This funny thing called taxation

There is a group of people looking to put North Dakota on the map again. This time it’s not about being a “happy” state, about low unemployment rates, about economic development. No, this time, they would like to see North Dakota as the first state to abolish property tax.

They claim that passing Measure 2 will make North Dakota truly “legendary.” And that it’s time that we throw the albatross of property taxes off of the tax payer and back on to the state…where it belongs! (Imagine loud voices cheering, pitchforks waving, torches in the air!)

But wait a minute…we should take the local tax revenue, and return it to the state? And let the state be responsible? Seriously?

I am all for tax reform, as would any reasonable person. I’m all for recalculating the numbers, so that no one economic group is unfairly taxed. I’m all for changes and discussions and working towards a better tomorrow. But throw our whole tax structure just because we couldn’t find a more reasonable answer? No thanks.

The way that property taxes are calculated is complicated. I get that. The way that you figure out if you pay property taxes is simple. If you buy property, there will be a tax. And out of that tax comes local improvements. County roads, township roads, school funding, local museums, local extensions services…the list continues on.

Again, if the purpose of this measure was to make a point about property tax reform, point is made. Thank you, let’s have a discussion and work on it. Let’s move forward and get something hammered out in writing. Something that works.

The thought of truly eliminating property taxes is ridiculous and a mistake of epic proportions. And it wouldn’t even be a mistake just for our generation. It would be a disaster for generations to come.

Yes, North Dakota has a budget surplus. Yes, our state is booming and growing and doing all things that are pointing to a strong future for the next generation. Let’s build upon it and leave our state in better condition for the next generation. Not set it up to fail before they even have a chance to have a voice.

If Measure 2 proponents want to see changes made at the capitol, great…let’s get some changes made. Let’s cut spending and prioritize our funding, and work with our legislators to reach these goals. That’s our job as voters and constituents, right?

How does it work that the proponents of Measure 2 blame our legislators, tell the world that they’re not doing a good enough job…and then give them the sole responsibility to not only fund the state-run programs, but ALL local programs as well!?!

Perhaps I’ve spent too many years on the farm, but I do believe our country was built on the principle that if you do not like who’s representing you at the local, state and federal level, you will have the opportunity to make changes. Has something changed recently?

Do you have questions about how this would work? So do I. Are there answers? Not really. And that scares the bejeebers out of me. I’ve been on the Yes to Measure 2 site a few times, and the FAQ seems to be broken. (How ironic.) (As of 4 p.m. 3/20/12…the FAQ was back up and working.) And I’ll post a link to the Keep it Local group, just to be fair…although I will admit that I haven’t been on that site as much. I prefer to hear what the people behind the measure have to say, and then make my own decision. And I encourage all voters to do the same.

So post your questions, and I’ll do the legwork to answer them, best I can (including links, facts, etc.)…and if I can’t find the answer, maybe I’ll just delete this blog post and start from scratch. That seems to be the answer of the day.

Yes, the world we live in is a crazy one…and it just got a little crazier.

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21 thoughts on “This funny thing called taxation

  1. What questions do you have that aren’t answered? Please be specific, as the there is a large amount of misinformation and fear mongering about Measure 2. K-12 gets full funding, local control of spending is granted, all other “local” revenue options are still available to all subdivisions (sales tax, bonding, specials etc) – you just can’t tax property. The measure specifically states K-12 and local government entities are funded fully and properly before any other special interests spending can take place. If it’s funded under your current property tax now (just look at your bill) – it’s funded after measure 2 passes. Here is what you and all your readers have to understand – the special interest money is going away to pay for this – the money is there to cover this – they know it – and they are not going to go down without a fight. This measure ends the abuses of property tax. This ends the lifetime rent to the government – this really is that simple. It’s families first – special interests and bloated government 2nd. Get the facts – they are on the site – I have no idea what you are needing – so please be specific so this can be corrected.

    • Wait a minute, I’m not against changing property taxes. I’m not against lowering taxes and improving our bottom line. What I’m against is making radical changes without having a plan in place. Look at my county specifically…if there are problems that need to be addressed at our township level, I can go to the township board and ask for changes. If they are short on funds, they can ask for a raise in the mill level. If we’re going to do away with mill-levy-based taxes, then what is the plan to ensure that those needs are addressed? Are the 9 families in our township expected to appeal to Bismarck for additional help? And what chance will we have, if we’re going up against communities such as Fargo, Bismarck and Grand Forks? Our school district is blessed with property-tax funds from wind towers. How will that money be guaranteed? I know about the struggles that some have with property taxes. We own a home in town, and we have recently purchased the land where I was raised…but our taxes in town aren’t that bad, until you add on the special assessments. And those won’t even be addressed by this measure.

