For the last four sessions, the North Dakota Legislature has been in the business of spending state tax dollars by paying local government to lower property taxes. In rare cases, the state has gotten what it paid for. But in most cases, local property taxes did not decrease by the full amount the legislature intended.
Of course, it never could or would, because property taxes are levied by local elected officials. Without passing restrictive laws to protect local taxpayers and rein in their local governments the state was never going to get a perfect situation.
During the 2013 Legislative Session, much of the previous "property tax buy-down program" spending was folded into the overall Education Funding Formula - a move concocted by Governor Jack Dalrymple (R) - even though it meant that if revenue ever fell off a cliff (like it is in the process of doing) education funding would have to be cut to remove the state from buying down property taxes.
This move was brilliant for anyone that wanted to set Republicans up for a huge fall if ever the state could not fulfill the new, much higher, education funding levels.
To alleviate this issue, House Republicans insisted that part of the state paid property tax relief be done in the form of a 12% credit, paid to counties on behalf of property owners.
During the last election, Republicans actually ran on the platform of doubling this portion of the property tax scheme.
The State Senate is going the other direction - in Senate Bill 2005 the 12% credit is being reduced to 11%.
This change passed the Senate by a 47-0 vote.
While the program was not sustainable or the right approach to begin with - Republicans for the last 4 sessions have promised it would be.
A mere 1% cut from 12% to 11% proves that this approach to property taxes was not a good policy initiative and would not last forever.
Property taxes will now go up faster than ever as the state tries to retract itself from a role it should never have played in the first place.
Without reforming the way local government officials can manipulate property taxes with the complicated mill levy and valuation system, nothing will ever change.