2020 Property Tax Changes (Oct. 8, 2020 Webinar)

Department of Agricultural Economics Author

10/08/2020 Added

61 Plays

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With Dave Aiken, professor and agricultural law specialist, UNL Agricultural Economics. The 2020 Unicameral at the last minute provided property tax relief of around 6% for most property owners. Learn how this happened and how to estimate your “property tax refund” that you could get next year.

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[00:00:16.500]Brad Lubben: Good afternoon. Welcome to our webinar. I'm Brad Lubin associate professor and extension policy specialist in the Department of Agriculture economics, say, you know, thanks for joining us today.
[00:00:27.780]Brad Lubben: This webinar, like many in our series is part of a series that we have done for on behalf of our extension farm and ranch management team.
[00:00:35.460]Brad Lubben: That typically run every Thursday at noon. You can find a recording of this webinar and previous webinars as well as a schedule of upcoming webinars on our website@farm.us now.edu
[00:00:49.770]Brad Lubben: One resource that we want to share as we begin today is to continue to remind you have the availability of the Nebraska rural response hotline.
[00:00:59.400]Brad Lubben: In times of stress, knowing when to reach out as a central Nebraska rural response hotline can provide mental health counseling information regarding legal assistance financial clinics mediation and more
[00:01:13.020]Brad Lubben: The hotlines toll free number is 1-800-464-0258. In addition, a wealth of resources related to stress and wellness can be found at rural wellness.us l.edu
[00:01:26.640]Brad Lubben: As a technical reminder during today's presentation, please use the chat box or the Q AMP a box located on the bottom of your screen.
[00:01:34.800]Brad Lubben: To ask any questions we will address those at the end of the presentation as time allows.
[00:01:40.620]Brad Lubben: Now onto today's topic we're going to talk about property taxes in Nebraska.
[00:01:45.750]Brad Lubben: Late in the most recent legislative session Nebraska legislature passed property tax legislation that will establish a refundable state income tax credit.
[00:01:55.770]Brad Lubben: Of an estimated 6% of property taxes paid for local schools eligible taxpayers will be able to claim this credit as soon as next year.
[00:02:04.830]Brad Lubben: To present today on how this legislation came to pass, and how the broader legislative agenda has has carried out.
[00:02:12.060]Brad Lubben: As well as how to estimate potential refunds and what it means for Nebraskans I'm pleased to introduce my colleague David can
[00:02:19.950]Brad Lubben: Dave is a professor at cultural law specialist here in the Department of Agriculture agricultural economics.
[00:02:25.830]Brad Lubben: Dave's a longtime colleague of mine, not just as a fellow faculty member, but I remember Dave as an instructor when I was an undergraduate student here in department as well.
[00:02:36.480]Brad Lubben: The University recently recognized Dave's 45 years of service to you and L in the Anglo arena and we greatly appreciate his service and has continued to work here, Dave, I want to turn it over to you to talk about property taxes today and look forward to the discussion.
[00:02:58.740]dave aiken: Thanks, Brad.
[00:03:01.200]dave aiken: And welcome, everyone.
[00:03:03.900]dave aiken: We're going to talk about the legislation that was adopted.
[00:03:09.690]dave aiken: Late in the legislative session.
[00:03:12.810]dave aiken: And just as a little bit of background, you know, property taxes is a perennial issue in Nebraska. We are a high property tax state.
[00:03:24.420]dave aiken: Are a property taxes.
[00:03:27.450]dave aiken: As compared to
[00:03:30.090]dave aiken: Farm income in Nebraska are very high. We're close to the top of the list.
[00:03:37.050]dave aiken: As far as that goes. So getting some property tax relief has been a a priority for ad groups for a long, long time.
[00:03:48.420]dave aiken: Now I have not had a ringside seat.
[00:03:54.120]dave aiken: In terms of the the
[00:03:57.630]dave aiken: politics involved in in the legislation, we're going to talk about today. I've been following this from the sidelines, you know, through legislative documents and through media accounts and so forth, but I have not been involved directly or indirectly.
[00:04:16.110]dave aiken: You know as talking to senators or anything like that. So I don't have inside information I I do, you know, have the occasional political observation to make
[00:04:29.580]dave aiken: But
[00:04:31.050]dave aiken: It is go purely as purely as an outsider. Okay, so what happened this year.
[00:04:38.640]dave aiken: Well, the legislature adopted legislative bill 1107 which was really three separate programs. The first one is the imagine Nebraska Act, which
[00:04:52.380]dave aiken: Is the new economic status economic development program at it. I think it replaces replaces the Nebraska advantage act so it's kind of the high end
[00:05:02.430]dave aiken: Economic Development Program for the state.
[00:05:06.000]dave aiken: The second program port program is a program to provide state funding to
[00:05:16.860]dave aiken: Get federal funds to create a $2.6 billion.
[00:05:22.410]dave aiken: Pandemic Center at the University of Nebraska Medical Center and Oman and this this project.
[00:05:30.540]dave aiken: Supposed to be a 700 high paying jobs and stuff like that. So it's, it, it's a big deal, be a big deal for the state, a really big. Really big deal for Omaha and you know the
[00:05:43.170]dave aiken: The state investment to get the that federal investment is pretty small, then the third one is the property tax the property tax program, which creates a state income tax credit for 6% of the property taxes paid for schools.
[00:06:01.350]dave aiken: And the legislation hopes.
[00:06:06.120]dave aiken: I think is the best way to put it, that the 6% could increase to 18% by 2025 but that depends on, you know, being able to hit some
[00:06:21.510]dave aiken: Marks, as far as
[00:06:26.070]dave aiken: Tax revenues generated and and that sort of thing. You know, if tax revenues.
[00:06:32.940]dave aiken: Are down then that, you know, might not get to the 18% by 2025
[00:06:40.680]dave aiken: You know that you know all that can be adjusted by the legislature down the road.
