Nebraska Legislature Ends Session with Unfinished Business on Property Tax Relief

Nebraska lawmakers fail to pass property tax relief bill, prompting Governor Pillen to call a special session to address the crisis.

Bijay Laxmi
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Nebraska Legislature Ends Session with Unfinished Business on Property Tax Relief

Nebraska Legislature Ends Session with Unfinished Business on Property Tax Relief | Credit: Zach Wendling/Nebraska Examiner

The Nebraska Legislature ended its 60-day session on Thursday, April 18, 2024, with several key bills passed but leaving the issue of property tax relief unresolved. Governor Jim Pillen criticized the Legislature's inaction on his proposed plan to cut property taxes and promised to call a special session later this summer to address the crisis.

Pillen's scaled-back plan, contained in Legislative Bill 388, aimed to reduce property taxes by expanding sales taxes to currently untaxed goods and services. However, the bill failed to gain enough support to overcome a filibuster on the final day of the session. Senator Lou Ann Linehan, the bill's sponsor, pulled it from the floor due to the lack of votes.

The governor expressed disappointment in the Legislature's failure to pass the property tax relief measure, saying, "The lobbyists and special interests may have won the first half, but I'll be back soon, and Nebraskans will get the property tax relief they deserve." Pillen vowed to call as many special sessions as needed to solve the property tax crisis.

Why this matters: Property tax relief has been a major issue in Nebraska, with many residents and businesses facing significant increases in recent years. The failure to pass a comprehensive plan during the regular session sets the stage for a contentious special session and potential political fallout for state lawmakers.

While the Legislature did not pass the governor's property tax plan, it did approve several other notable bills. These include measures to provide state funding for private school scholarships, create new tax credits, modify the homestead exemption program, and allow political subdivisions to be sued for child abuse. Lawmakers also passed bills related to electric grid reliability, conservation of threatened species, parole and probation reform, and broadband internet standards.

Senator Brian Hardin of Gering argued that LB 388 revealed more problems than it would fix and called for a special session to transform the entire state tax system. Senator Linehan acknowledged there was not enough support to overcome a filibuster on the bill in its current form.

Governor Pillen said he appreciated the efforts of the Revenue Committee, particularly Chairwoman Linehan, but blamed special interest groups for stopping the legislation. "Special interests have obstructed the long-overdue work of solving our property tax crisis," Pillen stated. The latest version of LB 388 would have relied on removing certain sales tax exemptions to bring in about $200 million for property tax relief, far less than the governor's original goal of a 40% reduction.

Key Takeaways

  • Nebraska Legislature adjourned without resolving property tax relief.
  • Governor Pillen's scaled-back tax plan failed to gain enough support.
  • Pillen vowed to call special sessions to address the property tax crisis.
  • Legislature passed other bills on education, taxes, and internet standards.
  • Lawmakers and governor blamed special interests for blocking property tax relief.