The ND House Tackles A Batch Of Property Tax Bills

Yesterday the state House addressed a slew of property tax bills (a full summary of the bills and outcomes below), including Governor Jack Dalrymple’s supposed “property tax relief” bill, which I thought was aptly characterized in this Grand Forks Herald headline:

The Governor’s property tax relief isn’t really tax relief at all. Not when spending burden is only being shift from local government to state government. We’re still paying for that spending, only through state instead of local taxes, and what’s more we’re shifting that spending away from the local government after we just had a property tax debate last year in which “keep it local” was the winning argument.

But I digress. What was much more interesting than Governor Dalrymple’s phony-baloney tax relief was the debate over HB1199, introduced by Rep. Jeff Delzer, which would have allowed for local government budgets to be referred to the ballot.

“We’re only about $1.6 billion away from taking over all political subdivisions,” Rep. Keith Kempenich said in favor of the bill, pointing to Governor Dalrymple’s supposed property tax relief. “We’re two thirds of the way there already.” Unfortunately the bill failed on a 38-49 vote after some, including Rep. Curtiss Kreun and Rep. Scot Kelsh, argued that the bill would put too much burden on local governments.

Here’s the video of the floor debate:

It’s amazing how fundamentally our legislative leaders seem to misunderstand the property tax problem. High property taxes are being driven by growing local spending. The solution should be to make that spending more accountable – make sure the taxpayers want the spending they’re being taxed for – but the solution favored by Governor Dalrymple, and others, is to pour more money onto the local governments. Which not only doesn’t reduce overall tax burdens, but it isolates local government leaders from having to take responsibility for spending increases.

What impetus do local officials have to keep spending, and thus property taxes, in line when the state government keeps bailing them out? Why should they prudent responsibly when the taxpayers have no mechanism through which budgets can be challenged?

Anyway, here’s a list of the property tax bills that passed the House, some of which would limit property taxes going forward:

HB1319, introduced by Rep. Dave Monson, is Governor Dalrymple’s property tax relief bill. It passed on a 86-3 vote.

HB1465, introduced by Rep. Mark Owens, would have limited property tax mill levy increases to no more than 3% of the previous year’s levy (with some exceptions). It passed on a 63-23 vote.

HB1290, introduced by Rep. Jim Kasper, would limit the dollar amount increase in property tax levies to no more than 3% of the previous year’s total. It passed on a 57-31 vote.

HB1198, introduced by Rep. Craig Headland, would provide an 8.5% property tax credit and would require that property tax statements sent to property owners contain a line item noting that tax payer’s tax relief received from the legislature. The bill passed on a 88-0 vote.

Here’s what failed:

HB1199, introduced by Rep. Jeff Delzer, would have allowed voters to refer local government budgets to the ballot. It failed on a 38-49 vote.

HB1239, introduced by Rep. Ben Koppelman, would have limited property tax valuations to no more than a 3% increase over the previous year. It failed on a 1-85 vote.

HB1273, introduced by Rep. Jim Kasper, would have provided a 80% property tax credit (capped at $5,400) to property tax payers. It failed on a 32-54 vote.

HB1198, introduced by Legislative Management, would have also required that property tax statements contain a line item for “state-paid property tax relief” and would have provided a property tax credit of 10% for all property owners. It failed on a 6-80 vote.