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Beatrice 6

The six people convicted and later cleared of killing Helen Wilson in 1985: (from top left) Joseph White, Tom Winslow, JoAnn Taylor, Deb Shelden, James Dean and Kathy Gonzalez. Gage County must pay the six $28.1 million and a bill introduced by Sen. Myron Dorn would help the county repay that amount.

Its legal options exhausted, Gage County taxpayers will now pay more than $28.1 million to six people sent to prison for a 1985 rape and murder they did not commit.

Gage County's property taxpayers are also on the hook for roughly $2 million in attorney's fees and another $1 million in interest over the next eight years.

And while they represent a minority of Gage County's 22,000 people, agricultural landowners are expected to shoulder as much as 80 percent of the total cost.

A farmer himself, Sen. Myron Dorn of Adams said he doesn't believe property taxpayers should bear 100 percent of the estimated $31 million federal jury verdict.

But, he told the Legislature's Revenue Committee on Wednesday, "that's the only thing allowable" under state law.

"There are multiple people in the county, multiple people I've talked to through the years, that think the state should be paying some or all of that," Dorn added. "There are multiple people who think there should be other ways allowable to pay for that."

To that end, Dorn introduced the Qualified Judgment Payment Act (LB472), a bill that would allow county boards, by a two-thirds vote, to levy a one-half-percent sales tax for the specific purpose of raising revenue to pay federal judgments.

Nebraska counties currently have the authority to ask voters to approve a sales tax to finance public safety, or to pay the county's share of an interlocal agreement or joint public agency, but those taxes cannot be collected in areas where a sales tax already exists.

Dorn's proposed sales tax would overlay all political subdivisions and existing sales taxes collected in a county, prevent the county from levying any further sales tax, and would automatically end once the federal judgment is paid.

"I wanted to ensure this was a very limited tax in use and duration," Dorn told the Revenue Committee.

If enacted, however, LB472 would not automatically result in Gage County reducing its property tax levy, which is currently at the maximum 50 cents per $100 of valuation set in state statute.

Dorn said attorneys for the Beatrice 6 have indicated they would pursue a court order if Gage County did not make a full-faith effort to raise the maximum amount of revenue to pay the judgment it could each year.

What LB472 could do for Gage County is generate an estimated $1 million a year in additional revenue, potentially allowing the county to pay the judgment in full a year or two early, at which point the county board could drop its levy back to the normal amount.

The Gage County Board of Supervisors unanimously supported Dorn's plan, writing in a letter that LB472 "would spread the burden of this judgment among others rather than just owners of the real estate."

"I can't say that we're in support of additional taxes, but this is a dollar amount we're going to have to pay regardless," said board Chairman Erich Tiemann. "We're open to looking at every potential avenue."

Jon Cannon, deputy director of the Nebraska Association of County Officials, told the Revenue Committee the bill was "narrowly tailored," capable of being used in rare circumstances where a federal judgment was leveled against a county.

An additional sales tax may also help Gage County if the state's ag economy continues to slump, driving down property valuations, Cannon added.

A former county supervisor said Dorn's bill shifted the responsibility for paying the judgment to the citizens of Beatrice.

Home and business owners living in Beatrice pay property taxes at higher assessed rates than the farmland throughout the county, Gary Barnard told the committee, and the majority of the businesses where a sales tax would be collected are located in the county seat of 12,300.

"Beatrice will be paying this sales tax," he said, "because in the little communities, there's no businesses that will provide a substantial sales tax. It is shifting it to the people of Beatrice."

Sen. Tom Briese of Albion questioned what amount of sales taxes the average citizen pays each year in Beatrice, and how that compares to the amount in property taxes paid by farmers in Gage County.

And Sen. Curt Friesen of Henderson asked Barnard why, if the incident took place in Beatrice, should those living outside the town be responsible for paying the judgment.

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"This is a unique situation and it looks to me like a sales tax would be the most fair way for this particular issue," Friesen said. "This is something that happened in the city. ... To spread that load evenly seems to me to be the most reasonable."

After 68-year-old Helen Wilson was murdered in her downtown Beatrice apartment, Beatrice Police launched an investigation that later went cold.

A private investigator hired by the Wilson family, Burdette Searcey, was later hired by the Gage County Sheriff's Office, where he conducted the investigation that led to the arrest of Joseph White, Ada JoAnn Taylor, James Dean, Thomas Winslow, Kathy Gonzalez and Debra Sheldon in 1989.

Five of the six took plea deals in the case — White maintained his innocence throughout — and it wasn't until a review of DNA collected at the scene in 2008 was it determined that one of police's original suspects, Bruce Allen Smith, was in fact responsible for the crime.

Smith, who died in an Oklahoma prison in 1992, had earlier been ruled out as a suspect after an Oklahoma City police lab technician wrongly said his blood did not match blood collected from Wilson's apartment.

Hanging over Wednesday's hearing were two of Dorn's other options he introduced for paying the Beatrice 6 judgment.

LB473 would allow Gage County to apply to the state treasurer for a low-interest loan to pay the judgment in full, but as senators noted, would still result in high property taxes until the loan was paid back.

No loan has ever been requested from the state, which has raised questions about the process, plus it's believed the $30 million loan would come from the state's already depleted cash reserve, which lawmakers hope to bolster this year.

And LB474, which would add federal judgments to the list of claims that could be filed under the State Tort Claims Act, would complicate Nebraska's already tight two-year state budget.

No action has been taken on any of the three bills.

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