Senators begin work on property tax cuts

Talk about it

BISMARCK—A plan to cut North Dakotans’ property taxes to the tune of $300 million started its trip through the Legislature Wednesday with a hearing where everyone was for it and no one spoke against it.

Senate Bill 2199’s outline was already well-known to those attending the Senate Finance and Tax Committee’s meeting. Gov. John Hoeven twice laid out the basics of it last summer, the state Commission on Education Improvement, of which Lt. Gov. Jack Dalrymple is chairman, discussed and approved it a few months ago and the sponsors include the speaker of the House, Senate minority leader and the Finance and Tax Committee chairman.

“If you want to provide property tax relief, this is the best way,” Dalrymple told the committee.

Rep. Lee Kaldor, D-Mayville, also a bill sponsor, said that, for him, it’s been an idea waiting in the wings for decades, “something I tried to accomplish more than – well, 20 years ago.”

The plan calls for sending an additional $300 million of the state’s surplus, largely oil tax revenue, out to the school districts over the next two years, but they only get the funds if they cut their property tax levies dollar for dollar. The infusion of state money into schools will finally have the state reaching the long-sought goal of having state government fund 70 percent of the cost of public schools.

Dalrymple, who long ago was House Appropriations chairman, has said he and Hoeven are convinced the tax plan-school funding program can be sustained indefinitely.

The president of the North Dakota Farm Bureau, Eric Aasmundstad of Devils Lake, testified Wednesday that his group is supporting the bill despite some doubts that it will be permanent.

“I still have many questions about the sustainability of this commitment and if in fact the education component of property tax is the proper venue for relief, as it is just over half of the property tax problem on a statewide basis,” he said.

The Association of Counties, which recently voted to back SB 2199, did not like the 2007 property tax relief law because it was an administrative hassle. Property owners reported their property tax bills on their income tax returns, where 10 percent of it was deducted as a credit.

Dalrymple, too, said the conclusion after two years is that the 2007 law “does not lower taxes, only mitigates them” indirectly.

“County government therefore urges a do-pass recommendation of SB 2199,” the counties’ executive director, Mark Johnson, said.

The committee took no immediate action.

Tags: property, taxes, cuts