Bill would let districts use more in‑lieu revenue for capital; DPI flags draft language and fiscal uncertainty

BISMARCK, N.D. — Lawmakers and school finance staff discussed House Bill 1130 on Oct. 12, a proposal to let school districts apply a higher percentage of in‑lieu revenue (taxes paid "in lieu of" standard property tax) toward capital projects and debt repayment.

Representative David Richter, R‑District 1, told the House Education Committee the change would operate similarly to a current sinking‑and‑interest deduction. Under the bill districts would calculate the portion of local revenue represented by in‑lieu receipts and deduct that portion before other formula deductions; municipalities and districts with large in‑lieu receipts (for example, gross production taxes in oil producing counties) stand to be affected differently than eastern districts with minimal in‑lieu revenue.

DPI fiscal staff…