Special session assured as property tax bill fails on final day in Nebraska Legislature

Special session assured as property tax bill fails on final day in Nebraska Legislature
Governor Jim Pillen addresses lawmakers on the final day of the regular 2024 session, telling them a special session on property tax relief will be called later this year (courtesy NPM)
April 18th, 2024 | Scott Miller

Nebraska lawmakers have adjourned sine die for the 2024 regular session, but the final day may have been more notable for the failure of certain bills to pass with the clock running out.

A measure supported by Governor Jim Pillen to broaden the sales and use tax to reduce property taxes by an estimated 22 percent was among those that failed.

LB388 would have also included a harder cap on local government spending, an increase in the earned income tax credit and front-loading of the income tax credit for property taxes paid.

During debate, Sen. Brian Hardin of Gering said the measure actually revealed more problems than it would fix, so he would support a special session to transform the entire state tax system.

“In the spirit of revealed problems, the tax issues are too important, and have been incrementally paralyzed for decades. It’s beyond time to strike down Nebraska tax policy and start over,” said Hardin. “We need to give birth, not try to resurrect. We need to transform, not tweak.”

After more than 90 minutes of debate, Sen. Lou Ann Linehan of Elkhorn, who earlier said the measure would have been the latest step following Blueprint Nebraska, recognized there was not enough support to overcome a filibuster. “I’m willing to come back this summer, this fall, whenever. But I hope we have a lot of conversations between now and then about all your perfect answers to this problem, because it’s easy to say ‘No, no, no’. That’s real easy. So, everybody who’s saying we can do better, I hope you have those ideas to the Revenue Committee by the end of June,” Linehan said.

Also failing on the final day of the 60-day session was LB 1363, which would have reduced the inheritance tax, and would have replaced that revenue for counties by increasing the documentary stamp tax collected when real estate changes hands.

Lastly, legislative supporters of school choice were able to overcome a filibuster of LB1402, which directs the State Treasurer to provide up to $10 million to non-profit organizations granting scholarships to students attending private or parochial schools. It’s expected the governor will sign the measure, which also has language to repeal last year’s LB753, the Opportunity Scholarship Act.

The failure to pass a property tax relief measure has guaranteed at least one special session for Nebraska lawmakers this year. During his address on the final day, Governor Pillen praised lawmakers for their sacrifices and the measures they did pass, but expressed his disappointment in the failure of LB388.

Pillen said every state resident agrees property taxes are out of control, and lawmakers need to take steps toward meaningful relief this year. “With this legislature’s failure enacting meaningful tax relief, we’re behind at the first half, but we still got a second half to go,” said Pillen. “I will call as many sessions as it takes to finish the long overdue work of solving our property tax crisis.”

Pillen said there was other unfinished business for lawmakers, and specifically mentioned the need to return Nebraska to ‘winner-take-all’ for Electoral College votes in the race for U.S. President.


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