I tried to live stream the Governor’s budget presentation but couldn’t get to it even though I had Real Player. Calling the Governor’s office I found I wasn’t the only one. I’ve had a chance to read the online post from the Governor’s office but I’d have rather had the opportunity to assimilate the nuances of his presentation.
From my reading I have to say I liked a lot of what the governor has laid out. It has always been my contention that spending on infrastructure, whether for statewide flood control or highways and roads in the western counties, is a legitimate role for government. Both of those proposals will have long term benefits for the citizens of North Dakota. They will also in the end be a stimulus for economic activity in both the short and long term.
I also like the fact that the Governor has gotten off the property tax buy-down bandwagon. Whether his proposal for K-12 funding is a good thing I’ll deal with another day.
Way back in the 90’s I became upset about the revenue sharing bill the legislature dealt with every session. Simply put, we allotted a certain amount of tax revenue to the political subdivisions. The fight was always over the size of the total allocation and how it was divided out. Basically the larger a subdivision’s mill levy the bigger their chunk of the pie. Municipal park boards were playing the game as well as cities, counties and townships. A battle would ensue between rural and city legislators and I felt it counter-productive. I called Mark Johnson representing the Association of Counties and Bob Johnson representing the League of Cities in for a meeting. I told the Johnson boys (no relation) that I was tired of it and would do my best to kill the appropriation if they didn’t come up with an equitable formula for the distribution. Way back then I could see that the State’s efforts at trying to hold down property taxes were futile. They must have known I was serious as they produced a formula that the legislature liked. Actually I was hoping they wouldn’t have and we would have been done with the whole thing.
The only real relief property owners will get on property taxes is if there is enough pressure on the legislature to cap the increases of taxes at 3, 4, or 5% of the total levy per property each year. Whether that is good public policy would be a hard fought battle. I can see the school districts, cities, counties and other local entities mounting a full frontal attack. The legislature and Governor are taking the easy way out by handing out the state’s tax revenue in the hope of having property tax payers feel good about their efforts. Witness the hundreds of millions spent on the effort since Governor Hoeven was first conned into the ill-thought policy.
It might have been good politics because the Democrats made it a campaign issue but it wasn’t good policy.
It would be interesting to know how big a percentage of the total of property evaluations out of state landlords and corporations own. Even if this property tax relief was real (it isn’t) who gets the benefit? If the legislature were to suspend the personal income tax, you know the majority of the money would stay in North Dakota.
I was intrigued by the Governor’s proposal to replace the $93 million the Feds are cutting out of county Medicaid with state funds. Following that logic as the Federal entitlement programs are cut the state, will as I predicted last week, end up holding the bag. If our country goes over “the fiscal cliff” or it comes down to a battle over the debt limit can the state pick up the full tab after the cuts? More importantly, shouldn’t an honest debate on the value of the programs take place in the legislature?
Picking up the tab because the state has a surplus is relieving the counties of some issues they should have to face. Regardless of the state surplus the legislature should be prepared to make the political subdivisions share in the pain if the federal government comes to its fiscal senses.
John Dorso represented District 46 in the North Dakota state legislature from 1985 to 1999 and as served as House Majority Leader from 1994 to 1999. He is also the author of When Governance Worked: It’s Time to Chart a New Course.