Late Into The Night, Legislature Votes To Buy Up $865 Million Worth Of Local Property Taxes

The House and Senate finally found some common ground on property taxes after a row kicked off yesterday morning when the House reconsidered, and rejected, Governor Jack Dalrymple’s plan to have the state effectively take over education funding from the local governments.

Here’s what went down:

Governor Dalrymple’s $714 million education mills buy-down was reduced to $665 million. To get the Senate to go along with that, the House agreed to a reduction of SB2036’s property tax buy down of $400 million to $200 million. All told, the two bills combine to provide $854 million worth of “property tax paid by the state.”

I put that last in quotes, because that’s exactly how Rep. Wes Belter put it when introducing the Senate amendments in the House. That’s an illuminating phrase because, as we all know, the state’s money is our money. You’ll hear many of our elected leaders trumpeting in coming days the $865 million in property taxes they passed (or $1.14 billion in tax relief, if you include the $250 million in personal/corporate income tax cuts).

But that $854 million is coming straight out of the income taxes, sales taxes, etc. we all pay to the state. It’s hard to believe that buying up taxes with other taxes is tax relief.

While that might reduce what we pay in property taxes in the short term, especially given the excess of revenues at the state level, it comes at the expense of an equivalent increase in state spending. All while not doing anything to constrain future property tax increases at the local level.

What’s the difference between SB2036 and Governor Dalrymple’s property tax plan? The property tax reductions in SB2036 come by way of an appropriation straight to the county auditors intended to result in a 12%, across-the-board buy-down of every property tax bill in the state.

Governor Dalrymlpe’s plan buys up school mills (or, put another way, increases state school spending) in exchange for eliminating education mills.

Neither of these approaches resolves the property tax problem long-term. At best, they kick the can down the road.

Here’s video of SB2036 passing in the Senate:

Here’s SB2036 passing in the House and being sent to Governor Dalrymple for signature:

Rob Port is the editor of SayAnythingBlog.com, a columnist for the Forum News Service, and host of the Plain Talk Podcast which you can subscribe to by clicking here.

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