January 20, 2017, Legislative Report for Week 3 from Rep. Rick Holman, ND District 20

MONEY ISSUES:
Last week, we visited with the tax department on proposed changes to the current 12% property tax rebate found in Senate Bill 2206. Instead of rebating 12% of all property tax classifications the proposal from the governor will apply only to the current county social services levy and provide $275 million dollars to cover those costs. For example, Traill County levies 16 mills for a total of $716,000 per year. Grand Forks County levies 19 mills to raise 5 million dollars. The proposed plan would have these costs picked up by the state with a lowering of the property tax assessment that is now paying those costs.  Any county receiving less than they did with the previous 12% will receive a supplemental payment to make up the difference. Taxpayers will see no difference in their tax bill as a result of this change and the delivery of county services and impact on county employees will not change.

House Bill 1130 was heard on Monday afternoon by both the House Policy and House Appropriations committees. This legislation is an attempt to fix the funding problem for our nursing homes by adding a provider assessment of about fifteen dollars per day or $450 dollars per month. The Governor’s proposed budget asks for this. In most ND facilities, about half of the residents are Medicaid supported. This proposed 5% fee would generate enough additional income from private, state and federal sources to restore recent funding cuts and return a sustainable financial position to our nursing homes. The rate increase would apply to both Medicaid and private pay residents. This would solve the funding problem but some see it as a tax on the wrong group. My analogy is that this user fee is much like a toll road. If you use it, you pay part of the cost. Is that what we want?

An alternative would be for the legislature to restore the reductions and authorize general fund expenditures, keeping our nursing home facilities financially viable. Hopefully, before this issue is finalized a compromise plan can be developed. Over the past four years the legislature has reduced income taxes for each corporation and person, generating less money for the state’s general fund, providing less money to continue previously covered costs. With less income to the state combined with increased costs of health care finding more ways to cover costs is increasingly difficult. Since a huge part of every nursing home budget is staff, question is “How do we make adjustments without reducing services?”  A very difficult thing to answer.

Be sure to contact me if you have questions.
Email: rholman@nd.gov, text or call (701) 238-1124
Rick Holman