Savings Account Legislation Passes; Vetoed by Governor

Despite early momentum proposals to create Education Savings Account (ESA) programs—House Bill 1540 and Senate Bill 2400—ultimately failed to become law. As a result, the state’s only significant school choice achievement this year is the authorization of public charter schools through Senate Bill 2241, as previously discussed.

Education Savings Accounts (ESA) are a state-administered program that allows families to use public funds for approved educational expenses outside the traditional public school system. These funds can be used for private school tuition, tutoring, curriculum, online learning, and other education-related services. Public charter schools are a form of publicly funded independently operated public schools that function outside the traditional school district structure, and they are granted greater flexibility in curriculum design, staffing, budgeting, and school operations. However, they are still required to meet the same academic standards and performance benchmarks as traditional public schools.

At the start of the 2025 legislative session ESA’s were operating in 18 states, and public charter schools are found in 46 states. 

Governor Kelly Armstrong vetoed HB 1540 in late April, halting the creation of a limited, income-based ESA program for nonpublic and homeschool students. While reaffirming his administration’s commitment to educational choice, Armstrong argued that the bill did not go far enough to serve the full range of North Dakota families, particularly those in rural areas with limited access to private schools.

The bill would have directed $21.7 million toward a voucher-style ESA initiative, providing eligible families between $1,107 and $3,900 depending on income. However, Armstrong noted that the majority of students—especially those in public schools or districts without private options—would not have benefited. “House Bill 1540 falls far short of truly expanding choice as it only impacts one sector of our student population,” the governor wrote in his veto message.

Armstrong pointed out that only 19 of the state’s 168 school districts have access to nonpublic schools, making the bill largely irrelevant to most families, particularly in rural regions. He cautioned that passing such a narrowly targeted measure could spark a voter referendum and undermine broader efforts to build sustainable school choice in North Dakota.

Instead, Armstrong urged lawmakers to rally behind Senate Bill 2400, which proposed a universal ESA available to all students, regardless of school type. He acknowledged the larger fiscal impact of SB 2400 but argued it would better reflect the principle that all families—public, private, or homeschool—deserve equal access to education dollars.

“Families all pay taxes, regardless of where or how their child is educated,” Armstrong said. “It is essential that an ESA program using state tax dollars be made available to all families to enhance their child’s education.”

Yet even that more expansive proposal failed to gain traction. Just one day after the HB 1540 veto, the House of Representatives voted down SB 2400, rejecting a motion to delay its consideration for further refinement. The defeat of both ESA bills marks the second time in recent years that North Dakota’s executive branch has blocked ESA legislation. In 2023, then-Governor Doug Burgum vetoed HB 1532 on similar grounds, citing its limited scope and inadequate support for rural families.

340B Protections; Expanding Access to Discounted Prescription Drugs in North Dakota

Governor Kelly Armstrong has officially signed House Bill 1473 into law, expanding access to discounted prescription medications through the federal 340B Drug Pricing Program in North Dakota. The bill passed the Legislature with strong bipartisan support — 71-17 in the House and 41-4 in the Senate — and now becomes state law.

The 340B program, created by Congress in 1992, allows eligible hospitals and health centers serving low-income, rural, and medically underserved populations to purchase prescription medications at reduced prices. Any profits made from the markup on these discounted drugs are intended to help providers cover the costs of uncompensated care and other essential health services.

Previously, hospitals and federally qualified health centers in North Dakota participating in 340B could only provide discounted medications through a single contracted pharmacy. HB 1473 changes that by allowing these healthcare facilities to contract with multiple pharmacies, significantly broadening patient access across the state.

"House Bill 1473 helps to stop drug manufacturers from implementing their own rules outside of an already established federal program," said Sen. Judy Lee (R-West Fargo) during the bill’s Senate debate. "Drug manufacturers continue to provide fewer discounted drugs to North Dakota, and that's not the way the federal program is supposed to work."

Supporters believe the legislation will particularly benefit rural and underserved communities by making it easier for patients to obtain affordable medications close to home. They also view the law as an important measure to push back against recent pharmaceutical industry tactics aimed at restricting 340B discounts.

Despite its broad support, the 340B program itself has faced national criticism. Opponents argue that it can incentivize the use of more expensive medications, that discounts are not always passed directly to patients, and that there is limited oversight of how hospitals use the program’s profits. These concerns were raised during the legislative process but did not slow the bill’s momentum in North Dakota.

