It appears to be, to quote Yogi Berra, deja vu all over again in the Nebraska Legislature.
Last year, six rural senators abandoned LB720, preventing the passage of the business expansion tax incentives bill that needs approval to replace the expiring Nebraska Advantage Act, holding it hostage. Their action followed a filibuster scuttled Sen. Tom Briese’s effort to acquire $112 million in property tax relief that followed the collapse of a more ambitious Revenue Committee plan.
Last week, the senator from Albion let it be known that LB720 is now inextricably tied to LB794, the Revenue Committee’s new property tax and school funding reform proposal, telling the Journal Star “one does not pass without the other.”
And Speaker Jim Scheer of Norfolk intends to keep the property tax and business incentives bills tied closely together on the legislative agenda, aiming for early floor debate on the measures in this short 60-day session.
For Briese, linking the bills is “an opportunity for rural and urban interests to come together,” providing property tax relief and state funding assistance to all schools for the “rurals” and the incentives to bring in new businesses and expand existing enterprises for the “urbans.”
But attempting to force Lincoln and Omaha senators to vote for a tax reform package that would cost their schools millions of dollars with no way to recoup those funds in exchange for business incentives that have, in the past, delivered inconsistent economic development results, is no compromise.
Nor is tying the measures together the “grand bargain” that will be required to avert filibusters and result in the passage of much needed property tax reform. Rather, the linkage is heavy-handed legislative extortion that will, in the end, hurt all Nebraskans, rural and urban alike.
The Revenue Committee’s bill, crafted in good faith with great effort, appears to be destined to fail, likely killed by a filibuster. That outcome is likely for any measure that doesn’t fully address taxing inequalities and truly restore the balance of the “three-legged stool” of income, sales and property tax.
The business incentives measure would, if presented on its own merits, very likely pass with little opposition. The incentives, after all, could benefit any community in the state, and even if they’re primarily used in Omaha and Lincoln, would bring in development dollars that lift the state’s economy.
That is the reason that Gov. Pete Ricketts, a strong supporter of property tax relief, opposes the linking of the bills and why each measure should be considered separately, not tied together to try to strike a bargain that will never be made.
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