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By Keith Colville
Valley City
Could North Dakota abolish property taxes? Should North Dakota abolish property taxes?
The answer to both questions is a resounding yes!
Before you dismiss this idea outright as impossible, please consider: After studying property taxes for quite a few years and trying to figure ways to fix the problems with property taxes such as the unfairness, unjustness and the government penalizing the citizen for improving her or his property and/or not letting the government into your house for internal inspection, to name a few, we have come to the conclusion that the system is so broken it can’t be fixed!
The first question we get is how will schools and other local expenses get funded without a property tax?
One answer: As of the last session of the Legislature, the state already covers 70 percent of local school costs, so a mechanism is already in place to fund schools without property taxes, so just the percentages would change. As far as other local expenses go, a similar mechanism would be put in place.
But some say we would lose local control. If you think we have local control now, you haven’t been to Barnes County Commission meetings lately. Their pat answer to everything is the state forces us to do this and the state forces us to do that. Also, local schools are under control of the Department of Public Instruction through imposition of the State Accreditation Manual.
Another question that is raised: Where would the money come from to replace the lost revenue? Some use the image of a three-legged stool: property tax, income tax and sales tax. If you cut off one of the legs, the system would become unbalanced.
Our answer: If you want to use legs on a stool to make your point, fine. In North Dakota, we have more than a 20-legged stool. In addition to sales tax and income tax, we have oil revenues, license fees and the state lottery, to name just a few of the state’s revenue sources.
If you picked only sales tax to replace property tax, if done right, the rate would only have to go up in the neighborhood of 2.5 percent and everyone would be contributing, not just the 53 percent of the population as is the case here in Valley City, where 47 percent do not pay property taxes.
And, of course, the lost revenue could be replaced by spreading out the difference evenly over the other 20-plus legs. Additionally, about $50 million would be saved each year by eliminating the costs of administering the property tax.
What other benefits would result?
Most cities have property tax incentives to encourage development. Abolishing property taxes would automatically give everyone everywhere in North Dakota (indeed, everyone in the United States) those incentives.
Locally, people would improve their properties without getting punished with higher property taxes. That would create jobs!
Statewide businesses from around the country would look very closely at relocating to North Dakota. Their bottom line, when excluding property taxes, would dramatically increase, creating more jobs.
You would not have to worry about having to sell your home because you can’t pay your property taxes. No one knows this better than our elderly and those on fixed incomes, who finally, after years of scraping to pay off their homes, are forced to move because they cannot afford their property taxes.
Because of property taxes, one’s home becomes a liability during difficult economic times. This should never happen. Your home should be a place of security and refuge, not a liability.
We have joined with other grassroots organizations from around the state to put on informational meetings across the state.
The next meeting will be in Valley City at 7 p.m. Feb. 19 at Pizza Corner. Come and have a piece of pizza on us and find out why the time has come to abolish property taxes in North Dakota.
For more information, visit our Web site at valleycitycci.com.
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