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Thank you for visiting my website. It is an honor to represent the people of the 42nd legislative district in the Nebraska Unicameral Legislature.
You’ll find my contact information on the right side of this page, as well as a list of the bills I’ve introduced this session and the committees on which I serve. Please feel free to contact me and my staff about proposed legislation or any other issues you would like to address.
Sen. Mike Groene
Column 12-17-20: Policy vs. Politics in the Legislature
Sometimes one wonders if elected office is worth the time and stress. I have a passion for truth and honesty, I also advocate for open, transparent and accountable government, traits and beliefs that often do not mesh with political expediency.
Having been on the Education Committee for the past six years, the past four as the chairman, I thought I would look back at some of the highlights that may have warranted the time and headaches.
2015-16 biennium-session: Senator Sullivan was the Committee Chair; she, a registered Democrat and I a Republican, became allies on most issues. Committee Priority LB959 came out of committee with the minimum 5 votes needed. Besides other improvements to the school funding formula, we eliminated a provision that required schools to maintain a minimal tax levy in order to receive their income tax allotment, justifiably rewarding school boards who control their spending.
2017-18: My first term as Education Committee Chairman. Committee Priority LB512 was passed, it included a provision to limit early retirement bonuses given to school employees to $35,000; previously, bonuses over $100,000 were being seen. The Committee amended into the bill legislation introduced by progressive Senators Pansing Brooks, Wayne, Walz, and Morfeld, disproving any claims that as chairman I do not work with senators who may have different political philosophies. The Committee also advanced Pansing Brooks’ LB645 and 1052 to include dyslexia as a consideration for special education help.
In 2017 we helped Senator Linehan pull LB651 out of a locked 4-4 Committee to the legislative floor; it required schools to assess student reading skills annually through the third grade and, if found deficient, work with parents to create an individual reading improvement program. In 2018 the legislation was then amended into Committee Priority LB1081 by a 33-0 vote.
When Appropriations Committee Chairman Stinner requested the Education Committee cut state aid to schools to match the Appropriation Committee’s budget, we, unlike in the past, made sure all schools were treated equally with the enactment of LB409.
2019-20 biennium session: 35 bills came out of committee; 27 were advanced to General File, 7 were amended into other bills and one was brought out by pull motion. 19 of those were introduced by senators with progressive leanings and 16 by senators who would be considered conservatives. I fail to see any political bias in those numbers, and am proud of my work to try to keep the committee non-partisan.
Passing good legislation takes time, an example is Senator Slama’s LB399–the civics education legislation. The bill began in 2016 as an effort by then Senator Krist to require the civics portion of the United States naturalization test be a prerequisite to graduation. Over the next 3 years it evolved into a comprehensive redo of state statutes requiring that certain history, civics and social studies standards be taught and assessed in our public schools. In 2019 the Committee was finally able to get it over the finish line with the Governor’s signature on it.
With the support of associations representing school boards, school administrators and teachers we introduced LB147 as an effort to create comprehensive school employee training for behavioral awareness, de-escalation and intervention. A funding source was proposed through state lottery fund resources. We defined what is expected of school personnel when students or others are threatened with harm by an aggressor. We clarified legal and employment protections they had when it was necessary for them to do the right thing in their role as custodial caretakers of our children. Due to a locked 4-4 committee, the legislative body pulled the bill from committee, and this past year we fell one vote short of the necessary 33 votes to overcome a filibuster. The refined legislation will be back next year; as I said, good legislation takes time and sometimes extraordinary effort.
Presently, hardcore politics is ruling the day, and I may or may not be Chairman of the Education Committee next year. I prefer to be Chairman but in two years, when done with my stint in public service, my family, friends and foes will know I left with my principles and integrity intact.
Contact Senator Groene: firstname.lastname@example.org; 402-471-2729
The Facts on the Dustup Over my COVID Infection
Friday Oct. 23 I attended a special HHS committee meeting in Lincoln and returned the next Tuesday for an Education Committee hearing, staying the entire week to work on legislation. I was informed on Friday the 30th by the Director of HHS that two of the testifiers on the 23rd tested positive for COVID. That same day one of my staff texted me they were in quarantine because a close contact of theirs had tested positive. The following Monday I tested for the virus, Thursday I received a positive test result. I have recovered fully from minor flu-like symptoms. My HHS contact tracer agreed that with the timeline of my illness the most likely source was from my staff on the following Wednesday or Thursday after the Education hearing. Monday Nov. 9th the Chairman of the Executive Board informed me that rumors were rampant that I had COVID and was planning to come to the Legislative Summit that week.
