NEBRASKA LEGISLATURE

The official site of the Nebraska Unicameral Legislature

Mike Jacobson

Sen. Mike Jacobson

District 42

The content of these pages is developed and maintained by, and is the sole responsibility of, the individual senator's office and may not reflect the views of the Nebraska Legislature. Questions and comments about the content should be directed to the senator's office at mjacobson@leg.ne.gov

Welcome
February 24th, 2022

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.

Sincerely,
Sen. Mike Jacobson

I want to take this opportunity to congratulate Sherry Vinton who has been selected by Governor-Elect Pillen to become the next Director of Agriculture. Sherry is a great choice and, for the first time in many years, we will have a Director of Agriculture who has strong Sandhills roots and is an active rancher. This is great news for our state!

 

Just as Governor-Elect Pillen is preparing his administration, so are state Senators getting ready for the 2023 Legislative Session. The First Session of the 108th Nebraska Legislature will begin on January 4, 2023. I spent this past week attending new Senator Orientation and the annual Legislative Council meeting. The orientation was a great opportunity to meet all my new colleagues and get to know them on a more personal level. The Legislative Council meeting included all of the returning state Senators along with the newly elected Senators. The meeting was primarily focused on getting an update on some of the larger issues we will be facing once the session begins. Budget and tax issues will be based on the latest budget forecast from the most recent forecast estimates from the Tax Rate Review Committee. The numbers predict revenues will continue to outpace expectations and push the General Fund and the Cash Reserve Fund in excess of allowable balances. On the surface, this is a great problem to have, but it is critical we deplete the reserves in a responsible manner. The tax payer must be the first priority.

 

The General Fund is essentially the State’s checking account, while the Cash Reserve Fund is more akin to a savings account. The Cash Reserve is commonly referred to as the “rainy day fund” and is statutorily limited to a balance of no more than $1 billion. The latest forecast – should it prove to be accurate – predicts a balance of $2.3 billion. What caused the fund to grow to this level over the past two years? And more importantly, what can we expect the fund to do in the future?

 

We can thank post-COVID spending for the boost in State revenues. Federal pandemic relief dollars and the PPP loans that were ultimately forgiven, created a huge economic boost to all states and resulted in unprecedented increases in tax receipts. However, this will not be case in the coming biennium. The rapid rise in inflation has caused the Federal Reserve to significantly raise the Federal Funds rate in order to slow the economy. Many expect the economy will go into a recession in the near future. The severity of the recession is unknown at this time, but either way, reduced tax revenues will be the likely result.

 

Even with the uncertainty of future tax collections, we need to focus on fixing the school funding formula to help bring further reductions in property taxes. This will likely be a priority in Governor-Elect Pillen’s budget and is certainly a focus of many Senators. In addition to new property tax relief, I will be focused on protecting the existing income tax credits and the elimination of the Social Security tax codified in LB873 last session.

 

As for reducing our General Fund and Cash Reserve Fund, the Legislature should look for one-time spends as it did with American Rescue Plan Act (ARPA) dollars, rather than creating new programs that will have an ongoing fiscal note. We may also need to re-allocate ARPA dollars from any projects that were determined not to qualify for their initial allocations. One project I would like to secure funding for in District 42 is rebuilding the 4-H Camp near Halsey that was lost in the Bovee Fire. I am working closely with Senator Brewer, the University of Nebraska, and the 4-H Foundation to determine the vision and scope of the rebuilding project and develop a funding strategy. I made it clear in my campaign that bringing more investment back to District 42 was a priority of mine, and keeping existing assets in our District is step one.

 

I am putting the finishing touches on several bills that I intend to introduce when the next session begins. All bills must be introduced in the first 10 days of the session. If you have ideas for legislation, please reach out to me or my staff at mjacobson@leg.ne.gov or 402-471-2729. My door is always open!