The debate surrounding HB 1473 also drew national attention. Bill sponsor Rep. Jon Nelson (R-Rugby) was targeted in a series of negative television advertisements and robocalls from Building America's Future, a nonprofit organization reportedly funded in part by billionaire and Trump senior adviser Elon Musk. The group's ads falsely claimed that the 340B program subsidizes gender transition procedures for minors, accusations Nelson flatly refuted. "There are no transgender surgeries happening in North Dakota, let alone any subsidized by the 340B program," Nelson said in response.

With Governor Armstrong’s signature, North Dakota has encoded access to affordable medications for vulnerable populations and has positioned itself as a leader among states defending the intent and reach of the 340B program against industry pushback.

Elevator Safety Legislation Enacted

Prior to this year, North Dakota was one of only three states without any safety protocols surrounding the publicly accessible people moving elevators and escalators. With the passage of new legislation championed by the Elevator Industry Work Preservation Fund, this will no longer be the case.

North Dakota lawmakers passed Senate Bill 2336, which was sponsored by Senator Greg Kessel (R-Belfield).   Governor Armstrong signed the bill, after House and Senate passage. The new law puts in place a framework for elevator safety to be implemented over the next seven years that will bring North Dakota in line with the rest of the country. 

The implementation of the new structure will be rolled out slowly, starting with the basic protocols; registering elevators and the creation of a database which will allow First Responders and Emergency Services to have the critical information that it takes to act effectively when on a call. 

Over the following five years it slowly implements critical safety procedures, such as new elevator permitting, existing elevator licensing, and eventually safety inspections. 

The legislation was supported by a broad group of emergency service and elevator workers, whose personal harrowing stories highlighted the failures and safety issues of the current structure.

North Dakota Legislature Adjourns with Record $20.3 Billion Budget

The North Dakota Legislature concluded its 2025 session passing a historic $20.3 billion budget.

The $20.3 billion budget for the 2025-27 biennium marks a 3.5% increase from the prior cycle, driven in part by robust Legacy Fund earnings and strong revenues early in the session. General fund spending alone rose to $6.25 billion, a 2.6% increase.

Major highlights include:

• $408 million in property tax relief, including a $1,600 credit for primary residences.
• A 2.5% annual increase in per-pupil funding for K-12 schools.
• $2.6 Billion for road and bridge infrastructure development

Senate Majority Leader David Hogue (R-Minot) praised the budget, saying it meets essential needs “without raising taxes or borrowing money” and delivers “two more years of record tax relief.”

In response to growing needs in behavioral health and corrections, lawmakers made historic investments:

• $300 million for a new State Hospital with 140 acute mental health beds.
• $13 million for additional regional psychiatric beds.
• $28.4 million in payments to local jails housing overflow state inmates.
• $35.6 million to complete the Heart River Correctional Center, the state’s first prison designed for women.
• $20 million to plan a new medium-security prison adjacent to the existing State Penitentiary.

Major Changes to North Dakota’s Elections and Campaign Laws

North Dakota's 2025 legislative session has been marked by a sweeping series of election-related reforms, as lawmakers and Governor Kelly Armstrong moved aggressively to address concerns surrounding election integrity, campaign transparency, and the conduct of political communications.  

Seeking to modernize outdated laws on political advertising, the Legislature passed House Bill 1204, expanding penalties for knowingly distributing false or misleading information during campaigns. Signed into law by Governor Armstrong after passing the Senate 45-1, the new statute now applies not just to traditional media like newspapers and TV, but also to social media, text messages, and phone calls.

Senator Sean Cleary (R-Bismarck) spearheaded the legislation noting that “as election communications evolve, our laws must evolve too.” Cleary acknowledged enforcement challenges, given limited resources among county state's attorneys, but believes this legislation may give teeth to the long standing laws in North Dakota about truth in campaigning.

This push comes after high-profile incidents during the 2024 election cycle, such as false text messages circulated on the day of the primary suggesting Congressional candidate Julie Fedorchak had withdrawn. Several legislators also reported being attacked through misleading social media ads distorting their voting records. 

Complementing this efforts, lawmakers also passed House Bill 1167, which will require any political advertisement generated in whole or in part using artificial intelligence to carry a disclaimer stating: “This content generated by artificial intelligence.” 

North Dakota’s ongoing debate over legislative term limits also featured prominently this session. In 2022 voters approved Constitutional Measure 1, limiting lawmakers to eight years in each chamber (for a combined total of 16 years), with changes allowed only by citizen initiative. This measure remains highly controversial with many voters feeling they had been mislead by proponents of the measure, claiming they thought they were voting for federal term limits. The measure also is likely to face a constitutional challenge, with scholars concerned that the section which overrides the amendment clause of the constitution creates a crisis, and that the supreme court should never have allowed the measure on the ballot. 