To correct the rumors, I sent an email to my fellow senators explaining as best I could without involving others the details on my contracting the virus and to say I would not be attending the conference even though my quarantine was over.
The attacks on me originated from one statement I made, “I finally got my wish and contacted [sic] COVID…. As I suspected it would happen.” I based my preference to be done with COVID on CDC information. It became an issue when a senator who is antagonistic towards me Tweeted out my email to his followers and friends in the Lincoln press, making false accusations that I was irresponsible and knew I was infected when I attended the Education Committee hearing, I neither knew nor was I infected at that time. Hate emails from his followers ensued along with biased news articles.
I have based my response to COVID on CDC studies and statements.
–CDC stated from the beginning the need to slow down the infections in order to match hospital capacities and to allow time for new treatments to be developed. Social distancing was advised as the best precaution but when in close quarters a mask could give additional protection. I have emphasized social distancing. New treatments, including the recently released Bamlanivimab, have drastically reduced hospitalizations in proportion to infections. Evidence shows that infections have skyrocketed as more and more people have let their guards down when relying on unreliable masks.
–CDC’s and Fauci’s eventual goal is to reach herd immunity through natural infections in combination with the event of a vaccine. From historical virus outbreaks, I knew I would eventually come in contact with the virus and I was not at high risk for serious illness due to my strong immune system and having no serious underlying conditions. I did not pursue the virus; it found me and no other cases have been traced to me. By definition, all who have contracted the virus are now part of herd immunity.
–CDC Director Redfield repeatedly has referred to a 10 state study showing actual COVID cases are at least tenfold over the number of positive tests. Today that would be over 123 million, nearly 40% of the population, making the death rate .21% (not tenfold). Anecdotally from what I have heard from constituents I would agree with the CDC estimate.
–The vaccine will go first to healthcare workers, those who have comorbidities and older citizens–individuals who have an increased chance of serious illness when combined with COVID. Remaining citizens will have to rely on natural immunity or isolate until the vaccine is universally available later in 2021.
What I went through was a shaming; I was told I was selfish, irresponsible, and ignorant besides many other colorful terms. Why haven’t we heard from the millions who have successfully endured COVID and why have they avoided getting tested for COVID? My experience may explain it: they were either asymptomatic or out of fear of personal attacks and shaming from an ignorant mob who are told by Twitter, the internet and a biased press what to think in lieu of how to think. America is troubled!!!!
Contact Sen. Mike Groene: email@example.com or 402-471-2729
Examining the impact of COVID-19 on the education of Nebraska’s children
The Education Committee held a hearing on LR402 to examine the effect COVID-19 is having on families due to the disruption it is having on PK-12 Education and what approaches parents were using to keep their children’s education on track.
Consistently we have heard from the education establishment of their efforts to provide educational opportunities to students in an uncertain environment where local, state and federal government entities were recommending limiting personal contact between students and school employees. They have done all they could with the uncertainty of liability and unknown health effects hanging over their heads.
Yes, schools have had to adapt quickly to COVID-19, but as a shift has happened from classroom to in-home learning, it has been parents and children who have had to make the bigger adjustments. It’s great that technology has allowed for remote learning, but expecting a child to sit in front of a computer screen for six hours is expecting a lot. This makes it a necessity for a parent to be present at all times to fill in for the teacher and keep their child on task. Before COVID-19, a family had a routine of work and family life. Even when classroom learning resumes it can quickly be altered by quarantine requirements if a child has contact with a person that has tested positive for COVID or a school decides to have alternating schedules. Many parents who disagree with a school’s mask mandate have had no choice but to find an alternative education path for their children.
Parents who testified gave compelling reasons why we must return to in-classroom education and allow children to settle back into a routine. They implied that the non-personal, two-dimensional world of a computer screen can cause depression due to the isolated learning environment. Some parents have been faced with becoming single-income families as one parent stays home to homeschool their children or to supervise the distance learning available from the public school.
