Task force on property tax reform digs into local levies
BISMARCK – Meeting for the first time Friday, members of Gov. Jack Dalrymple’s newly formed Task Force on Property Tax Reform wasted little time before digging into the state’s plethora of local property taxes, trying to separate them into groups that should be scrapped, bundled, further analyzed or left alone.
The task force, comprised of Dalrymple as chairman with nine other voting members and four non-voting members appointed by him, is charged with identifying opportunities to simplify, consolidate or eliminate unnecessary or duplicative taxes.
However, comments from some task force members suggest that getting rid of taxes will be easier in principle than in practice, with local interests and political ramifications to consider.
One of the more involved discussions Friday centered on county levies for human services, which accounted for more than $47 million in property taxes collected in 2012, and whether the state could take on funding of those services, an idea previously floated in the Legislature.
“Let’s face it, it’s not simple or it would have been done by now. But it’s also a lot of mills,” Dalrymple said.
State Rep. Wes Belter, R-Fargo, said the idea may make sense on the surface, but he added that when the state funds something, it usually wants to control it.
“I think we need to be very careful that we don’t undermine the current programs with a state-run bureaucracy,” he said.
“I’m not so sure that a large county bureaucracy is out-performing a state bureaucracy. That’s an open question,” Dalrymple said.
North Dakota Association of Counties Executive Director Mark Johnson, a non-voting task force member, said county commissioners have recently expressed openness to having the state help with human services funding and would be willing to roll back mills in exchange.
Task force member Hal Gershman, a businessman and president of the Grand Forks City Council, observed, “Everybody wants a lot of money from the state because the state has a lot of money, but they don’t want to give up the local control.”
The panel agreed to have the state Department of Human Services look into the idea’s feasibility.
Friday’s discussion indicated that smaller taxes won’t necessarily be easier to eliminate, either.
Members learned that 47 of North Dakota’s 53 counties impose a mill levy to fund a veterans service officer, with a weighted average of 0.73 mills, less than half of the 2-mill limit. Cass County Auditor Mike Montplaisir said “I don’t know why it’s not a general fund expense” in all counties as it’s been since Cass County adopted its home rule charter.
“I assume it’s because the veterans want to make sure there’s a veterans service officer no matter what,” Dalrymple replied, later saying it “strikes me as one not worth fiddling with.”
“If we’re looking for input on the committee, if we tamper with it, we might get a lot of input,” Sen. Dwight Cook, R-Mandan, said, drawing laughter.
As a Tax Department official led the task force through a mind-numbing list of more than 200 mill levies authorized for cities, counties and other jurisdictions under state law, Gershman questioned how the state ended up with so many.
Dalrymple said the levies were approved through decades of legislation, adding, “to my knowledge, there’s never been a real attempt to collapse the whole system into something that’s comprehensive.”
The task force ultimately will prepare a report and recommend reforms to the 2015 Legislature.
With property tax bills expected to start arriving in North Dakota residents’ mailboxes this week and next, Dalrymple said the state needs to restore “full credibility” to the property tax system by going through it with a fine-toothed comb and identifying improvements.
“People need to have some confidence in it,” he said.
The task force’s next meeting is set for Jan. 24.