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HB 1573

A BILL for an Act to create and enact chapter 57-66 of the North Dakota Century Code, relating to the imposition of a pore space utilization tax and creation of a North Dakota disaster fund; and to provide an effective date.

69th Legislative Assembly (2025-26) Introduced by Jared Hendrix and 6 co-sponsors

Imposes a $5/ton tax on substances transported via new long pipelines for permanent underground storage in North Dakota, with first $500 million funding a disaster fund.

Second reading, failed to pass, yeas 23 nays 61
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WeVote Research Nonpartisan
Bill Summary · HB 1573

Summary — HB 1573 (North Dakota version)

Note: Multiple states introduced bills numbered HB 1573 in 2025. This summary addresses the North Dakota bill titled “An Act to create and enact chapter 57‑66 of the North Dakota Century Code, relating to the imposition of a pore space utilization tax and creation of a North Dakota disaster fund.”

Purpose

To impose a tax on substances transported for permanent underground injection/storage in pore space (e.g., carbon capture and sequestration or other injection operations) using certain pipelines, and to create a dedicated North Dakota Disaster Fund to receive and use initial tax revenues for pipeline‑related disaster mitigation and response needs.

Key provisions

  • Tax imposed: $5.00 per ton on all substances transported via any pipeline that
    • is put in service after July 31, 2025, and
    • has a length greater than 25 miles (40.23 km) from onloading site to offloading site, when the substance is transported for the purpose of injection and permanent underground storage in pore space located in North Dakota (57‑66‑01).
  • Reporting and payment:
    • Taxpayers (the transporter) must remit the tax and file a monthly report within 25 days after each month (reports to include tons transported, tax remitted, and other required data) (57‑66‑01, 57‑66‑02).
    • Taxes become delinquent if not received by the 25th day; the Tax Commissioner may impose late fees and grant payment extensions (57‑66‑02).
  • Administration and enforcement:
    • The Tax Commissioner may require records, conduct hearings and investigations, compute taxes on incorrect/omitted returns, and provide refunds for overpayments (57‑66‑03).
  • Revenue allocation:
    • The first $500 million of revenue collected is credited to the newly created North Dakota Disaster Fund (57‑66‑04, 57‑66‑05).
    • All remaining revenue thereafter is credited to the state general fund.
  • North Dakota Disaster Fund uses:
    • Subject to legislative appropriation, funds may be used to mitigate damages arising from transporting substances through the specified pipelines; buy specialized response equipment not otherwise provided; pay for necessary training related to pipeline hazards not otherwise provided; and pay expenses associated with a governor‑declared state of disaster or emergency. Funds may not be used for expenses covered by insurance or other federal/private sources (57‑66‑05).
  • Effective date: for taxable events occurring after June 30, 2025.

Who would be affected

  • Primary: persons or entities transporting substances for permanent underground storage via pipelines that meet the “in service after July 31, 2025” and “>25 miles” criteria (likely new, long‑distance injection pipelines and their shippers).
  • Secondary: pipeline developers and industries considering new pore‑space injection projects (e.g., carbon capture and sequestration, industrial CO2 transport, disposal injection operations) — the tax increases per‑ton transportation cost.
  • State government: tax administration responsibilities for collection and enforcement; potential new dedicated resources for pipeline disaster response up to $500 million.

Potential impacts and considerations

  • Increases operating/transport costs for new long pipelines used for underground injection, which could affect project economics for CCS and disposal operations.
  • Creates a substantial dedicated fund (first $500M) to support mitigation/response to pipeline incidents and related preparedness; may improve emergency response capacity for pipeline‑related hazards.
  • The $5/ton rate and scope (only pipelines entering service after July 31, 2025 and longer than 25 miles) target future projects, possibly influencing route/project design or financial planning.
  • Administrative burden: monthly reporting, compliance, and potential audits by the Tax Commissioner.

Procedural status

  • Introduced in the 69th Legislative Assembly. Effective date for taxable events after June 30, 2025 is specified in the bill text.
  • As provided in the brief bill information: Status — Second reading, failed to pass (yeas 23, nays 61).

If you want, I can draft a one‑page explainer for affected stakeholders (pipeline operators, local governments, or emergency responders) outlining compliance steps and likely financial impacts.

Compiled from official sources — confirm details with the bill’s official record.

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