[00:06:46.530]dave aiken: A lot of people have opinions about how we need to fix property taxes in Nebraska and we'll run through a few of those in the course of the
[00:06:59.100]dave aiken: In the course of the presentation.
[00:07:01.920]dave aiken: But there are lots of trade offs involved to get a deal like this put together and the three programs, adopted in the imagine Nebraska Act, the property tax reform was by far the most controversial.
[00:07:23.940]dave aiken: The economic development update and the money for the pandemic center pandemic center at the med center. Those were both pretty you know they're almost a slam dunk category.
[00:07:39.990]dave aiken: In terms of being bills that would sail through with high levels of support, you know, on both sides of the aisle. The only thing that was the only thing that
[00:07:53.250]dave aiken: Was slowing things down, was that
[00:07:57.510]dave aiken: In a
[00:07:59.370]dave aiken: Political move that we will discuss a little bit in a few slides.
[00:08:05.220]dave aiken: Those two basically non CONTROVERSIAL PROGRAMS.
[00:08:11.160]dave aiken: Or less kind of our show programs got tied to the very controversial property tax program. And so, you know, if these, these two wagons were there to his the property tax reform to we wouldn't be we'd be talking about another year, and no property tax reform in Nebraska.
[00:08:30.360]dave aiken: So there are lots political, trade offs involved. And you know what comes out, it's you know, it's the legislative sausage that that nobody likes to watch me made, but, you know, at the end of at the end of the day.
[00:08:47.310]dave aiken: We have
[00:08:49.560]dave aiken: Pretty fairly significant property tax relief and something that could really could grow into something that would be more robust property tax relief. So I think, you know, the legislature was very pleased and I think they have. I think they had every reason to be
[00:09:08.640]dave aiken: Okay, this was a two year process because you know the legislature, you know,
[00:09:15.900]dave aiken: The budget is a two year budget and and this is that second year.
[00:09:21.990]dave aiken: Last year, what happened is that, you know, everybody in their brother had their own property tax proposal and there were
[00:09:32.520]dave aiken: Lots of lots of different proposals that reflected the different philosophies about what's the best way to a call to accomplish property tax reform and so we'll just we'll just take through some of the most
[00:09:48.000]dave aiken: Some of the most important ones and then and then see what happened. Okay, the first one that will talk about is
[00:09:56.430]dave aiken: Change the state aid formula to increase the per pupil state aid.
[00:10:04.080]dave aiken: And
[00:10:05.700]dave aiken: As a consequence of that increasing the amount that's across the board.
[00:10:11.220]dave aiken: That would reduce the need based aid that goes primarily to metros school districts
[00:10:18.510]dave aiken: I use the term metro loosely, not in the not in the strict sense of sense. But, you know, goes to
[00:10:26.490]dave aiken: Schools and and what I'll call the the
[00:10:31.530]dave aiken: Regional Trade Centers and so forth. Carney red Island, South Sioux City, you know, Columbus.
[00:10:39.480]dave aiken: They get some of that need based aid in addition to like internal wall. So it's not just like in Omaha, but like at Omaha, the two are the two big gorillas.
[00:10:49.350]dave aiken: In that in that arena.
[00:10:52.980]dave aiken: So Lincoln and Omaha school districts strongly oppose that you know they they will pull out all the stops to avoid changing the state aid formula, unless it's a change that they signed on to
[00:11:07.530]dave aiken: And I just, I'll make a couple of observations. First of all, what was passed and point 20 did not change the state aid formula.
[00:11:17.760]dave aiken: The second thing and I'll return to this towards the end and talking about where we go from here.
[00:11:25.320]dave aiken: In in all the different groups who were negotiating these property tax reforms.
[00:11:32.070]dave aiken: And because property taxes is a major, major source for school finance and it's the major thing that property taxes spent for Nebraska. So, so when you talk about property taxes, you're almost always talking about school revenue as school tax receipts as well.
[00:11:54.570]dave aiken: Lincoln or school districts were never at the table. They were never part of that discussion. And so pretty much whatever came out.
[00:12:04.470]dave aiken: That you know the schools, school districts didn't like it. They're going to let everybody know they didn't like it. And that was, you know, school district opposition was what stopped.
[00:12:17.610]dave aiken: Quote consensus property tax reforms in
[00:12:22.290]dave aiken: And in 2020 so
[00:12:25.710]dave aiken: That's know politically, we've got a ways to go before we'll get to the grand bargain stage, but that's something that will take a lot more. A lot of time.
[00:12:39.270]dave aiken: And a lot of a lot of leadership and buy in to to bring that about. So anyway, the changing the state aid formula increasing per pupil aid.
[00:12:50.310]dave aiken: And and why was digging into this. This is sort sort of been my, my professional hobby. The last four or five years is is trying to figure out the property tax situation in Nebraska. I was surprised that the per pupil amount of state aid is so small.
[00:13:13.980]dave aiken: The biggest chunk of the state aid formula is this need based aid that goes to school districts that don't have the PR people property tax base that most
[00:13:25.920]dave aiken: rural school districts. Enjoy. So that's, you know, changing that it's going to be
[00:13:35.280]dave aiken: Every dollar that you could improve people state aid that goes to every school district based on the number of kids that they have without regard to how much they can raise your property taxes.
[00:13:47.430]dave aiken: You know, unless the total amount of state aid increases that's going to reduce the amount of state aid that's available for these for the metro school districts. Again, not just looking at Omaha, but they would get the lion's share of that of that amount.
[00:14:03.570]dave aiken: So,
[00:14:05.310]dave aiken: strong opposition from like an Omaha and that that you know the compromise bill from last year.
[00:14:13.920]dave aiken: Never, never made it out of the gate because of that.
