Sales tax refund payments begin for flood rebuilders

With more than half of claims yet to be processed, North Dakota residents rebuilding from the 2011 floods already have received about $809,000 in state sales-tax refunds, according to the North Dakota Tax Department.

The vast majority of those refunds have gone to Ward County residents.

The 2013 North Dakota Legislature approved refunds of up to $2,500 in sales taxes paid on eligible reconstruction expenses. The application deadline was Dec. 31.

The tax department has processed 456 claims and expects to complete the remaining 580 claims in 10 to 12 weeks. Of the processed claims, 129 applicants received the maximum refund.

The refund program has gone fairly well, Tax Commissioner Ryan Rauschenberger said.

Rauschenberger, a Kenmare native, spoke about the refund and other tax issues while in Minot Thursday to officially announce his intention to seek the Republican endorsement for the position to which he was appointed by Gov. Jack Dalrymple in November. Voters will elect a state tax commissioner in November.

Rauschenberger, 31, had served as deputy state tax commissioner under former commissioner Cory Fong since July 2009. He graduated from the University of North Dakota in Grand Forks with a bachelor’s degree in accountancy and master’s degree in business administration. He was an auditor with PricewaterhouseCoopers in Minneapolis before returning to North Dakota as manager of energy development in the state Department of Commerce.

During his time with the tax department, he has seen significant increases in electronic income-tax filing and property-tax relief, he said.

“We have increased electronic filing of individual income taxes to over 85 percent, which is a huge milestone for any state to achieve,” he said.

The department encourages electronic filing because it results in fewer errors both by taxpayers and within the office in processing those returns. It also speeds tax refunds.

“It’s a win-win situation,” Rauschenberger said. “It’s better for taxpayers and it’s better for our department. We actually have been able to decrease our employees from 155 back when Cory started as commissioner to 134. That’s due to increases on our end in our IT infrastructure. We are more efficient than we used to be, and I think we are more effective.”

Rauschenberger added the office brought its multi-million information technology infrastructure on line on time and under budget.

The decrease in staff and higher efficiency comes as the workload has grown, including about 410,000 individual 2012 tax returns in 2013.

“That’s a huge number. That’s way up from past years,” Rauschenberger said. “But because of electronic filing and because of the strong IT infrastructure that we have, we have been able to handle that influx.”

He added that public reception to recent property-tax relief also has been good, although he noted the process still can be improved.

“We are already making some suggestions on how we can make the property-tax bill and delivery of the relief more efficient,” he said.

One change that could occur in the long-term is the creation of a common, consistent tax bill statewide, making tax statements less confusing for people who receive bills from more than one county, he said. Currently, each county sets its own format for its tax statements.

Rauschenberger serves on the governor’s task force on property tax reform. He said the task force is investigating whether some mill levies can be eliminated or consolidated and whether there may be better ways to fund certain government costs.

“It might be more effective and efficient for the state to fund something as opposed to putting it on the property-tax bill,” he said.

“Property tax is one of the most sensitive issues we are facing,” he added. “I think the Legislature and the governor have done a lot. I think they deserve a lot of credit. … But there are others out there that don’t think we have done enough.”

He said legislators could decide to provide more property-tax or income-tax relief.

“If so that’s great,” he said. “I think that will all come up during the campaign, but I think we have a very strong message that a lot has been done in those areas already.”