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Democrats say ‘Shell game’ shortchanges property tax relief: Republican appropriations chairman says focus is on permanent solution

BISMARCK -- Easing the property tax burden on North Dakotans through a partial state takeover of county social services costs shouldn't mean sacrificing part of the state's 12 percent property tax buydown as Republicans have proposed, Democrats s...

BISMARCK - Easing the property tax burden on North Dakotans through a partial state takeover of county social services costs shouldn’t mean sacrificing part of the state’s 12 percent property tax buydown as Republicans have proposed, Democrats said Wednesday.
“We think that should be in addition to existing property tax relief, rather than supplant it,” said Senate Minority Leader Mac Schneider, D-Grand Forks.
Gov. Jack Dalrymple’s budget recommendation calls for continuing through 2015-17 the 12 percent buydown that lawmakers approved in 2013.
Dalrymple also proposes additional property tax relief by having the state Department of Human Services assume the costs of certain social service programs from counties, at a cost to the state’s general fund of about $23.2 million. That change is in Senate Bill 2206.
However, an amendment to the state treasurer’s budget, Senate Bill 2005, would pare the current 12 percent credit to 11 percent and trim the appropriation for property tax relief from $250 million to $226.8 million in 2015-17 - essentially offsetting the relief from the social services takeover.
“So, it’s a shell game,” said Sen. Tim Mathern, D-Fargo, who sits on the Senate Appropriations Committee.
The committee’s chairman, Sen. Ray Holmberg, R-Grand Forks, stressed that the property tax buydown is only temporary tax relief, while the social services takeover is proposed as permanent relief. A projected drop in state revenue as a result of slumping oil prices also factored into the amendment, he said.
“We mouth that we want permanent property tax relief. Here’s a way to move in that direction, keeping in mind the less money that’s available,” he said.
Holmberg also said lawmakers are far from deciding whether to cut income taxes - Dalrymple proposed $100 million in individual relief and $25 million in corporate relief - and that “could be another source down the road” for the $23.2 million. An updated state revenue forecast is due out in mid-March.
Democrats suggested the $25 million for corporate relief would be better spent on covering the state takeover of social services costs.
“We want property tax relief to be on top of the priority list,” said Sen. Jim Dotzenrod, D-Wyndmere, whose Senate Bill 2307 would extend the 12 percent credit.
Dotzenrod’s bill passed the Senate unanimously Wednesday, but Mathern said SB 2005, which is up for final Senate passage Thursday, would reduce the credit to 11 percent when it takes effect.

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