Nebraska Unicameral: LB 947 does not solve the state’s property tax dilemma

Early next week, the Nebraska Legislature is scheduled to take up debate on LB 947, the governor’s tax cut plan. LB 947 cuts taxes for corporations and offers delayed property tax relief in the form of an unfunded tax credit. This legislation fails to address the state’s structural reliance upon property taxes to fund education or outline how the proposed tax cuts will be paid for.

We signed a letter alongside other Nebraska organizations urging senators to vote no.

March 26, 2018

Dear Senators,

As representatives of an array of agricultural organizations we ask that you vote no on LB 947 and instead urgently and substantively address the state’s property tax dilemma in the remaining days of the legislative session.

The state’s reliance upon property taxes to fund K-12 education has placed an unsustainable burden upon on our state’s residential and agricultural land property owners and undue blame upon our school systems. We need to address our state’s school funding dilemma and bring property tax relief to residents. And quite simply, LB 947 does not offer the solution.

Instead of placing emphasis upon property tax relief and identifying the revenues needed to meet the state’s obligations, LB 947 would create a nearly $650 million budget shortfall when fully implemented. By prioritizing tax cuts for corporations and drawing dollars from the rainy day fund, the bill only exacerbates the tenuous budget situation for years to come. Unfunded tax cuts of this magnitude would create a significant setback for Nebraska.

Moreover, the proposed property tax relief outlined does not bring about real tax reform for the state. Rather than providing immediate property tax relief, minimal tax cuts are phased in the form of refundable income tax credits. For rural Nebraska, LB 947 offers too little, too late and leaves the state's reliance upon property tax owners to pay for education. This only creates a greater divide between urban and rural Nebraska.

Our farmers and ranchers do not have the luxury of waiting until 2030 for property tax relief, and our state stands to suffer substantially from their loss. A vote in opposition of LB 947 leaves way for the Legislature to work through a real solution to problem at hand.

We need a real property tax reform solution that:

  • Lessens the state’s dependence upon property taxes to fund K-12 education.
  • Provides immediate and substantial property tax relief to all property tax payers.
  • Protects the state’s cash reserves and funding for vital services.
  • Requires a long-term, sustainable solution to how the state funds education.

Nebraskans are in need of property tax relief, but they are not asking to sidestep their responsibility to help fund the schools and services that uphold their communities. They are simply asking for balance in the way the state meets it obligations to pay for education and other critical services. We ask that you vote no on LB 947 and instead take up debate on a real solution to the state’s property tax dilemma.

Sincerely,

Pam Potthoff, President
Nebraska Women Involved in Farm Economics

David Wright, President
Independent Cattlemen of Nebraska

Kevin Cooksley, President
Nebraska Grange

Jordan Rasmussen, Policy Program Associate
Center for Rural Affairs

Al Davis, Treasurer
Independent Cattlemen of Nebraska

John Hansen, President
Nebraska Farmers Union