With the Legislature out of session, it has been nice to spend more time in the District, but haven’t slowed down! Julie and I were able to attend the first night of the Miss Nebraska contest, which continues to be a major statewide event that is held each year in North Platte. I am so happy for Miss Nebraska 2023 Morgan Baird, who just completed two years of service as a page at the Nebraska Legislature. Given all the late nights as we ended the session, she had little time to prepare for the contest, yet her performance was flawless.

We also participated in some of the NebraskaLand Days activities, including the parade. Julie and I plan to attend as many of the upcoming parades as we can throughout District 42, as well as town hall meetings and other local events. Feedback from constituents is very important to me, and I look forward to having more time to see folks face-to-face.

Two weeks ago, we also had the opportunity to attend the 90^th Anniversary of Farm Foundation in Chicago. I was fortunate to be invited into membership over 10 years ago and have always enjoyed attending their semi-annual meetings. Farm Foundation is a policy research organization comprised of 150 members who are industry experts in the food system, including former Secretaries of Agriculture, large producers, processors, retailers, agricultural economists, and environmentalists. I was especially pleased to have been asked to lead a panel discussion at this meeting on the future of ag finance and business structures. As the capital required to operate profitable farms continues to rise, many producers will be looking to unlikely partnerships to access the capital needed to operate in the future.

Property taxes are a big component of the cost of running an agricultural operation, but they are a significant expense for any landowner. I continue to receive a lot of questions and complaints regarding recent property value increases, so I thought it might be good to review the process once again.

Property values are subject to review as of January 1 each year. A yellow card indicating the valuation change is sent to each property owner once a change is made. Valuations are based on a number of factors, including what the market value of your property might be and how similar properties have been valued. Currently, we are experiencing a shortage of homes and inflated construction costs. This means that the same home is selling for more than it would have even five years ago. Because the market is placing a higher value on properties, valuations are going up.

It is important to note, however, that a higher valuation does not alone indicate your property taxes will increase. Before your property tax can be determined, each local taxing authority must set its budgets (generally in October) and hold a public hearing before approving the budget. The State has no power to assess property taxes, which is why it is so important for people to know about and participate in the local budget process. You should receive another postcard in the mail alerting you to local budget hearings.

Once budgets are approved, the County Treasurer compiles all the tax requests for each taxing authority (County, City, School District, Ag Society, Airport Authority, Community College, etc.). The total requests and the property available to tax within each authority’s jurisdiction are used to determine what level the mill levy must be to generate the necessary taxes to fund all the local taxing authorities. The mill levy determines your property tax.

Again, the State only generates funding from income taxes, sales taxes, and fees. Since property taxes are assessed and collected at the local level, the Legislature cannot directly lower your property tax bill. However, the Legislature has tried to lower property taxes indirectly. First, the Legislature approved a significant increase in State aid to local school districts, which account for approximately half of your property tax bill. Our hope is that more State aid will reduce districts’ reliance on local property taxes.

Second, the Legislature provides property tax credits and rebates based on what you pay for support of local school districts and community colleges. Last year, that number amounted to 30% of the property taxes you paid to those entities.

Finally, the Legislature voted this year to begin funding the operation of community colleges at the state level, as it does with state colleges and the University system. Soon, property taxes for community colleges will only be assessed to pay off existing bonded indebtedness. Ongoing support will come from state support, tuition, and grants.

So, take a deep breath when reviewing your property valuation statements because it is only one piece of the puzzle. Although you may not have improved your property over the last few years, the market value has increased due to the cost of new housing and the short supply. It is good to have your value go up, but it is bad if that increase results in higher taxes. It is up to the local taxing authorities to determine how much the increase in property values affects your tax bill.

Please feel free to reach out to me at mjacobson@leg.ne.gov or 402-471-2729 about issues impacting you. My door is always open!