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Gov. Ricketts Testifies for LB303, 2.27

Gov. Pete Ricketts testifies Wednesday, Feb. 27, 2019, in support of LB303, a bill introduced by Sen. Brett Lindstrom of Omaha which would increase the state's property tax credit fund.

Gov. Pete Ricketts presented his two-pronged property tax relief plan before the Legislature's Revenue Committee on Wednesday, positioning his proposals for consideration when the committee begins to try to fashion a tax reform package next week.

Ricketts told senators LB303 would fund an immediate increase in direct property tax relief by establishing a statutory floor of $275 million in the state's property tax credit fund.

Meanwhile, LR8CA would offer a pathway to "sustainable tax relief" by offering voters an opportunity to vote on a proposed constitutional amendment that would cap property tax increases at 3 percent a year, Ricketts said.

While both measures received support from a long line of testifiers at Wednesday's committee hearing, there was a lack of any high-profile support from major agricultural organizations, which are committed to other bills that propose more immediate, substantial and structural property tax relief.

The committee is poised to begin what is likely to be an arduous and lengthy debate about major tax reform at an executive session scheduled for Monday evening.  

Committee Chairwoman Lou Ann Linehan of Elkhorn hopes to have a tax reform package ready to move to the floor by mid-April.

Linehan sponsored the proposed constitutional amendment at the governor's request.  

Sen. Brett Lindstrom of Omaha introduced the proposal to increase the property tax credit fund at Ricketts' request.

Meanwhile, Sens. Tom Briese of Albion, Curt Friesen of Henderson and Mike Groene of North Platte have introduced their own tax reform packages, all of which already have been the focus of lengthy public hearings.  

All five of those senators are members of the committee.

Ricketts said the state's property tax credit fund has been increased by 60 percent since he became governor four years ago; the new proposal would increase the fund by $51 million beginning this year.

In answer to a question from Briese, the governor said he supports placing the anticipated $30 million to $40 million increase in state revenue from collection of sales taxes for online purchases into property tax relief.

A lineup of testifiers told the committee that the hike in property tax relief is needed to help sustain Nebraska agriculture at a time of serious economic distress. 

"It's Nebraska's No. 1 economic engine," Shane Greckel of Bloomfield said. 

Ricketts said the proposed constitutional amendment gives the voters of the state an opportunity to weigh in on the property tax issue.

LR8CA would allow a political subdivision to exceed the proposed 3 percent cap on increased property tax revenue with approval by a majority of voters at a special election.

That retains local control, the governor said.

Among supporters of that proposal were Lincoln City Councilman Roy Christensen and Coby Mach, president of the Lincoln Independent Business Association.

"The public sector is way out ahead of the private sector's ability to pay," Linehan said in presenting the proposal. "We need some tough spending caps."

Opponents say the two-pronged plan is the wrong approach.

The two proposals "fail to address the heart of Nebraska's high reliance on property taxes, low state support for K-12 education and other local services," Renee Fry, executive director of OpenSky Policy Institute, told the committee.

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Reach the writer at 402-473-7248 or dwalton@journalstar.com.

On Twitter @LJSDon.

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Political reporter

Don Walton, a Husker and Yankee fan, is a longtime Journal Star political and government reporter.

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