I am honored to continue my service as your State Senator and want to take a moment to thank everyone who assisted me with the campaign. I would also like to extend a special thank you to my wife, Julie. Running for office is a decision with a significant impact on one’s spouse. Julie was a steadfast supporter and went above and beyond to support the campaign.

Now that the election is over, Senators are preparing for the 2023 session in earnest. This week, I will be attending orientation for new Senators in Lincoln. Even though I am technically a returning Senator, I asked to be included to ensure I am fully prepared for next session. I am also looking forward to getting to know all of my new colleagues. Later in the week, the Legislative Council will hold its annual meeting in Nebraska City. Senators will discuss current issues and start the process of establishing the Committee on Committees, which determines committee membership.

The Unicameral has 14 standing committees that meet regularly, as well as several special and select committees. All legislative bills are afforded a public hearing. After a bill is introduced, it is referred to the standing committee with jurisdiction over the bill’s topic, and standing committees meet in the afternoons throughout the first several weeks of the session in order to hold bill hearings. After the end of bill hearings, committees only meet periodically for supplemental hearings or in an executive session to consider advancing bills for consideration by the whole Legislature.

Committees have approximately seven to nine members and always have representation from each of Nebraska’s three congressional districts. With the exception of the Appropriation Committee, which meets five days a week, standing committees meet either one, two, or three days a week on regular days. For example, the General Affairs Committee meets on Mondays, while the Judiciary Committee meets Wednesdays, Thursdays, and Fridays. Senators’ committee assignments are organized so that they have a standing committee meeting five days a week during the bill hearing period, which means they can serve on one or several committees.

As a general rule, returning members can choose to remain on their existing committees. New Senators are assigned to open spots based on their interests, and the committees’ need to have fair congressional district representation. When I was appointed, I assumed Sen. Groene’s standing committee assignments: Agriculture, Natural Resources, and General Affairs. There are several Senators from the Third District, including myself, who are interested in serving on the Transportation and Telecommunications Committee. If there are not enough spots, I would be interested in staying on the General Affairs Committee. I have also expressed a desire to serve on the Revenue Committee, given the number of District 42 constituents who are concerned about Nebraska’s tax system. In the end, it is my goal to make a positive impact on District 42 regardless of my committee assignments.

In addition to thinking about committee assignments, I have also been working with my staff on bill drafting. We are in the process of finalizing micro-TIF legislation, and I plan to co-sponsor a bill requiring two-person crews on trains. There are several other issues that I am exploring as well that may become legislative bills.

Finally, Julie and I attended an information meeting on November 6 in Dunning to discuss the damage to the State 4-H Camp and Nebraska National Forest from the Bovee Fire. The Nebraska National Forest is one of the largest man-made forests in the world, and thousands of youth and families have visited the State 4-H Camp since it opened in 1959. University of Nebraska officials reassured us that 4-H camps would still be held in 2023 in other parts of the state; however, the decision about whether to rebuild the camp had not yet been made. I expressed my desire to see the camp rebuilt and am ready to assist with obtaining funding support from the Legislature, if necessary. It would be a tragedy to allow this state treasure, which has exposed many to the beauty of Nebraska’s Sandhills, to go away.

If you would like to discuss an issue impacting you or you have ideas for legislation, please feel free to reach out to me at mjacobson@leg.ne.gov or 402-471-2729. My door is always open!

As Veterans’ Day approaches, I want to take an opportunity to highlight this critical but often neglected section of our population. Both my father and father-in-law served in the U.S. military in World War II and the Korean War, respectively. They were immensely proud of their service to our country. Today, there are approximately 16.5 million veterans in the U.S., a majority of whom are of the Vietnam War era and are men over the age of 75.

Because the bulk of our veterans are aging and the 2.5 million post-9/11 military veterans make up less than 1% of the population, it may be easier for younger generations to overlook the needs of our veterans. Furthermore, in the era of 24-hour news cycles and social media, it is easy for events like Russia’s invasion of Ukraine to fade into the background. However, threats to our democratic principles, fundamental freedoms, and continued safety are ever-present. Our men and women in uniform are our first line of defense.