[00:14:18.780]dave aiken: Excuse me, one of the one of the
[00:14:23.820]dave aiken: Equally controversial, but this was more Conover still at the at the citizen level rather than just at the at the governmental level with school districts
[00:14:34.230]dave aiken: Changing sales the sales tax base in Nebraska closing some sales tax exemptions and using the increased revenue from you know the the additional sales taxes that would be
[00:14:49.500]dave aiken: Collected on you know prescription drugs or doctor visits or
[00:14:55.350]dave aiken: Getting your haircut or your nails done, or whatever it happens to be.
[00:15:01.080]dave aiken: That was proposed and then that was that was proposed in a fairly, you know, and they're looking at closing a number of loopholes to race to try to raise some significant money to provide
[00:15:11.520]dave aiken: Significant property tax relief and the turns out that the bill in were provided somewhere between 350 and $500,000 worth of property tax relief, which would admit, which would have been a lot would be very substantial probably actually
[00:15:31.350]dave aiken: You know what we got this year was 120 525 million
[00:15:37.200]dave aiken: New dollars going into property tax relief.
[00:15:41.040]dave aiken: So, you know, that gives you some some basis of comparison.
[00:15:45.480]dave aiken: There are lots lots of opposition to closing the sales tax loopholes, you know, one person's loophole is another person's economic lifeline.
[00:15:54.780]dave aiken: Board, you know. So you would think from hearing all these all these businesses, we're going to go broke. If they lost their sales tax exemption and the state was going to just dry up and go away. You know, so it was you know that the sky was going to fall if we close these loopholes.
[00:16:12.210]dave aiken: More significantly the governor said that he was opposed to lower in one tax by increasing a different tax. This is called attack shift. And so, and, and he was not he was not in favor of of
[00:16:28.860]dave aiken: You know, increasing the sales tax base to provide new revenue for property tax relief, so that you know this this was going to be a hard enough law to pass without having to overcome a veto so
[00:16:45.330]dave aiken: You know they they
[00:16:47.580]dave aiken: That that was that was kind of the end of that.
[00:16:53.730]dave aiken: Okay.
[00:16:55.560]dave aiken: Another what another thing that was proposed, I think, and I think this was in both the governor's proposal and also in a ledges separate legislative proposal, putting a cap on spending increases by school districts
[00:17:10.710]dave aiken: And this was this was strongly opposed by, you know, all school districts, not just like an Omaha. In fact,
[00:17:20.190]dave aiken: As I went through the hearing record Ahmed Ahmed hearing
[00:17:26.610]dave aiken: They
[00:17:29.370]dave aiken: Were all, I think it was the Milford School District. So a representative of the bill for school district came in and said, look, if you go back for the last 10 years repair.
[00:17:39.240]dave aiken: The increases in state spending and the increases in school spending, you know, statewide. It's, it's, like, one of them is 3.1% and one of them is 3.2% so I mean they're both within a 10th of a percent of each other so
[00:17:55.620]dave aiken: You know, if we're reckless in terms of how much money we spend, you know, the legislature is right there with us, you know, step for step. So making the point that the increases were not
[00:18:10.110]dave aiken: As bad as as proponents of this this approach suggested. So again, that was part of the final compromise package last year and the schools. Schools saying that one.
[00:18:24.060]dave aiken: Okay.
[00:18:25.740]dave aiken: There are many, many
[00:18:28.500]dave aiken: Property Tax slash school finance proposals in the hopper last year, but none of them gained any political traction. So the revenue committee under the
[00:18:42.750]dave aiken: Determined leadership of Senator. Senator land.
[00:18:49.710]dave aiken: From the Omaha area, you know, they worked really hard and she's worked really hard on this and really deserves a lot of credit for for the process getting as much getting as far as it as
[00:19:04.800]dave aiken: They, they came up with a compromise where they tried to take the best from all the different proposals, you know, the most popular parts and stuff like that. Put it together a new bill reported that out of committee, the Omaha and like in the school district supposed it
[00:19:21.180]dave aiken: Senators from Omaha and Lincoln, you know, voted accordingly and the vote and the last year's compromised was five bones short the number data to a filibuster, I think that, and I'll put 28 votes. Then, and this was key you know the other Kudo has to go. Tom breezy.
[00:19:43.500]dave aiken: But senator breezy have lead a group of about a half a dozen or maybe a few more world senators who voted against the
[00:19:55.080]dave aiken: Imagine Nebraska Act, the rewrite of their basket Vantage act and said we're not going to vote for this economic development update
[00:20:04.500]dave aiken: Until we get meaningful property tax relief and they held firm and so the management Alaska Act, which should have sailed through didn't because enough real centered or said no, we're not. We're not going to vote for this until you get until we get your votes for property tax relief.
[00:20:24.690]dave aiken: And
[00:20:26.820]dave aiken: Without that
[00:20:29.520]dave aiken: We would not have property tax relief, you know, we'd be having this webinar on something else. But it wouldn't be on on what was accomplished.
[00:20:38.850]dave aiken: OK, so the end of the 2019 legislative session, you know, this is the interim between the two. The 2019 and 2020 session.
[00:20:48.540]dave aiken: You know the revenue committee, you know, met with the governor to develop something that the government could support and you know getting into governor support was a big deal. So the
[00:21:02.340]dave aiken: new revenue from broadened property tax base was out
[00:21:08.760]dave aiken: Because of the governor's opposition and so that meant necessarily that the size of the property tax relief was going to be much less than if you add 100 200 $300 billion of new sales tax revenue to play around with.
[00:21:27.450]dave aiken: You know, you're not going to have those kinds of dollars available to fund property tax relief. So it was going to be something smaller
[00:21:36.330]dave aiken: Second, the second thing that was a big thing was the so called 35% solution. And this was a proposed constitutional amendment.
