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The Associated Press - ND Dem Gov Candidate Says GOP Tax Plan Flawed

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Location: Fargo, ND

The Associated Press - ND Dem Gov Candidate Says GOP Tax Plan Flawed

Dale Wetzel

North Dakota's candidates for governor don't like each other's plans to cut taxes, but Republican Gov. John Hoeven and Democratic challenger Tim Mathern both oppose a ballot measure to slash state income tax rates in half.

Hoeven and Mathern, who met Friday at a debate sponsored by the North Dakota Associated Press Broadcasters Association, discussed smoking restrictions, highway speed limits, Devils Lake flooding and problems at the state's workers' compensation agency.

They have competing proposals to reduce income and property taxes. Hoeven's $500 million package reserves $100 million for income tax cuts, $300 million for school property tax reductions and $100 million for increased state aid for schools.

Mathern, who is a Fargo state senator, has rolled out a $1 billion proposal that includes income and property tax reductions and increased aid to schools and city and county governments.

North Dakota's state income tax structure has five tax brackets, ranging from 2.1 percent to 5.54 percent of taxable income.

Hoeven's proposal reduces each bracket by an equal percentage, while Mathern's preferred income tax plan leaves the top rates intact while making deeper cuts in lower brackets.

"It's basically giving money to the wealthiest people in North Dakota," Mathern said of Hoeven's proposal.

Measure 2, an initiative on North Dakota's Nov. 4 ballot, gives voters the chance to approve deeper income tax cuts than either candidate for governor is offering. It would reduce the five individual income tax brackets by roughly half, while cutting corporate income tax rates by 15 percent.

Both Mathern and Hoeven said they opposed Measure 2. They have the same sentiments for the North Dakota ballot's three other proposals: Measure 1, a constitutional amendment that creates a new trust fund for surplus oil tax revenues (opposed); Measure 3, which would increase state spending on anti-tobacco measures (in favor); and Measure 4, which gives the governor authority to hire North Dakota's workers' compensation director (in favor).

They would want to retain the Workforce Safety and Insurance agency's board of directors as an advisory panel if Measure 4 is approved, the two men said. At present, the 11-member board hires WSI's director, who reports directly to it.

During the debate, both Hoeven and Mathern said they favored stronger state anti-smoking restrictions. In interviews afterward, both men said they would support a statewide smoking ban in bars, a proposal the North Dakota Legislature rejected last year.

State law already bars smoking in most public workplaces. Last June, Fargo city voters approved extending the ban to bars and truck-stop areas that state law presently exempts.

Mathern said he backed lowering North Dakota's highway speed limits, which he said would both save fuel and make the state's roads safer. Hoeven said he did not favor lowered speed limits as an energy-saving strategy, saying he preferred to push for more energy production.

Mathern, in an interview, said he believed North Dakota's 75 mph speed limit on interstate highways should be lowered to 70 mph. Other speed limit reductions should be made based on the type of road, he said.

The Fargo Democratic state senator said he did not want to set interstate speed limits at 55 mph, which was done in the 1970s in response to a spike in oil prices. The American Trucking Associations, which represents the trucking industry, has asked Congress to approve a national 65 mph limit.

In discussing Devils Lake flooding, Mathern suggested he would oppose Canadian-favored projects in North Dakota unless Canada softened its opposition to North Dakota efforts to drain away excess Devils Lake water, and use the Missouri River to supply water to eastern and northwestern parts of the state.

"I think we have to be tougher negotiators with Canada. When they want to run a pipeline through our country, we ought to be bringing up water," Mathern said, referring to a huge oil pipeline that a Canadian company is building in eastern North Dakota to carry Canadian crude to Midwestern refineries.

The two men took a number of political jabs at each other, with Hoeven portraying Mathern as a free spender who has consistently supported tax increases in the Senate.

Mathern's campaign proposals have ignored budget realities, and he has spent a projected $1.2 billion surplus in North Dakota's treasury at least twice, Hoeven said.

"That's his approach. Raise taxes. He just doesn't have credibility when it comes to the issue of tax relief," Hoeven said. "My opponent seems to think building a surplus is a bad thing, and I'm sure, if he's elected, he'll start building a deficit right away."

For his part, Mathern said the Republican governor, who is seeking his third four-year term in office, has been advocating initiatives that he should have pushed during his first eight years.

"If he really believed (in his initiatives) ... he would have put them in the budget,"Mathern said, referring to the governor's spending recommendations to the Legislature. "The values are in the budget. He hasn't demonstrated what he says. That, to me, is zero credibility. When you believe in something, you do it, you don't just talk about it."

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