The military’s people and physical assets contribute significantly to Nebraska’s economy. Nebraska hosts over 100,000 veterans, as well as thousands of active duty and reserve military personnel. Offutt Air Force Base is the headquarters of the U.S. Strategic Command and the U.S. Air Force’s 557th Weather Wing and 55th Wing of the Air Combat Command.

The Nebraska Legislature continues to look for ways to welcome our military members and their families. In 2022, I voted to pass bills that reduced regulatory barriers so military spouses can transfer occupational licensing easily, increased access to State Tuition Assistance for members of the Nebraska National Guard, and appropriated funds for important improvements at Offutt.

In addition to passing laws that directly benefit our local military, the Unicameral also provides indirect support to military personnel and veterans. For example, support of behavioral health services, Veterans Treatment Courts, local healthcare and retirement facilities, job training and education, and much more help ensure our military and veterans have access to the services and opportunities they need to thrive in Nebraska.

Thank you to all of our service members and their families for the sacrifices they have made on behalf of our country. I hope everyone takes a moment on November 11 to celebrate our veterans and consider the ways our military works every day to preserve our way of life.

If you have ideas for how the Legislature can support veterans and the military or would like to any other issues impacting you, please feel free to reach out to me at mjacobson@leg.ne.gov or 402-471-2729. My door is always open!

This past Friday, I joined Governor Ricketts for the ribbon cutting for the newly constructed Army National Guard Vehicle Maintenance shop on east Highway 30 along the western boundary of the North Platte Airport. Not only does the National Guard support our active military, but it also plays a significant role in helping to deal with disasters, such as the 2019 floods and the COVID-19 pandemic. We are fortunate to have a strong National Guard that is well-trained and ready at a moment’s notice.

The new facility at Lee Bird Field replaces the Field Maintenance Shop built in 1955 on North Highway 83. The original facility was designed to support jeeps and 5-ton trucks. The new facility is a result of a $9.6 million investment by the federal government and will support 60 over-the-road 18-wheel trucks and Humvees, as well as serve as a regional hub. It is truly a state-of-the-art building comprised of 24,800 square feet, four times larger than the original facility. It will serve the Nebraska Army National Guard well into the future. I am also excited that the 41-acre site is well-positioned for future expansion. A facility like this is an asset to the entire legislative district.

As the former chairman of the North Platte Airport Authority, my colleagues and I began negotiating to lease this land to the Guard nearly five years ago. Like many large projects, planning starts well in advance of completion. This project could well be the beginning of other significant growth now that the airport has been annexed into the City of North Platte and construction of Sustainable Beef has begun. The combined impact of Sustainable Beef and the Hershey Rail Park will create many job opportunities and will result in significant secondary development as the support businesses begin to locate in the area as well. Having a nearly 9,000-foot runway will also make development at Lee Bird Field likely.

Airport expansion will also be more likely if the voters approve Proposed Constitutional Amendment No. 1 in the November 8 election. This amendment would allow political subdivisions that own or operate an airport to use its revenue to recruit new or expanded regularly scheduled commercial passenger air service. Reliable passenger air service is an important tool for attracting businesses and residents to our region. I support the passage of this amendment, and I encourage you to do the same.

I continue to pursue solutions like Proposed Constitutional Amendment No. 1 to benefit District 42. This week, I worked with the Governor’s office to increase access to hay from South Dakota for ranchers whose access has been complicated by the fire damage in Thomas County. Please reach out if you would like more information.

Thank you again to all of our rural volunteer firefighters and first responders. This past year has been one for the record books, and it is still not over. I was very pleased to vote for LB717 to increase State compensation to fallen firefighters, first responders, and law enforcement officers who lose their lives in the line of duty from $50,000 to $250,000 (and indexed for inflation). Although no amount of money can replace a life, helping to ease the financial burden is an investment that Nebraska needs to make.

