Special assessment study

Rep. Jason Dockter, R-Bismarck, middle, talks with Rep. Craig Headland, R-Montpelier, during Tuesday's interim Taxation Committee meeting at the state Capitol in Bismarck involving a study to replace city special assessments.

North Dakota lawmakers beginning a study of alternate revenue to special assessments found a starting point with the city of Bismarck.

Bismarck Mandan Chamber-EDC President Brian Ritter and Bismarck City Administrator Keith Hunke appeared Tuesday before the Legislature's interim Taxation Committee to outline the city's efforts to mitigate special assessments, which are fees imposed on private property owners for public improvements.

Ritter said the city is a focus because Bismarck since 2016 has studied roadway infrastructure funding and special assessment issues in two task forces, ultimately conceiving a street utility tax in 2018 to essentially replace special assessments with an added fee to city residents' monthly utility bills. Bismarck voters would have to approve the proposed tax.

"The city of Bismarck has already done a lot of the legwork in what we believe is a more cost-effective way to utilize funding and benefit the taxpayers and take a lot off their plate from an assessment perspective," Bismarck Mayor Steve Bakken said.

But that idea is halted by a 2017 law that essentially bans cities and counties from implementing new types of taxes. Sen. Erin Oban, D-Bismarck, pointed to that law as the root of the study's issue.

"I think there are a number of ways where we can try to address what the city of Bismarck has discovered since that passed in 2017," Oban said. "What I want is for cities and local leaders to be able to make decisions that are best for governing their political subdivision and that the state does not get in the way of that."

Rep. Jason Dockter, R-Bismarck, introduced the bill that brought about the study. He said he's heard from Bismarck residents hit with special assessments as high as $15,000. Special assessments can be especially hard for young families and senior citizens, he added.

"It's a heated topic. It comes up every session: 'Why do we have special assessments?'" Dockter said. "That's why we're doing the study on this."

Dockter said the 2017 law meant for a "restraint" on local entities' taxing power. But he hopes the study finds a "palatable" solution, such as allowing voter approval of new taxes.

Ritter said the law made Bismarck's process "more difficult." He also hopes the study can find flexibility for voter approval.

"The whole goal, the whole concept is to really figure out can we replace special assessments and can we do so responsibly?" he said. "And is the street utility tax part of that solution?"

The interim Taxation Committee will meet about four more times before the next legislative session convenes in January 2021, when potential legislation could come from the study.

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Reach Jack Dura at 701-250-8225 or jack.dura@bismarcktribune.com.