      Again, I’m all for change, and would love to see a common-sense approach to property taxes. But I’m not for eliminating a known tax, for something that’s left to our imaginations.

      • This is directly answered within the measure’s language. The state – not your local entity controls all mill levey’s – the “locals” are just allowed to levy the tax. The state controls all Ag Land values – not your local entity. The state controls all formulas for all valuation of all properties – not your locals. The measure requires full funding for K-12 (which has been increased from roughly 35% to now 70% from the general fund – where is the loss of “local” control argument there?) and to fully and properly fund all sub-divisions FIRST! In that order. Schools and ALL local government paid for FIRST. The measure is written as such knowing all sub-divisions are different. Look at your property tax bill – Fargo’s won’t look the same as Mott. The measure “fully and properly” funds this. There is NO more Imperial Cass County – as the measure constitutionally states payments “fully and properly”. Right now funding goes to whoever gets the most votes in Bismarck. And who has the most votes in Bismarck? Fargo. Do you really think that if your town or county needs better roads you have the votes in Bismarck to get them? No, because right now it’s majority rule. But with CONSTITUTIONAL protections it doesn’t matter what the votes in Fargo are, the Constitution compels them to “fully and properly fund” each sub-division – this means city, county, township etc. This is to be done FIRST before any special interest money can be used!

      • Actually, our township board does a decent job of protecting our roads and making improvements as needed already, thank you. And schools are fully funded at what level? Because I do believe the budgets in our schools in our county look different than others. Is the sky the limit? Or are all schools required to fit in certain parameters? And special interest money…what is that?

  2. Why do you think the their is so much money being used by the opposition to Measure 2? This takes away special interests – including large city special interests. This levels the playing field for everyone – AND you get to stop renting from the government – you have actual private property! Again – property tax is just ONE tax. The “locals” still have “permission” to use other revenues that currently exist – fees, sales, bonding, specials…etc. This is just stopping tax on your CASTLE! The government CAN’T take it away for failure to pay property tax! The replacement funds for property tax are directed to the sub-divisions with no strings attached! That is local control! yesm2.com!

    • The problem is, I don’t have a problem with the government taxing my “castle.” It’s a privilege that I have as a property owner. If I didn’t want to have that privilege, I could simply not buy property. How do we have out-of-state landowners assist with paying for roads/etc.? Especially those that are rarely ever in the area, but need the roads kept open? Is that my privilege as a resident to cover the costs of their upkeep?

  3. You are correct – special assessments won’t be affected – however, they shouldn’t change anything in how they are applied. What would you rather have?…a property tax + specials or just a “specials” bill for the entire year for the entire length of the bond – like over 10, 20 or 30 years? That could be like $100.00 per year. Not $100 EXTRA on top of property taxes per year – for the length of the special payment.

