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Economic Woes Force $13-Million Cut in North Dakota

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Continuing weakness in North Dakota's agriculture-based economy forced lawmakers this month to approve a fiscal 1988-89 budget that cuts state aid to schools by $13 million from its current level.

Precollegiate education will receive $398 million in the upcoming biennium, down from $411 million in fiscal 1986-87 and $7 million less than the amount requested by Gov. George Sinner. Overall state spending will fall from about $1.08 billion to about $1.06 billion.

Joseph Linnertz, a spokesman for the state's department of public instruction, predicted that many communities will have to raise their local property taxes to make up for the reduction in state school aid. He added, however, that public education fared better than most other government services in the 1988-89 budget.

For example, he said, education officials felt lucky that the budget preserved the state's eight teacher-resource centers. Mr. Linnertz noted that funding for the centers was cut from $350,000 to $200,000.

In a special session last December, lawmakers agreed to ask voters to endorse a package of sales- and income-tax changes to raise $141- million to help eliminate a projected budget deficit in the current biennium.

The measures, which were approved in an election last month, raised the state income tax from 10.5 percent of federal income-tax liability to 14 percent; instituted mandatory withholding of income taxes from workers' paychecks; and raised the sales tax from 4 percent to 5 percent.

Heidi Heitkamp, the state's tax commissioner, said lawmakers approved a second series of tax changes during the regular session that ended this month. The changes, which are expected to raise an extra $68 million, included an additional 0.5 percent increase in the sales tax; the removal of several sales-tax exemptions; and a one-time 10 percent surtax on the state income tax.--E.F.

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