February 14, 2016

Farmers ask for property tax relief; school officials object to governor’s plan

Capitol(Honors_to_Citizens)Farmers complained property taxes are out-of-control. Public school officials complained a proposal to keep them in check is too burdensome.

Both sides were heard at a legislative hearing before the Education Committee as it considers LB 959, which would limit school districts to two-and-a-half percent revenue growth annually. Districts could exceed the limit by going to a vote of the people.

Martell farmer Rod Hollman told committee members though farm income is down, property taxes keep rising, leaving landowners frustrated and angry.

“We’ve survived drought. We’ve survived blizzards. We’ve survived 40 degree below zero weather while we’re calving and low prices, but this has made them really angry,” Hollman stated.

“I am here to tell you that we are bleeding in agriculture right now,” Dale Gronewold, who farms near Gothenberg, told the committee.

Gronewold said evaluations of farmland keep going up, sometimes dramatically, even as farm income has fallen. Echoing what many farmers and ranchers told the committee, Gronewold said he had talked to county assessors, to school boards, and to other government officials to no avail.

Meanwhile, Gronewold said farmers and ranchers face huge jumps in their property tax bills while farm income falls.

“We are bleeding to death and somebody has to help us,” Gronewold pleaded.

Shane Greczel, a row crop farmer in Knox County, said it is hard to understand how farm income can go down, but taxes keep going up.

“And when my income goes down, I have to reflect accordingly. I have to back off. I cannot expand my operation. I just ask that government would do the same thing when we take a look at it,” Greczel said. “There are times that we have to step back just a little bit, we have to consolidate, and we have to make do with what we have. That’s what business has to do. It’s what farming has to do.”

Public school officials, though, object to the proposal pushed by the governor.

York School Superintendent Mike Lucas said school spending isn’t driving up property taxes.

“I think the big elephant in the room regarding LB 959 and I’ll say this respectfully is school spending is not the problem,” Lucas told the committee.

Lucas spoke for many educators in stating that Nebraska schools keep tight budgets and rarely exceed three percent revenue growth.

Lucas did sympathized with the farmers.

“I love farmers and it’s sad to me to hear the us versus them,” Lucas said.

Yet, Lucas said the proposal would only hurt schools without truly putting a dent in property taxes.

Virgil Harden with the Grand Island Public School District objected to the governor’s proposal.

“There’s nobody in Grand Island Public Schools in our board or in our administration that says let’s go spend more money, because we can,” according to Harden. “We spend the money to meet the needs of our children and two-and-a-half percent does not cut it.”

LB 959 is the second of the governor’s two-pronged approach to cut property taxes (the other is LB 958). Two legislative committees will decide whether the bills will be sent to the full legislature for debate.

Could you use another $2,300 in your tax refund check? Read on…

IRS LogoThe Internal Revenue Service is appealing to Nebraska taxpayers to sign up for the Earned Income Tax Credit.

Ken Corbin, who directs the program for the IRS, says if you made money working in 2015, you may be eligible for the credit.

“Any person who has earned income from employment — whether you’re running a business, farming or self-employed — could potentially qualify for EITC,” Corbin says.

In Nebraska last year, he says 130,000 families got more than $310-million in Earned Income Tax Credit dollars. Each family averaged around $2,300.

Corbin says there are still one in five people who may be eligible, who don’t know about the credit, or who don’t file for it.

“Meaning that more than one-million of the taxpayers are not putting EITC dollars to work for them,” Corbin says. “Anyone with earnings of $54,000 dollars or less should see if they qualify at IRS.gov, search word: EITC.”

You may’ve checked in the past and found you weren’t eligible for the credit. Corbin says you should check again, especially if you’ve had some major changes in your life.

“Marital status changes, they might have children, employment changes, changes in their income,” Corbin says.

He says you should check each tax year to see if changes might make you eligible. Corbin says you can still file and claim the EITC tax credit even if you are not required to file a tax return.


Lawmakers hear pros and cons of cutting property taxes (AUDIO)

Gov. Pete Ricketts answers questions during the Revenue Committee hearing on LB 958.

Gov. Pete Ricketts answers questions during the Revenue Committee hearing on LB 958.

