Senate committee reviews sweeping amendment to HB 1168 raising primary-residence credit to $1,650 and other property-tax changes

The Senate Finance and Taxation Committee reviewed a 63-page amendment to House Bill 1168 that would raise the primary-residence property tax credit, align several exemptions, and make technical and implementation changes to how property tax relief is calculated and distributed.

Chairman Weber described the amendment as a “hog house” that incorporates contents of House Bill 1176 and a number of technical corrections. The draft would raise the primary-residence credit to $1,650 while keeping a limit that the credit cannot exceed 75% of property tax due and must be at least $500.

Senator Grama explained the targeted effect of the proposal: “At $1,650 and 75% with a floor of $500 we're dealing with all of those individuals with property taxes less than $2,200. So you're concentrating all your credits on the very low end of all of the property tax owners.” He said preliminary fiscal estimates he had seen put the cost of that “skin in the game” design in the vicinity of $21 million, and that the figure would require county data and tax-department analysis.

Key provisions discussed by the committee include: - Disabled-veterans exemption: The amendment would raise the disabled-veterans valuation exemption to align with a $200,000 threshold already used for certain senior exemptions (described as section 10 in the amendment). - Primary-residence (PRC) credit increase: The amendment would raise the PRC maximum to $1,650 from an earlier draft level and maintain the 75%-of-tax cap with a $500 floor (section references discussed around sections 11–12). - Voter-approved levies: The amendment removes language that had prevented the PRC from reducing taxes that result from voter-approved levies, meaning the credit would apply against those levies (committee discussion singled out school bond “sinking” levies such as levy code 2109 as particularly identifiable). - Township levies and annual meetings: The amendment clarifies that townships, which hold annual March meetings, should not be required to replicate that vote on general-election day under the cap/vote rules (committee discussion noted townships’ statutory schedule under Century Code). - Bonding exception: The amendment creates an exception so that temporary 3% cap adjustments used for bonds can reflect typical bond terms (discussion noted typical bonds run 20 years, so a 4-year cap exception would be inadequate). - School funding formula fix: Committee members discussed changes in sections 23–24 intended to prevent school districts from being shortchanged if assessed values change and mill levies are constrained by the 3% cap; language would allow the state to adjust payments to maintain funding intended by the 60-mill baseline. - Tax-statement study: The amendment adds a legislative management study to consider a one-time redesign of the property-tax statement for clarity and consistency. - Appropriation and funding: The amendment contemplates covering any deficiency in PRC payouts with a deficiency appropriation at the next legislature and indicates intent to use the legacy fund as the source.

County and tax-department staff flagged implementation concerns. Linda Swyjovic of the Association of Counties told the committee the association supports many of the technical fixes and that the Department of Revenue has an internal practice to distribute the “big first round” of PRC payments by March/early April, with a second disbursement by June 1 to handle abatements and later corrections. Ms. Swyjovic said that approach addresses the counties’ concern about getting funds to taxing districts before preliminary budgets and hearings.

Shelley Myers, state supervisor of assessments, asked the committee to consider administrative dates in the bill. “If we're going to be moving up the application date for the primary residence credit, I think we're going to have to open it in October … it kind of moves the whole window,” she said, noting the department would need to change processing timelines and possibly open application windows earlier.

Danelle (North Dakota Association of Counties) raised communications concerns: a 75% formula that produces varying credit amounts on individual tax statements will require significant public messaging because the prior PRC was a flat $500 that taxpayers could clearly understand.

Committee members acknowledged several outstanding technical issues that need cleanup — including explicit references to levy code 2109, finalizing dates for certification and distribution, and continued talks about the “skin in the game” design. Chair Weber did not take a committee vote on the amendment that day; instead the committee recessed and agreed to reconvene after the Senate floor session to finish the work.

No formal committee votes on HB 1168 were recorded during this meeting; members directed staff and agency representatives to return with clarifications and technical fixes before the committee proceeds to a motion.

The committee identified implementation steps for counties, the tax department and software vendors — including possible programming work to calculate a 75% cap with a $500 floor on a parcel-by-parcel basis — and asked stakeholders to provide more detailed fiscal estimates and technical language for forthcoming drafts.