Tax Relief

Tax relief began within the legislative interval

Editor’s note: This is the first in a series of articles examining the recently concluded first session of the 107th Nebraska Legislature from various perspectives.

The first session of the 107th legislative term of Nebraska’s unicameral system ended in late May when Governor Pete Ricketts made his annual “sine die” speech on May 27, which he called “historic”.

Among these measures in the 90-day session in 2021, lawmakers tackled and passed the biennial state budget, which will cover government spending and revenue for the next two years.

Ricketts said the meeting was historic in many ways, including how lawmakers continued to deal with the challenges of COVID-19 in the state, but also notable bills passed on things like controlled government spending, property tax breaks, and broadband expansion .

Farmers and ranchers found several important pieces of legislation in Ricketts’ address. While Ricketts joked that the most popular bill he signed as governor was likely a bill to ensure emergency sales of COVID-19 alcohol can continue after the pandemic ended, farm producers have been strong at the legislature’s job interested in the state budget and property taxes.

Two-year budget

“The foundation of all of our work together begins with the budget,” said Ricketts. “We have a budget that includes the major services we provide in the state of Nebraska while still controlling spending at an average annual growth rate of 2.4%. This is great work. And because we continue to control spending, we were able to work together on tax breaks. “

Ricketts reported that LB1107 provided $ 430 million in property tax relief each year in this year’s budget through a refundable income tax credit. “Combine that with an increase in the property tax relief fund and homestead exemptions, and we offered $ 1.7 billion in property tax relief over the next two years,” he said.

Including bills that include social security tax breaks, military veteran perks, business tax rates, ethanol, agriculture, and state residents, Ricketts said this is historic – and could be the largest tax break passed by any Nebraska bill in the past Quarter of a century or possibly in the history of the state.

“Eighteen and a half percent of our budget will receive an average of tax relief over the next biennium,” said Ricketts.

Broadband

Rural residents who do not have good quality broadband were interested in legislation to expand broadband to up to 30,000 more households in the state.

“This will allow these households to work from home, have telemedicine, do homework, do e-commerce and entertainment,” said Ricketts.

With up to 80,000 households working below the FCC minimum for broadband quality, he found that the state still has more work to do to extend high quality broadband to the rest of those households.

He also noted that there is more work to be done on property tax relief. “Taxes on property keep rising,” Ricketts said. “Over the past 10 years the average annual increase has been 4.3%.”

He urged the legislature to take advantage of the property tax breaks in the future and pass a bill to curb the growth of property tax laws in the local jurisdiction.

Ricketts noted that the legislature would meet again in the fall to take census data and work on redistributing elections in the state for the next decade. He thanked lawmakers for their work during the pandemic and noted the state’s achievements despite COVID-19, including one of the lowest COVID-19 death rates of any state, the highest number of students in person in classrooms nationwide, and the lowest average unemployment rate of any state in the Year 2020 and continued through 2021.

“The Nebraskans have strengthened,” said Ricketts. “They took care of their neighbors. They found ways to adjust business practices and they changed their lives to slow the virus down. “

Other important guidelines listed in a press release from the Office of the Governor of interest to agricultural producers and rural citizens include some of the following bills:

  • Lower taxes on social security income
  • a new obligation for local governments to notify taxpayers if their property tax bills are expected to increase by more than 2%
  • a law that will make it easier for hospitals and nursing homes to meet their staffing needs by ensuring accelerated reciprocity for many licensed health professionals
  • Fully funded the federal school aid formula and deliver more than $ 1 billion annually to K-12 public schools

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