County Board adopts budget, defeating proposal to cut property tax

2012-08-28T17:45:00Z 2013-07-01T17:45:15Z County Board adopts budget, defeating proposal to cut property taxBy JORDAN PASCALE / Lincoln Journal Star JournalStar.com

Lancaster County homeowners were one vote away from some property tax relief, but the majority of commissioners said money instead will go to bolster the county's reserve fund.

The Lancaster County Board of Commissioners formally adopted its annual budget Tuesday on a 4-1 vote (Chairwoman Deb Schorr voted against), but an unexpected vote on property tax relief took the spotlight.

Commissioner Brent Smoyer has advocated for a small amount of property tax relief that would give $1.5 million, or 0.6 cents of the 1.6-cent levy transferred from the Railroad Transportation Safety District to the county, back to property taxpayers.

The idea was quashed after Smoyer learned the county's reserve funds, which are used in emergency budget situations, were at $8 million, half of what the budget director said they should be.

However, the Lincoln Independent Business Association sparked a rebirth of the discussion during Tuesday's public hearing when LIBA President Coby Mach pressed for property tax relief.

There was extra money to go around because of an unexpected 5.74 percent increase in the county's tax valuation base and the RTSD funds.

"The extra amount should go to taxpayers. ... With the RTSD money, you have a balanced budget, you can fund priorities and hire additional staff, lower property taxes by $1.5 million and still have $400,000 in reserve for emergencies," he said. "It's the perfect time to lower property taxes."

Chairwoman Deb Schorr made a motion for the cut, but it failed on a 3-2 vote. Commissioners Bernie Heier, Larry Hudkins and Jane Raybould said although property tax relief would be great, they wanted to prepare for the future, which may be even tougher than this year's budget.

Heier proposed taking even more from the RTSD for a property tax cut, but that also failed.

"It’s hard to help poor people when you’re poor," Heier said in regard to the tax-cut proposal. "If our reserves don’t expand, we won’t be helping many people for very long."

The $160 million budget comes in 3.58 percent higher than last year, with the most controversial item being the levy shift from the RTSD.

Schorr, in prepared remarks, said the county faces a revenue challenge every year, because it doesn't get sales and income taxes.

"We rely on property tax and we rely on inheritance tax to reduce property tax," she said.

The county got $8.2 million in inheritance tax this year, she said, and without that, an additional 4 cents of levy would’ve been needed to meet all of the mandated services required by state law.

Gov. Dave Heineman has called for an end to the inheritance tax, which he calls a death tax.

Notable increases within the overall budget come from corrections, which is opening a new jail. Its budget is $2.7 million higher than last year, despite $600,000 in reductions from an original budget request. An additional 37 employees must be hired to staff the jail at a cost of $1.6 million. They will be hired throughout the budget year.

The election commissioner's budget saw a $400,000 bump because there are three elections this year as opposed to one last year.

The treasurer is spending an additional $450,000 on new, streamlined tax processing software.

The Board of Equalization budget increased $209,000 because of the mandatory three-year revaluation of property.

Mach, the only person to testify, said he was pleased the overall levy did not increase, but said taxes still have gone up for many because of the valuation increases.

"You have a reserve. It may not be ideal or where you want it to be, but people across this community wish they had a reserve, too," Mach said. "There's been some pretty tough times and you have faced them, but everyone else has as well.

"We are asking for a little bit of a return."

Before the vote, Raybould called for systematic changes and an end to reliance on one-time funds, which she called a deplorable practice.

Raybould has been criticized in the past for thinking too much like a businessperson in a public environment, but she said the public sector could learn from private business practices.

She advocated for privatizing more county services, sharing of sheriff's cruisers, early retirement buyouts that don't just move people up the ladder, challenging elected officials to come up with efficiencies and to turn back raises.

Reach Jordan Pascale at 402-473-7120, jpascale@journalstar.com or follow him @LJSPascale.

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