[00:21:47.100]dave aiken: For which
[00:21:50.490]dave aiken: petitions were being circulated to get it on the ballot.
[00:21:55.530]dave aiken: This November.
[00:21:58.920]dave aiken: Those petitions were being circulated, but the
[00:22:05.820]dave aiken: Signature collection process was not well funded
[00:22:11.490]dave aiken: It would have the 35% solution would have
[00:22:15.510]dave aiken: Given everybody who paid property taxes in Nebraska. The 35 a state income tax credit for 35% of their total property taxes paid. So if you paid
[00:22:28.530]dave aiken: $10,000 in property taxes, you get a 30 $500 credit on your state income tax return and and you know depending on
[00:22:40.020]dave aiken: You know what your taxes were that year, you could get all that money back for refund or you could get a bigger refund. You know what that 3500 on top of what refund, you would have gotten otherwise.
[00:22:50.340]dave aiken: So that would have been
[00:22:54.360]dave aiken: You know, that was a big deal, it would it would have bought a huge hole in the budget and
[00:23:02.880]dave aiken: You know, would have required massive spending cuts massive tax increases, or both. But coven
[00:23:11.670]dave aiken: put a stop to this to the to the petition effort.
[00:23:16.680]dave aiken: I also believe that it was a lack of money.
[00:23:22.440]dave aiken: But
[00:23:23.880]dave aiken: You know it. They stopped clicking balance. You know, when it became clear that that would be kind of that would provide a health risk to circulate and so forth. So they so that was didn't have to take that into account this time around.
[00:23:40.080]dave aiken: Okay, so we get to the 2020
[00:23:44.520]dave aiken: And
[00:23:46.740]dave aiken: The bill that came out of the revenue committee was LB 974
[00:23:52.770]dave aiken: And its proposal would have been to lower property tax valuations over three years and he would go from 75% to 55% and we should be about a 20 20% reduction of total property taxes.
[00:24:14.460]dave aiken: And then residential, commercial, industrial would go from 100% evaluation 87% which works out to about 8% reduction in the total property tax bill.
[00:24:26.460]dave aiken: This means that, you know, Lauren, the value of prop of land for
[00:24:33.690]dave aiken: School valuations means that schools would get be able to collect less property taxes. And so the difference would have been made up by
[00:24:44.820]dave aiken: Increased state aid and addition school tax increases would have been kept would have been limited and that bill stalled on general file, it did not have the votes to go to to make it to the second round of debate.
[00:25:05.730]dave aiken: So at this point.
[00:25:08.430]dave aiken: Speaker sheer, who is the third one who gets a gold star for this legislation appointed a group of senators to develop a compromise and it was understood that this compromise would include you know the Med Center program. The Economic Development Program and the property tax reform.
[00:25:35.010]dave aiken: And you know this group was set up before the legislative session was
[00:25:43.590]dave aiken: adjourned temporarily adjourned because of the colon crisis and that gave them. They gave them time to negotiate.
[00:25:58.320]dave aiken: Excuse me. So when the legislature reconvene
[00:26:03.780]dave aiken: This summer, the they came up with a new bill legislative 1107 and I think the final vote on it was 42 to three or something like that. So it had
[00:26:16.380]dave aiken: overwhelming support. I mean, there were there were people who were very vocal and say, no, this is not the right way to do
[00:26:23.670]dave aiken: Property tax reform, you know, we need to reform the state of the program and stuff like that. But anyway, you know, they were in the minority, everybody was happy to get this thing done.
[00:26:33.840]dave aiken: They also they wanted those other two bills, the economic development bill on the med center bill they wanted those bills to get past and they're happy to to include property tax as part of as part of the three programs that this bill would come. We cover.
[00:26:51.540]dave aiken: And
[00:26:53.070]dave aiken: If you're, if you want to, you know, you know, you hear about inside baseball and stuff. If you want to get inside Nebraska party. So you can look at the group, you know, speaker sheer appointed a group
[00:27:05.490]dave aiken: To try this in 2019 and he appointed a group to do that. The same thing with 2020 the some of the people on both groups and some of the people that were on the 2018 group we're not on the
[00:27:19.620]dave aiken: Group and they're replaced by somebody who was probably a little bit more flexible, you know, more willing to help make a deal.
[00:27:27.480]dave aiken: And and you know that plus the State Economic Development Program, but the Brassica advantage Act was going to terminate this year.
[00:27:37.500]dave aiken: And he terminates in 2020 so they needed the replacement ready to go, otherwise they would be there with no economic development program to, you know, the lore.
[00:27:46.680]dave aiken: You know, Google or Microsoft or, or, you know, Toyota or whomever to come to Nebraska and, you know, build a big plant unemployed people, whatever. So
[00:27:58.650]dave aiken: It was, you know, it was this year for that bill to get past and so that helped you know that very hard deadline focused everybody's attention on on trying to get this deal done and and they did. And people were happy.
[00:28:16.680]dave aiken: Okay, so how is this gonna work. Well, I just checked the Revenue Department website, you know, this morning and they don't have anything out on this yet, but, you know, my guess is that
[00:28:31.140]dave aiken: There will be
[00:28:33.450]dave aiken: I don't know whether it will be
[00:28:38.970]dave aiken: Whether it will be just part of the basic form, whether it will be a separate schedule or whatever. But there will be somewhere on next year's
[00:28:51.600]dave aiken: state income tax return, you'll have the opportunity to say, Did you pay property tax. Yes. Okay, well then enter line online, blah, blah, blah. Enter the amount
[00:29:03.540]dave aiken: From your property tax return that says how much you paid to local schools.
[00:29:10.260]dave aiken: Or maybe they will look it up and they'll be able to tell you what it was or, you know, um, who knows. I don't know how they're going to do it.
