(Note To Readers, Legislators, and Media: This article is meant to be a strictly factual article without judgement and opinion. As the alternative bills on property tax reform are introduced, I will provide similar summaries, then offer a compare/contrast of the bills. I am taking this approach because the biggest challenge the legislature will face is the arguments over which plan is better, rather than the details. This would cause the legislature to bog down. It is my intention to help legislators and the public determine what these proposals actually do and what provisions of each proposal make the most sense and offer the most bang for the buck to the taxpayers, within the context of the framework for property tax reform I have previously outlined. Yesterday, the explanation of Governor Armstrong’s plan was published and can be found here.)
This morning, the House Finance and Tax Committee heard testimony on HB 1168, introduced by State Representative Scott Louser (R-Minot) to, as he frames it “buy-out rather than buy-down” the K-12 education share of property taxes.
Louser has advocated this position for many years.
During testimony, Louser begins by explaining how the bill came to be drafted. He says that he started working on the bill in June 2023, after the House failed to pass a property tax relief bill. Louser says that he wanted to find a way to provide property tax relief that was sustainable and would not harm the state's economy.
Louser's bill would cap the amount that local governments can increase property taxes each year at 3%. This cap would not apply to school districts, which would be allowed to increase property taxes by up to 10 mills. Louser says that this cap is necessary to prevent local governments from raising property taxes too much, which would harm the state's economy.
Louser's bill also includes a provision that would allow local governments to increase property taxes by more than 3% if they get approval from the voters. This provision is intended to give local governments flexibility in the event of an emergency.
The committee members ask Louser a number of questions about his bill. They ask him about the cost of the bill, how it will be implemented, and how it will affect different types of property owners. Louser answers the committee members' questions and provides additional information about his bill.
Positive Reactions From Education Lobbyists
Dr. Amie Copas, Executive Director of the North Dakota Council of Educational Leaders, supports a bill aimed at property tax relief, emphasizing its beneficial language for schools. She highlights the bill's evolution through six iterations, incorporating lessons from the 2013 tax relief, and maintaining funding formulas for K-12 education. Schools operate under a mill levy authority of 60 mills, with specific allocations for general education, transportation, and miscellaneous expenses.
Copas explains the existence of an excess mill levy authority in school code, allowing districts to request additional mills with voter approval. She addresses the importance of public application for tax refunds and the need for legislative support for school funding.
Amy DeKok, Executive Director of the North Dakota School Boards Association, provided the committee with information on school finance, including the annual "school finance facts" report from the Department of Public Instruction, which details school funding, mill levies, and valuations. She offered to share the 74-page document electronically and highlighted the levy limitations for school districts.
DeKok also mentioned a document on school funding litigation prepared by the legislative council, which addresses adequacy and equitability in funding. She expressed support for Representative Lousers' proposal, which recognizes the unique funding needs of K-12 education and public school districts, and offered to translate any necessary information for the committee.
The committee does not take any action on Louser's bill at this meeting.
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