One of These Things Is Not Like the Other

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I had to chuckle a bit when I saw this letter to the editor today from Fargo Forum reader Matt Smith.

While I appreciate that Mr. Smith follows my work so closely, I have to take exception to his accusing me of hypocrisy because I was critical of the Fargo City Commission for giving out a $660,000 tax exemption to FedEx even after the company said they’d develop their new facility without it.

My supposed hypocrisy? I was also in favor of reforms to the state’s oil tax code which eliminated a massive tax exemption which eliminated the oil extraction tax when prices were below a trigger level in exchange for a reduction in the top oil rate from 11.5 percent to 11 percent (or 10 percent when oil is under $90 per barrel).

This was solid reform which has actually resulted in a $183 million tax increase on the oil industry so far in 2016. I was critical of Democrats griping about these reforms recently, pointing out that they are misleading the public about the nature of that reform.

As for my supposed hypocrisy, I would point out that these are two very different types of public policy.

Local governments handing out specific tax exemptions to specific companies which apply for them is not the same sort of thing as state lawmakers making changes to the tax code which impacts every single company producing oil in this state.

Let’s do a thought exercise to illustrate this point.

If policymakers decided that I, Rob Port, am exempt from property taxes for the next 10 years (the deal that FedEx got) that would be a very different thing from policymakers saying that everyone should get a 10 percent reduction in their income taxes.

It is amazing to see how anything related to the supposedly evil and benighted “big oil” drives some people to distraction. To the point where they can’t discern the difference between reforming the tax code for all it applies to and exemptions for specific companies from paying taxes everyone else has to pay.

If the City of Fargo wanted to exempt all businesses from the property tax, or lower property tax mills for all property owners, then fine. We could debate that as policy. But it would be a much different thing than what the commission did to draw my criticism, which was giving a specific tax exemption to a specific company the representative of which is on the record saying his company doesn’t need it.