BISMARCK, ND — North Dakota voters will decide this fall whether to abolish elections. property tax It would be a first for a state and a major change that officials initially estimated would require more than $1 billion in replacement revenue annually.
Secretary of State Michael Howe’s office said Friday that backers had submitted more than enough signatures to constitutional initiative for the General elections in November. In 2012, voters rejected a similar measure.
Property taxes provide the basic funding for countless local government services, including sewer, water, roads, prisons, police, school construction and teacher salaries — “pretty much the most basic form of government,” said Aaron Birst, executive director of the North Dakota Association of Counties.
Rising property taxes, often fueled by rising home prices, have frustrated people across the U.S. The North Dakota initiative qualified for the ballot as Nebraska Legislators are considering more than 100 proposals to ease rising property taxes. A plan will be debated next week. Kansas Legislators approved a small cut in property taxes this year, saying homeowners want bigger reductions.
The campaign in North Dakota is taking place because the state is financially healthy, largely due to high oil and sales taxes.
The leader of the measure’s campaign, former Republican Rep. Rick Becker, said it would help alleviate property taxes. He said people often don’t fully understand the process surrounding property valuations and taxes.
“They don’t think it’s fair. They’re just waiting for a letter in the mail saying what their house is worth now, and that appreciation means higher taxes. But everyone seems to be passing the buck because the locals are saying, ‘Well, we didn’t raise your taxes’ — well, we’re paying more taxes,” said Becker, a plastic surgeon in Bismarck and an unsuccessful Candidate for the US House of Representatives.
If the measure passes, the state would have to replace more than $1.3 billion in government aid annually starting in 2025, a preliminary report found. estimate of legislative researchThe state operates on a two-year budget, and the total two-year estimate of replacement revenue would be more than $2.46 billion after subtracting current amounts from the state’s property tax credit program, according to the estimate. The state expects to collect $5 billion in general tax revenues in those two years.
Becker said local governments would still be responsible for their budgets and would have to generate revenues above the fixed annual amount that would replace the state. He proposed a combination of a fee or tax for “municipal operations” and infrastructure maintenance for each household and business. That would be fairer and more transparent, he said.
Where the replacement revenue comes from is up to the Legislature, Becker said. He suggested some of it could come from the state’s $10.7 billion in revenue Oil tax savings.
The measure would be a monumental task for the Legislature’s budget writers, who would have to reconsider funding for numerous items, said Republican state Rep. Don Vigesaa, who heads the House Appropriations Committee. The Legislature’s research office has already compiled a preliminary list of areas and programs where funding could be obtained, such as the state’s Operation Prairie Dog infrastructure fund, he said.
Regardless of the election outcome, the property tax issues will be a major problem for the 2025 session, Vigesaa said. Voters approved term limits In 2022, this means new lawmakers will eventually replace longtime members who have been closely involved in the budget process, he added.
Last year, the Republican-led Legislature passed a package of income tax cuts and property tax credits worth an estimated $515 million.