[00:29:16.980]dave aiken: But anyway, the amount that you paid the amount of your total property tax went towards schools. Well, you know, probably be entered
[00:29:26.460]dave aiken: Into your income tax return. And then they'll say, multiply that amount by 6% and then that will be a credit
[00:29:33.360]dave aiken: That a refundable credit that you know will go towards any taxes that you all, and if you don't know any taxes and it'll come back to you as a refund from the State of Nebraska.
[00:29:45.240]dave aiken: So I'm I'm encouraging everybody to hang onto your property tax statement, you know that she hit from the county
[00:29:52.410]dave aiken: Or, you know, if you have land in more than one county, you know, it'll be from all the captain for from wherever you land so hang on to those. And if you want you can multiply that by 6% and that will be a good ballpark of of what your credit will be on your
[00:30:11.250]dave aiken: state income tax return. Next year, I'm guessing that for most for residential users, it's going to be in you know $500 and up, maybe, you know, something like that.
[00:30:26.730]dave aiken: For farmers and ranchers, you know, it's going to be five, you know, five $6,000 or more somewhere in that neighborhood, but you can you can calculate it yourself. You know, I just
[00:30:42.300]dave aiken: Plugged in average guys for homes and, you know,
[00:30:47.940]dave aiken: Thought, what I would be average you know size sizes for farms and ranches and stuffing this semester is that way but but you can do it yourself.
[00:30:57.840]dave aiken: From the tax statements the property tax statements. So that'll that'll that'll give you a little heads up in terms of what that what that might look like for you.
[00:31:08.220]dave aiken: Okay. Well, I mentioned that this is a multi year program.
[00:31:15.870]dave aiken: And
[00:31:17.670]dave aiken: So the money from the first year and the base amount of 120 $5 million is pretty much locked in could be could be changed by feature Legislature's but we're hoping that that's not that's not going to happen.
[00:31:35.310]dave aiken: But you know, it's this amount of supposed to increase each year for the next five years or so until we get to 375 million, but it all depends on you know on
[00:31:49.980]dave aiken: The economy being in good shape and tax revenues being pretty robust and stuff like that for all that to happen. And if it, if it doesn't happen, then it's going to take longer to get to the 375 million
[00:32:04.380]dave aiken: Or whatever it is but 335 million is. I mean that's substantial property to actually, you know, that's, you know,
[00:32:13.290]dave aiken: Three 300 million 400,000,500 bucks. That's, that's very substantial property to actually
[00:32:21.900]dave aiken: And, you know, so, so that's
[00:32:25.260]That's
[00:32:27.120]dave aiken: You know,
[00:32:28.740]dave aiken: You know, it starts at the at the moderate level, but it, it gets it gets better. Hopefully, as time goes on, so
[00:32:38.790]dave aiken: So what. So how well does the economy have to do well sales and income tax collections, they have to first act to exceed projections and then they on an annual basis. They have to
[00:32:51.510]dave aiken: Exceed projections by the three and a half or they have to exceed excuse me three and a half percent so if
[00:32:59.160]dave aiken: Sales income taxes are more than three and a half percent and on an annual basis, you know, then hopefully we're on the road to get to the full term 75 million
[00:33:10.170]dave aiken: You know, if, if it's if it's short of that, you know, then it may take us longer to get there. But you know, that's
[00:33:16.740]dave aiken: That's going to be a year by year thing to see how that all plays out. So you know the the hundred and 25 million is is is pretty much guaranteed in the short term, but whether that's going to triple
[00:33:29.910]dave aiken: You know, in the next five years.
[00:33:32.490]dave aiken: Really depends on on how well the academy and Nebraska hums along
[00:33:38.880]dave aiken: Might we see a return of the 35% solution. Yeah, we might
[00:33:46.530]dave aiken: You know, especially if
[00:33:49.500]dave aiken: Work if we end up being kind of stuck at the hundred and 25 million for the for the
[00:33:57.090]dave aiken: Income Tax
[00:34:00.210]dave aiken: Credits were like, you know, there might be interested in in getting bigger property tax relief.
[00:34:09.900]dave aiken: And so then, you know, we could see that ballot that about being circulated again.
[00:34:16.740]dave aiken: I think we'll probably find out in January, February, weather for the folks
[00:34:22.440]dave aiken: Who have backed out in the past. What you know what to do that again, or whether they're going to whether they're going to take some time.
[00:34:28.320]dave aiken: Take time out to do it. They can wait till 2020 2022, you know, early 2022 and still have plenty of time to get it all the balance. Oh yeah, we'll have to wait and see.
[00:34:40.980]dave aiken: But if it had been adopted, if it'd been put on the ballot and voters had voted it in, you know, it would have it would, you know, blow to $1.5 million
[00:34:52.350]dave aiken: Hole in the budget and we would have had to raise raise taxes or cut spending, you know, by one, a half billion dollars.
[00:35:03.480]dave aiken: Or, you know, half and half, or, you know, two thirds one third, whatever, you know, a lot of ways to split it. Then we probably have to
[00:35:12.030]dave aiken: Broaden the sales tax nations, you know, you don't have to do stuff that that we wouldn't be willing to do otherwise we'd probably have to do that in order to
[00:35:22.440]dave aiken: Try to hold a state government together and stuff like that. So I don't think that this is necessarily gone away.
[00:35:31.950]dave aiken: But it's no I don't think it's going to be the high priority issue that it has been the last few years, at least for the next year or two.
[00:35:43.020]dave aiken: Okay, we have a
[00:35:46.800]dave aiken: Actually three initiative measures that would authorize casino gambling in Nebraska. I'm sure you've all seen some of the ads on TV. No, keep the money in Nebraska and and and you know coach Osborne saying, Please don't vote for this, you know, and that
[00:36:07.080]dave aiken: One of the, one of the three
[00:36:10.560]dave aiken: Initiatives. Actually, it's the last one initiative measure for 31
[00:36:15.750]dave aiken: Would provide an estimated $40 million for property to actually. Well that's, you know, we're looking at at 125 million to get us the 6% you know 40 is roughly a third of that. So it's around 2% of, you know, the property tax credit for the school taxes.