If you would like to discuss hay access, first responders, or any other issues impacting you, please feel free to reach out to me at mjacobson@leg.ne.gov or 402-471-2729. My door is always open!

As many of you know, the borders of District 42 were expanded beyond Lincoln County during the 2020 redistricting. Outmigration of population from Lincoln County over the last decade accounts for the change. Now, District 42 also includes McPherson, Hooker, Thomas, Logan, and the majority of Perkins County. Fortunately, I am very familiar with these counties and continue to actively engage with constituents throughout the District to learn about their needs.

I remain laser-focused on finding ways to grow District 42. A key component to retaining and recruiting population will be continuing to improve services within all areas of the District. One common thing throughout the newly expanded district is that there are many villages and unincorporated communities, as well as individual farms and ranches. It is often harder to make a “business case” for private investment when the population is low. In these situations, the State must find efficient ways to incentivize or, if necessary, subsidize investment.

For example, smalltown and rural Nebraska depends heavily on volunteer firefighters and paramedics to provide emergency services. This past year was particularly busy for our Rural Volunteer Fire Departments. Dry and windy conditions have resulted in many wildfires both inside and outside District 42. Our District 42 crews were also called upon to provide mutual aid for the very large fires. We are fortunate to have men and women willing to put their lives on the line to protect others.

Rural emergency services receive a small portion of county property taxes, but these funds are not always sufficient to cover significant one-time expenses. We must do all we can to not only provide training for our volunteer first responders but also ensure they have the necessary equipment. To this end, I have been working with two villages in the District that need a new ambulance. I have encouraged them to apply for available grant funds, which provide an opportunity to improve their equipment without increasing local property taxes. In addition, I will continue to support mobile training programs, like Simulation in Motion, which provide educational opportunities where the volunteers are. These programs decrease the training burden on rural volunteers by reducing their travel obligations.

Another area where state government can help is connectivity. Next session, I will continue to ensure that available funding for connectivity infrastructure reaches District 42. Although progress has been made in building out broadband, there is more to do. Technology continues to outpace our ability to build out the infrastructure. As labor remains tight, farmers must rely more heavily on technology to manage their operations.

We also have a huge need for improving mobile coverage. It is literally impossible to drive from North Platte to Mullen on Highway 97 without losing cell phone coverage. The drive on Highway 83 between North Platte to Thedford encounters the same problems. Not only do those living and traveling in these areas need connectivity to work and socialize, but mobile service is critical for public safety.

Although I would prefer the federal government would slow its spending, the pandemic response and infrastructure funds being sent to the states will be spent by someone. If we are on the hook for the bill, we need to get all the value we can from Nebraska’s share of the funding. The Legislature was careful to make sure that American Rescue Plan Act (ARPA) funds were only going for “one-time” spending projects such as deferred maintenance, necessary infrastructure, and transformative developments. As we now consider how to invest funds from the Broadband Equity, Access, and Deployment (BEAD) Program, I will be there to remind my fellow Senators about the needs of our villages, unincorporated communities, and more isolated farms and ranches.

If you have identified needed support for other critical services or want to discuss any other issue impacting you, please feel free to reach out to me at mjacobson@leg.ne.gov or 402-471-2729. My door is always open!

The 2022 Election is a big one for Nebraska. In just a few short weeks, Nebraskans will elect a new Governor and Lieutenant Governor, at least 15 new State Senators, and countless other civil servants to state, regional, county, and local offices. At the national level, control of both the House of Representatives and Senate is at stake, as well as leadership in many other states.

This time of year, there is always much discussion of election security, going all the way back to Florida’s “hanging chads” in the 2000 election and beyond. Nebraska is fortunate to avoid many of the problems we hear about in other states thanks to protections implemented by the Nebraska Secretary of State and the Legislature.