We learned there are options for parents. Nebraska allows parents to choose alternative educational paths for their kids. Some choose a homeschool option that is one-on-one with a parent; others choose a co-op or a learning pod where a few families get together and one parent does the teaching, they rotate the responsibility, or they pool their resources and hire an individual to teach the kids. More formally, some families approved to homeschool their kids enroll them in a more formalized alternative school like one of the four Acton Academies in Nebraska, where each child works to create and develop their own learning path.
Homeschooling comes at a cost, too. We heard from a mom that couldn’t afford formal curriculum and is grateful that her kids are young enough to learn from free resources available online. Parents with kids in middle or high school, though, need textbooks and supplies for science classes. Many of these parents need help.
Of course, there are many parents in the state that have typically chosen private or parochial schools for their families. We heard at the hearing that, unfortunately, those numbers are declining due to the pandemic, too. Scholarship fundraising is down and some families impacted by COVID-19 have had to tighten their belts forgoing tuition payments. Enrollment has dropped more than 10% overall in parochial schools with low income student enrollment being hit the hardest. North Platte’s St. Patrick’s school is down 16 students this year, but perhaps even more troubling is the kindergarten lost over 20% of its enrollment.
The impact on kindergarten enrollment is a pandemic phenomenon that is happening nationwide, and certainly across the state. Because kindergarten is not compulsory, some parents are keeping their young children in child care or at home another year to avoid their first experiences with school to be done under these circumstances. They can either enroll them in first grade or kindergarten next year.
We learned that in order to maximize education opportunity the legislature may need to look at ways to help parents financially and increase access by removing regulatory roadblocks. It is the responsibility of parents to educate their children, government’s mission is to facilitate it.
Contact Sen. Mike Groene: firstname.lastname@example.org or 402-471-2729.
Senator Groene’s opinions on the 2020 Constitutional Amendments and Initiative Measures
I have been asked for my opinion on the 6 ballot amendments and initiatives.
Amendment No.1; Striking from Article 1 Section 2 of the State Constitution the phrase “otherwise than for punishment of crime, whereof the party shall have been duly convicted.” It appears after the phrase “There shall be neither slavery nor involuntary servitude in this state”.
Our State Constitution actually mirrors the wording of the 13th Amendment to our US Constitution. Which states, “Neither slavery nor involuntary servitude, except as a punishment for crime whereof the party shall have been duly convicted, shall exist within the United States, or any place subject to their jurisdiction.” It was one of the last documents signed by President Lincoln before his assassination in 1865.
The noun “slavery” is the state of being under the control of someone where a person is forced to work for another. It does not always coincide with being a slave where one is the property of another.
Today when a judge gives a sentence of community service, making a young vandal clean up his graffiti, or when a convict is required to attend rehabilitation classes as a condition of release from confinement, both could be considered involuntary servitude or a form of slavery. If Amendment 1 passes, taxpayers may be forced to pay convicts a minimum wage to make their bed.
I now regret voting for Legislative Resolution 1CA. I got caught up in our present national atonement mood over an evil scar on the American conscience. Our State Constitution should not conflict with the US Constitution and this issue is not about the ownership of slaves but instead concerns the rehabilitation and punishment of individuals who have committed crimes against society.
Amendment No 2: Article VIII section 12 of the State Constitution, Tax Increment Financing. Include a new designation of extremely blighted and allow for a 20 year payback period in an extremely blighted area in lieu of the present 15 years limit for a standard TIF project. You may remember Senator Wayne and I had a knock down fight on the floor on this issue where he ended up putting filibuster motions on all of my bills as retribution. Undaunted, I continued to fight this vague expansion of TIF, but when Senator Wayne agreed to accept my amendment 1255, adding a definition of extremely blighted; “due to a high rate of unemployment combined with a high poverty rate as determined by law” I agreed to no longer fight the legislation. At the end of the day, Senator Wayne and I share the same passion to see TIF used properly as a tool to upgrade the older infrastructure of communities where many times poverty exists. He later helped enact my Micro-TIF legislation LB1021. Good government is not for the faint of heart, it is done in the fire of debate in the public eye. Unjust government can only happen in the backroom deals of those who play well together. I am voting yes on Amendment 2.