[00:36:38.940]dave aiken: So you can decide it's not gonna, it's not going to move the needle a lot on property taxes if it is adopted, it will be something you know
[00:36:51.000]dave aiken: It's not, it's not negligible. But it's not moving the needle significantly, I guess, is how I would put it. And so
[00:36:59.550]dave aiken: But that is certainly an issue now.
[00:37:04.020]dave aiken: There's a couple ways to increase
[00:37:09.750]dave aiken: The property tax base at the local level.
[00:37:13.980]dave aiken: And so we're going to talk about both of them in the next two slides. First one is wind and solar energy let you know wind farms and solar farms.
[00:37:24.300]dave aiken: If, in the next few years, the United States gets more serious about
[00:37:30.480]dave aiken: Trying to do something constructive about climate change moving in the direction of war clean energy. I think particularly if if
[00:37:42.150]dave aiken: The Vice President.
[00:37:44.790]dave aiken: Biden wins the election next month.
[00:37:49.470]dave aiken: Or this year, I guess. Hopefully it'll be over sometime in November, but who knows
[00:37:56.610]dave aiken: You know there'll be a lot of money trying to encourage
[00:38:02.190]dave aiken: Clean energy or renewable energy development like wind and solar and, you know, depending on how its structured if it's targeted to areas. That's two states that say, yeah, we want to grow our clean energy sector within our state.
[00:38:21.540]dave aiken: Then you know
[00:38:25.530]dave aiken: The states would get would have the opportunity of increased federal money to to put into those sorts of developments to try to make that go
[00:38:33.660]dave aiken: Nebraska is a we have excellent when resources and better apparently better staller resources that I that I was aware of and but you know we're, we're, I think a top five state in terms of what potential
[00:38:53.730]dave aiken: And then we've realized, some of that. But we can we can do a lot more than we then we will. This is one of the deal though for where we're kind of shoot ourselves in the foot, you know, where with all the local opposition to
[00:39:09.480]dave aiken: electricity transmission lines.
[00:39:12.930]dave aiken: A local opposition to new wind farms, you know, because they make too much noise and and and and whatever.
[00:39:23.580]dave aiken: You know, so
[00:39:25.680]dave aiken: We certainly have the potential to grow that sector of the economy, but
[00:39:32.010]dave aiken: Things have to change a little bit from how they are now in order to in order to bring that about.
[00:39:39.690]dave aiken: I tell my
[00:39:42.210]dave aiken: Students in agricultural law that they should think of wind energy development on their farm or solar energy on their farm, sort of like striking oil on their farm.
[00:39:54.210]dave aiken: You know, if you're in Texas or Kansas or Oklahoma. If you're a farmer that's got that Scott oil wells on your farm. You know, you don't really need to worry a lot about
[00:40:06.090]dave aiken: Making the farm pay for itself because you've got a lot of oil money that's going to come in and keep that keep that farm viable for a long time. Well, wind and solar energy have that same kind of economic
[00:40:21.540]dave aiken: Potential for the owners by agricultural land so so that's a, that's a real possibility for
[00:40:30.930]dave aiken: You know, building or increasing the local tax base, you know,
[00:40:36.390]dave aiken: They pay property taxes if they come in so that they you know that that lightens the property tax load on everybody else in the County School District or whatever. And so, that is that is a
[00:40:48.990]dave aiken: One thing that you know if you're concerned about local property taxes. That's another thing to take to take a hard look at the next one is livestock development.
[00:41:00.390]dave aiken: And this is, this has been a tug of war.
[00:41:04.410]dave aiken: That's been going on in Nebraska.
[00:41:07.500]dave aiken: You know, at least for the 45 years that I've been here, you know,
[00:41:13.470]dave aiken: You know, since then, we've seen a
[00:41:17.220]dave aiken: From the beginning, and that 1975 to now we've seen big changes in the structure of livestock production, not necessarily on the beef side but on the bus, but clearly on the swine side, you know, we've gotten to larger, larger scale operations and so forth. And, you know,
[00:41:38.820]dave aiken: These facilities pay more.
[00:41:42.540]dave aiken: Property taxes, then you know you do per acre for corn or soybeans or pasture.
[00:41:51.900]dave aiken: But they have had a tough time in trying to get more of those facilities in Nebraska and and particularly as five facilities. The
[00:42:06.300]dave aiken: You know, we've had a lot of different legislative proposals, you know, to try to limit COUNTY ZONING of livestock facilities. The way they have an Iowa.
[00:42:18.210]dave aiken: You know, if, if we had if we had the zoning law. And I love that if we had Iowa zoning on and we're asking, excuse me, so I'm trying to say if we had Iowa's zoning law Nebraska and interpreted in in Nebraska, the same way. It's been courted interpreted in Iowa.
[00:42:36.450]dave aiken: It'd be very hard for caddies to turn down proposed new livestock developments.
[00:42:43.860]dave aiken: But our Nebraska Supreme Court has interpreted differently than they do in Iowa. So, you know, you've got to get zoning permit in most counties in Nebraska. If you want to develop the livestock facilities above
[00:42:59.550]dave aiken: above a certain size.
[00:43:01.890]dave aiken: And those are fairly can be fairly controversial, you know, there'll be a lot of lot of concern about
[00:43:11.880]dave aiken: expressed concern about groundwater quality from, you know, from new are being applied to cropland or just manure on the livestock facility, not understanding you know what
[00:43:28.170]dave aiken: How that maneuvers manage and asked me manage to get the state environmental permits and so forth.
