North Dakota State Tax Commissioner Brian Kroshus, right, provides comment to North Dakota Republican lawmakers Rep. Robin Weisz, Sen. Jerry Klein and Rep. Glenn Bosch on the estimated financial impact of two November ballot bills, Friday, Aug. 23, 2024, at the State Capitol in Bismarck, N.D. (AP Photo/Jack Dura)

By: Mary Steurer

BISMARCK, ND (North Dakota Monitor) – A referendum to eliminate the assessed value-based property tax would not only eliminate the standard property tax on residential, commercial and agricultural properties – it would also impact six special tax categories, according to Tax Commissioner Brian Kroshus.

These include taxes on mobile homes, taxes on electricity generation, distribution and transmission, a forest conservation tax and other types of payments in lieu of property taxes implemented by local governments.

Taxes on power generation companies, power distributors and transmission lines accounted for approximately $30.8 million of the state’s tax collections in 2023.

The state collected about $4.4 million in mobile home taxes in 2023.

In 2023, North Dakota received about $1 million from local substitute property taxes and the Forest Conservation Tax, which owners of forest land in participating counties can pay in lieu of property taxes.

Although these taxes are separate from traditional property taxes, the ballot proposal would remove the sections of the North Dakota Constitution that legalize them, Kroshus said. The ballot proposal would repeal sections four, five, seven, nine and ten of Article 10 of the state constitution.

Kroshus said the gross production tax on oil and gas – which oil and gas companies pay instead of property taxes – will not be affected by the property tax measure.

North Dakota collected $1.4 billion in residential, commercial, agricultural and other ad valorem property taxes in 2023.

If approved by voters in November, the ballot measure would require the state to reimburse local governments at least an amount equal to the property taxes they collected in the 2024 tax year.

Kroshus told a group of lawmakers last week that if the ballot measure passes, North Dakota could face costs of between $3.04 billion and $3.15 billion over the 2025-2027 budget cycle.