The Political Subdivisions Committee recommended a due-pass on House Bill 1537 as amended, moving to protect certain pre-2025 local financing agreements from being automatically voided.

The measure, discussed Feb. 14 during the committee’s session, would add a new subdivision allowing parties to financing agreements executed before Jan. 1, 2025 that would otherwise be void under current law to remain enforceable unless the Public Finance Authority or another state enterprise elects to void them. That election would require a 30-day written notice to the parties. The bill also clarifies that this subsection does not affect litigation that commenced prior to Jan. 1, 2025.

The amendment was explained to the committee by Stephanie Engerbertson of the North Dakota League of Cities, who said the change is intended to avoid “unintended impacts” for municipalities and rural water districts that have longstanding agreements lacking PFA signoff. She told the committee the amendment “leaves section 1 and 2, which is existing law, alone” and adds a new subdivision giving agencies the option to void older agreements after 30 days’ written notice.

Representative Hager asked why the amendment uses a retroactive date of Jan. 1, 2025 when laws normally take effect after the legislative session; Engerbertson said the earlier date was chosen to signal legislative intent and to reduce a rush to litigation during the interim. Eric Volk, executive director of North Dakota Rural Water, confirmed his organization agreed with the revised language.

Committee members moved the amendments (motion by Representative Osterley, second by Representative Balinski) and approved them on a roll call. The committee then voted to give House Bill 1537 a due-pass recommendation as amended (motion by Representative Vasley, second by Representative Marshenbacher). The clerk recorded the votes on both the amendment and the final motion; the bill passed the committee as amended.

The committee record shows members asked for a copy of the Public Finance Authority’s written concurrence with the language and asked staff to include the correspondence in the bill’s file.

House Bill 1537 will move forward from committee with the amendment adopted and with Representative Moshenbacher listed as the carrier.