Whenever state senators return to finish their regular session, they’ll be asked one more time to deliver at least short-term property tax relief to rural Nebraska.
In terms of estimated results, the plan’s latest version looks much like its earlier versions the past two years.
That’s good news for 40 west central Nebraska school districts, all but two of which would gain state aid — most of them substantially so — in the newly tweaked tax-relief plan released Wednesday.
The latest version, proposed as a Revenue Committee amendment to Legislative Bill 1106, retains the substantial state aid infusions — mainly by restoring per-student “foundation aid” — from 2019’s original version by Sen. Mike Groene of North Platte.
The 40 districts in The Telegraph’s traditional coverage area would share nearly $60.6 million in aid in 2020-21, 25.2% more than this year and half again the amount they got two years ago.
State aid for North Platte Public Schools would rise 9.1%, from $9.75 million this year to $10.64 million in 2020-21.
The Revenue Committee amendment also generally projects overall state-aid gains by 2023 for large and small schools alike, as did its immediate predecessor that stalled in February.
But two other similarities between the two 2020 versions seem unlikely to convince enough urban senators to give the new plan a filibuster-proof 33 votes from among the 49 lawmakers.
» Both rely on current state revenue surpluses, which historically have dried up in hard times and were tapped earlier this week for emergency funds to combat the COVID-19 outbreak in Nebraska.
For now, Gov. Pete Ricketts and Gering Sen. John Stinner, chairman of the Appropriations Committee, believe the tax-relief plan still can be afforded, Revenue Committee leader Sen. Lou Ann Linehan of Omaha said Wednesday.
» Though Omaha- and Lincoln-area schools would get more state aid in 2022-23 than now, Lincoln, Bellevue, Ralston and Papillion-La Vista would see their aid drop in one or more individual years.
» The Revenue Committee analysis also estimates that Omaha, its bordering districts and Lincoln would collect more in property taxes by 2023 than today, despite overall gains in state aid.
By contrast, only three west central Nebraska districts — Mullen, Paxton and Wallace — would be in that situation, according to the committee’s analysis.
As with last month’s plan, the latest version would have to defeat a filibuster with 33 votes, advance twice and win final approval with 33 votes to take effect immediately if Ricketts signs it.
Senators might be out for another month before returning for the last 17 days of their 60-day 2020 session. They used up three days this week in taking $83.6 million from current surpluses to boost the state’s response to COVID-19.
Groene, who chairs the Education Committee and sits on the Revenue Committee, acknowledged Thursday that the tax relief plan’s majority support remained short of the magic two-thirds.
“The education establishment fears change. Senators up for re-election fear voting against property tax relief,” he told The Telegraph. “We will see who fears more.”
Linehan, who also sits on Groene’s committee, said in a Wednesday press release that hard-pressed small-town Nebraskans now also have COVID-19 to worry about.
“As our communities and families are reeling from the coronavirus pandemic, it is even more urgent we deliver property tax relief,” said Linehan, who represents the Elkhorn area in the Unicameral.
“Small businesses are worried about keeping their doors open, agricultural producers are dealing with plunging commodity prices and homeowners are struggling to make mortgage payments,” she said. “We have an obligation to deliver property tax relief.”
Also hanging fire is a revised tax incentive package (LB 720) that rural senators have vowed to block without property tax relief. The state’s current incentive program expires this year.
The proposed LB 1106 amendment, which the Revenue Committee advanced 6-2 Wednesday, makes several adjustments from the version it tried to attach last month to a different bill (LB 974).
It still would tighten current tax-rate and budget-growth lids on schools, the better to ensure that higher state aid produces lower property tax requests.
One notable addition in the latest plan, however, would allow school boards to raise property tax rates above state lids — assuming a supermajority vote — if the Legislature fails to keep the plan’s funding promises.
The state’s largest schools, most of which receive “equalization aid” to offset costs of educating poor students and non-English speakers, say they fear senators will cut that aid first if per-student aid returns to the formula for the first time in 30 years.
Linehan again rejected that contention Wednesday, saying that equalization aid would still come first “even if foundation aid were to remain static or fall” due to lower state revenues.
Total aid for west central Nebraska districts fell by 40.6% from 2008-09 to 2018-19, due first to the Great Recession and then to several years of soaring farm and ranch taxable valuations.
Even under the latest version of the tax relief plan, a dozen regional school districts wouldn’t regain by 2023 all the state aid they lost over the past decade.
Five districts got less than $20,000 in aid apiece this year, mostly due to a small rebate of state income taxes paid by each district’s residents.
Two got less than $10,000: Hayes Center ($7,846) and McPherson County ($5,546).