Let's Be Clear: Governor Dalrymple's Budget Includes Zero Tax Relief

The precise use of language is vital in politics. After all, that language is the basis upon which the laws we must live under are built, so what words mean is important.

Which is why it’s frustrating when publications like the Bismarck Tribune insist on calling Governor Dalrymple’s property tax shift tax relief.

Property tax relief has been long sought after in North Dakota. The vehicle for that relief in the last several sessions has been local school districts — buying down property tax that funds primary and secondary education. There are proposals that will be before legislators for the state to fund about 80 percent of local school spending, in order, to continue to provide property tax relief.

In Gov. Jack Dalrymple budget that state funding of local school district takes the $342 million in relief from two years ago and adds another $714 million. There’s no doubt, this is real property tax relief, and the idea is to make it permanent.

What Dalrymple is doing isn’t lowering the burden of government. That can only happen when government gets smaller. Rather, the governor’s tax shift simply hides hundreds of millions of dollars worth of local spending in the state budget.

We are taking tax dollars we all pay to the state, and using them to pay off local spending. That might seem like tax relief in the short term, thanks to the rivers of oil tax revenues flowing into state coffers, but what happens if/when those rivers dry up? The state is still going to be obligated to this local spending, and the burden for that obligation is going to fall squarely on the back of statewide taxpayers.

Milt Friedman was fond of saying that what the government is taxing us doesn’t matter. If the government grows that represents more spending we’re going to have to pay for, whether it be now or at some point in the future. I think that wisdom applies to this situation. Taking money from local spending out of state tax revenues, instead of local tax revenues, doesn’t reduce the overall burden of government.

Besides, the history of these state buy-downs of local taxes isn’t very good in North Dakota. Despite spending some $752 million on property tax relief since 2007, North Dakota property taxes keep going up. What makes us think this latest buy-down is going to change that trend?