Nebraskans cast their vote on paper ballots. Even voting machines available for those with accessibility issues merely create a paper ballot. Ballots are then counted by machines that are not, and cannot be, connected to the Internet. Every counting machine is tested three times before each election, including a mock election to verify the accuracy of the ballot total. And, even though machine voting is more accurate than hand-counting, Nebraska selects a portion of precincts to have its machine count verified with a hand count. Once ballots are counted and tabulated, only then is election result information transferred to an Internet-enabled device for publication via a secure, encrypted USB device.

Nebraska voters should have peace of mind knowing that their vote will count, every time.

Other Nebraska policies also help ensure election security. Voters may not register on election day. By having Nebraskans register in advance, our election officials have time to verify the accuracy of voter registration information, as well as anticipate the number of voters, ballots, and precinct workers that will be needed. That said, there is still time to register if you would like to vote in the General Election! Mail-in registration must be postmarked by October 21 and in-person registration is open until October 28.

Once registered, it is time to cast your ballot. Many people still like to vote in person on election day. Polls are open for 12 hours starting at 8:00 a.m. Central or 7:00 a.m. Mountain Time. However, early and mail-in voting is also available for those who cannot make it to the polls on November 8. You can cast your vote in-person at your county election office now through November 7. Ballots can also be submitted via mail. In most Nebraska counties, ballots are not mailed to all registered voters. Instead, you must request a ballot be sent to you. October 28 is the last day a request for a mail-in ballot can be received. All early ballots must be submitted by the close of polls on November 8.

Who you elect really does affect you. Local officials set your property tax rates, including funding for schools, roads, emergency services, and levies for entities like natural resources districts. State officials determine income and sales tax rates and consider policies to ensure Nebraskans’ health, safety, security, and constitutional rights are protected.

In addition to local initiatives, all Nebraskans will consider two ballot initiatives this year. One would change the Nebraska Constitution to require a voter to show a valid photographic identification prior to casting a ballot. The other initiative would phase-in an increase to the state minimum wage from $9.00 to $15.00 by 2026 and cost-of-living increases in later years.

Finally, I was part of a bi-partisan coalition in the Legislature that proposed an additional change to Nebraska’s Constitution. If approved by the voters, LR283CA would to allow cities, counties, and other political subdivisions who own or operate an airport to use its revenue to develop or expand commercial passenger air service. This change could expand flight offerings at our larger hubs in Omaha and Lincoln, as well as smaller regional airports like the one in North Platte.

More voting information, including sample ballots, is available on the Nebraska Secretary of State’s website at: https://sos.nebraska.gov/elections/2022-elections. Thank you to all of my fellow Nebraskans who have put forth their names to serve our great state by seeking elected office.

If you want to discuss election security, this year’s ballot questions, or any other issues impacting you, please feel free to reach out to me at mjacobson@leg.ne.gov or 402-471-2729. My door is always open!

Last week, we were all saddened by the news of the Bovee Fire near Halsey, NE. The fire destroyed about 19,000 acres of forest and grassland in and around the Nebraska National Forest. In addition to the damage of the forest and grassland, the Bovee Fire also devastated the nearly 60-year-old Nebraska State 4-H Campground. Sixteen of the seventeen buildings were destroyed, with only the staff house remaining intact. Thousands of Nebraskans, including my wife and children, have fond memories of this amazing facility having either stayed there as a 4-H camper, Rotary Youth Leadership Awards camper, or someone who attended a wedding reception or conference held in that facility.

Last Wednesday, I was able to see the damage first-hand and receiving a briefing with other local officials. It was an emotional event for all those present to see the damage. I have also been in touch with the leaders of the Nebraska 4-H Foundation to determine the amount of the loss and their next steps. Although the Nebraska State 4-H Campground buildings were insured, it’s unlikely insurance payments will cover total replacement of the facility given the age of the buildings. As your District 42 State Senator, I will work with the Foundation and other volunteers to help find the additional funding to replace this State treasure.

