Pillen promises special session as Nebraska Legislature moves past tax bill without a vote
Governor: ‘I will call as many sessions as it takes’ to pass property tax reform
LINCOLN, Neb. (WOWT) - Gov. Jim Pillen scolded the Nebraska Legislature at the conclusion of the session Thursday for not passing a property tax relief package, saying he would call a special session to get it done.
“I will call as many sessions as it takes to finish the long overdue work of solving our property tax credits,” the governor told the Unicam.
Pillen also indicated he would call a special session to address “other issues,” but specifically said he would call a session for “winner-take-all” as soon as he knew he had enough votes for it to pass. A last-ditch bid to consolidate Nebraska’s electoral votes failed earlier this month, getting only eight of the 23 needed votes.
Realizing that a special session was “in the realm of possibilities,” Speaker John Arch of La Vista told 6 News on Wednesday that with so many moving parts, he wasn’t yet sure whether there might be enough votes to overcome a filibuster. The second round had 28 votes, but 33 are needed to move the bill forward to a vote.
Nebraska state senators got to work at 9 a.m. Thursday morning on their final day, but failed to take a vote on the major tax bill that has hung over the session.
The last day of the Legislature is usually ceremonial; but this year, there was a lot of heavy lifting largely because of the major changes proposed in taxing. The final session got started at 9 a.m. Thursday. The day wrapped in mid-afternoon, with Pillen addressing the Legislature at about 4 p.m. Thursday.
“Enjoy halftime. We’ll see you here again soon,” he said in his closing remarks.
Before getting into the disappointments of the session, the governor applauded the accomplishments that were made by state lawmakers these last few months, from religous protections to supporting military personnel, and for investments in bioeconomy as well as protecting waters against nitrates.
Pillen also made a point of showing his approval of legislation strengthening infrastructure security.
“We have long known that Nebraska is not entirely shielded by oceans from foreign interference,” he said. “Today, an enemy may only be a keystroke away from disrupting our water, our electrical communications and other critical systems. Against that modern threat, even a triple land-locked state must shoulder the responsibilities of national security.”
NO DECISION ON TAX BILL
LB388 was proposed by State Sen. Lou Ann Linehan of Elkhorn. In his State of the State address in January, Gov. Jim Pillen called for a 40% reduction in state property taxes by shifting $1 billion through either new revenue or ending exemptions.
After nearly two hours of debate, Linehan suggested they move past the bill and bring more ideas to the table in June, hinting at the likelihood that they’ll be back for a special session this summer.
“I hope we have a lot of conversations between now and then about all your perfect answers to this problem. Because it’s easy to say no, no, no. That’s real easy,” she said. “So, everyone who’s saying we can do better, I hope you have those ideas for the Revenue Committee by the end of June.”
There have been several ideas on the table in the last few weeks, including new taxes on candy and soft drinks, to taxing services such as digital advertising and visits to the veterinarian. Small businesses pushed back, and a general sales tax increase is no longer on the table.
Pillen said “out-of-control local spending” is what’s driving the state’s property taxes higher, admonishing lawmakers for failing to pass limits on spending.
“Because of this Legislature’s inaction this morning, Nebraskans will not see a penny of property tax relief out of this session. It’s unacceptable from my seat,” he said. “Our property tax crisis must be solved now. Property taxes are so out of whack, you don’t even need to own property to feel its harm in this state.”
Citing a report, he said property tax relief programs aren’t fixing the problem, especially with $420 million in property tax credits going unclaimed, particularly in bigger school districts.
“The share of taxpayers not claiming their credits in big school districts is jaw-dropping,” Pillen said.
He said those amount to about half of those in Millard, Westside, and Lincoln; nearly 60% in Papillion-La Vista; and 67% in Omaha.
Pillen also accused lobbyists for derailing efforts to utilize sales tax to help correct the issue.
“We will make sure this body acts on the truth — on the truth — about property taxes not the misstatements pressed by special interests,” he said.
The governor said it’s unfair for property taxes burden residents while other items get a break.
“My heart goes out to the seniors in Nebraska, hardworking folks in our state who face losing their homes, because they can’t afford their property taxes; but see tax loopholes for candy, pop, CBD, and tech behemoths remain in law. The lobbyists and out-of-state special interests will keep fighting for their carveouts and favored treatment. But you know and I know what Nebraskans expect. The lobby might image they won this half, but the people of Nebraska are gonna win in the end. We will finish this work, and we will finish this year.”
‘SCHOOL CHOICE’ BACK-UP PLAN
The last item on Thursday’s agenda was the backup plan to last year’s Opportunity Scholarships Act — more commonly known as “school choice,” which gives tax credits for private schools.
Voters could reject the initialy Oppotunity Scholarships bill in November, so lawmakers created another version where the state puts the money in directly. LB1402 replaces the Opportunity Scholarships Act earmarks funds directly into the state budget for private school scholarships.
The bill passed 32-14 — but only after removing the emergency clause, which would have put the bill into effect as soon as the governor signed it into law. State Sens. Raymond Aguilar of Grand Island, Terrell McKinney of Omaha, and Lynne Walz were present but did not vote on the bill. Calling the new bill an “end-run” around last year’s petition drive that got “school choice” on the ballot, the Nebraska State Education Association said Thursday that it will launch another petition drive to overturn the new bill — and could mount legal action as well.
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