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HB 1353

Counties and county officers; Counties and County Officers Act of 2025; effective date.

2025 Regular Session Introduced by Tom Gann

Caps annual property tax growth to CPI (max 3%), restricts levies unless districts obtain a 60% voter approval for overrides; includes carryforward rules.

Second Reading referred to Rules
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Bill Summary · HB 1353

HB 1353 — Limitations on Property Tax Levies by Taxing Districts (North Dakota)

Status: Second reading — failed to pass (yeas 25, nays 63)
Introduced: November 15, 2024
Primary sponsors (intro text): Representatives Koppelman, Toman, Kasper, Dressler, Steiner, Schatz, VanWinkle; Senators Powers, Walen
Chapter/Code: Creates a new section in NDCC chapter 57-15
Effective date in bill text (if enacted): for taxable years beginning after December 31, 2024

Main purpose

To cap year‑over‑year growth in property taxes (measured in dollars) that a taxing district may levy without voter approval, tying allowable increases to inflation (CPI) with a 3% cap, while specifying technical adjustments, exceptions, carryforward rules, and a voter-approval process for overrides.

Key provisions / what the bill would do

  • Annual limit on levies: Property taxes levied (in dollars) by any taxing district may not exceed the amount levied in the prior taxable year by more than the percentage change in the Consumer Price Index (CPI) for All Urban Consumers — Midwest region — but not to exceed 3% in any one taxable year.
  • Base adjustments: The prior‑year dollar amount used to calculate the cap is adjusted to account for:
    • Newly taxable property or improvements,
    • Loss or reduction of prior exemptions,
    • Property that became nontaxable,
    • Expired or reduced temporary mill levies (or other temporary mill changes).
  • Carryforward of unused allowance: If a taxing district increases levies by less than its allowable percentage, it may carry forward the unused percentage to any of the next three taxable years. The carryforward may be used so long as the combined use in a single year does not exceed double the per‑year percentage limit. Unused carryforward expires after three years.
  • Exceptions (not subject to the limit): New or expanded levy authority enacted or approved since the prior year; irrepealable taxes to pay bonded indebtedness; the state medical center one‑mill; specified Garrison Diversion levy; taxes/special assessments to pay obligations (including revenue bonds, debt service, special assessments); certain statutory levies and special improvement projects.
  • Voter override: A taxing district may exceed the cap for at most one taxable year if a ballot measure stating the proposed increase is approved by at least 60% of qualified electors voting on the question at a statewide primary or general election.
  • Preemption: Cities and counties may not use home rule to supersede or modify these limits.
  • Definitions: CPI is defined as BLS Midwest region annual change ending Dec. 31; “taxing district” covers any political subdivision authorized to levy taxes.

Who is affected

  • Directly: taxing districts (counties, cities, school districts, special districts, and other local political subdivisions that levy property taxes).
  • Indirectly: property owners and taxpayers (through potential limits on local tax revenue growth and possible impacts on local services or need to seek voter approval); bondholders and capital projects (exceptions preserved for bonded indebtedness).

Fiscal/operational impact — likely effects

  • Constrains local property tax revenue growth to inflation (capped at 3%) unless voters approve larger increases.
  • Could increase frequency of ballot measures for one‑time needs or revenue shortfalls.
  • May force taxing districts to reduce spending, reprioritize, or seek alternative revenue sources where costs grow faster than allowed levy increases.
  • Preserves capacity to fund debt service and certain statutorily specified levies.

Procedural / timeline details

  • If enacted as written, the new limit would apply to taxable years beginning after December 31, 2024.
  • Overrides require a 60% voter approval at a statewide primary or general election and are approved only for one taxable year at a time.
  • Carryforward of unused percentage is limited to a three‑year window.

Current legislative status / note

This version failed on second reading (yeas 25, nays 63) and therefore did not become law in this form.

Compiled from official sources — confirm details with the bill’s official record.

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