MINOT — Measure 4, a proposed constitutional amendment put on the November ballot through the petitioning process, would do two things.
First, it would prohibit any ad valorem tax on property. This is to say that the State of North Dakota and its various political subdivisions would not be able to tax your property value. It’s important to remember that they would still be able to tax your property in other ways, though. They could levy a tax on the square footage of your land and its structures, or tax your other property like your boat, or your camper, or your jet skis.
Lots of people, including many in the news media, describe Measure 4 as “abolishing property taxes,” but that’s not true at all. It only gets rid of one very specific type of property tax.
But the measure has another mandate, too.
In Section 1, subsection 3, it states, “The state shall provide annual property tax revenue replacement payments to political subdivisions in an amount equal to no less than the amount of tax levied on real property by the political subdivisions, excluding tax levied on real property for the payment of bonded indebtedness, during the calendar year in which this amendment was approved by the voters.”
In plain language, the amendment obligates the state to replace the revenues eliminated by Measure 4 at whatever level was collected this year.
This means that local taxing entities that have kept their property taxes low, or who don’t levy a property tax at all, are going to find themselves in a real pickle.
A travesty, really.
Consider Mountrail County as an example. This western North Dakota jurisdiction has kept its property tax levy very low. According to data I collected from online property tax records, a funeral home business in Parshall is valued, structures and land, at $216,500. The business was assessed just $12.56 in county property taxes in 2023.
A residential home in Stanley, the county seat, valued at $265,800, paid just $13.87 in county property taxes.
As a point of comparison, in Ward County, just to the east of Mountrail, a residential property in Minot, the county seat, which was valued at $237,000 paid $604.14 in county property taxes.
The elected officials overseeing things in Mountrail County have made decisions that allow them to keep their property tax levy low. Given how frustrated many North Dakotans are with their property tax bill, those leaders should be applauded.
But if Measure 4 passes, they’ll be punished. The amendment will forever and ever enshrine the state’s obligation to fund Mountrail County at its current property tax collection levels. Forever and ever.
Mountrail County’s neighbors, like Ward County, would be entitled to a much larger reimbursement from the Legislature. By the way, some jurisdictions, like the park district in the City of Williston, don’t collect a property tax at all. They’d be entitled to nothing.
Measure 4 treats every tax jurisdiction, from those that have kept property taxes low to those that pushed them higher, as if they were the same. And it would write that inequality into our state constitution.
It would be a terrible mistake if we allowed that to happen.
