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Patrick Springer, Published May 17 2012

Schafer, Omdahl make bipartisan appeal to North Dakota voters to reject Measure 2 property tax repeal

FARGO – Ed Schafer and Lloyd Omdahl might be considered a political odd couple, but both agree North Dakota voters should reject Measure 2’s proposal to eliminate property taxes.

Schafer, a former Republican governor, and Omdahl, a former Democratic lieutenant governor, stood side-by-side Thursday and called the measure a “vaguely dangerous” way to achieve tax relief that would rob local governments of control.

Schafer, who served as governor from 1993 to 2000, said Measure 2 on the June 12 primary ballot poses one of the most important public policy issues that have faced North Dakota for many years.

“People are frustrated about property taxes,” he said. “There’s no question about that.”

But Schafer said Measure 2, if passed, would be cumbersome to undo because it would amend the state constitution, and therefore require a constitutional fix.

“It will take years and years and years if this experiment fails,” Schafer said.

Schafer and Omdahl, who was lieutenant governor from 1987 to 1993, and earlier was state tax commissioner, agreed that power would shift from cities, counties, townships and school districts to the state Legislature if Measure 2 is passed.

“One size will not fit all because there’s such a wide range of services being provided by these local governments,” Omdahl said, adding that there also is great diversity between urban and rural areas.

Both also agreed that the wording of Measure 2, which requires the Legislature to “fully and properly fund” the legal obligations of local government, is too vague.

“That language actually is dangerous,” Schafer said, adding it could possibly result in a “one size fits all” funding solution that would not work well.

“It will be directed by Bismarck,” he added, resulting in more power to the Legislature and central government. “I believe local control will be compromised.”

Through property taxes, local units of governments have exercised local control of schools and other services throughout the state’s history, Omdahl said.

“That is an asset that has been with us from the territorial days,” he said. “Local governments make the decisions and define quality of life locally.”

Proponents of Measure 2 have suggested that revenues flowing from the oil boom would replace local property taxes.

But Schafer said that might not be the case because petroleum revenues are required for new infrastructure and to offset the impacts of energy development.

Also, Omdahl said, questions about hydrofracking – using water under pressure to pump oil and gas from deep underground – mean it’s too soon to count on the continued reliability of petroleum revenues.

Although proponents of Measure 2 say lawmakers have failed to adequately address rising concerns about the property tax burden, both Schafer and Omdahl said pressure is growing on legislators to take action.

“I’m sure there’s inclination to lower the property tax,” Omdahl said. “The Legislature knows that, and I suspect they’re going to do something about it.”

Schafer and Omdahl also accused Measure 2 proponents of quoting them out of context for highlighting their critical comments about the property tax, implying their support for the proposal.

Charlene Nelson, chairwoman of Empower the Taxpayer, the group pushing Measure 2, defended the use of the former officeholders’ comments, saying they speak for themselves about the flaws of the property tax.

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Readers can reach Forum reporter Patrick Springer at (701) 241-5522