American auto pioneer Henry Ford once said, “If everyone is moving forward together, then success takes care of itself.”
With the legislative session reaching its halfway point, success is starting to come into focus as we continue working with lawmakers to deliver meaningful property tax relief and reform.
There is real momentum, and there’s a simple reason why: because taxpayers are demanding it.
The message from voters on the campaign trail last year was loud and clear: Property taxes are too high, and recent efforts by the state to buy down property tax bills haven’t done enough to offset rising home values and growth in local spending.
We began working on solutions last summer and rolled out a property tax relief and reform package in my State of the State address on Jan. 7. Our proposal included a primary residence tax credit of $1,550 per year in the 2025-27 biennium – with that amount growing over time – and a cap of 3% per year on future increases in local property tax budgets.
This plan is responsible, achievable and durable, using Legacy Fund earnings to initially pay for part of the relief and eventually cover all the cost. And it delivers relief first to those who need it most: In this first biennium alone, 3 of 4 homeowners would qualify for the relief, and 1 out of those 3 would pay no property tax.
The reaction was overwhelmingly positive from North Dakota homeowners who have been hit hard by property taxes. On the other hand, certain cities, counties and other political subdivisions were predictably less receptive to a state-imposed limit on their spending.
This week, House lawmakers passed House Bill 1176, which was introduced by Rep. Mike Nathe and most closely resembles our proposal, with only slightly lower relief of $1,450 per year.
The 81-10 vote bodes well for the bill going forward, and we’re thankful for House members’ action.
As the bill crosses over to the Senate, there may be a desire to water down the relief to taxpayers. This would be a mistake.
The House has already loosened the cap provision, making it easier for voters to bypass the 3% cap for up to four years with a simple majority vote. Reducing the $1,450 per year of relief in HB 1176 would shortchange taxpayers at a time when state revenues are strong and reserve funds are healthier than ever.
We urge the Senate to adopt HB 1176 as quickly as possible, as the cost of this property tax relief and reform package will affect many legislative decisions downstream. Senators have been involved in these discussions from the beginning. We have momentum, let’s not waste it.
We know this package won’t be perfect, and the likelihood is high that legislators will need to make adjustments in two years, particularly to the cap provision. But, just this once, why don’t we give taxpayers the benefit of the doubt? The worst that can happen is they get to keep more of their hard-earned money and local political subdivisions must live within their means.
Whatever version of the bill reaches my desk, this much is certain: It must include reform. Otherwise, we’ll still be stuck in Einstein’s definition of insanity: doing the same thing over and over again and expecting different results.
North Dakota taxpayers deserve better, and I’m confident the Legislature will deliver.
Kelly Armstrong is the 34th governor of North Dakota.