Further confusion arose over when term-limit clocks should start ticking — the date the measure passed (November 7, 2022) or the start of the next term (January 1, 2023).

House Bill 1300, introduced by Rep. Ben Koppelman (R-West Fargo), originally set the effective date as November 7, 2022. The Senate, led by Sen. Janne Myrdal (R-Edinburg), amended it to January 1, 2023. After extensive debate and a failed attempt to maintain the House’s preferred date in conference committee, the House ultimately voted 61-28 to kill HB 1300.

With HB 1300 defeated, attention shifted to Senate Concurrent Resolution 4008, which proposed broader changes to the term limits rules. SCR 4008 will allow lawmakers to serve four full terms (about 16 years) in a single chamber and clarifies that partial terms would not count against the limit. Critically, it would also repeal the ban on the Legislature amending term limits. Because it is a constitutional change, voters will decide its fate in the 2026 general election.

North Dakota is one of six states with lifetime legislative term limits, along with California, Michigan, Missouri, Nevada, and Oklahoma.

Election procedure reforms continued with House Bill 1165, which changes how absentee ballots are handled. Previously, ballots postmarked by the day before Election Day could be counted if they arrived up to 13 days later. HB 1165 tightens the rule, requiring ballots to be received by the time polls close on Election Day.

Supporters championed the bill as promoting uniformity and trust in elections, noting that neighboring states like Minnesota, South Dakota, and Montana already have similar deadlines. Governor Armstrong has signed HB 1165 into law, although litigation challenging Trump’s executive order is pending at the federal level.

The Legislature has also moved to standardize all voting systems in North Dakota. House Bill 1297 bars any city, county, or political subdivision from using approval or ranked-choice voting in any local, state, or federal race. Following an overwhelming passage by the legislature Governor Armstrong signed HB 1297, citing a need for a "consistent, efficient, and easy-to-understand voter experience."

This legislation seemingly specifically targeted Fargo, which had implemented approval voting in 2018 through a ballot initiative. Under Fargo’s system, voters could select as many candidates as they approved of in municipal elections, a method supporters like Fargo Mayor Tim Mahoney argued better reflected majority sentiment.

Despite Fargo’s experiment with approval voting lawmakers concluded the system was incompatible with statewide election integrity goals. 

Secretary of State Michael Howe supported the bill, and unlike a similar effort vetoed by former Governor Doug Burgum in 2023, the legislation sailed through both chambers with wide margins.

North Dakota Moves to Address Prison Overcrowding as Sentencing Reform Stalls

Facing mounting pressure on North Dakota’s correctional system, Governor Kelly Armstrong announced a series of proposals aimed at expanding prison capacity and investing in behavioral health services. Meanwhile, a controversial sentencing reform bill promoted by Attorney General Drew Wrigley was defeated in the state House after intense debate.

In his budget proposal, Governor Armstrong outlined plans to add 178 new beds to the state’s prison system over the next two years through partnerships with counties and through the reengagement of existing state resources. One such partnership is with Grand Forks County, who is completing an expansion of its correctional center but lacks operational funding. Thew County approached state officials with a partnership proposal,  $16.1 million for the Department of Corrections and Rehabilitation (DOCR) to staff and operate the new section, which will allow for the adding 90 beds by July 1. Additionally, Armstrong proposes establishing a temporary housing facility at the Missouri River Correctional Center, adding another 88 beds by summer 2026.

“The state needs the beds. This is a real quick path to it,” said Colby Braun, director of the DOCR. 

To address persistent overcrowding in North Dakota’s prisons, the Legislature approved more than $143 million in one-time funding for correctional infrastructure, jail reimbursements, and inmate services. The investments are attempting to establish a coordinated effort to expand capacity, modernize facilities, and strengthen support programs across the state’s correctional system. Among the most significant allocations is $35.7 million to complete construction of the Heart River Correctional Center, a new women’s prison in Mandan.

To provide immediate relief to county and regional facilities already overflowing housing populations, the state set aside $28.4 million in payments to local jails. An additional $13 million was directed toward deferred maintenance and extraordinary repairs across DOCR facilities.

Longer-term planning also received legislative backing. The budget includes $20 million for planning and design of a new Missouri River Correctional Center and $750,000 to study future options for the James River Correctional Center. A separate $570,000 was allocated to upgrade and prepare the James River site.