  4. Measure 2 will not be taking local tax revenue and returning it to the state, the state will give your local governments revenue to replace property tax because this tax will be eliminated. Instead of you having to pay because you own this much land and it produces so much of this and you own this kind of house, you won’t do this; the state will use money it already receives from us in the other taxes we pay. The state has already set aside $400 million to do this and is taking in $4.8 million dollars a day, yes a day.
    Property taxes have been the most hated tax even in 1816 there were cartoons drawen up of commissioners wanting tax for our property. England got rid of it. We left England and maybe it is high time we get rid of a system we carried over with us on the “Mayflower”.
    With the passage of Measure 2, the legislature will have a directive from us the people, from this directive they will have to decide how to implement the instruction to eliminate property taxes and fund with other tax revenue. Measure 2 requires the state to fund legal obligations such as contracts will have to be honored all other statue requirements would have to be funded like our children’s education and it is only the portion which the property tax revenue was funding. If you check with your county and local government you will find some of their funding sources, revenue comes from things other than property tax, like the state, the federal government, fees, maybe sales tax or other taxes. Your local officials should be able to tell you how much of the revenue is generated by property tax. The state will appropriate this money based on what is now your property tax money and give it to your local governments, your local governments will still decide like they do now; how to spend it. There will be no need for you to hash out what you pay line item by item with the state legislature. The legislature will develop a process for the local entities to disperse the funding, much like schools have to do now, and they receive 70% of their funding from the state. The schools will receive 100% of the funding from the state and will have local discretion on how to spend it. Governing does not change the funding changes.
    “The thought of truly eliminating property taxes is ridiculous and a mistake of epic proportions. And it wouldn’t even be a mistake just for our generation. It would be a disaster for generations to come.” Ridiculous, Why? I think it is ridiculous to allow the infectious nature property tax has become in our major cities to spread to our more rural areas, because this “infection” will spread. What has happened in our cities is a mistake in epic proportions. As property owners our homes have been mortgaged to pay for multiunits to store our elderly, to pay for multiunits to gouge rent from our youth and workers, $800 to $1000 a month rent, to pay for many things we have very little recourse other than to pay for even when it means taking less and less pay home for our families. If it is not in your area yet, the techniques of this property tax scam will come to your area, because it is being taught by the associations in the Keep it Local Group, they are teaching the local governments how you can squeeze more tax dollars out of your people and they won’t be able to do much about it, because they have your property as collateral. Sure, you can vote these people out, but not all of them will be removed and the land grabbing can continue. In Mandan in 2006 I started looking at what was happening, seniors were screaming they were being taxed out of their homes and they were. We got a new mayor and a couple commissioners and still the pillage continues in 2006 we went from $40 to $60 million in debt to over $100 million in debt, now. How can this happen? They have our property as collateral to finance the projects they want. We go to the hearings and say no more and still there is more. The very sad apart about this our income is dwindling because our paycheck and pay raises cannot keep up with the increases of property taxes. Special interests, many of them the Keep it Local folks, get exemptions from paying taxes and the rest of us have to pay. If it is good for some not to pay property taxes than why not for all of us? We still have income, sales and other revenues to pay for our local needs, those taxes are in place, let’s use the money we have and stop mortgaging our homes with property taxes.
    What scares the beejeebers out of me; is Fargo in this last census has more people living in multiunits than living in homes. Is this because of the millions of dollars they have given in exemptions to multiunit developers? Did this property tax policy cause the shift in population? For me the power a tax policy could have to change where people live is frightening. I would like my children to have their own home one day without having a second mortgage (a perpetual lien) on it by those you do not really have much local control over.
    The time to make the change is now while the state has a surplus.
    I am the Secretary of the Empower Taxpayer, I signed the petition, and got involved about a month ago. Because it will be legendary it we eliminate the property tax. We could, we just have to believe we can. It will be just like how it feels if you pay off your mortgage, a little lighter, and freedom.
    My website is http://www.bbuz.biz I post information on my local government and others things on it. I am sorry the Faqs page was not readily available when you went to http://www.YesM2.com I will check with our webmaster to see if there is or was a problem.
    I am glad you are looking for answers and the dialogue is open.
    Susan Beehler Mandan ND 701 220-2297

    • Sorry about delay in approving your comment. I’m normally home most of the day with my children, but today we were out of town.

      I appreciate you taking the time to respond to my post, but I don’t believe you understand or appreciate my position. I live in a township with very few people in it, just like many in our state. Have you ever been to a township meeting in a rural area? Have you ever driven through a township with the board members, while they’re assessing the damage from a flood? Have you ever been at a township annual meeting, where the supervisors discuss and decide what the budget should be for the next year, what they need to request for mills, etc.?

      If you have, then you know that the statements made aren’t exactly the truth. You know that township boards set what mill they request a year in advance from when it’s actually paid. And yes, the state does have control over the mill levy, in the sense that the state dictates what the MAXIMUM amount that can be levied. But it’s up to each townships discretion to determine what their needs will be and where they are comfortable being funded. Many townships do not use the maximum amount, until conditions are warranted to do so. I know that for a fact.

      And the township can also exceed this maximum, for a limited amount of time, if the township notifies its members as a whole, meets and votes on the matter. I also know that for a fact.

      You state that schools will be funded by the states 100%, instead of 70% as it is now. But who determines what that budget amount would be? Is it so much per student? Is it so much per capita? What is the plan?

      You say that we can not vote enough of “these people” out and that the “land grabbing” will continue…and yet we’re to give them sole discretionary power over funding?

      You also state that the North Dakota has a surplus…and yet, one of the feature posts on the Measure 2 site states specifically that North Dakota has spent all of its money. Which is it?