[00:43:35.730]dave aiken: And
[00:43:37.080]dave aiken: When I go to extend your meetings to talk about this. I think I really annoyed the corn farmers in the eye. So I say we've got more vital water contamination and impression from corn farm corn farmers putting fertilizer on their fields than we do from anybody, applying
[00:43:56.010]dave aiken: The newer to their field. So you know what that is, you know, when you look at when you look at the maps that show
[00:44:05.430]dave aiken: Any groundwater, you know, the high nitrate areas in Nebraska its most of that is from
[00:44:13.980]dave aiken: Irrigated corn production.
[00:44:17.610]dave aiken: And
[00:44:19.650]dave aiken: So, you know, they will raise the water, the groundwater quality concerns because that's something under the law that they can hang their hat on, to turn it down.
[00:44:30.120]dave aiken: However,
[00:44:31.920]dave aiken: I think for most world people called there may be a legitimate concern about ground water quality.
[00:44:39.630]dave aiken: They're really concerned about the owners and I did spend a summer in a or
[00:44:47.250]dave aiken: A good chunk about summer working in a pig confinement near Hastings back in the early 1970s. And you know what, I stopped working there your
[00:44:57.960]dave aiken: mom. My mom threw all my work clothes away and stuff like that shaved my beard off. So I didn't know. I didn't smell so bad and stuff, you know i mean it's it's it's it's a it's a quite distinctive over and and and very, very different from from cattle.
[00:45:15.120]dave aiken: So,
[00:45:17.370]dave aiken: You know,
[00:45:18.810]dave aiken: But because the now most modern fight swine production facilities are are in buildings, you know, you have opportunities to limit orders outside the building. If you're willing to take some some extra steps and and
[00:45:37.080]dave aiken: To, to try to limit those orders and it's my opinion that, and I know I'm probably beat my head against Wall, but it's my opinion, you know,
[00:45:49.740]dave aiken: My informal observations is bands is that, you know, livestock producers.
[00:45:54.720]dave aiken: Want to think that older older is not a real issue. You know, that's still people don't die from livestock owner. So, so you can't say it's a health issue or anything like that, you know, it's just people don't
[00:46:04.680]dave aiken: People don't like people like farmers or they don't like livestock or whatever, they're just use the alerts and excuse to oppose my zoning permits and I don't think that's
[00:46:18.300]dave aiken: I don't think that's really how it plays out. I think, you know, people don't like dealers and we got plenty of lawsuits in Nebraska, where would do livestock facilities.
[00:46:28.050]dave aiken: Have been you know mailed because of the orders that they generate and the juries and said, yeah, this your neighbors, should that to put up with this. So I think, you know, the livestock sector, if they wanted
[00:46:40.950]dave aiken: Growth the rural tax based they're going to need to
[00:46:45.990]dave aiken: Adopt a little different, a more flexible attitude I guess on orders and, you know, try to
[00:46:53.580]dave aiken: Say, You know, we want to be good neighbors. We understand there are some aspects of livestock production that
[00:47:00.150]dave aiken: Everybody doesn't like we're going to do everything we can to make our facility. The best facility around
[00:47:06.690]dave aiken: And to minimize whatever negative aspects of it that may be of concern to you. Here's what we're going to do for odors. Here's what we're going to do for water quality, you know, we're going to do everything.
[00:47:18.330]dave aiken: The best way that we can so that so that that we're good neighbor and mean it. And you know, I think that kind of a strategy would help. But, you know, we're whether that's going to happen. This is
[00:47:35.250]dave aiken: I would love to see it happen. But I'm not, I'm not going to bet the farm on it.
[00:47:41.040]dave aiken: Okay. The when I when I have property tax meetings exceptions know when we get the question answer part. People always some there's always somebody sometimes two or three somebody to say, well, you know, they put you know they they built that new football field or
[00:48:00.390]dave aiken: They built that new band room or whatever it was. And you know that the school spending is just out of control. You know, we didn't have
[00:48:10.770]dave aiken: We didn't have fancy football field when I went to school. You know 60 years ago.
[00:48:18.060]dave aiken: Or whatever it was.
[00:48:21.000]dave aiken: But
[00:48:22.440]dave aiken: It's easy to complain about school spending. It's really hard to do anything about it, you know.
[00:48:29.700]dave aiken: Parents want, you know, parents that had kids in school want their kids to have the best
[00:48:37.530]dave aiken: Opportunity opportunities that they have
[00:48:40.710]dave aiken: Amazingly, there are people in rural communities who, you know, whose kids have gone through school, but who still think having a good school that provides good opportunities for students is probably one of the
[00:48:53.850]dave aiken: Best economic development activities that they can have to try to bring new business enterprises to their community, you know, and, and I agree, good schools are will plus i think in terms of in terms of the communities economic development portfolio so that's that's really important.
[00:49:16.890]dave aiken: It's really hard to be on the school board and to be a consistent budget hawk, the store. I like to tell as a rancher who lived. I think on the edge of the sand hills.
[00:49:28.980]dave aiken: Got on the school board and he was you know he he was going to try to really hold a budget and after he after he voted against a few things.
[00:49:39.240]dave aiken: Parents got a recall petition and he had to go through a recall election, you know, to stay on the school board. He won the recall election, but they clipped his wings a little bit. I think in terms of
[00:49:51.630]In terms of spending.
[00:49:55.140]dave aiken: Being the spending hawk so
[00:49:58.380]dave aiken: You know, it's a lot of work to be a school board as a lot of work you know to be a kind of Commissioner in Rd board member, you know, all these all these people who
[00:50:10.230]dave aiken: assume responsibility and public service, you know, really deserve a pat on the back because it's a lot of work. It's a lot of very, very difficult work, and I don't think they get enough appreciation from the general public. Because, because it's a real sacrifice, I think.
[00:50:28.230]dave aiken: But to do it. Well, you know, you got to do a lot of homework because there's all kinds of financial stuff you have to try to figure out, and that, and it's just you know it's it's it's really a big challenge. It's not easy to complain.