A legislative committee has heard the governor’s plan to cut property taxes, but also hears some complaints about the plan as well.

Gov. Pete Ricketts personally lobbies for the bill that would limit local governmental spending and cap growth of agricultural land assessments at three percent.

“It’s a balanced approach. It’s an incremental approach. It’s a measured approach. I think it strikes the right balance,” Ricketts tells members of the legislature’s Revenue Committee.

The bill would tighten current spending limits on local governments, such as cities and counties. It would eliminate current exceptions to levy limits, requiring local governmental officials to take proposed increases to a vote of the people. A companion measure would limit growth within the school funding formula.

The measure proposes providing a tax break for farmers and ranchers by capping the statewide aggregate increase in farmland assessments at three percent per year.

Ricketts urges lawmakers to listen to Nebraskans.

“You know, I know, our constituents, the same ones that live all across the state, are asking for property tax relief,” according to Ricketts.

Local governmental officials oppose the limitations.

Lincoln Mayor Chris Beutler questions why the state would meddle with a formula which he contends has served Nebraska well. Beutler adds limiting revenue growth at the local level could put the bond ratings of cities at risk, because it would undermine confidence in the ability to meet bond payments.

The Executive Director of the Open Sky Institute, Renee Fry, questions the assessment cap for farmland, saying that if it had been in effect in 2005, agricultural property would now be assessed at 30.7%.

“As a shift occurs, you would likely see requests by residential land owners and commercial property owners for their own property tax breaks,” according to Fry.

The Revenue Committee will determine whether the full legislature debates the bill, LB 958, sponsored by Sen. Mike Gloor of Grand Island. Its companion bill, LB 959 sponsored by Sen. Kate Sullivan of Cedar Rapids, is scheduled to be heard by the Education Committee Tuesday.

AUDIO:  Brent Martin reports [:45]

Governor’s first property tax relief bill reaches legislature

Sen. Kate Sullivan

Sen. Kate Sullivan

The first of two bills targeting property tax relief is scheduled to be heard today in the Unicameral.

Governor Pete Ricketts’ proposals are being carried by Senators Kate Sullivan of Cedar Rapids and Mike Gloor of Grand Island.

Senator Sullivan says the measure, LB 958, has a few primary areas of focus.

“It controls growth in local spending, just like we’re doing at the state level,” Sullivan says. “It also gives taxpayers a greater voice in how local government levies their taxes and budgets their tax dollars. In many cases, if they want to go beyond the limitations that we’re setting, take it to a vote of the people.”

Sen. Mike Gloor

Sen. Mike Gloor

Senator Gloor says the legislation will help with limiting spending and cap ag land valuations at three-percent per year.

“This tax package is an effort to tighten up spending limits on local government,” Gloor says. “It’s important to note, it doesn’t remove funding mechanism for local governments but does tighten up spending limits, removing exemptions and placing them under the levy lid, as an example.”

Both the Nebraska Farm Bureau and Cattlemen’s Association support the bills. Farm Bureau President Steve Nelson says the property tax relief is badly needed.

“There’s a huge imbalance out there that has been partially created by increased land values,” Nelson says, “and now today, we’re faced with significant declines in farm prices across the board, in the grains and in the livestock as well.”

The senators say neither of the property tax bills will reduce education spending.

By Jerry Oster, WNAX, Yankton


Nebraska’s tax e-filing rate surpasses 90% participation

NebFile logoThis year’s e-file system is available for Nebraskans to get their state taxes done.

Revenue Department Tax Specialist Dawn Holtmeier says NebFile is free to use and gets you a faster refund.

“If all your income is from Nebraska, you’re a full year Nebraska resident, it’s a good option for you,” Holtmeier says.

However, she says if you’re claiming some of the more rarely used credits, then you cannot use NebFile. Details are online at the NebFile website.

Holtmeier says you will need to finish your federal taxes before doing your state return, but e-filing does speed up the process.

“It’s a little slower process when you paper file, because so much of the process becomes manual, so then you can be waiting up to eight to 12 weeks,” Holtmeier says. “If you’re getting a direct deposit, it’s going to be slightly quicker. A paper check is going to add, probably, a week to ten days.”

She says whether you e-file or use a paper form, you are still responsible for making sure all information is complete and accurate.