Agriculture Groups Back Proposal to Buy Down School Mills on Ag Land; Committee Hears Fiscal Implications
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Summary
Senate Bill 2363 would reduce the school mill levy applied to agricultural land from 60 mills to 30 mills, a proposal supporters say would make property tax relief more equitable for farm and ranch landowners; witnesses warned the change would shift burdens without broader offsets, and the fiscal note was cited at roughly $80.5 million.
Senate Bill 2363, sponsored to insert agriculture‑land relief into the broader property‑tax discussion, drew testimony from farm groups who urged lawmakers to include agricultural property in any final relief package.
Sponsor Senator Herbley framed the bill as an attempt to put farmland “at the table” in the property‑tax debate. The draft would reduce the school mill levy for agricultural land from 60 mills to 30 mills — effectively halving the school portion of the local rate applied to ag land — and supporters said that change could meaningfully reduce some farm tax bills.
Matt Purdue, representing the North Dakota Association of Regional Councils during testimony on rural programs, provided statewide data: agricultural property accounted for about 19% of statewide property tax collections (excluding special assessments) in 2024. Speakers said roughly 1.6% of the population operates the bulk of farmland, and agricultural owners fund a disproportionate share of local taxes in many counties — in 42 counties agricultural property taxes exceeded residential property taxes and in 30 counties ag taxes accounted for 50% or more of local collections.
Julie Ellingson of the North Dakota Stockmen’s Association, Pete Hanover of the North Dakota Farm Bureau and Leslie Isengil of the Corn Growers Association expressed support, calling the proposal a simpler, administrable approach to ensure relief is not borne only by non‑agricultural taxpayers. Witnesses said a buy‑down tied to the school mill is administratively straightforward and would complement other proposals under consideration.
Committee members discussed the fiscal note and practical implementation. The fiscal note referenced by sponsors estimated a state cost in the range of $80,500,000 (figure cited in the hearing record). School finance staff noted that implementing the change for the 2025‑27 biennium would require updated taxable valuation data by school district and could create a timing issue unless the committee structures the change to take effect with a one‑year delay or obtains retroactive valuation detail.
No committee vote was recorded; witnesses urged inclusion of agricultural property relief in any final property‑tax package to avoid shifting disproportionate burdens to farm communities.