Greetings District 36. There has been a great deal of media coverage recently over the Legislature’s efforts to reduce the property tax burden. A bill debated last week, LB408, was touted as a major property tax relief proposal. In fact, LB408 would not direct one cent toward direct property tax relief. The premise of LB408 argues local boards are overspending, which is a false narrative in District 36.
LB408 proposed to impose additional levy limits on locally elected boards, even though there is undisputed evidence that those boards are staying within existing limits. Further, Sen. Williams stated he believes it is offensive to make a general assumption that school boards, city councils, and counties are overspending. He is reminded that the same people that elect the local officials in District 36 also elected Sen. Williams.
Each year that he has been in office, Sen. Williams has supported every measure that allocated State funds to directly reduce property taxes. Property tax reduction efforts this year were accomplished through the State’s budget which he supported. The amount of State funds used to reduce property taxes now totals $1.45 billion over the next two years. That amounts to about 15% of the State’s budget directed to reduce property tax.
Property taxes are levied and collected by local governments. The State is prohibited from levying property taxes so the only way the Legislature can address property tax reduction is to direct State funds, generated from sales and income taxes, to the cause. In 2007, the Legislature created the property tax credit fund with $105 million from the State. The property tax credit fund will now direct $613 million over the next two years to direct property tax reduction.
In addition, the Legislature passed a measure last year that was termed the “grand compromise”, which created another program funded through sales and income taxes. That fund is used to pay for an income tax credit to property tax owners for a portion of the property taxes paid. The new fund will receive a little over $600 million over the course of the next two years, and exceeds the amount that was projected in the original proposal.
In addition, the Nebraska Homestead Exemption will provide an estimated $200 million in property tax reductions over the next two years. Finally, an estimated $80 million in new revenue will also be directed to reducing property taxes through money generated from the tax on gambling.
That tax was enacted through the gaming initiatives approved by voters last year. Additional State funds that reduce the property tax burden come through the State’s school funding formula.
As always, feel free to contact Senator Williams anytime at (402) 471-2642 or email@example.com.