North Dakota Committee Rejects House Bill 1465 Amid Charity Funding Concerns

The House Finance and Taxation Committee of the North Dakota State Legislature convened on February 19, 2025, to discuss key legislative matters, including proposed amendments to House Bill 1465 and considerations regarding charitable funding and tax brackets.

The meeting began with a discussion on the impact of state tax reductions on charitable organizations. Concerns were raised about larger charities benefiting disproportionately from state tax policies, while smaller charities may not see similar advantages. Representatives highlighted that the Attorney General's office has mechanisms to adjust revenue allocations through administrative rules, allowing charities to modify their gaming operations to increase funds for charitable causes. This includes changing the payout percentages of games to retain more revenue.

Representative Dressler expressed apprehension regarding the fiscal implications of the proposed changes, noting uncertainty about the financial impact of the bill, which was previously estimated at around $3 million. Despite these concerns, Dressler moved to amend the bill, which was seconded by Representative Olsen. A roll call vote followed, resulting in the amendment passing with a 9-3-2 vote.

Following the amendment, discussions shifted to the overall viability of House Bill 1465. Representative Haggert, despite voting for the amendment, indicated a reluctance to support the bill, suggesting that charities could find alternative funding solutions without state revenue reductions. Haggert subsequently moved for a "do not pass" recommendation on the bill, which was seconded by Representative Steiner. The motion was put to a vote and passed with a 10-2 margin, with two members absent.

The committee then addressed another bill, but no action was taken as members discussed potential amendments. Representative Dressler raised questions about the implications of eliminating the upper tax bracket entirely, suggesting a shift to a lower rate for higher income levels. However, concerns about the substantial fiscal cost of such a change were noted, with estimates around $178 million, which may be politically unfeasible.

The meeting concluded with the committee deciding to pause further discussions on the remaining bill until after the session, indicating a need for more thorough consideration of the proposed changes. Overall, the session highlighted ongoing debates about tax policy, charitable funding, and fiscal responsibility within the state legislature.