Lawmakers pushed through to wrap up their action on all bills at 4 a.m. Saturday morning. In the end, about 600 bills were passed a budget of $20.3 Billion. There were many hang-ups that drew out Day 74 Friday night and forced legislators to work into the early morning. In particular, a conference committee report on campaign finance was rejected, new conferees appointed, several additional meetings were held and after all that the Senate defeated HB 1377 – which was their final bill to act on. Before that, lawmakers gave final action on important budget bills and property tax relief.

PROPERTY TAX RELIEF

The Property Tax Relief bill, HB 1176, will provide more than triple the amount of relief to North Dakota property taxpayers. Governor Armstrong signed the bill into law Saturday which provides a primary residence credit of up to $1600. The $403 million in relief is funded by Legacy Fund earnings. HB 1176 was expected to be one of the first bills passed this session; but was finalized on the last day. The conference committee met 13 times, deadlocked over the provision that required taxpayers to pay at least 25% of their taxes due. That amendment was removed in the final version. Below are some highlights of what is included in the bill, click to View HB 1176.

• RELIEF:
• $1600 in property tax relief for primary residences, known as the PRC ($403 million total / biennium)
• The Primary Residence Credit may not: reduce liability for special assessments, exceed the amount of taxes due on the primary residence
• Increases renter refund to $600
• Increases disabled veteran’s credit
• Removed the expansion of homestead tax credit that was approved in prior versions
• RESTRICTIONS:
• Caps local government at 3% growth in dollars levied by property taxes
• Political subdivisions can carry over unused percentage to use once within 5 years
• Counties, cities & schools can go to a vote in general election to get approval to exceed 3% limitation, good for four years. Townships can vote at annual meetings to exceed cap.
• ADMINISTRATION:
• Creates primary residential property as new class of property
• Assessment notices to all property owners and include date, time & location for local board of equalization meetings
• Budget hearing notices to replace estimated tax notices
• PRC can be applied to voter approved levies (this was a technical correction NDACo worked to get in final bill)
• Interim study to look at implementation of HB 1176, impact of levy limitations, feasibility of revising tax statement & analysis of tax-exempt property

The House defeated HB 1168 which was another property tax relief bill still alive, and the Senate killed HB 1575 which also was still being held by the Senate as a backup vehicle in the event lawmakers ran into issues coming to an agreement on HB 1176.

TRANSPORTATION FUNDING

Major changes came late Friday on the NDDOT Budget SB 2012, which at initial analysis appear to be more favorable to local funding for roads. After negotiations, lawmakers settled on keeping the Prairie Dog buckets in the oil & gas revenue stream and in fact moved the buckets up ahead of the Strategic Investment Improvement Fund (SIIF) bucket. This provides more assurance Prairie Dog buckets will fill as these funds are dependent on oil prices and production. However, the Prairie Dog funding is decreased from $230 million to $160 million to cities, counties and townships. The survival of Prairie Dog may be a result in the direct message NDACo provided to lawmakers Wednesday urging lawmakers to resist the House proposal to eliminate the Prairie Dog funding. Here are other highlights of the DOT Budget:

• Total DOT Budget $2.7B
• Adjusts allocations of state share of oil & gas tax collections to municipal, county & township infrastructure funds (Prairie Dog)
• 50% of Motor Vehicle Excise tax will go towards roads with 25% into highway tax distribution fund and 25% into the flexible transportation fund, the other 50% goes to the General Fund.
• Adjusted the Highway Tax Distribution fund: 60% state, 35% counties/cities, 3.4% townships, 1.6% transits
• No gas tax increase (House proposed 5-cent increase which would have raised $70 million in funding for infrastructure)

STATE HOSPITAL & PRISON EXPANSIONS

The OMB Budget, HB 1015, included $300 million for a new State Hospital to be built in Jamestown. It also included 3% salary increases for state employees for each year in the biennium. The bill also increased funding for guardianship grants.

SB 2015, the DOCR Budget includes several one-time appropriations as well to address the overcrowding of the prison system including: Funding to construct the Heart River Correctional Center (new women’s prison), temporary housing at the Missouri River Correctional Center and $20 million to plan and design a new minimum security male correctional facility. In addition, the budget includes an increase in the rate DOCR pays counties for housing state inmates from $110 to $115 a day. SB 2015 also includes a study related to sentencing practices, correctional and parole systems. This study was added following the defeat of SB 2128 which sought to increase sentences for violent crimes.

NDDHHS BUDGET

The ND Health and Human Services budget, HB1012, passed keeping State Aid funding for local public health units level at $8 million for the 2025-27 biennium. Also funded in the state’s largest budget were behavioral health facility grants: $1.5 million added to the previous biennium’s funding and matching funds for CHI Williston to complete 10 patient behavioral health beds by the end of calendar year 2025 along with $12.9 million one-time funding and matching funds to help in completion of 24 behavioral health beds at Altru Health in Grand Forks to serve the northeast region.

OTHER BILLS THAT RECEIVED FINAL ACTION

SB2267 was signed by Governor Armstrong surrounded by bill sponsors and supporters. The bill puts rule making and installer licensure for onsite wastewater treatment systems (septic systems) under the Department of Environmental Quality (DEQ). Permitting will continue to be done by local public health units with DEQ adopting rules and providing technical assistance and guidance as needed. Passage of this bill comes from years in the making over several sessions.

A conference committee removed a provision in HB 1022 to add $50 million to the infrastructure revolving fund for political subdivisions. This additional funding was added as a last attempt to provide financial assistance counties with jail expansions or new builds. Two other bills that sought to provide low interest loans or grants were defeated and the Legislature voted to study local jail needs instead.

• HB 1454: Prohibits government entities from requiring vaccines – PASSED
• HB 1298: Increases speed limit on interstate to 80 mph and changes speeding fine schedule – PASSED
• HB 1229: Assumes vehicle owner is responsible in fleeing incidents, sets penalties – PASSED
• SB 2180: Requirement for public comment at regular meetings (city, county, township, school district, park district, water resource district) – PASSED
• SB 2093: House added income tax relief to Senate bill to provide income tax exemption for retired law enforcement benefits paid to surviving spouses – FAILED

Special thanks to all our county members who communicated with your lawmakers on bills. Your involvement makes all the difference!

Stay tuned for a more detailed report summarizing the entire 69th Legislative Session and county-related bills. Make sure to register for the ND Legislative Wrap Up – May 14th!