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Sen. Mike Groene

Sen. Mike Groene

District 42

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Tuesday’s Telegraph editorial on Tax Increment Financing (TIF) gave the wrong impression of my involvement surrounding the successful efforts to stop the advancement of LB 496 (add construction cost to TIF) and my views on local policy.

The editorial writer’s aggressive, opinionated language adds nothing to the local conversations on TIF.  Most citizens support TIF when properly used.  Community supporters begin to disagree when TIF is used solely for economic development by aiding private developers in areas where deteriorated conditions are not a factor. The original Pro Printing and the recent Hobby Lobby are good examples of projects where old infrastructure was replaced.

During debate with my friends Senators Stinner and Williams, my comments were directed towards support of the proper use of TIF, the State Auditor’s report, the misuse of TIF statewide, and on the true motives behind some who supported LB 496.

Point by point rebuttal:

–TIF’s 1978 addition to “Community Development Law” (Neb. Rev. Stat. 18-2101 to 18-2144) brought a specific tool to redevelopment for what was commonly referred to as urban renewal with the dictate that it could only be used where “blighted and substandard” conditions existed. The words “economic development” are not in CDL statutes. The Legislature’s intent assumed economic development happens, TIF exists to redirect that development to blighted and substandard areas.

–The words “blighted and substandard” are in Article VIII-12 of the State Constitution; it is wrong to imply those words could be removed by legislative action. Acknowledging the “and” used in TIF’s constitutional language instead of the “or” in CDL law is critical to understanding TIF’s purpose.

–“…undeveloped land?”: a 1998 State Supreme court case “Fitzke v. City of Hastings” ruled, “If a private development project is ineligible for TIF because it is located on land which is not blighted or substandard within the meaning of the CDL, it logically follows that eligibility could not be created by simply incorporating the project site into an adjacent area which has been declared blighted or substandard and revising the redevelopment plan for that area to include the project. Such a result would be contrary to the legislative intent underlying the CDL, which is to eliminate blighted and substandard URBAN areas through a cooperative effort of the public and private sectors: not to aid private developers.”  The court ruling has been ignored in recent years. Why? Because as the State Auditor pointed out, there is no State oversight of TIF use other than a citizen hiring a lawyer to sue in civil court.

–No claim has been made that cities can’t use public funds in a TIF redevelopment project.  What is understood by statute is that proceeds from TIF should be used to help offset those costs.

–TIF bonds in the past have been sold directly to the developer with above market interest rates. The practice’s legality has not been questioned, its ethics have.

–Concerning North Platte’s diversion of TIF dollars to an unrelated loan fund, the Auditor’s report did not cite related statutes pro or con. The legality of the practice will have to be decided by a court.

The one time I mentioned North Platte as a city was in praise.  “North Platte is doing fine. Property tax rates are going down. We slowed down TIF, but we are doing just fine, housing market is strong”.   My positive testimony gave the impression that Lincoln County residents respect the rule of law and do not believe the end justifies the means.

I understand that an editorial is the opinion of one individual with personal political views. It is obvious the writer of the Telegraph editorial would not vote for this Senator.  It is also obvious that if I had an opportunity, I would not vote for them, but I love political debate and I remain an avid reader of the Telegraph.

I told you when I knocked on your door that I would represent you, not the special interest who dismisses you as the “workforce”.  Decide for yourself, the transcripts of the debate will be posted to our legislative website early next week. Read and enjoy. Intimidated? I am not!

Please do not hesitate to contact our office, mgroene@leg.ne.gov or 402-471-2729, with any comments, questions or concerns

Sen. Mike Groene

District 42
Room #1107
P.O. Box 94604
Lincoln, NE 68509
Phone: (402) 471-2729
Email: mgroene@leg.ne.gov
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