Some cities could delay refund of job credits

A bill that would attempt to ease the financial strain on city governments was advanced from select file March 8.

LB209, introduced by Bellevue Sen. Abbie Cornett, would provide notice to cities of pending job credit tax refunds one year in advance. Cornett said the bill would help many smaller cities struggling with cash flow problems.

In addition to the bill’s notification provision, cities of the first and second class, as well as villages, could delay payment of job credit tax refunds by one year. Nebraska cities are classified by population as follows:
• first class cities have populations between 5,000 and 100,000;
• second class cities have populations between 800 and 5,000; and
• villages have populations between 100 and 800.

An installment repayment option would be allowed for any refund exceeding 25 percent of a city’s total sales tax receipts.

A Cornett amendment, adopted 28-0, would permit a certified municipal employee to obtain confidential sales tax return information from the state tax commissioner on behalf of his or her municipality.

A second Cornett amendment made technical corrections to the bill and was adopted 39-1.

Omaha Sen. Bob Krist introduced an amendment to the Cornett amendment that would have made the installment repayment plan available to all cities — most notably Lincoln and Omaha. Krist said the financial issues plaguing small towns affect larger cities as well.

“Omaha faces this issue every year and must budget millions of dollars to prepare for it,” Krist said. “If this is good policy for some, it’s good for all.”

Lincoln Sen. Danielle Conrad spoke in support of the Krist amendment, saying it was an issue of equity.

The Krist amendment failed on a 10-22 vote.

Senators advanced the bill to final reading by a voice vote.

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