Senator Tom Brewer
43rd District
06-29-2018

I read in the paper where the Independent Cattlemen of Nebraska (ICON) and an Omaha Attorney, feel the property tax crisis in Nebraska should be solved through a lawsuit or a constitutional convention.

The lawsuit would argue the way we fund schools through local property taxes is unconstitutional as locally collected property taxes cannot be used for a “state purpose.” Article VII of the Nebraska constitution mandates “the legislature shall provide for the free instruction in the common schools.” The argument is using 60-70% locally collected property taxes to fund a state purpose (K-12 schools) is unconstitutional because you are doing it with local property taxes instead of state revenues.

There have been Nebraska Supreme Court cases that have established a “precedent” on exactly what the words “shall provide for the free instruction” actually mean. In plain English the court says they mean; “the legislature shall provide a bunch of laws that create local units of government, such as school districts, and then give them the power to levy and collect property taxes.” The court has held that the Legislature has more than “provided” that. Of course ordinary people think “shall provide” means shall “pay for” or shall “appropriate monies for,” etc. Sadly, that’s not what those words mean in the eyes of the law. Any lawsuit therefore would have to overturn this long-held court precedent. People have sued the State over this issue multiple times in the past and lost. To my knowledge this lawsuit hasn’t been filed, so I look forward to seeing how this new legal theory of property tax money being spent for a “state purpose” would fare in the court.

The Constitutional Convention they call for would first have to be a question put to the people on the ballot, either by the voters through the initiative and referendum process, or by the legislature. Once on the ballot, the voters would then have to decide if Nebraska should have a constitutional convention, or not. Nebraska has had Constitutional Conventions before. The legislature of 1917 passed such a measure and it was put on the ballot. The voters approved it in November of 1918 and the constitutional convention met in Lincoln in December of 1919 until March of 1920. In this convention, 41 new amendments to the constitution of 1875 were passed and all were ratified by the voters in a special election in September of that year. Given the recent failure of the Property Tax Ballot Initiative, I am curious to see what the organization is behind this effort. Clearly there isn’t enough time left to get this question on the 2018 ballot, so this idea will have to wait for the 2020 election at the earliest.

I’ve devoted my entire time in the legislature to the study of the property tax crisis in Nebraska. It is my #1 priority. I’ve brought a bill each session and initiated a call for a Special Session for “just” the property tax issue. Besides the scourge of Wind Energy in the Sandhills, and Public Power running roughshod over landowners in the district, I have spent little time on anything else. I will bring a bill to address it every session I am here until the problem is solved. I believe the root-cause of the problem must be addressed. I’ve seen numerous ideas that nibble at the edges of the problem, but don’t really solve it permanently. These aren’t bad ideas – I support everything that can lower property taxes – but the political reality is you can have all of nothing, or part of something. These ideas are not big, comprehensive things because they reflect the small, limited approaches senators think may be “likely” to pass in our very divided political environment.

Property taxes are too high in Nebraska because the Legislature doesn’t appropriate enough sales and income tax revenue to support K-12 schools. 48 other States spend more “state revenue” than we do. Nationally, about 40% of funding for K-12 is paid for with property taxes. Nebraska is 60%. In my district, there are schools that are over 70% funded with property taxes.

I think we need a solution that is as big as the problem. I will bring a bill next session that will be a proposed constitutional amendment that changes the language of Article VII and clarifies what “the legislature shall provide” actually means. Exclusive of bonded indebtedness that voters in a district may decide they want, I believe no more than 33% of the funding for K-12 education in Nebraska should be borne by property tax payers. The legislature has to pass this to get it on the ballot for the people to decide in an election. With this language in the constitution, the legislature will be forced to finally address the problem. In the meantime, I will continue working with other Senators, legislative working groups and citizen groups I am a part of to seek other paths to a solution.

Please contact my office with any comments, questions or concerns. Email me at; tbrewer@leg.ne.gov. Mail a letter to; Sen. Tom Brewer, Room #1202, P.O. Box 94604, Lincoln, NE 68509 or call us at (402) 471-2628.