Technology and rehabilitation efforts were also a focus. Lawmakers approved $9.75 million for software and system upgrades, $13.7 million to expand Rough Rider Industries programs, $3.1 million for diversion and deflection center grants, and $1.03 million for workforce training and education initiatives within the correctional system.

While these projects will expand capacity and improve operations, officials emphasized that infrastructure alone will not solve the state’s incarceration challenges. Elected officials across the board reiterated that investments in behavioral health and reentry support remain critical to reducing recidivism and addressing the root causes of incarceration.

The budget also includes $19.2 million for behavioral health initiatives, including $6.9 million to expand Free through Recovery, Community Connect, and peer support programs, $7.8 million to enhance youth crisis services, $2.5 million to support the state's substance use disorder voucher program, and $2 million for rural crisis support.

At the start of the session Govenor Armstrong also announced the creation of a new Cabinet-level position: Commissioner of Recovery and Re-Entry. This role oversees coordination across corrections, health and human services, and the judiciary to address root causes of incarceration and promote rehabilitation. 

As the state moves to expand prison capacity, an effort to impose stricter sentencing requirements failed in the Legislature. Senate Bill 2128, spearheaded by Attorney General Drew Wrigley, would have required violent offenders, drug traffickers, and sex offenders to serve at least 50% of their sentences in prison before becoming eligible for parole. If denied parole, inmates would have been required to serve 85% of their sentences.

The bill also sought to mandate that sentences for crimes like fleeing law enforcement and assaulting officers be served consecutively, rather than concurrently. Although the Senate passed the bill earlier this year by a 28-18 vote, the House rejected it 41-52 citing a lack of data to support claims that this may reduce recidivism and the rate of select violent crimes.

Opponents, including several Republican lawmakers, argued that the bill would exacerbate prison overcrowding and limit access to rehabilitation programs that help reduce recidivism. Colby Braun, the DOCR director, echoed those concerns, noting that transitional facilities—where inmates prepare for reintegration into society—are crucial to reducing repeat offenses. The DOCR warned that most inmates would not qualify for transitional housing if SB 2128 became law.

Supporters, including Wrigley and several prosecutors, framed the bill as a way to better protect victims and uphold public trust in the criminal justice system. Rep. Pat Heinert (R-Bismarck), a former sheriff, argued that the system was losing the confidence of crime victims and law enforcement officers.

With new investments in infrastructure and behavioral health, the administration aims to address the current crisis in a more measured and incremental way.

Protecting Access to Low-Cost Energy

The legislature acted on two bills this session that protect North Dakota’s electrical transmission infrastructure, and therefore our state’s continued access to affordable energy.

SB 2339, introduced by Senator Greg Kessel (R-Belfield), provides a mechanism for utilities to file wildfire mitigation plans with the state government, which lays out the utilities’ efforts to prevent transmission infrastructure accidents from causing wildfires.  Additionally, the bill provides for a clearer path to recovery if a natural disaster damages infrastructure resulting in a wildfire.

HB 1258, introduced by Representative Mike Brandenburg (R-Ellendale), streamlines the process by which electrical transmission lines are permitted.  Specifically, the bill provides that a local political subdivision may not prevent a project permitted by the Public Service Commission from being completed by using local ordinance.  The bill will enhance access to infrastructure to bring additional energy to areas experiencing increased demand for energy.

Finally, HB 1279, introduced by Representative Anna Novak (R-Hazen), extends the current coal conversion tax holiday and phases out the exemption over a period of six years.  This policy protects the core of North Dakota’s baseload generation capacity, as well as our state’s foundational energy generation source.

Mental Health Investments in North Dakota

The Legislature has passed $300 million investment to construct a new, state-of-the-art hospital. This proposal seeks to replace the aging 550,000-square-foot facility with a more efficient, 300,000-square-foot building designed to be trauma-informed and welcoming, featuring amenities like courtyards and single-occupancy rooms. The new facility would support approximately 140 beds, enhancing the state's capacity to provide mental health services. 

In 2025, North Dakota enacted two significant pieces of legislation aimed at enhancing access to behavioral health services and improving the professional landscape for mental health providers. House Bill 1035 (HB 1035) established the state's participation in the Social Work Licensure Compact, facilitating multistate practice for social workers. Senate Bill 2079  redefined the classifications of mental health professionals, expanding the workforce eligible to provide mental health services. 

