With property taxes on the rise, especially on agricultural land, Nebraska lawmakers continue to focus on tax-relief plans, but with little results.
This week, state senators debated one of the most elaborate property tax bills to hit the Legislature floor.
Legislative Bill 289, proposed by Sen. Lou Ann Linehan of Elkhorn, would increase state aid to public schools by $500 million by raising the state sales tax by half of a percent, repealing tax exemptions for a list of about 20 services, including hair cuts, home repairs, lawn care, veterinary services and motor vehicle repairs, and adding new taxes on items such as soda, candy and bottled water.
Gov. Pete Ricketts blasted the bill during a town hall meeting in Blair, calling it “largest tax increase in Nebraska history.”
But after three hours of debate, no action was taken, which has left the future of that bill uncertain.
That could mean it's time for senators to start over.
LB 289, on the surface, looked like a viable option to help property owners and schools, including Blair, that are strapped financially due to the broken Tax Equity and Educational Opportunities Support Act (TEEOSA) formula, which, when enacted in 1990, was to equalize school funding and provide property tax relief.
But, truly, LB 289 would only shift the tax burden. It does not find a solution. While it may provide a brief tax relief for property owners, they'll still be paying it elsewhere in places such as at the grocery store or the beauty salon.
Even the governor's recommendation of a $51 million increase to the Property Tax Credit Relief Fund, which senators restored this week, is only a temporary fix.
Nebraska needs long-term property tax relief.
Nebraska needs to cut spending.
Nebraska needs new revenue sources.
Until the Legislature can come up with the right solution, the state will continue to struggle. And at what cost?