Julie and I also made the drive to Dunning, NE on Friday to attend the funeral of Mike Moody. A long-time assistant fire chief and businessman, Mike lost his life while working to contain the Bovee Fire. I had the opportunity to meet Mike several years ago when he was working as a loan officer at the Purdum State Bank. He was a truly giving individual who enjoyed living life and serving others. He was a great role model for all of us to follow.

Mike’s funeral was held in the Sandhills High gymnasium and still required many to stand. Firefighters, first responders, paramedics, and law enforcement officials were there from the entire region. It was an amazing tribute to the heroism of Mike and every other firefighter. I want to express my condolences to his wife Cheryl, daughter Hollie, son Jack, and stepsons Jeff Pflaster and Jared Pflaster and their families. Mike was a person who made a difference and will be truly missed.

With the dry conditions throughout the region this year, rural volunteer fire departments have been going virtually non-stop to protect the lives and property of our residents. It often goes unnoticed that these courageous people volunteer their time to get training, are on call at a moment’s notice, often drive personal vehicles to the station or fire, all to put their lives on the line to protect us. Mike’s family has requested that memorials be directed to the Purdum Rural Fire or Thedford Volunteer Rescue Squad. I encourage everyone to make a contribution, if you are able.

I look forward to hearing from constituents about issues impacting you. Please feel free to reach out to me at mjacobson@leg.ne.gov or 402-471-2729.

Water is the lifeblood of rural Nebraska. Not only do we need clean drinking water for our communities, farms, and ranches, but water is essential for the crop and animal production that drives so much of our economy.

Unfortunately, it is not as simple as preserving the water resources located in our state. River flows require Nebraska to manage water in partnership with up- and down-stream states like Colorado and Kansas. Many are probably most familiar with the Republican River Compact, which requires careful water-use management in southwest Nebraska. This management requires expenditures by area ag producers, including costs to complete the N-CORP project.

More recently in the spotlight is the South Platte River Compact, an agreement entered into by Nebraska and Colorado in 1923 and consented to by Congress in 1926. The compact establishes two minimum flows of water coming from Colorado into Nebraska’s Western Irrigation District in the South Platte River Basin. During irrigation season (April 15 to October 1), a minimum flow of 120 cubic feet per second (cfs) is required. One cfs is equivalent to 448.8 gallons of water flowing per minute. The compact also establishes a 500 cfs minimum flow during the non-irrigation season into the Perkins County Canal (which has never been built).

This past week, I had the opportunity to join eight of my legislative colleagues on a tour of the proposed Perkins County Canal site. I was especially encouraged that three were urban senators who wanted to see firsthand why this project is so critical. It will take urban and rural Senators working together when the time comes to fund this project.

When the Compact was signed, there was no deep-well irrigation and the front range of Colorado was much less developed. Today, the water demand in Colorado had increased significantly and the flow of water in the South Platte River has diminished to levels well below Compact compliance. Further, the development in Colorado is accelerating to the point that summer flows from the South Platte River could stop entirely in dry years.

Colorado is planning for its future as its population grows. There are plans for approximately 300 projects and over $10 billion in expenditures to ensure no “excess” water leaves Colorado. These plans would cause a nearly 90% reduction in flows coming into Nebraska along the South Platte. Already this year, a large portion of the water users within the Western Irrigation District were unable to obtain adequate water flows for irrigation, thanks to the reduced water flows from Colorado. Additional reductions could also impact downstream irrigation and drinking water access.

Colorado is out of compliance with the Compact. They are allowing junior water users to access water that should be flowing into Nebraska. However, Colorado has taken the position that unless and until the Perkins County Canal Project is built, they have no obligation to supply the winter flows of 500 cfs.

If the Perkins County Canal Project were built, it would begin near Ovid, CO, where the official meter is located. It would then stretch south of the South Platte River in Keith County and ultimately deliver water back in to the South Platte River. The Project would also likely include mechanisms for holding winter-time flows until the water could be released in the summer to augment the South Platte River water flows and help supply the water needs for Lake McConaughy, hydropower and power plant cooling, environmental flows, agricultural use, and ultimately municipal supplies for Lincoln and Omaha. It is estimated that the amount of water stored and released from the Project could fully replace the current summer irrigation water released from Lake McConaughy today.

