A proposal to place a 3% constitutional limit on the annual growth in local government property tax revenue moved front-and-center Wednesday as the newest legislative effort to achieve property tax relief.
The effort, spearheaded by Gov. Pete Ricketts and Sen. Lou Ann Linehan of Elkhorn, chairwoman of the Legislature's Revenue Committee, attracted strong support from predominantly rural interests during a public hearing that focused on sharply rising property taxes.
"A 3% growth rate is reasonable," Ricketts said. "We can't outstrip the ability of people to pay."
And it isn't only rural Nebraska that is impacted by the state's high and rising property taxes, Linehan said.
"People won't move here and are leaving because of taxes," she said.
People are also reading…
Mark McHargue, president of the Nebraska Farm Bureau, told the committee that farmers and ranchers believe "enough's enough at some point" and that "property taxes are too great a piece of the pie" in terms of funding local government and schools.
The proposal (LR22CA) follows on the heels of legislation approved last August that launched a new refundable state income tax credit applied to a percentage of local school property taxes paid. Together with the state's current property tax credit relief fund, those two tax breaks would be programmed to deliver $650 million in annual property tax relief five years from now.
Opposition testimony came essentially from representatives of cities and counties, with school districts and community colleges holding their fire for now.
Sen. Mike Flood of Norfolk expressed surprise and disappointment in their decision not to appear.
Dennis Meyer, Lancaster County budget and fiscal officer, told the committee that a 3% lid could limit the county's ability to respond to road and bridge needs.
Lynn Rex, speaking for the League of Nebraska Municipalities, expressed concern about limiting flexibility to meet needs.
"Local control has worked in Nebraska," Don Wesely told the committee in speaking on behalf of seven cities.
If senators ultimately decide to take action on the proposal, he said, legislation would be preferable to a constitutional amendment.
Supporters of the bill said Nebraskans are leaving the state because of high property taxes and are enduring a lower standard of living and reduced capacity to accumulate savings if they stay here.
Ricketts remained throughout the full morning of testimony.
The spotlight shifted in the afternoon to testimony on a bill (LB408) introduced by Sen. Tom Briese of Albion, which he described as the statutory version of the constitutional proposal.
Representatives of school districts and community colleges showed up to testify against that bill.
"There's a lot of anger and frustration over property taxes," Briese said.
"It's choking off economic growth," he said, stressing agriculture and forcing young couples out of the housing market.
Although his bill is the backup, Briese said, he prefers the constitutional solution.
Representatives of education organizations were peppered with questions from committee members asking them to justify spending growth.
Kyle Fairbairn, director of the Greater Nebraska Schools Association, said schools already operate under spending limits and property tax lids.
Spencer Head, a member of the Omaha Public Schools Board of Education, said "we're the ones who should determine whether to increase spending" under a system of local control of education.
MEET THE STATE SENATORS