The recent decision by the Fargo City Commission to not rescind the universally criticized FedEx tax incentive have once again highlighted the need for property tax reform. Since 2009, state funding for local government has increased more than two-fold, even after recent budget cuts made due to the oil market downturn. Fargo’s decision to blatantly give away incentives raises the question of whether clawbacks should be added to local funding formulas.

“When our local elected officials give away their own revenue sources in the form of corporate welfare tax incentives they are actively defeating the purpose of state-funding property tax relief efforts,” Marty Riske, Libertarian Party candidate for governor said. “Local government officials are to blame for out of control property tax increases, and when they give away their own revenue sources via exemptions, the state should not be there with more funding to offset their revenue negative decisions.”

During the recent North Dakota Chamber of Commerce’s debate this very issue came up.

Riske suggests that a clawback of state funding for non-essential programs be considered as a way to diminish the appeal driving local government officials to reduce their own sources of tax revenue. For example: state funding for local government would be reduced by the amount of the giveaways granted by local government, thereby protecting state taxpayers from being asked to subsidize the local giveaways.

“The idea that local government officials can give massive corporate welfare handouts, over-tax the rest of its residents who do pay property taxes, and then also get state funding in the name of property tax relief is simply illogical and wholly unfair to state and local taxpayers,” Riske continued. “It’s time for state lawmakers to defend their own efforts to reduce the property tax burden by limiting local government’s ability to giveaway their own revenue sources.”

“Those who have preached for local control need to realize that local control is exactly what is pushing property taxes higher! If there is no consequence to offering corporate welfare to businesses that seek it, it will continue to become a greater and greater burden to the state,” Riske concluded.

– Submitted by Marty Riske, N.D. Libertarian candidate for governor