Project costs are estimated at nearly $500 million. This year, I voted to authorize a $53.5 million expenditure to complete a feasibility study and obtain land “options” to ultimately purchase the land necessary to construct the Canal and water-holding structures. Although this will be a multi-year project, delays will only empower Colorado to continue approving new water-use projects that decrease Nebraskans’ access to the South Platte water supply.

If you would like to learn more about the South Platte River Compact and the Perkins County Canal, I encourage you to check out the Nebraska Department of Natural Resources’ website at https://dnr.nebraska.gov/perkins-county-canal.

As your State Senator, I will continue to fight to make certain that we do not lose critical access to water in the South Platte River merely by failing to act to claim our rights to this precious water from Colorado. The economic and personal impact is huge and we must act now.

If you’d like to discuss water rights or any other issue, please feel free to reach out to me at mjacobson@leg.ne.gov or 402-471-2729. My door is always open!

What’s with the pink card that I got in the mail titled, “NOTICE OF PROPOSED TAX INCREASE”?

If you have received a large pink card in the mail recently, your taxes might be going up. Under recent “Truth in Taxation” legislation, a political subdivision (city, county, school district, community college) whose proposed budget exceeds the 2% growth rate plus the political subdivision’s real growth percentage must notify taxpayers on a postcard and hold a mandatory joint hearing explaining why they are increasing your taxes. The cards will outline the 2022 tax assessed value of your property compared to the 2021 value and estimate changes in your property tax based on the new valuation and the “old” mill levy. It is shown as an estimate because the new mill levy will not be set until all taxing authorities have approved their budgets.

The joint hearings are your opportunity to voice your opinion of the political subdivision and their proposed budget. Political subdivisions will not finalize their budgets until after these hearings. Once budgets are approved, then the new consolidated mill levy will be set and the actual tax bill will be determined.

As I mentioned in prior columns, property taxes are only levied by local political subdivisions. The State has no ability to levy a property tax. So, controlling property taxes means holding the line at the local level. The Legislature does, however, have some ability to indirectly reduce property taxes in a couple ways.

First, the Legislature must avoid imposing any “unfunded mandates” on local political subdivisions, whose implementation would need to be paid for with local property taxes. Second, the Legislature can make changes in the TEEOSA formula which distributes funds to local school districts. The formula is based on each district’s “needs” as determined by the number of students and other factors, and is also based on “resources,” meaning the value of the property in the school district. As a result, the formula is designed to distribute more funds to the larger cities and forces the rural areas of the state that have large agricultural land bases to pay their own way. Many of the school districts in District 42 are considered “equalized,” which means they get no funding from TEEOSA. This is unfair and simply wrong!

The third thing the Legislature can do is return your money to you through other state tax mechanisms. This year, I was pleased to support the greatest property tax benefit afforded to Nebraska property tax payers in history. In addition to reducing the highest income tax rate and eliminating the tax on Social Security and military retirement, LB873 significantly increased the amount of income tax credit available based on property taxes paid to fund public schools and community colleges.

The LB873 tax credits will ramp up over the next few years. In the 2020 tax year, the state income tax credit was approximately 6% of the amount paid to fund your local school district. In the 2021 tax year, this amount grew to 25% of the amount you paid toward your local public school district. For the 2022 tax year, you will receive approximately a 30% income tax rebate of the property taxes you paid for your local school district and your local community college.

The income tax credit is paid regardless of your state income tax bill; however, you are required to apply for the credit to receive the refund. If you did not apply for the credit when you filed your 2021 income tax return, it is not too late! Simply complete the form available on the Department of Revenue’s website: https://revenue.nebraska.gov/about/nebraska-property-tax-credit

I encourage all property owners in District 42 to apply for the income tax credit, and attend public budget hearings held by your local political subdivisions. Political subdivisions want your input on how they can best serve you.