HB 1035, signed into law on March 14, 2025, created Chapter 43-41.1 of the North Dakota Century Code, officially bringing the state into the Social Work Licensure Compact. This interstate agreement allows licensed social workers to practice in other compact member states without obtaining additional licenses, thereby enhancing workforce mobility and addressing service shortages, particularly in rural areas. 

The National Association of Social Workers – North Dakota Chapter (NASW-ND) strongly supported the bill. They highlighted that the compact would streamline licensing processes, reduce administrative burdens, and improve continuity of care for clients who move across state lines. The compact also benefits military families by allowing social workers who are military spouses to maintain their licensure status despite frequent relocations . 

The North Dakota Hospital Association and Nexus-PATH also endorsed HB 1035, emphasizing the need for more mental health service providers across the state. By facilitating interstate practice, the compact aims to attract and retain a larger social work workforce, thereby improving access to care in underserved regions . 

SB 2079, enacted on March 18, 2025, amended Section 25-01-01 of the North Dakota Century Code to update the definitions and classifications of mental health professionals. The bill restructured the tier system as follows: 

• Tier 1: Includes psychiatrists, psychologists, licensed physicians, physician assistants, and advanced practice registered nurses. 
• Tier 2: Expanded to include licensed professional counselors (LPCs), in addition to licensed clinical social workers, licensed professional clinical counselors, and licensed marriage and family therapists. 
• Tier 3: Now excludes LPCs, reflecting their reclassification to Tier 2. 
• Tier 4: Expanded to include certified peer support specialists, recognizing their role in providing behavioral health support.

New Potential for North Dakota’s Rich Natural Resources 

Energy production and mining are two of North Dakotas' largest industries, and the Legislature is looking to the future to secure its role in these spaces as the economy and technology continue to evolve. North Dakota is positioning itself at the forefront of U.S. energy innovation with two legislative efforts advancing research into nuclear energy and rare earth mineral extraction—both seen as key to the state’s long-term energy diversification and national competitiveness. 

The North Dakota House of Representatives has approved Senate Bill 2159, paving the way for the Energy and Environmental Research Center (EERC) in Grand Forks to conduct research into nuclear energy technologies. The measure passed 57-32 in the House after earlier clearing the Senate in a near-unanimous 45-2 vote. The bill returns to the Senate for consideration of House amendments. 

The move allows North Dakota to participate in a national resurgence of interest in nuclear energy, including potential use of recycled fuel rods and small modular reactors. EERC, which serves as the State Energy Research Center under the oversight of the Industrial Commission, is now authorized to explore above-ground storage solutions and a varied set innovative nuclear systems. Any nuclear research projects must be approved by both the Industrial Commission and the state’s High-Level Radioactive Waste Advisory Council. 

“This isn’t about storing waste—it’s about researching new energy options,” said Rep. Jon Nelson, R-Rugby, whose district was once eyed by the U.S. Department of Energy for underground nuclear waste testing. “We have protections in place to ensure we don’t become a dumping ground.” 

Rep. Todd Porter, R-Mandan, pointed to Wyoming’s plans to convert a coal plant into a nuclear facility as an example of regional competition and the importance of keeping North Dakota in the mix. Meanwhile, House Bill 1025, also passed by the House, calls for a broader legislative study into the feasibility of nuclear power plants across the state. 

In a somewhat related area, North Dakota lawmakers have passed legislation aimed at advancing the state’s role in domestic rare earth mineral production. House Bill 1459, introduced by Rep. Dick Anderson, R-Willow City, and amended in the Senate by Sen. Dale Patten, R-Watford City, is now headed to Governor Kelly Armstrong for signature.

HB 1459 seeks to position North Dakota as a strategic player in the extraction and processing of rare earth elements (REEs), particularly from coal seams found in the Williston Basin. These minerals are essential for a range of high-tech and defense applications—from smartphones to electric vehicles and missile guidance systems. With China currently dominating global rare earth supply chains, supporters of the bill framed it as a critical measure for U.S. energy independence and economic security.

“This keeps North Dakota on the map,” said Patten, who introduced a key amendment in the Senate that reshaped the bill. “It shows the Department of Energy and others that we are serious about domestic mineral development.”

Earlier versions of the bill included a provision mandating a 2.5% royalty payment to mineral rights owners for any REEs extracted from coal seams—on top of the royalties already negotiated in existing coal leases. This language drew criticism from property owners, lawmakers, and advocacy groups like the Northwest Landowners Association, who argued it was unconstitutional and would retroactively alter private contracts. The concern nearly derailed the bill.

