North Dakota Property Tax Debate
BISMARCK – The North Dakota State House defeated a bill Tuesday that would exempt those 65 years old and older from paying property tax.
House Bill 1380, which would eliminate property tax for homeowners 65 years old and older, failed in the House by a vote of 67 to 25, after receiving a 12-0 Do Not Pass from the House Finance and Taxation committee.
The bill carrier, Representative Jim Grueneich, R-Dis. 28, Ellendale, mentioned the Homestead Tax Credit which seniors are eligible for as a reason to vote no on the bill. The bill has an appropriation of around $330 million, which Grueneich said could be used to expand on the Homestead Tax Credit instead.
“While this is a very nice gesture to our 65 and older, there’s a lot of them that quite frankly don’t need the elimination of property tax,” said Gruenich. “It’s hard to vote against a bill that is really geared toward a carve out of 65 and older because it’s our parents and grandparents, but I think what we’re trying to do is go home with permanent property tax relief, and this is a bill where that same $340 million could get us in that direction.”
The sponsor of the bill, Minot Representative Larry Bellew, R-Dis. 38, read a letter he received from a constituent, in which the sender stated she appreciated all the discussion on taxes in the North Dakota Legislative Assembly, which recognized all taxes as generally known to be unfair.
“But I hear no one directly acknowledging the elephant in the room,” Bellew read. “The tax that is the most unfair, and if the truth be told, this is property tax.”
Bellew also mentioned inflation as a reason to give relief to those 65 years old and older since many are relying on fixed incomes.
“The State of North Dakota can do something to help those who have worked all their lives to raise and provide for their families,” Bellew told the assembly. “Every senior should be able to retire with dignity. The high taxes and inflation are hurting seniors on a fixed income, if not all of them. Almost every other tax besides property tax can be controlled by the payer.”
Bellew explained that both income and sales tax are controlled by the payer based on what they buy and their income level.
“No matter if a homeowner is rich or poor, can pay or not able to pay, the property tax is based on what the local jurisdiction decides what the property is worth,” said Bellew. “Failure to meet the tax that is assessed will result in the confiscation of the property by the government. Assessing taxes based on an artificial evaluation rather than earned income is essentially counting on non-existent money. Government entities love this type of taxation, because it allows them to extract more money.”
Bellew also mentioned the current biennium projected increase in general funds is around one to two billion dollars, taking into consideration Governor Doug Burgum’s income tax reduction of $500 million.
“North Dakota has more than enough to pass this proposal, and the $500 million tax reduction,” said Bellew. “If this were to happen, we would still have a general fund increase of over $700 million. I believe that the highest priority for North Dakotans is property tax relief, along with government spending restraint during this period of historic inflation.”
Representative Don Vigesaa, R-Dis. 29, Cooperstown, said the assembly cannot pass the bill because he believes the state does not levy property tax.
“We have House Bills, outside of the agency bills, with general fund appropriation requests of $1.4 billion,” said Vigesaa. “Above and beyond what we have to do to fund agencies. The Senate, as of a couple days ago, had over one billion dollars of requests of appropriations from their members. We just cannot pass this bill.”