In the closing days of the 2018 legislative session, State Senators have the opportunity to deliver major property tax relief for Nebraska’s hardworking homeowners and farm and ranch families. The Nebraska Property Tax Cuts and Opportunities Act (LB 947) is on the agenda for legislative debate. If enacted, this measure along with the existing Property Tax Credit Relief Fund, would deliver over $4.5 billion in property tax relief over the next 10 years.
LB 947 was crafted with the help of many rural and urban voices, and has garnered the support of major groups ranging from the Nebraska Farm Bureau to the Nebraska State Chamber. With the debate and a vote on LB 947 coming up soon, here are five big reasons why Nebraskans need LB 947’s property tax relief this year.
1 – Family farm and ranch incomes continue to decline: As Ronald Reagan once said, “Simple fairness dictates that government must not raise taxes on families struggling to pay their bills.” The principle still rings true today in our current economic climate. Farm income has been cut in half since 2013 and is predicted to go down again in 2018–making it difficult to sustain the family farm or ranch. Despite declining incomes, farm and ranch property taxes have continued to spike. With no action, farm property taxes will most likely increase in many cases again this year.
2 – Nebraska must become more competitive with surrounding states: National rankings confirm what Nebraskans experience: Nebraska is a high-tax state. The Tax Foundation ranks Nebraska as having the 11th-highest property taxes in the nation. Our property taxes are higher than any of our surrounding states. Those high taxes are causing some people to leave Nebraska. I have heard firsthand the stories of farmers who sold their land in Nebraska and moved across the border to states like Missouri because those states have much lower property taxes. While it’s difficult to influence commodity prices, our Legislature has the power to do something about property taxes.
3 – Agriculture is key to growing Nebraska: Agriculture is Nebraska’s largest economic driver. One in four jobs in our state is tied to agriculture. To grow Nebraska, we must grow agriculture. While agriculture is constantly increasing yields and making land use more efficient, it is property-intensive and relies on our state’s fertile land to produce the food we grow to feed the world. High property taxes punish our farmers and ranchers who are growing food and creating opportunities for other Nebraskans. We should incentivize our farmers and ranchers to keep growing their operations, adding value to their commodities, and creating opportunities. Property tax relief would go a long way towards doing just that.
4 – This proposal unites urban and rural Nebraskans: The Property Tax Cuts and Opportunities Act is the only tax relief proposal that has united urban and rural interests. In addition to the Nebraska Farm Bureau and Nebraska State Chamber, it’s received the endorsement of the National Federation of Independent Businesses, Nebraska Bankers, Nebraska Soybean Association, Nebraska Pork Producers, Nebraska State Dairy Association, and many others.
5 – Delivering relief now will protect taxpayers: Nebraskans have rightly been asking for tax relief. As calls for relief have grown, some interest groups have touted proposals that would provide tax relief to one group of people at the expense of others. Some have called for sales tax increases. Others have put forward proposals that would result in damaging cuts to our K-12 schools and public safety programs. To protect the budget and important priorities, LB 947 responsibly steps up tax relief over time. This will ensure that we can manage the budget and annual tax relief as revenues grow. Historically speaking, revenues have grown about 5 percent annually over the last 30 years. This proposal requires less than 1 percent annual revenue growth to finance tax relief.
Nebraskans need tax relief. LB 947 provides that relief in a responsible, manageable manner for Nebraska farm families, homeowners, and businesses. As the Nebraska Farm Bureau President Steve Nelson said recently, a vote for LB 947 is a vote for property tax relief. A vote against LB 947 is a vote against property tax relief. If you want to see property tax relief this year, I encourage you to contact your State Senator right away. Their contact information can be found at www.NebraskaLegislature.gov. If you have questions about our efforts to pass property tax relief, please call my office at 402-471-2244 or email me at Pete.Ricketts@Nebraska.gov.