Committee hears bill to buy out K‑12 property tax mills, cap local levy growth

House Finance and Taxation members on the floor in Bismarck opened a hearing on House Bill 1168, a proposal from Rep. Scott Lausser to shift the state’s 60‑mill K‑12 levy off residential property and fold that funding into the state per‑pupil formula.

The bill would eliminate the mandated 60 mills for residential property, leave those mills in place for nonresidential classes such as commercial and agricultural land, and place a 3% cap on year‑to‑year property‑tax revenue increases for non‑school political subdivisions unless voters approve an override. Sponsor Rep. Scott Lausser said the measure is intended to reduce property‑tax burdens on homeowners and fold school funding into a single per‑pupil payment handled by the state.

Why it matters: The proposal would change how K‑12 education is funded and shift recurring local tax revenue into the state budget. Lausser and several witnesses said the change could deliver substantial, immediate relief to many homeowners but would also create tradeoffs for local governments and nonresidential property owners.

Lausser, the sponsor and a Minot school‑board member, described the bill as the sixth iteration of a concept he began developing after the 2023 session. He told the committee the bill limits the local portion of residential property tax linked to K‑12 to state funding and sets the baseline per‑pupil payment in statute. “I was actually accused by a lot of people of trying to block Measure…