If you’d like to discuss taxes or any other issue, please feel free to reach out to me at mjacobson@leg.ne.gov or 402-471-2729. My door is always open!

Now that fall has arrived, the attention of ag producers has turned to harvest.

Ranchers have completed their hay harvest and are preparing for the winter-feeding season once the grazing season comes to a close. The areas of the Sandhills that got some good rainfall this summer should have enough hay production to allow those ranchers to meet their needs this winter and hopefully build their hay supplies for future years when rain is not as plentiful. Unfortunately, many did not receive necessary rainfall and may need to cull some of their cow herd to make available hay and grass supplies stretch if they are not able to find additional hay supplies.

Meanwhile, the crop farmers in the southern half of District 42 prepare to harvest fall crops. For many farmers, the fall harvest will be much shorter than normal as severe drought crippled production on non-irrigated acres. Even those receiving some rain may experience low yields in their fields and be required to harvest the limited bushels produced. In many cases, the cost of harvest will exceed the economic value of the crop. Although most carry Federal Crop Insurance to protect against crop failures, no producer wants to earn their revenue this way. Further, the Federal Crop Insurance Program pays claims based on a producer’s 10-year average and fields with no or low yield will negatively impact future averages and thus reduce the future safety net.

Both ranchers and farmers in District 42 are facing a delicate economic situation with many moving variables. On one hand, calf prices are near record levels. Corn prices are also high, which is good for the farmers who have corn to sell. However, low hay yields and high corn prices mean the cost to background calves and ultimately bring them to finish weights will cost much more than previous years. Likewise, farmers face high production costs as fertilizer, seed, and energy costs rise. Within the larger economy, labor is still in short supply and supply chains continue to be slow to return to pre-pandemic efficiencies. Inflation continues to strain the wallet of everyday Americans and the ability of cattle and crop prices to stay high will depend on the degree to which the consumer is willing (and able) to pay more at the grocery store. This will, of course, depend upon the economy avoiding a deep recession.

The stage is set for tougher years ahead. Everyone in agriculture will need to prepare for leaner times ahead and manage their finances accordingly. We have seen this scenario play out too many times in the past.

Unfortunately, the Nebraska Legislature has little control over the variables mentioned above. However, one input the Unicameral can help reduce is the burden of how land is taxed. Ranching and farming both demand producers utilize a tremendous amount of real estate. Far too many of my colleagues do not recognize that the tremendous capital investment and risks that farmers and ranchers take on. And, unlike many industries, significant capital investment does not always translate to profits.

The amount of land for even a modest ag operation is large and in an inflationary environment, ag producers are seeing non-producers push up land values as they search for “safe places” to invest funds. Although land values may rise, ag producers will only realize the gain in value if they are ready to sell. The public needs to remember that these farms and ranches work more like “factories” that allow the producer to grow their crops and livestock. Unfortunately, higher land values lead to higher property taxes, even if profitability stays level or falls. Many homeowners experience the same situation. They bought the home to live in, not to sell. Homeowners, especially seniors living on fixed incomes, see their property taxes rise simply because the home they live in went up in value, yet they have no additional income to make up the difference. Some are ultimately forced to sell the home because they cannot afford the higher tax bill.

Although the Legislature was able to pass LB873 this past session to provide the largest tax relief package in state history, we still need to do more if we want to make Nebraska’s tax structure fairer and more affordable. I will continue to focus on educating my colleagues on how property taxes affect Nebraskans and help provide solutions to improving our tax system.

If you’d like to discuss this or any other issue, please feel free to reach out to me at mjacobson@leg.ne.gov or 402-471-2729. My door is always open!

Sen. Mike Jacobson

District 42
Room 1302
P.O. Box 94604
Lincoln, NE 68509
(402) 471-2729
Email: mjacobson@leg.ne.gov
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