      I also have concerns about where the “pork” will be cut from. OK, so from the Measure 2 site, I see that perhaps out-of-state tuition subsidies and state employee benefits would be on the hit list. But that’s not going to come close to covering it…so what else? These are answers I need to know. And who will make these decisions? The legislature as a whole? A special session? A special committee? If we have a hard time getting the work done that needs to be done during a regular session, then how would this be accomplished? At what cost to taxpayers?

      Again, I’m all for change…it just has to be well thought out and easy to follow. And so far, it’s not passing my litmus test.

  5. I understand and agree with the concerns that you raise about Measure 2, Val. As a rancher and a landowner, I know what it feels like to pay property taxes, believe me. On the surface, Measure 2 may seem attractive (who likes paying taxes, anyway?), but, after further review, it is clear to me that it would result in many negative unintended consequences. The most scary of those to me is the shift from local government and local decisionmaking to a much more centralized government, with important local decisions falling in the lap of the state legislature instead. Local projects would have to “compete” against one another for dollars, and with more of our population shifting to urban areas, rural North Dakotans would be the net losers, as there are less legislators to rally for those rural priorities than there are for the urban. I am all about property tax relief and reform, but Measure 2 leaves too many unanswered questions and problematic possibilities to be the right answer to accomplish this goal.

  6. Ms. Beehler, I appreciate your dreams of your kids owning their own homes one day. My husband and I share those dreams. We are in our 30’s and currently rent the ranch we are living on (raising 3 kids and 100+ cows) south of Mandan from a very nice fellow who lives in Colorado. I believe if Measure 2 passes, it would encourage folks like our landlord to purchase even more land in the state and directly compete with young North Dakota families (like us) who have dreams of home(or ranch)-ownership. Instead of being “mortgaged to the government,” this measure would cause many young people like me to be permanent renters with no hopes of ever owning property.

    I also need more specifics for “fully and properly.” Who determines that? The legislature? What happens when there are more needs in 20 years in some present-day rural areas than there are in 2012? Is “fully and properly” determined by the 2012 budget? If so, then small (low population) towns, counties, townships and every other local form of government will have to come to Bismarck to lobby for their needs. That’s not a battle many in rural areas will win (and I don’t think that’s fear mongering. That’s a legitimate point based on the make-up of the legislative body and the general difficulties of fewer people available in lesser-populated areas to do the work).

    I see this measure as pitting rural against urban areas and increasing competition between out-of-state and in-state residents. That’s not a North Dakota I’m excited about living in.

    • I agree, Sheyna. These are some of my very same concerns. I look at farm land that my husband and I would like to buy. What incentive would out-of-state landowners have for selling or renting? What will this do for prices per acre? Will land prices escalate even more? So many questions…not enough answers.

      • What incentive do they have now? If out-of-state people have an opportunity to buy, as insider you go buy first, because you are here and they are there. Just think you maybe would be able to afford more acreage. Out of state owners can not vote, you can, so laws can be made or encouraged by your county lobbyists to favor in state land owners. Ask them what they could do if Measure 2 passes, instead of hoping it doesn’t? Be prepared, have your land deal looked at so you can sign on the dotted line if Measure 2 is passed. Be proactive. The majority of the out of state agricultural land owners are in Adams, McKenzie, and Sioux counties. in Morton county only 6% are out of state owners. The complete list is available I am sure from your Association of Counties. If not I will be posting on my website soon.

    • Those against Measure 2 would like you to believe you will have to come to Bismarck, for you living in Mandan, this would be no big deal,but you and no one else will have to come to Bismarck to lobby if Measure 2. The only way we can have property tax reform or it eliminated is for it to be decided by the legislature, because the legislature has control over how our local governments are funded, you can not go to the county and say let’s reform property tax, because the county has no control over what they can and cannot do or you can Vote for Measure 2 a citizen generated petition to change the way our local government is funded. You are my neighbor, I live in Mandan. If Measure 2 does not pass, than you would definitely have to come to the legislature to make changes or initiate another Measure those are the only options. The city, the county, and other local entities cannot change it because the state does not allow it. Currently the legislature is looking to stick it to the farmers, Did you see this article? http://bismarcktribune.com/news/state-and-regional/proposal-would-end-nd-rural-property-tax-exemption/article_c6dc82a4-7569-11e1-965b-001871e3ce6c.html The state looks to attract out-of-state business now, they give exemptions to come here, but you and I don’t get those exemptions. This does not happen as much in the counties or rural areas but is growing more and more in the urban areas and it won’t be long before everyone is doing it. So if exemptions are great for some why not all of us. Our home and our property should be ours not under the government control.

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