Editorial: Minnesota school tax credit program for farmers is a policy winner
Dilworth-Glyndon-Felton school backers came up with a slate of enhancements for the district's public schools, including a new early childhood center and improvements to elementary, middle and high schools. The group called itself Developing Great Futures and its wish list added up to $31.5 million. But the 2015 initiative ran smack into the Rebel Action Committee, an opposition group headed by a farmer who opposed the projects because he believed farmers were shouldered with a disproportionate part of the property tax burden. The proposed bond issue, which needed a majority to pass, fell far short, gaining only 18 percent.
Similar stories have played out in many school districts around Minnesota, where agricultural landowners have balked at bond issues for school improvements because they feel farmers would be stuck with an unfair tax burden. But the playing field has changed significantly with the advent of Minnesota's School Building Bond Agricultural Credit. The new program provides a 40-percent tax credit for agricultural landowners for school bond issues. The Minnesota Legislature, which acknowledged the financial burden facing farmers, set aside $35 million for the program.
That's very good news for districts like Dilworth-Glyndon-Felton, where 60 percent of the land base is agricultural. With significant tax relief from the credit program, agricultural landowners should be more receptive to proposals to improve local schools, so important to maintaining healthy communities and in educating future generations. The administration of Gov. Mark Dayton, notably including Revenue Commissioner Cynthia Bauerly, which proposed the program in the governor's budget recommendations, deserves credit for coming up with an innovative solution for a problem that seemed intractable.
Faced with chronically low commodity prices, farmers have been badly squeezed in recent years. So it's understandable that farmers in particular, whose livelihood requires them to own or rent large swaths of land, would be especially sensitive to property tax increases, even for something as important is a school bond issue. Yet rural communities where schools close, often after years of struggling financially, are doomed to wither and die. Quite simply, schools are critical to the future.
Minnesota's new tax credit program is an idea that's worth borrowing. The North Dakota Legislature should study their next-door neighbors' program and adopt a version that makes sense. After all, lots of rural school districts in North Dakota face the very same problems that have confronted districts like Dilworth-Glyndon-Felton. Meanwhile, with the new tax credit program in hand, Dilworth-Glyndon-Felton school administrators are planning to bring a more modest, $23-million bond issue to voters in November 2018. They're optimistic that they'll have a more favorable reception from agricultural landowners. We hope they're right.
Editorials represent the views of Forum management and the Editorial Board.