The Appropriations Committee heard testimony Feb. 18 on three bills seeking to increase funding for the state\u2019s Property Tax Credit Cash Fund.<\/p>\n
The fund was established in 2007 to offer relief to property taxpayers in Nebraska and is slated to receive $113 million from the state\u2019s general fund in 2014. The proposed measures each seek to increase the property tax credit fund, but differ in their amounts and funding sources.<\/p>\n
LB1094, introduced by Hyannis Sen. Al Davis, would increase the general fund transfer for the current fiscal year to $138 million. Davis said the one-time $25 million increase would offer some property tax relief without endangering state funding for needed programs.<\/p>\n
\u201cI think it\u2019s reasonable; I think it\u2019s sustainable,\u201d he said.<\/p>\n
Two other bills would bolster the fund through transfers from the state\u2019s cash reserve.<\/p>\n
LB1086, introduced by Omaha Sen. Pete Pirsch, essentially would double the annual appropriation over the next two years by transferring $115 million from the cash reserve in 2014, and another $115 million in 2015.<\/p>\n
Pirsch said the state\u2019s cash reserve \u2013 estimated to reach approximately $725 million by the end of 2015 \u2013 is strong enough to sustain a $230 million reduction in order to provide property tax relief. He said the coming two years are expected to be fairly strong economically.<\/p>\n
\u201cI think given what our projections are now, gives where our cash reserve is, I think it\u2019s a very reasonable and a very plausible number,\u201d Pirsch said.<\/p>\n
LB669, introduced by Omaha Sen. Beau McCoy, would authorize a one-time $85 million transfer from the cash reserve in fiscal year 2014.<\/p>\n
McCoy said the property tax credit fund is not going as far as it once did in reducing property taxes, while the burden on taxpayers has increased. Omaha currently has the 12th highest property tax rate in the country for a major metropolitan area, he said, and Nebraska agriculture producers pay the third highest property taxes in the country.<\/p>\n
\u201cWe\u2019re overtaxing Nebraskans,\u201d McCoy said. \u201cI don\u2019t see this as a spending program, I see this as giving back to hardworking Nebraskans.\u201d<\/p>\n
Harvey Sankey of Nebraska Taxpayers for Freedom testified in support of the bills, saying Nebraska ranks in the top 10 among states with the highest property taxes as a percentage of home value. Property tax relief was the highest priority among those who spoke at recent meetings of the Legislature\u2019s Tax Modernization Committee, he said.<\/p>\n
\u201cMost of the people spoke about relief in property taxes,\u201d Sankey said. \u201cThat\u2019s what they were all concerned with. I think this is a good way to tell \u2026 your constituents that you heard what they had to say.\u201d<\/p>\n
Renee Fry, executive director of the OpenSky Policy Institute, testified in opposition to LB669 and LB1086. Lawmakers should not draw down the state\u2019s cash reserve in order to provide minimal property tax relief, she said, adding that the average homeowner would receive $57 in additional tax credits under LB669 and $77 under LB1086.<\/p>\n
Fry said Nebraska would have been in serious fiscal trouble during the last recession if not for the influx of over $500 million in federal stimulus dollars. Without those funds, she said, the state\u2019s cash reserve would not have been strong enough to avoid raising taxes and making even deeper cuts to programs and services.<\/p>\n
\u201cWe need to learn from those lessons and make sure that we continue to follow on that path of fiscal responsibility and make sure that we don\u2019t set ourselves up to fall short,\u201d Fry said.<\/p>\n
The committee took no immediate action on any of the bills.<\/p>\n","protected":false},"excerpt":{"rendered":"
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