A powerful political player in Nebraska backs a petition drive to cut property taxes by a billion dollars, though it hopes there is another way.
Nebraska Farm Bureau President Steve Nelson readily admits a petition drive isn’t the best route to cutting taxes.
“Our first choice is to solve the property tax issue in the legislature,” Nelson tells Brownfield Ag News. “We think that’s the best place for it to happen.”
In part, according to Nelson, because the legislature, unlike the voters, can devise a plan for how best to fit a 30% property tax cut into the state budget.
Nelson, though, is quick to add that something must be done this legislative session. If not, the Farm Bureau will throw its considerable weight behind the petition drive.
Essentially the same as Legislative Bill 829 sponsored by Sen. Steve Erdman of Bayard, the petition would give property owners a refundable income tax credit equal to half of the property taxes collected by their local school district. It is estimated to cost $1.1 billion.
A few property tax proposals have been filed this legislative session, but this is the short, 60-day session. Lawmakers begin day 30 today.
Those proposals are in the Revenue Committee.
Gov. Pete Ricketts supports LB 947, sponsored by Sen. Jim Smith of Papillion, chair of the Revenue Committee, on behalf of the governor. Under the governor’s proposal, the legislature would convert the Property Tax Credit Relief Fund to provide refundable income tax credits for agricultural property owners as well as homeowners. Tax credits would at 12% with a cap of $280 for homeowners. The credits would increase by 2% every other year until they reached 30% in 2031. The residential caps would rise $50 with each increase.
The plan calls for $200 million in property tax relief for agricultural and residential property as well as $40 million in cuts to individual and corporate income taxes.
If the legislature fails to act this session and voters approve the billion-dollar property tax cut, it will be up to legislators to deal with the fall out.
“We’ve dealt with those kinds of budget numbers in the past and it’s not been the catastrophe that some would describe it as being,” according to Nelson. “So, I’m confident that the legislature can deal with it.”
Ken Anderson, Brownfield Ag News, contributed to this report.
AUDIO: Brent Martin reports [:50]