Confusion grows over proposal to abolish property tax in North Dakota

Lots of internal strife is being reported in North Dakota Legislature regarding property taxes and this has resulted into a huge uproar. What should be done to find an ultimate solution? Well, it seems that the best solution lies in its abolition and this proposal has come to the fore already thanks to a legislator who proposes a constitutional amendment to accomplish the goal within three years. What is the essence of this suggestion? It has been learnt, that the proposal tells the Legislature to make use of tax collections to make up the more than $700 million that local governments amass each year in property taxes, starting in January 2012.

In this context Rep. Dan Ruby, R-Minot did appear as the foremost personality. Dan Ruby stated before the House Constitutional Revision recently that it would be better for the Legislature to supervene upon the lost revenue without raising state tax rates. However the statement was not unanimously greeted and faced questions from a number of legislators and lobbyists. Ruby said in spades, “Once this money is back in the people’s hands, most of what they buy, the state’s going to get 5 percent of that back in sales tax.” “If this helps businesses be able to increase wages, based on not having to pay property tax … the state’s going to get more money back.”

Well, there was, Jerry Hjelmstad, a staff attorney for the North Dakota League of Cities, as well. Hjelmstad was perceived to oppose the idea and said that there was the need of more details about how local governments’ property tax collections would be made up. According to the proposed amendment, the Legislature ought to write a formula for distributing state tax revenue to local governments to finance their “legally imposed obligations.” Hjelmstad said to this, quite a few services local governments provide for their residents are not legally required.

Whatever it is, the proposal has attracted many and one of them is Bev Nielson, a spokeswoman for the North Dakota School Boards Association, who termed the proposal an interesting concept.