A group of state senators met constituents and local officials at a town hall at Northeast Community College on Tuesday night to discuss property tax reform.
The town hall, hosted by the Platte Institute and sponsored by Elkhorn Valley Bank, featured area Sens. Jim Scheer of Norfolk, Tom Briese of Albion and Ben Hansen of Blair, as well as Lou Ann Linehan of Elkhorn, who is the chairwoman of the Legislature's Revenue Committee, which drafts tax legislation.
The four senators agreed that property tax reform is needed, but finding a solution is difficult.
To pass a significant tax reform bill, it would take support from 33 of the 49 senators. With that number, the bill would be safe from a filibuster and could override a governor's veto.
Adam Weinberg, communications director for the Platte Institute, told the Daily News on Tuesday that there’s been general agreement to fix property taxes, but the hard part has been getting enough senators to agree on one solution.
“Nothing of a controversial nature like this can pass if it can’t overcome the filibuster,” Weinberg said. “It remains to be seen if everyone can put their differences aside and agree on a tax reform plan. We should all want something in this state to succeed. But some of us are never going to agree with others on certain things.”
Scheer said the divide between urban and rural areas, especially the differences between urban and rural schools, is making the property tax debate difficult.
“Smaller schools in rural areas don’t have the same offerings that large, metropolitan schools have,” Scheer said. “Larger school districts have more students in a more consolidated area with less property valuation. So they are receiving much more state aid than a lot of districts.”
That inequality in education and funding is the key problem, Scheer said. Because of the inequality, many school districts are forced to fall back on local property taxes.
Scheer also noted that since the last redistricting in 2010, there are now more senators representing urban areas than rural.
“It’s not going to go back,” Scheer said. “So we’re going to need to find some compromise. But I think it’s possible. I have high expectations for 2020.”
There’s also some concern that the Legislature may now be on a timer. A proposed constitutional amendment will force the Legislature to take action on property taxes if senators can’t find one themselves.
A ballot initiative based on a proposal by Sen. Steve Erdman of Bayard, which would enact a state constitutional amendment to give taxpayers a 35% income tax rebate annually, is collecting signatures across the state.
Weinberg said the “35% solution” would cost the state more than $1 billion annually and would fundamentally change the state’s finances. But he said many voters may look past that to send a message to the state’s lawmakers.
“It would be really foolish not to take this seriously at this point,” Weinberg said. “A lot of people no longer trust the Legislature to act on any sort of tax reform.”
The four senators had different outlooks on the ballot initiative.
Linehan said the initiative is a short-sighted solution to a complex problem, but she acknowledged its growing popular support as the Legislature fails to pass tax relief.
“If they went door-to-door in Elkhorn, I have no doubt they could get the signatures they needed,” Linehan said.
Hansen said he is on the fence as to whether he supports the proposal.
“Our heart tells us we want to vote for something, we want something right now,” Hansen said. “But our head says how are we going to pay for it?”
Briese was the only senator present who openly supported the initiative, saying that he signed it himself. But Briese said he views the ballot measure as a Plan B, and that Plan A should be a solution crafted within the Legislature.
Scheer did not comment on the ballot initiative.
The other senators agreed with Briese that a solution should come from an act of the Legislature.
“It’s going to take a lot of work on our end to do it,” Hansen said. “But we need different solutions and different options with lots of good debate.”
The ballot initiative must collect the required number of signatures by July 2020. The exact number of signatures needed isn’t known until the date the signatures are submitted, but it requires 10% of registered voters in the state, and at least 5% of voters across 38 counties.
Scheer also used the forum to voice frustration with the lack of participation in politics by voters throughout the state.
“When I was on the local school board, there was very little public input, and I don’t think that’s changed a lot,” Scheer said. “If indeed our property taxes are too high, look to the person to your left or right, because we are all the problem.
“It may not be convenient, but then you better run for a local office or a state office. Because things won’t change until you get people wanting to change. … I think there is a solution to all of this, but I think the solution is that each and every one of you has to become more involved.”