Nebraska Legislature considers property tax reform
(The Center Square) – Property tax reform is on the table in the Nebraska legislature this year. Gov. Pete Ricketts’ supports a bill capping the growth of local property taxes to 3% annually.
Nebraska property taxes have increased by about 52% over the past decade, compared to 18% inflation and 48% income growth, according to the State Department of Revenue.
In a poll by the Platte Institute last month, 55% of respondents cited property taxes as the tax they would most like to see lowered.
The governor’s proposal would limit the potential increase of property taxes but doesn’t actually lower them, Platte Institute Policy Director Sarah Curry told The Center Square.
“What we are seeing from our polling is that people want significant reform because they want lower property taxes,” Curry said. “I don’t think the governor’s plan is bad, but it’s not going to lower anyone’s property taxes. It’s just going to keep them from growing at an exponential rate. So I think something else is going to have to be done.”
The question is what and how, Curry said. Since property taxes pay for education, how would the state replace those dollars?
One way would be to expand the state sales tax by including services that are now exempt, which Sen. Tom Briese, R-Albion, has proposed.
It would be possible to have a combination approach, Curry said.
“There is nothing to say that we couldn’t get the sales tax broadening in place and use some of that revenue to offset the cost of education and reducing our reliance on property taxes,” Curry said. “I think the governor’s plan has to go through – we have to cap local property tax growth. Then in association with them, the state should pick up more of the tab for education, using the funds already existing and expanding the sales tax base.”
The solution may not be possible with one bill, Curry said.
“Nebraska needs multiple tweaks here and there to change it,” Curry said
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