Summary — SB 2154 (North Dakota)
AN ACT to amend and reenact subsection 13 of section 1‑01‑49, subsection 4 of section 10‑30.5‑01, and section 40‑57.1‑02 of the North Dakota Century Code — definition of “primary sector business”
Status & timeline
- Introduced: March 10, 2025 (Senators Cleary, Meyer, Thomas; Reps. Bahl, Monson, Nelson)
- Passed both chambers (Senate 47‑0; House 91‑1).
- Governor approved; effective date: August 1, 2025.
- Companion: HB 4215.
Purpose / intent
- To clarify and expand the statutory definition of “primary sector business,” explicitly include certain tourism operations, define “new wealth,” and align related definitions used for economic development programs and tax‑exemption eligibility.
Key provisions
1. Amends NDCC § 1‑01‑49(13) — “Primary sector business”
- Defines a primary sector business as an entity (individual, corporation, LLC, partnership, association) certified by the Department of Commerce’s Division of Economic Development and Finance that “adds value” through knowledge or labor and thereby creates “new wealth.”
- Explicitly includes tourism operations that demonstrate they create new wealth by attracting out‑of‑state visitors.
- Defines “new wealth” to mean revenues generated in North Dakota through sales of products or services to:
a. Customers or visitors from outside the state; or
b. Customers in the state when the products/services were previously unavailable or difficult to obtain from in‑state businesses.
Amends NDCC § 10‑30.5‑01(4)
- Cross‑references the § 1‑01‑49 definition and states that “primary sector business” includes tourism but expressly excludes production agriculture.
Amends NDCC § 40‑57.1‑02 (definitions used in the chapter)
- Reiterates that “primary sector business” has the meaning in § 1‑01‑49.
- Expands the definition of “project” (for purposes such as income tax exemption) to cover both qualifying primary sector businesses and tourism projects, including new establishments or expansions.
- Defines “tourism” to include recreation, historical/cultural events, guide services, and unique lodging and food services that serve as destination attractions.
Who is affected
- Businesses seeking certification as primary sector businesses (manufacturing, value‑added services, tech, etc.).
- Tourism operators that can demonstrate out‑of‑state visitor-driven revenue.
- Entities and local development organizations that apply for programs, grants, incentives, or the income tax exemptions linked to “primary sector” or “project” status.
- Production agriculture — explicitly remains excluded from the primary sector definition (so unchanged for program eligibility).
Potential impacts
- Broadens eligibility for economic development tools and tax incentives to include certain tourism activities and in‑state businesses offering previously unavailable goods/services, subject to certification.
- May increase tourism‑focused investment and applications for state programs from destination operators.
- Clarifies administration: certification requirement places decision authority with the Department of Commerce’s Division of Economic Development and Finance.
Procedural note
- Text amendments operate by replacing/reenacting the three statutory provisions; they take effect upon the stated effective date (August 1, 2025).
