Ag groups endorse property tax reform plan
Thee 61,000-member Nebraska Farm Bureau has thrown its support behind Sen. Curt Friesen’s property tax relief proposal in the gathering legislative battle over major tax reform.
“The bill (LB497) broadens the sources used to fund K-12 schools, reduces the over-reliance on property taxes and replaces the parts of our system that have created inequities in how the state of Nebraska treats students and taxpayers in funding schools,” the Farm Bureau stated.
The Friesen bill is one of three major tax reform plans that received a public airing Thursday during a marathon hearing conducted by the Legislature’s Revenue Committee that prompted nearly 10 hours of testimony.
A competing proposal (LB314), sponsored by Sen. Tom Briese of Albion, attracted the most attention at the hearing.
The Friesen plan, which would ensure that every public school in the state receives state support equal to 50 percent of its basic education funding needs, was co-sponsored by a dozen rural senators, including Briese.
The move to 50 percent funding support would be phased in over three years and would result in a reduction in reliance on property taxes to support local schools.
A lineup of agricultural organizations that are affiliated as the Nebraska Agriculture Leaders Working Group has joined the Farm Bureau in supporting the bill.
Friesen’s proposal also phases in a reduction in the value of agricultural land for school tax purposes and establishes an annual maximum property tax authority for each school district based on the amount of state aid received, the prior year’s tax request and a basic growth factor.
In order to fund the proposal, the bill would generate an estimated $523 million in additional annual revenue.
The bill would repeal a host of state sales tax exemptions, increase cigarette and alcohol taxes and repeal the $10,000 personal property tax exemption.
Friesen’s plan would also provide a one-time $150 million allocation to help replenish the state’s cash reserve fund.
“The bill fixes inequity in school funding (along with) over-reliance on property taxes to fund education,” Friesen said during Thursday’s hearing.
Both Friesen and Briese are members of the Revenue Committee.