Straight Talk From Steve: Local Control
October 5, 2023
One of the complaints that I often here about the EPIC Option Consumption Tax has to do with the loss of local control. For example, the League of Municipalities held an informational meeting last week, where they complained about how the EPIC Option Consumption Tax eliminates local control. This was a false assumption. The EPIC Option Consumption Tax does not eliminate local control.
The pink postcards we all received recently in the mail were the result of a bill that passed in the Legislature called, "The Truth in Taxation Act." In short, it means that it is true that your taxes will go up! The pink postcards are supposed to inform the people about a public hearing, but for many Nebraskans, the pink postcards arrived after the date of the public hearing. That was the case for me with one of my own properties. The hearing was scheduled for September 19 and I received the pink postcard on September 27.
Pink postcards need to be mailed out earlier. When pink postcards are mailed out in September, it is too late for local units of government to hear from the people. Budgets have already been passed, and hearings are treated as a mere formality. Instead, the people need to become part of the budgeting process and that can only happen when local units of government hear from the people before they pass their budgets. Therefore, the pink postcards need to be mailed out ahead of time and hearings need to take place while the budget is being crafted.
Property taxes seldom ever go down. There have been a few rare occasions when a local unit of government actually requested fewer tax dollars than they did the prior year, but that is a very rare exception to the rule.
Lobbyist organizations and farm groups like to dupe the public into believing they are getting property tax relief when they are not. For example, Southeast Community College (SCC) tried to raise their mill levy this year to the maximum amount allowable by law. They did this on top of the 15 percent increase in valuations on everyone's property. My property taxes to SCC increased 29.5 percent! After a public hearing was held where more than 200 taxpayers complained, the SCC board decided not to raise the mill levy. Afterwards, several lobbyist organizations and a farm group praised SCC for keeping their mill levy the same. But what these groups failed to realize is that keeping the mill levy the same merely amounts to a decrease in the amount of everyone's tax increase. In other words, the 15 percent increase everyone received on the valuation of their property means that everyone's property taxes will go up despite the fact that SCC kept the mill levy the same.
Every pink postcard that was sent out was mailed by a local unit of government with local taxing authority. Not one state agency mailed a pink postcard. Why do people continue to believe that local control is the solution to their tax problems? Insanity is continuing to do what you've always done and expect different results. So, now I must ask, how is that local control working out for you?
Whenever you hear the phrase property tax relief that is almost always code for a decrease in the amount of your tax increase. I recently met with a County Commissioner in eastern Nebraska, who was boasting about how his county did not raise their mill levy. I asked if the county's valuations had gone up? His answer was that they went up four percent. I then suggested that he raised taxes by four percent. He responded, "No we kept the mill levy the same." So, I explained to him that people don't pay their taxes in levies; they pay them in dollars. Because everyone's overall property tax burden will go up, he effectively raised taxes on everyone in the county by keeping the mill levy the same.