It is not often that voters choose to keep a tax, but that is exactly what happened in North Dakota on June 12.
More than three-quarters of voters chose to keep the state property tax, according to the North Dakota secretary of state.
The proposal, Measure 2, required amending the constitution and, if passed, would have made North Dakota the only U.S. state without a property tax. North Dakota, which is currently amid an oil and gas boom, has the lowest state unemployment rate in the country, according to the U.S. Bureau of Labor Statistics.
Advocates of Measure 2, largely represented by the grass-roots group ‘Empower The Taxpayer,’ say taxing the family home is an infringement on basic rights.
“Our family budget has to suffer so that government does not,” said supporter Robert Hale on the group’s website. Hale is author of the book “Property Tax Revolution: It’s Our Home, Not Theirs.”
Property tax is a big contributor to state revenue, but advocates of Measure 2 believe states should be funded from a variety of other taxes—including sales tax, individual and corporate income taxes, lottery revenues, and oil and gas production. With North Dakota booming, now is the time to do it, proponents said.
Opponents of the proposal, represented by ‘Keep it Local ND’—a powerful coalition of groups that includes corporations, business associations, and public workers—ran a strong campaign against the bill.
They feared erosion of flexibility and local control, an increase in taxes, and a further centralizing of power.
“Measure 2 is a radical and reckless proposal that will force the greatest transfer of political power in North Dakota history,” the group said in a statement on its website
The coalition noted that over 15 percent of property in North Dakota is owned by non-residents.
“Out-of-state property owners would pay no tax, but still receive services,” the group said.
Former Republican Gov. Schafer, and former North Dakota Lt. Gov. Lloyd Omdahl, a Democrat, issued a joint statement opposing the bill, but acknowledged there was room for reductions in property tax and reform.
“A gradual biennial reduction is far better than one radical action, especially when we can’t know all of the unintended consequences,” Omdahl wrote in The Bismarck Tribune.
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