Forum Editorial: Measure 2 rebuke a new revolt
One of the strongest verdicts rendered by North Dakota voters in Tuesday's election was their resounding defeat of a ballot measure that would have cut by half state income tax rates for individuals. At first blush, the...
One of the strongest verdicts rendered by North Dakota voters in Tuesday's election was their resounding defeat of a ballot measure that would have cut by half state income tax rates for individuals. At first blush, the
70 percent thumping suffered by Measure 2 might seem to exhibit a remarkable reluctance by voters to give themselves a tax break. Not at all. It's a clear expression that the overwhelming majority of North Dakota voters want further relief from local property taxes.
In a very real sense, the spurning of Measure 2's income tax cut is an outgrowth of a revolt at the ballot box in 1989, when North Dakota voters passed three referred measures overturning tax increases that had passed the Legislature.
Since then, lawmakers in Bismarck have held the line on state income and sales taxes - while for too long remaining blithely indifferent to the downstream pressures their austerity imposed on the property taxes that local governments, especially school districts, must rely upon.
Fortunately, economic growth stemming from the state's success in diversifying its economy - with a huge boost from once-soaring oil and farm prices - have filled state coffers, leaving a projected surplus of $1.3 billion, including $400 million set aside in reserves, as a hefty cushion for the 2009 Legislature. The defeat of Measure 2, and Measure 1, which sought to create an oil and gas tax trust fund, mean significant property tax relief remains within reach.
Gov. John Hoeven must have been overjoyed by the defeat of both measures, considering several ambitious initiatives he has unveiled and will present soon to legislators: $300 million in property tax relief; $100 million in income tax relief; $100 million in additional state support for education; $40 million in college tuition grants and a $32 million plan for children, families and seniors - a $572 million wish list the Legislature is certain to scrutinize, but one that also will arrive with a mandate from voters, who supported Hoeven by an even larger margin than they rejected Measure 2.
Measure 2, had it passed, would have blown a $414 million hole in those proposals, obliterating meaningful property tax relief, straining the state's ability to maintain essential services and infrastructure, and creating an unhealthy imbalance in the state's tax system.
The need for property tax relief, and more generous state support for education, is clear. The state's share of education funding has steadily declined since 1981-82, when it picked up
58.5 percent of the tab, and the local share was 23.3 percent. State support dwindled to 50 percent by 1988-89. Since the 1989 tax referrals, the state's share of support for K-12 education has plunged to an embarrassing 39 percent, sticking local property taxpayers with 45.1 percent of the cost of educating the children who represent the state's future.
Since 1989, legislators have taken their guidance from the referral revolt at the ballot box. Now, almost 20 years later, taxpayers find themselves in a very different position. The resounding defeat of Measure 2 is a clear expression that taxpayers understand the immense pressures that have been placed on their local property taxes by decisions made in Bismarck, and with the rise in property valuations over time. The voters' rebuke of Measure 2 is a new tax revolt - property tax relief.
Forum editorials represent the opinion of Forum management and the newspaper's Editorial Board