Straight Talk From Steve: LB-589
August 24, 2023
Whenever it comes to delivering on property tax relief for the good, hardworking citizens of Nebraska, governmental entities with tax asking authority always seem to find ways to shut it down, and that is exactly what is happening in Nebraska again this year. Today I would like to inform you about how the Nebraska Department of Education is undermining the Legislature's efforts to provide property owners with some much-needed property tax relief this year.
Earlier his year Sen. Tom Briese of Albion introduced LB 589, which became known as the School District Property Tax Limitation Act. The Legislature amended this Act into LB 243, passed the bill, and Governor Pillen signed it into law on May 31, 2023. LB 243 put a cap on each school district's revenue growth. This was done with the intention of giving property owners some much-needed property tax relief. However, a provision in the bill allows school districts to exceed their property tax authority whenever 70 percent of the school board members agree to do so.
Because school districts all across Nebraska will soon have their revenue growth capped, they are becoming nervous about the future. As a result, Bryce Wilson, a fiscal analyst for the Nebraska Department of Education, has begun suggesting to superintendents and business managers across the State to consider this provision in the bill. As a result, some school boards have begun the process of allowing them to use the unused property tax authority granted to them under LB 243.
Summerland is one such school district. The business manager for the Summerland School District told the members of his school board at a recent school board meeting that Bryce Wilson had suggested that the school district consider adjusting their property tax authority. So, the school board took the first step in this process by voting to make LB 243's seven percent threshold in the tax levy available to them, and the school board will soon be voting on whether or not to actually raise the tax levy. Because of this provision in the law, it has now become incumbent upon concerned taxpayers all across Nebraska to begin attending their school board's monthly meetings.
Nebraska State law (NSS 79-1027) puts restrictions on how much money school districts can stash away in their cash reserves. However, schools have found other ways of getting around these restrictions. For example, extra cash can be stored in funds which are not connected to the school district's general fund or the general cash reserve fund, thereby skirting the restrictions in the law, and that is what I expect some of them will do. Bryce Wilson has only been suggesting that school districts take advantage of their unused tax asking authority when it is actually needed.
Helping property owners and taxpayers survive during hard economic times is not something which falls within the scope of the Department of Education.
Many governmental entities with tax asking authority have demonstrated over the years a gross negligence in caring about the plight of property owners and taxpayers, especially during hard economic times, and this is a major reason why I introduced the EPIC Option Consumption Tax. The EPIC Option Consumption Tax would solve the problem of governmental entities taxing you beyond your ability to pay. In other words, the EPIC Option Consumption Tax plan contained in LB 79 would finally force these governmental entities to live within their revenue means, and this is the only way that Nebraskans will ever be able to solve this difficult problem.
As long as we continue to live with our current, broken tax system, governmental entities with tax asking authority will continue to abuse the system and over-tax the people, and that just might prove to be a blessing in disguise. As my high school FFA adviser told me this week, "Taxes are not yet high enough for tax reform." What he meant by that statement is that tax reform will not come to Nebraska until enough Nebraskans finally come to the conclusion that they can no longer pay their taxes. Sign the petition!