Initiative Measure 428: A change to our state statutes to limit payday loan interest to 36% and prohibit payday lenders from evading this rate cap. Presently, absorbent late fees and loan fees are often assessed to many of these loans. You can blame our federal government for this mess. Payday loans became common after the “Dodd/Frank” legislation passed in congress, prohibiting high interest rates on credit card applicants with bad credit ratings; it took credit access away from many. I am voting for the Initiative. My only fear is by eliminating credit access for some; we may see loan sharks on street corners. When there is demand the market will always fill the need.
Initiative Measure 429 to constitutionally permit casino gambling at racetracks and Measures 430 and 431 to enact it in our statutes: I do not see how they would improve the state’s social character nor do I see a net gain in tax receipts over the social cost to government. Those who have discretionary cash can afford to travel out of state to gamble. When gambling is local, the poor have access, therein lies the social cost. I am unwilling to be part of it.
Contact Sen. Mike Groene: email@example.com or 402-471-2729
The True Purpose of TIF
I have fought the misuse of tax increment financing (TIF) for over 20 years. We can argue about the definitions of substandard and blighted property all day long, but you will never convince me that an open field outside the city limits fits the purpose of TIF, defined in Article 8-12 of our State Constitution.
When going back and reading the debate points made by proponents of the 1978 TIF ballot initiative, it becomes clear that it was intended to help communities address the presence of individual older properties considered to be blighted and substandard because they are rundown, worn-out and their design no longer fits the expected living standards or business needs of today.
When I had asked local city officials why not use TIF to revitalize smaller individual projects in existing downtown and older residential areas, their reply was always, “to comply with existing state laws the legal and consulting costs were too high for smaller development projects to be practical.” I finally had to admit they were correct; the more the Legislature passed laws to reign in abuses of TIF, the related costs created to comply made compliance only affordable to large economic development projects that needed the open fields on the outskirts of town to build on. The over-regulations created a mini-industry of lawyers and consultants who peddle their costly TIF expertise to city leaders.
In response we came up with LB1021; officially known as an expedited review project, we like to call it Micro-TIF. In short, it makes TIF available to individuals by incentivizing them to fix up or replace an older home or business by exempting those projects from regulations that caused high legal, consulting and bond-financing cost, plus it removes the need to play any local political games.
LB1021 will become law on November 14. Local communities must first elect by resolution to allow expedited reviews. Second the city must create blighted and substandard areas encompassing the older parts of their communities, larger communities are limited to 35% of their area. Smaller towns can designate up to 100%. As a side note, cities the size of North Platte who is presently at 24.6%, wishing to utilize the benefits of LB1021 must now think twice before they annex and designate large tracts of bare land as blighted and substandard.
In preparation of LB1021 becoming law, we are now working with the State’s Economic Development and Revenue departments to create the required standardized, easy to understand individual application and county assessor forms. We are also creating a template for a promissory note for communities to use when incurring the necessary indebtedness required to access the increment property taxes needed to pay to the property owner for fulfilling their promise to improve the property.
If you are a present property owner or a building contractor and you wish to improve or replace a present building that is at least 60 years old, and the new value after improvements will be no more than $250,000 for a home, one million for a business property or $10 million for a building on the National Registry of Historic Places (the Pawnee Hotel for example) you can qualify for Micro-TIF.
Another benefit if you are looking for a new home, instead of considering a new TIF’d home where the property taxes you pay go to the developer, you might consider using Micro-TIF to remodel or build a replacement home in an older part of town where you will receive the direct property tax benefits. Unlike standard TIF projects where the tax increments are paid to the holder of the bond debt, Micro-TIF stays with the property owner.
The benefits of Micro-TIF as envisioned are many; it could be a boon for small businesses involved in construction or those who sell construction supplies. It is one answer to creating truly affordable workforce housing. It may also make owning a future Habitat for Humanity home or Lincoln County Community Development Corporation home affordable and it could help revitalize the business community in the old downtown areas.
How much MICRO-TIF is allowed to improve the outlook of a community will all depend on a community embracing the true purpose of TIF.
Contact Sen. Mike Groene: firstname.lastname@example.org or 402-471-2729.
