It’s the Legislature’s goal to end the session Friday, or work through the weekend until they do. Monday is day 71 of the 80-day limited Legislative Session. Lawmakers spent most of their days this week in conference committees working out the differences between the House and Senate versions of bills even meeting Saturday.

Legislators met six times on HB 1176, which is the property tax relief bill that also restricts local government’s ability to increase taxes. The conference committee started working off proposed amendments brought in by the House. Many of these amendments are pretty similar to what the Senate was working on to improve the property tax relief/reform package prior to the conference committee meeting, so it appears there aren’t many differences. Building off the version of the bill the House passed the amendments proposed would:

• Increases the Primary Residence Credit to $1650
• Use Legacy Earnings to fund the property tax relief
• Includes changes to the disabled veterans’ credit by increasing the credit
• Removes the proposed expansion of the homestead tax credit
• Removes the provision stating that the PRC may not be applied to voter approved levies (this was a major priority for NDACo)
• Removes language related to levy limitation and township levies (this was determined not to be needed as townships vote yearly on their budgets)
• Adds an exemption to the levy limitation section related to borrowing
• Includes intent language for the legislature to provide property tax relief to additional property classes in the future
• Adds a study on various property tax relief and reform topics including the content on a tax statement
• Appropriation: $438.2 million

The bill still contains a 3% cap restricting the growth of tax levies for local government but allows the political subdivision the ability to exceed the cap with a vote during the general or primary election, emergency levies are also exempt from the cap. The committee discussions have been focused on the challenges related to capping school districts due to the current school funding formula. The Senate has also emphasized their support for a provision to ensure property owners are paying at least 25% of their tax liability. The 75% threshold may be the greatest difference at this point between the House and Senate stance on HB 1176.

The Senate also finally acted on HB 1168 which was introduced to provide property tax relief by buying down school mills. The Senate “hog-housed” the bill to mirror their changes to HB 1176 and passed it unanimously. Senate leaders have indicated they have kept the bill alive as a backup in the event the conference committee can’t agree on HB 1176. The Senate Finance & Tax committee has not acted on HB 1575 which is highly unusual at this point in the session. This property tax relief/reform bill sought to reduce property tax rates and restricted local government by capping taxable valuation growth.

TRANSPORTATION FUNDING

The House approved their version of the ND Department of Transportation budget which includes a drastically different proposal for infrastructure funding for counties, cities and townships. The House version includes a 5-cent increase in the gas tax which would generate $70 million. House members debated that portion of the bill separately, that aspect of the bill passed narrowly with a vote of 47-42. The House then moved to approve the entirety of SB 2012. The conference committee met for the first time on this bill Saturday. The greatest differences between the House and Senate versions are:

• The House version eliminates the prairie dog buckets and instead includes that funding inside the SIIF bucket in the oil & gas tax distribution revenue streams.
• The House version has all of the motor vehicle excise tax going to the General Fund. The Senate version has 100% of the MVE going to counties, cities & townships for road funding.
• The House version has more focus on local dollars for infrastructure being distributed through grants versus direct distributions.

The Senate killed HB 1382 which proposed a 3-cent increase in gas tax with a vote of 0-45. Which may indicate that a gas tax increase may be difficult to get approved in SB 2012.

Other Conference Committees:

The DHHS budget, HB1012, conference committee has met seven times and is still reviewing changes made by the Senate. A few items have been agreed upon but there are still quite a few discussion points. Members on both sides are thoughtfully considering the differences.

The DOCR budget, SB 2015, is another big budget with funding for add prison space. It also includes an increase in the daily rate to county jails when NDDOCR contracts with them for beds.

Here is a link to the conference committee schedules which updates during the day:

https://www.ndlegis.gov/legend/committee/conference/public-schedule/

Bills worth noting that received final action this week:

• HB 1193: Back the Blue Grants of $3.5 million to local law enforcement for retention bonuses – PASSED
• SB 2180: Public Comment – PASSED
• SB 2160: Related to NDPERS Health Insurance – PASSED
• HB 1613: Law Enforcement use of Robots – PASSED
• HB 1582: False information to Law Enforcement – PASSED
• HB 1307: Prohibits home rule cities/counties from superseding state law on elections – PASSED
• HB 1482: Requires bond elections to be on primary or general ballot – PASSED