Sen. Brad Bekkedahl, R-Williston, said the provision infringed on the rights of landowners to renegotiate their leases. “I would want to have the ability to negotiate another lease,” he said during floor debate.

In response, Patten’s amendment removed references to existing coal leases and shifted the bill’s focus toward clarifying mineral rights, creating a framework for voluntary negotiation, and launching a state-led study into rare earth extraction. Language added by Rep. Lawrence Klemin, R-Bismarck, allows landowners and coal companies to renegotiate leases to reflect REE development, but some lawmakers remained uneasy with the retroactive implications.

“This is a way for the mineral owner to realize revenue,” Patten emphasized, especially in scenarios where coal fly ash is used as a source of REEs and traditional royalty structures might not apply.

Rep. Anderson noted that technologies are rapidly evolving to extract rare earths from fly ash—the residue of burned coal—which may not fall under existing lease agreements. Without proactive legislation, he warned, mineral owners could end up with nothing. “If you get too greedy, you lose,” he said during a Friday committee meeting.

Despite the legal complexities, many lawmakers, including Rep. Todd Porter, R-Mandan, supported the bill as a foundational framework that “provides clarity and certainty to industry” and sets the stage for investment. Porter acknowledged litigation over royalties is likely but called it a necessary step in establishing clear legal parameters.

Industry leaders and researchers echoed the urgency. The Lignite Energy Council warned that without legal and financial certainty, rare earth extraction projects may stall, and landowners may lose out. The Energy & Environmental Research Center (EERC) at the University of North Dakota estimates that a facility processing 200,000 tons of coal annually could profitably extract rare earths, potentially delivering high-value output from just one truckload of concentrate per week.

“We need policy, clarity, and investment. Without them, this opportunity will pass us by,” one EERC researcher said.

The final version of HB 1459 passed the House 63-26 and the Senate 27-19, with lawmakers emphasizing the bill’s revised focus on setting policy direction rather than enforcing contractual terms. Supporters now hope the measure will signal to the U.S. Department of Energy that North Dakota is prepared to engage in the rare earth supply chain and secure the federal funding necessary to do so.

Automotive Dealership Protection for Warranty Repair Work Authorized

This session the North Dakota legislature overwhelmingly supported House Bill 1515 which expanded upon protections for North Dakota auto dealers that have been in place for over a decade but that have been being exploited by Auto manufacturers. 

According to existing North Dakota law automotive manufactures couldn't force their Affiliated dealerships to be paid a lower rate for warranty repair work than they were paid for regular non-warrant repair work. However, the 2013 law had a gap, it was not made clear that warranty work should be paid for the same amount of time that the non-warranty work was. 

This led to auto manufacturers paying pennies on the dollar for warranty repaid work as compared to the standard rates North Dakota consumers had to pay. The legislature determined that this was a major issue, and the governor agreed. The legislature overwhelmingly passed House Bill 1515 and Governor Kelly Armstrong signed the bill.

This is a major win for local businesses in North Dakota and continues North Dakota's long-standing practice of not only supporting the companies and people that are invested in the state, but in protecting North Dakotans as a whole from predatory out of state actors.

Peace Officer Memorial Highway Established

Following unanimous approval by the Legislature, Governor Kelly Armstrong has signed Senate Bill 2277 into law, officially designating Highway 200 as the Fallen Peace Officers Highway to honor North Dakota law enforcement officers who died in the line of duty.

The new law authorizes the North Dakota Department of Transportation to collaborate with the North Dakota Peace Officers Association and the families of fallen officers to dedicate up to one mile of Highway 200 in each officer’s honor. The state may also accept private donations to help fund the installation of memorial signage.

Highway 200 includes the area where Mercer County Deputy Paul Martin was tragically killed in December 2023 while attempting to stop a fleeing vehicle. According to the Officer Down Memorial Page, 62 North Dakota officers have lost their lives in the line of duty.

Rep. Bill Tveit (R-Hazen) praised the measure, describing the highway as “a blue ribbon from east to west” across North Dakota.

With the Governor’s signature, preliminary steps are now underway to implement the legislation, including planning for signage and coordination with families of fallen officers.

With the adjournment of the 69th North Dakota Legislative Assembly, lawmakers will now turn their attention to work on interim studies and committees in advance of the 2027 session.  Your Primacy Strategy Group team will provide information on the interim process as it advances.  Please feel free to reach out to us should you have any questions or need any additional information.