We have just completed another local government budgeting cycle. Most of us dread the coming announcement of a new tax rate and the hit it brings to our personal budgets. Of course every year many of us already have received a notice of a property valuation increase, adding an even larger hit to our finances. In Lincoln County if you live in the country, this year you received a notice of an appreciable valuation increase for the acreage under your home. The change was dictated by the State Department of Revenue. The government rent (property taxes) in Nebraska for living on your own “God’s Little Acre” is regressive and a detriment to home ownership.
After six years in the legislature I now realize that long-term direct property tax relief will never be gained with the present dueling political philosophies of expanding government spending and that of the present practice of using property tax credits as a short-term placebo to appease the common man while still keeping the corporate world happy.
If we are ever going to make Nebraska an affordable place to live, there are three routes we can take: The Legislature can restrict access to property taxes by local governments and eliminate costly local government mandates and force consolidation of local government services. With the present super majority legislative process in place, the likelihood of that happening on a noticeable scale is minimal.
The second is the petition process where a simple majority of the voters can enact legislation.
The third way to control property taxes is the grassroots vigilance of the taxpayer. Run for office, vote for the candidate with the courage to say no to government spending or attend the meetings of local boards, especially their budget hearings.
This past biennium session the Legislature did enact two important budget hearing bills LB148 and LB103.
In LB148, budget hearings must now be held from a regularly scheduled meeting and it shall not be limited by time. At the hearing, copies of the budget must be available for citizens to examine, a presentation must be given to explain the budget changes and all citizens attending must be given the opportunity to speak. It mandates that all public meetings, not just the budget hearing, of larger government entities must be posted in a local newspaper. We needed to stop a new practice by some to post their meeting notices on their seldom read websites. We also added a clause specific to NCORPE, the joint entity created by four NRDs to manage the pumping of our Lincoln County ground water into a creek. It had come to our attention that NCORPE, who is responsible for the spending of millions of your tax-dollars, had gone without a published budget for over a two year period and after investigating we found out they were not required to hold a budget hearing. Now they do.
LB103 put clarity in government property tax asking. How many times have September headlines claimed your taxes weren’t raised because the levy remained the same or was even lowered slightly? Of course we knew they did raise our taxes by taking advantage of huge valuation increases. Once, after being told by a local politician that they did not raise my taxes because they did not raise the levy, I informed him that until I can pay my taxes in levies, I’ll continue to judge my tax burden in dollars. It is now required of local entities to start their budget process by lowering their levy in the budget to match the preceding years tax-asking. If they wish to spend more of your tax dollars, they must now hold a public meeting and take a vote on raising your tax burden by raising the levy.
You do not have to be well versed in a budget to attend a budget hearing, if one issue catches your eye, show up and give them your opinion. It may be an expansion of government run preschools, a jail expansion, the purchase of new vehicles or salary and benefit increases that dwarf what you have. Just show up!
Contact Sen. Mike Groene: email@example.com or 402-471-2729.
Today is Constitution Day. On August 29th 1956 President Eisenhower signed the below Proclamation 3151—creating the observance of Constitution Week.
“Whereas on September 17, 1787, after four months of debate, highlighted by sharp differences of view and by wise compromises, the outstanding leaders of our Republic, who were meeting in convention at Philadelphia, signed the Constitution of the United States of America; and
Whereas the story of the framing, signing, and adoption of that epochal document constitutes one of the most significant chapters in the history of our country; and
Whereas it is fitting that every American should reflect upon the vision and fortitude of our forebears in creating a charter designed “to form a more perfect Union, establish Justice, insure domestic Tranquility, provide for the common defense, promote the general Welfare, and secure the Blessings of Liberty” for themselves and for the fortunate millions who were to follow them as citizens of this Nation; and
Whereas the Congress, by a joint resolution approved August 2, 1956, has requested the President to set aside the week beginning September 17 of each year as Constitution Week, a time for the contemplation and commemoration of the historic acts which resulted in the formation of our Constitution:
Now, Therefore, I, Dwight D. Eisenhower, President of the United States of America, do hereby designate the period beginning September 17 and ending September 23, 1956, as Constitution Week; and I urge the people of the United States to observe that week with appropriate ceremonies and activities in their schools and churches, and in other suitable places. I also urge them at that time to give solemn and grateful thought to that eventful week in September 1787 when our Constitution was signed, delivered to the Continental Congress, and made known to the people of the country, thus laying the foundation for the birth of a new Nation.”
