State lawmakers will have to override a veto to approve a local option sales tax bill that Nebraska city officials favor.
Gov. Dave Heineman has vetoed the local option sales tax bill.
“Let me tell you what LB 357 is all about: increased spending and increased taxes,” Heineman told reporters during a recent news conference at the Capitol.
The League of Nebraska Municipalities has lobbied for the bill. It would allow cities in Nebraska to ask voters to approve a one-quarter to one-half cent increase in the local sales tax for specific projects. Mayors point out the tax hike isn’t automatic. It must be approved by the voters.
Heineman counters with a challenge. He challenges the mayors to put a property tax decrease on the ballot.
In his veto letter, Heineman outlined objections to the bill:
LB 357 authorizes local governments to enact a 33% increase in the local option sales tax. I take exception with arguments of proponents that this legislation is about nothing more than local government control. Local control is a value that I cherish; however, LB 357 is a state authorization of a sales tax increase.
State law authorizes cities to tax. State law authorizes how much cities are allowed to tax. LB 357 authorizes cities to tax up to 33% more in sales tax than they already are imposing. That is an excessive burden upon Nebraskans at this time in our current economy.
LB 357 is stated to have protections because residents of a local community would have the right to vote on this tax increase. Current law already requires cities to conduct a public vote in order to add any local option sales tax. Thus, the bill offers no new safeguard in that respect.
Sen. Brad Ashford of Omaha sponsors LB 357. He contends it contains safeguard that will prevent cities from abusing the power to increase taxes. Ashford says he will move to override Heineman’s veto.
“The governor and I disagree,” Ashford said during the League of Nebraska Municipalities news conference to promote the bill, repeating. “He has every right and prerogative to go out and argue his points, but I think that giving the trust to the people trumps most any argument that I’ve heard on this issue.”
The bill passed on a 30-15-4 vote. Ashford must get 30 votes to override a gubernatorial veto.
AUDIO: Brent Martin reports [:40]
AUDIO: Gov. Heineman comments on LB 357 [1:15]
AUDIO: Sen. Ashford comments on LB 357 [6:15]