North Dakota Legislative Resolution Hearing
BISMARCK – A North Dakota legislative committee heard testimony on a concurrent resolution attempting to place the option of eliminating property tax on the November 2024 ballot.
The House Finance and Taxation committee heard Monday House Concurrent Resolution 3024, which, if passed, would put the option on the November 2024 ballot for voters to amend the North Dakota Constitution. The amendment would prohibit political subdivisions from levying taxes on the assessed value of real or personal property. The resolution has an exception if the property tax is being used to pay off a bond. It adds that the state shall provide annual property tax replacement payments.
“I know this sounds like a crazy idea,” said the main speaker on the resolution, Dr. Rick Becker, Bismarck. “In most states this would be a crazy idea.”
Becker read from the Tax Foundation and the United States Census Bureau that North Dakota typically ranks between number one and three in tax collections per capita every year, including the factor of average income. He added that North Dakota ranks number four as the highest spending state per capita.
“Red state, Republican supermajority,” said Becker. “The state takes in more money for every man, woman and child than any other state. The 2021-23 budget is $9.3 billion more than a budget that would have increased for all of inflation and all of our population growth.”
Becker said there is $1.4 billion in property taxes.
“We have revenue that we can use,” said Becker. “There isn’t a magic way for me to tell you how are we going to do it. I have one method. You have to base it on a window of time that’s right now. Whatever the legislature does, it changes all the time.”
Several property owners spoke in favor of the resolution.
Representatives from the North Dakota Association of Realtors, North Dakota Association of Counties, North Dakota School Board Association, and North Dakota League of Cities spoke in opposition.
“We are standing in opposition of HCR3024 as we believe it threatens local control that is vital for our counties to provide local services to our citizens at the levels that those local citizens desire,” said Donnell Preskey with the North Dakota Association of Counties. “We believe, contrary to what the sponsors of this bill assume, that our counties are fiscally responsible.”
Preskey explained to the committee in reading from the North Dakota Red Book that property taxes from counties in North Dakota have been going down since 2017. She added that when counties received funds from the Coronavirus Aid, Relief and Economic Security Act in 2020, counties lowered taxes.
“Forty-five percent of the counties, 24 of them, lowered tax rates in 2021,” said Preskey. “Seven of those counties decreased the tax rate by more than 10%. Fourteen counties lowered taxes levied in 2021, so that’s the dollar amount, and 11 counties lowered both the tax rate and the taxes levied.”
Preskey added that in 2022, 84% of voters approved to continue or increase property tax levies.
“The election results show us that citizens recognize the needs in their area and will support tax increases to support these important services,” said Preskey.
A measure to eliminate property tax was voted down by North Dakota voters in 2012.
The committee plans to vote on a recommendation for HCR3024 and send it to the House assembly for consideration.