During the 2019 legislative session we passed LB399 to update sections 79-724 and 79-727of our state statutes concerning the duties of our public and private schools in instruction of American Civics; they shall conduct its activities, choose textbooks, and arrange its curriculum in such a way that the youth of our state have the opportunity to become competent, responsible, patriotic, and civil American citizens in the areas of our nation’s history, government, geography, and economic system. Included in LB399 was a dictate that in at least two of the three grades from the fifth grade to the eighth grade, students shall be instructed in a way that they will possess a deep understanding of and respect for both the Constitution of the United States and the Constitution of Nebraska. Constitution Day was also added as a required day in which appropriate patriotic exercises shall be conducted to celebrate the Holiday.
LB399 now requires schools to either give each student the naturalization test used by the United States Citizenship and Immigration Service prior to the completion of the eighth and twelfth grades or they must require students to attend a public meeting or complete a project or paper on a person or event on one the holidays that observance is required. As parents if you want to qualify the Civics education that your child is receiving, just have them complete the naturalization test; the results of their Civics education will become immediately evident.
It has been 223 years since 39 of the original 55 delegates, many of them veterans of the Revolutionary War, gathered to sign the Constitution and 219 years since an insistent James Madison pushed Congress and the states to add 10 amendments defining the rights of free individuals to the Constitution. It is in that vein of insistence and hard work that the “Daughters of the American Revolution” organization pushed for the study and teaching of the Constitution and drove Congress to create the observance of Constitution Week in 1955.
Today at 3pm “Bells Across America” will be ringing from churches and public buildings as we all pause and consider, not mine or your constitutional rights, but the blessings given us through the Constitution of the United States of America, protecting all of our God given rights.
Contact Sen. Mike Groene: firstname.lastname@example.org or 402-471-2729.
An opportunity lost: on long term property tax relief
After taking some time to mull over the events of the delayed COVID related legislative session, I am back to writing my column.
I will start with LB1107, the legislature’s attempt to address the two big issues that we faced: Nebraska’s regressively high property taxes and the demand by large corporations for income and sales tax relief in the guise of tax incentives. I had labeled the plan as the Grand Bargain early in the session and now much to my chagrin, the title has stuck.
After changes were made to LB1107, I eventually could live with its business incentive portion, titled the ImagineAct. Originally the bill had very little in it for rural Nebraska. We sat down with the bill’s sponsor and the State Chamber of Commerce; they agreed to add a rural manufacturing incentive tier for rural counties with less than 100,000 residents. It allows for lower thresholds for manufacturers with as few as five new employees and $1 million in investments to qualify for wage and investment credits. In rural Nebraska most of us wear blue jeans to work and if we’re going to grow, it will be in the area of manufacturing.
I did disagree with the inclusion, for the first time in Nebraska, of the use of your tax dollars for direct cash payments to attract or maintain business entities; $300 million commitment to the University of Nebraska Medical Center if they attract a federal surge capacity hospital, $40 million (over 10 years) to retain one large eastern Nebraska data collection company and up to $6 million in annual refundable tax-credits to companies involved in renewable chemical production. The reality was it was going to happen and as usual the money would flow downhill to eastern Nebraska. So in retrospect, why not a project in rural Nebraska too? With the help of Gary Person of Lincoln County’s Development Corporation we introduced AM3362 to create the Nebraska Rural Projects Act to assist with up to $10 million in matching state funds to build a railroad spur line off a main track to create an Industrial Rail Access Business Park. It was too late to get it included in LB1107, but it was well received in the body and I will pursue it next year as separate legislation.
What I could not support was the, ‘let’s throw money, rob Peter to pay Paul’ property tax relief plan in the bill. I absolutely will not support the Washington mentality of throwing money at a problem. That is exactly what creating another property tax credit is; the new credit would start at 5.5% rising to 12% of your school property taxes applied against your state income taxes. The total credits will be at least $125 million annually (for four years), eventually reaching $375 million in five years plus an inflation factor. Sounds like a lot of money but let’s put it in prospective. Over the last 5 years statewide property tax collections have increased $813 million to $4.378 billion; since LB1107 does nothing to control local government spending, it is reasonable to believe property taxes will continue to increase at the same rate. Meanwhile in five years the new property tax relief will amount only to $375 million. To take another view, the new credit will be shared by over 700,000 real-property owners who already pay $4.378 billion in property taxes, while at the same time corporations now paying approximately $325 million in income taxes will eventually be sharing $150 million in tax incentives, supposedly against newly created income and sales taxes.
