North Dakota voters opt to keep property taxes
BISMARCK — North Dakotans have rejected an initiated measure that would have made it the first state in the country to abolish its property taxation system in the Tuesday, Nov. 5, general election.
As of press time, the Secretary of State's website said 63% of voters rejected Measure 4, while 37% voted to adopt it, according to incomplete and unofficial results.
The system's abolition would have turned local governments to other revenue sources — such as business and sales taxes — to fund projects and services like roads, police, water infrastructure, jails, school construction and teacher salaries.
North Dakota's tax commission attached a more than $1.5 billion value to annual statewide property taxes in its fiscal impact estimate of the measure.
Property taxes are determined and collected by counties that distribute revenue back to cities, townships, school boards, park boards, library boards, park districts and rural fire and ambulance services.
Additionally, some industries pay taxes and fees in place of property tax that were also subject to elimination by the measure.
The current system stands with two main forms of property tax: central assessments and local assessments.
Local assessments involve land and other permanent assets owned by a business or individual. Central assessments involve the value of railroads, pipelines and utilities. Values are determined by the State Board of Equalization, which also certifies value to counties in North Dakota.
The initiative was accelerated by widespread frustration involving rising property taxes and perceived inaction by the state Legislature.
Initiative sponsor and former Rep. Rick Becker led the movement "End Unfair Property Tax," hoping the action would send a message to the state about "wasteful" state spending.
The opposition was led by "Keep It Local," a group backed by more than 100 organizations involved in nearly every sector of the state's economy — from energy and agriculture to real estate and health care. Opponents worried the action would hamper local control. Gov. Doug Burgum and both gubernatorial candidates spoke out against it.
The state would have been required to replace property tax revenue by making payments yearly to local governments in the indefinitely fixed amount of property tax collected in 2024.
If a locality operated above that amount, officials would have had to use municipal fees and other forms of taxation to compensate.
Also under the measure, North Dakota governments would have had lower limits on how much debt they could incur.
