A property tax relief package backed by Governor Pete Ricketts got off to a rocky start in the Unicameral, but advanced after a compromise was reached.
Sen. Mike Gloor of Grand Island brought the second half of the governor’s package to the floor for debate.
“This would be Act Two, LB 958. It’s the work of the Revenue Committee as relates to property tax relief,” Gloor said, acknowledging the legislature has already advanced LB 959, dealing with education funding.
LB 958 seeks to lessen the financial impact recent increases in property taxes have had on agriculture in Nebraska. In its original form, the bill would have directed $30 million in property tax relief annually to agriculture. It also would have restricted the revenue growth of the state’s community colleges.
The first sign of trouble came when the legislature agreed to divide the question, splitting the agriculture tax relief portion of the bill from the section dealing with community colleges.
It then hit resistance from urban lawmakers, who questioned why tax relief should be centered solely on agriculture.
“And colleagues, I am not going to support 958 without a balanced approach,” Sen. Jim Smith of Papillion declared as he outlined a plan to lower the personal and corporate income tax rates, stating that would bring relief to all Nebraskans.
Smith relented after the compromise was reach.
The legislature debated the merits of the bill throughout the legislative day, many members meeting on the floor during debate.
What emerged was a compromise.
The amount of tax relief was lowered from $30 million annually to $20 million. The sponsor promised to remove the section on community colleges from the bill.
Trimming the price tag calmed some of the fears that tax cuts might create budget shortfalls in years to come.
Appropriations Committee Chairman Health Mello of Omaha gave the compromise his blessing.
“Colleagues, I think we’re in a positon that while it may not be perfect, it’s safe to say we feel comfortable with what we have in front of us,” Mello said during floor debate.
Mello said the amended LB 958 addressed the increase in agricultural land values while being mindful of future state budgets.
In the end, Gloor expressed relief.
“I appreciate people taking a deep breath, keeping a positive attitude towards this, understanding the fact that we have had a lot of conversations about the dollars and sense of the decisions we make.”
LB 958 advanced on a 39-2 vote.
AUDIO: Brent Martin reports [1 min.]