LB1107 does not deliver long-term tax relief; I didn’t vote for its final passage, to have done so would have given the false impression it did. All tax dollars collected by government is spent. It has become clear to me; true property tax relief in Nebraska will only come from electing local officials who have the courage to control spending and the state stepping up its support for public education. Meanwhile, in my remaining time in the Legislature I will pursue tax relief through attempts to control the spending power of local governments.
Contact Sen. Mike Groene: email@example.com or 402-471-2729.
Property tax; Senators Briese and Groene agree!
As I prepared my column this week on the Revenue Committee’s property tax relief proposal, I kept coming back to a column written by Senator Briese that appeared in the Omaha World Herald earlier this week. Unable to improve on his work, he has given me permission to adapt his work to my thoughts and present the result as our update to you:
The Legislature’s Revenue Committee Advanced Legislative Bill 1106 with AM2870 to general file. It’ll lower valuations for all Nebraska property taxpayers, increase state aid to all school districts, limit property tax increases and reduce the property tax burden for all real property owners. Yet some of our friends in the education community object to it.
LB1106 will create foundation aid, a common sense and fair approach, guaranteeing state financial aid for every Nebraska public school student no matter where they attend a public school. Some equalized districts — districts that receive state support through the Tax Equity and Educational Opportunities Support Act (TEEOSA) — raise concerns over a shift away from equalization aid. But even after full implementation, foundation aid would comprise only roughly 50% of total state aid. The equalization component of TEEOSA would remain in place. At the end of the day, total state aid for the equalized districts would still hinge on the equalization formula.
Some in the education community are concerned the current proposal would lower basic allowable growth rate (BAGR) for districts from 2.5% to 2%, suggesting this impairs their ability to grow their budgets. But for the last 10 years, the legislature has adjusted the BAGR, causing an average budget authority increase of 1.48%. Even with those budget reductions, by utilizing a variety of exemptions to budget limitation, schools have on average increased their spending by a robust 3.5 to 4% annually.
We currently require the issuance of bonds for school construction to be preceded by a public vote. Large ag-land valuation increases have given a growing number of districts the ability to avoid this public vote requirement by levying taxes for a special building fund within their general fund levy, then using that fund for construction of new school buildings. Our proposal would simply require a public vote, reaffirming the expectations of the taxpayer to have a voice in the decision to build new school facilities.
Currently, schools can bank unused budget authority, which allows considerable leeway to exceed the existing budget limitation. Our proposal resets budget authority to 110% of the actual 2018-19 general fund expenditures, but then still allows schools to bank unused budget authority going forward.
Existing statutes provide a levy limitation for our taxing entities, including school districts. These levy limitations are an effort to protect the taxpayer. However, in many districts, the levy is far enough below the limit so as to make the limit ineffective. Our proposal would remedy this in year four by essentially limiting growth in property taxes to 2% annually, plus actual growth. At the same time, foundation aid is forecast to grow at 4.5% per year. Plus, if things go awry, a district maintains the option to call upon its voters to approve a levy override.
Some in the education community express concern that the property valuation reductions contained in our proposal will cause a reduction in overall district revenue for a handful of districts during the first three years. But it does appear that if spending increases in those districts are kept to an average of 2-3%, those issues are negated.
Others are simply concerned about assumptions as to actual valuation growth coupled with the proposed valuation reductions. But this is where the equalization formula provides a backstop. If resources fall, the equalization formula is designed to provide the aid necessary to match needs.
A few have expressed concern about elimination of what is perceived by many to be an unfair perk to a handful of districts, the averaging adjustment. But our proposal increases overall state dollars going to every district, more than replacing those averaging adjustment dollars.
Considerable compromise has gone into LB1106, and no one is getting everything they want. If future revenue projections go awry, we as a legislature can and will make adjustments. We do value public education.
Contact Sen. Mike Groene: firstname.lastname@example.org or 402-471-2729.