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Don Walton: Property tax reduction proposals would not raise tax rates

September 24, 2018

As yet another debate about property tax reduction begins to ramp up in advance of the 2019 legislative session, two influential public policy voices point to different options for replacement revenue.

Neither involves increases in state tax rates.

Following up on its legislative forum in Lincoln earlier in the month, the Platte Institute is zeroing in on elimination of some sales tax exemptions.

Meanwhile, a member of Open Sky’s board points to “the hundreds of millions Nebraska spends annually through the tax code in the form of tax incentives, tax credits and other tax expenditures.”

“Some tax breaks can outlive their usefulness and turn into significant drains on our state budget,” former Sen. John Harms wrote in an op-ed expressing the Open Sky perspective.

In making his case, Platte executive director Jim Vokal asks: “Did you know that the state gives up more revenue in sales tax exemptions (around $4.8 billion) than it collects in sales and income taxes?”

Those are two different pathways to property tax reduction that would avoid increasing any state tax rates.

But each proposal would face significant barriers in its bid for legislative consensus.

Whether to rely on more sales tax revenue or additional revenue produced by fewer tax deductions is a question that would divide state senators into opposing philosophical and political camps.

Recent legislative experience suggests you cannot find the 33 votes required for a consensus agreement on tax reform that could clear a filibuster by opponents.

The clock is ticking now in a couple of ways.

Next year is a non-election year, and that’s the safest political time to do it, and rural senators are about to lose a seat — or two — in the Legislature following the 2020 census.

Still untried is the possibility of a grand bargain that would combine tax reform with a couple other issues that are important to some senators.

A package of bills. A package deal.

Long ago and far away, that’s what the Legislature used to do.

* * *

Sen. Bob Krist was mugged last week.

That kind of assault, which characterizes too much of our politics at a time of unusual personal invective when anything goes and truth is deemed to be fluid or marginal or even irrelevant, drives away potential candidates for public office.

It also impacts the decisions of current officeholders who may be considering re-election bids or future efforts to move into other elective office.

In the wake of the personal assault on Krist, I heard from both.

All of this poisons and distorts the political environment for citizens, candidates and voters.

No, no, this criticism is not partisan. Do not frame everything in partisan terms. This is non-partisan. Parties are a big part of this problem and that’s a plural.

And so is the example set in Washington today. Big-time.

Let’s talk about the state’s future, the candidates’ vision, education, public services, economic development, schools. About taxes and opportunities and challenges and aspirations and quality of life and people who may need our assistance and kids.

Let’s get out of this dark alley and into the sunlight and center on the real stuff that impacts Nebraskans and their future.

Vote for Gov. Pete Ricketts or Sen. Bob Krist based on performance and issues; and do not let them try to tear down either man.

* * *

Chuck Hagel makes the list of the 15 greatest Republican senators since 1950 compiled by Ronald Feinman, a professor of American history and author whose list was posted online.

“These 15 GOP senators from the past could show Mitch McConnell and his colleagues how to do the job,” the article stated.

Hagel was the most contemporary Republican senator on the list.

Others: Margaret Chase Smith, Everett Dirksen, Barry Goldwater, Clifford Case, Jacob Javits, Howard Baker, Mark Hatfield, Charles Mathias, Bob Dole, Lowell Weicker, Richard Lugar, William Cohen, Arlen Specter and John McCain.

Feinman described Hagel as “a mainstream conservative” who was unafraid to cross party lines and take independent positions, such as opposing President George W. Bush’s Iraq war policy.

* * *

Finishing up:

* The use of trackers who are paid to shadow candidates from the other party is not new. One night in Omaha, a young man stood outside a home taking note of who showed up at a private political fundraiser for Chuck Hagel. As cold rain poured down, Hagel went outside and brought the Democratic tracker inside the house.

* Come back to TPP, Japanese consul-general Naoki Ito urged during a meeting at the Journal Star last week. No penalty would be imposed on the United States in the wake of President Trump’s abrupt withdrawal from the Trans-Pacific Partnership trade agreement when he took office, Ito said.

* And on a separate trade front, former Secretary of Agriculture Mike Johanns on Twitter: “Positive news. Resuming negotiations is the right pathway to work out issues with China. Hopefully real progress can be made.”

* Heading toward October: the spectacular, showcase month, splashed in orange and red and yellow. Once you arrive, please linger.

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