The state House passed a $100 million property tax relief package Wednesday morning, moving forward on a measure that leaders in both parties have called a top priority of this year's legislative session.

With just over a week left before the Legislature is required to adjourn, the bill must still clear the state Senate and endure any negotiations between the chambers.

It's main provision provides $80 million to give property owners a 5.9 percent rebate on their property tax bills. Under two other provisions, the state will spend $16 million to eliminate the marriage penalty for many taxpayers and $4 million to increase the homestead tax credit, a program that provides property tax relief to low-income North Dakotans who also are elderly or disabled.

The bill also lowers the cap on annual school district tax increases from 18 percent to 9 percent.

"I think what we have is an equitable way of distributing this money and the taxpayers in North Dakota certainly deserve it," said Rep. Wes Belter, R-Leonard, who chairs the Finance and Tax Committee.

Wednesday morning's passage came after a tense week during which the bill was amended numerous times and members of the state Senate openly expressed frustration over the delay. Many of the amendments added provisions of an earlier property tax relief plan that died in the state Senate earlier this month when a handful of Republicans joined Democrats in voting against it.

Democrats wanted increased school funding to be part of the relief package and objected to the marriage penalty change, saying it disproportionately benefits wealthy taxpayers. They pushed for these changes in the House-passed version but were voted down after more than two hours of debate.

Leading up to Wednesday's vote, much of the debate centered around the portion eliminating the marriage penalty, an aspect of the tax code where married couples pay more in taxes than the sum of what they would pay separately.

Rep. Louis Pinkerton, D-Minot, said the $16 million to eliminate the marriage penalty would be of greater benefit to low-income taxpayers if it were used instead to fund increased property tax relief. He dubbed it the "55 cent tax break" because many married couples with incomes less than $30,000 would get cents on the dollar as relief.

Rep Mark Owens, R-Grand Forks, said the marriage penalty is an inequity in the tax code that can be fixed by a single action. He said it doesn't benefit many low income couples because most of the penalty is paid in higher income brackets.

"There is no marriage penalty for them," Owens said.

Some legislators, such as Rep. Gil Herbel, R-Grafton, had their eye on the clock and on compromise. He said the bill was far from perfect but that he supports it because the top priority is getting some form of tax relief back to the people.

"Time is running out on us and we need to get this process moving," Herbel said.

(Reach reporter Jonathan Rivoli at 223-8482 or jonathan.rivoli@bismarcktribune.com)