Committee advances bill to give all North Dakota fire departments sales-tax exemption; amendment adds vehicle-excise-tax exemption

The Senate Finance and Taxation Committee voted to recommend a due‑pass for House Bill 1139, a measure sponsored by Representative Mikey Pyle that would allow all fire departments certified by the state fire marshal to make purchases exempt from sales tax regardless of how the department is organized.

Representative Pyle told the committee the bill “seeks to level the playing field by allowing all fire departments in the North Dakota to make purchases free of sales tax regardless of the organizational structure.” He said the change is intended to ensure departments that operate as non-profit volunteer organizations have the same purchasing power as departments that are city or township entities.

Fire department testimony and local impacts

John Veil, fire chief for the Castleton Fire Department, told the committee his department serves roughly 385 square miles and a primary population of about 4,500, with an extended extrication response zone of about 745 square miles. Veil said Castleton is organized as a 501(c)(3) nonprofit and that the department and its local contracting partners prefer that structure because it preserves local input on budgets and operations. He described recent capital expenditures and typical costs: a used rescue truck he described in testimony as priced under $400,000 when purchased, a cutter/spreader/jaws-of-life set near $65,000, and airbags and struts in the neighborhood of $25,000.

State Fire Marshal Doug Nelson said non‑governmental departments that are certified under Century Code receive essentially the same minimum-service requirements as municipal or rural districts, and he told the committee his office supports HB1139.

Tax-administration and amendment

Shannon Fleisher of the North Dakota Tax Department reviewed the bill’s scope and said it originally referenced the state sales-tax chapter (Chapter 57‑39.2). Committee members raised whether motor-vehicle excise tax should also be covered. Fleisher said the vehicle-excise exemption is governed under the motor-vehicle excise-tax statutes and that the bill would need an additional provision to add that exemption.

Senator Kenton Wallen moved to amend HB1139 to add a motor-vehicle excise‑tax exemption for vehicles used by qualifying fire departments and provided the statutory cross-reference the tax department recommended; Senator Romo seconded the amendment. The committee took a roll-call vote on the amendment; the clerk recorded affirmative votes and the amendment passed.

Following that amendment, Senator Wallen moved — and Senator Patton seconded — that the committee give HB1139 a due‑pass recommendation as amended. The committee approved the due‑pass recommendation on a roll-call vote.

Why it matters

Witnesses framed the bill as an administrative fix that would reduce costs for volunteer and nonprofit fire departments that currently lack tax-exempt purchasing privileges because they are not organized as a municipal or rural fire district. Supporters said the change would help departments reinvest scarce funds in equipment and training. The state fire marshal’s office and several volunteer chiefs told the committee that similar ambulances and emergency-service providers already qualify under existing tax exemptions and that equal treatment for fire services is logical and administrable.

Ending

After adopting the excise‑tax amendment, the committee recommended HB1139 do pass as amended. The bill now moves on to the next phase of the legislative process with the committee’s due‑pass recommendation.