[00:50:43.440]dave aiken: But you know that that doesn't
[00:50:47.340]dave aiken: That at the end of the day, that doesn't ever really done change anything.
[00:50:53.790]dave aiken: Okay, so what are the chances for the big elusive grand bargain to solve the property tax problem in Nebraska.
[00:51:06.450]dave aiken: Here, you know, the state local taxes we pay property taxes are the highest you know 38% sales tax is 29% in income taxes 26%
[00:51:19.020]dave aiken: Nationally, you know, our property taxes are very high where I think we're the top 10
[00:51:24.240]dave aiken: And and a lot of these top 10 states. The other states. The top 10 are states that don't have an income tax or don't don't have a sales tax, or maybe we don't have
[00:51:33.330]dave aiken: Either index or sales tax. So, you know, we've got all three. But our property taxes are still out there. So our property taxes are high. Our sales taxes at the National
[00:51:45.240]dave aiken: Compared to other states are local. And I think it's the favorite tax to raise for for most states and our income taxes are somewhere in the middle.
[00:51:56.460]dave aiken: So,
[00:51:59.520]dave aiken: Some people suggest that well yeah I mean if it was a third, a third, a third
[00:52:04.350]dave aiken: You know with property tax for paid about the same and property taxes income taxes sales taxes, you know, that would be a more balanced approach rather than having
[00:52:15.960]dave aiken: A property tax you know being, you know, one and a half or so, more than, than the other taxes least more than that, more much more than income taxes.
[00:52:27.960]dave aiken: And so this is what's called attack shift where you raise the taxes that are
[00:52:34.080]dave aiken: You know, not carrying their share the load. And so that gives you the revenue to lower the taxes that are carrying too much of their loans. That'd be racing racing sales taxes or income taxes are both in order to try to lower the property taxes.
[00:52:49.830]dave aiken: Now one political reality that you come up against pretty quick, is that it's pretty hard to raise state income taxes because you know we all we use that term very loosely
[00:53:04.290]dave aiken: We have
[00:53:06.870]dave aiken: Ice. I like to say that we have to make Nebraska safe for millionaires.
[00:53:12.660]dave aiken: And that's only partially tongue in cheek. But the idea is that you know you've got these entrepreneurial types. You know who are the millionaires. The high flyers.
[00:53:21.330]dave aiken: And they've got their business, whatever business. It might be and if they come to your state, you know, they will
[00:53:29.460]dave aiken: You know, they'll hire people and and create jobs and stuff like that. And that's wonderful. But if they if they look common and and see what our
[00:53:40.110]dave aiken: Income taxes are like I said, Oh my gosh, you know, I don't want to pay those kinds of taxes. I'm not, I'm not taking my business to Nebraska. I'm going to take it someplace else that has a more business friendly income tax structure, you know, and you know, and in that that that contention.
[00:54:04.680]dave aiken: Is very persuasive, I think, to
[00:54:09.660]dave aiken: You know, to governors and to legislators and stuff, who want to improve the state's economic activity increase economic development so
[00:54:19.950]dave aiken: You know, it's, that's going to be the best it's gonna be hard to raise income taxes, very much for property tax relief.
[00:54:30.330]dave aiken: Nebraska is low nationally for state aid to school.
[00:54:34.380]dave aiken: And, you know, one of the things that
[00:54:37.890]dave aiken: One of the one thing that we could do is increase that that would basically increase sales tax and income taxes going into the state aid fun
[00:54:47.400]dave aiken: And if that fund were increased
[00:54:50.790]dave aiken: And maybe restructured a little bit so that more of the aid was across the board, so that every, every school would get a significant amount of state aid, one of the proposals that was shot down in
[00:55:05.160]dave aiken: You know that that would take some pressure off the property taxes.
[00:55:12.870]dave aiken: But, you know,
[00:55:16.080]dave aiken: That I mean that sounds like that's something that, that you could talk about. But, you know, school districts were not part of the negotiations last year, or this year.
[00:55:26.700]dave aiken: The schools don't trust state aid, because no back with Ben Nelson was Governor before it became US senator. We went through a budget crisis and stayed the schools was cut and the school districts will never forget that.
[00:55:44.610]dave aiken: You know, maybe, maybe after maybe after 50 years or something. Maybe then it will say, Well, you can't complain about something that happened 50 years ago, but it's less than 50 years old.
[00:55:54.120]dave aiken: So they can so they they remembered and they say, we don't trust you know we don't want to lose any of our sales tax, but any of our property tax base, excuse me, because as soon as we do, you're going to cut state aid.
[00:56:09.510]dave aiken: To schools and then we're going to be in a pickle. So there's no easy answers no clear strategy to our grand bargain.
[00:56:19.650]dave aiken: And if you know if there weren't easy answers or a way to get this time, I think we would have done it.
[00:56:25.920]dave aiken: And, you know, the fact that we're still here talking about, you know, when we adopted sales and income taxes. Back in the 60s. That was supposed to
[00:56:35.880]dave aiken: Lower property taxes. Well, you know, probably property taxes are higher now than they were them. And so, you know, it's a tough problem we haven't been able to figure it out. Then, and it's just because it's just you know it's it's hard, hard to move people on this so
[00:56:55.470]dave aiken: Thank you very much. And I think we may have a question or two. So, I will turn it over, back to Brad.
[00:57:04.140]Brad Lubben: Dave, thank you very much for your discussion thorough discussion of how we got to this point what we actually have and what the path forward might be
[00:57:14.700]Brad Lubben: We do have a handful of questions. I invite a few more as we have just a few minutes left here in our, in our planned time to talk about property tax day. One of the questions just a technical question relates to
[00:57:29.610]Brad Lubben: Is the income tax credit, specifically only on property taxes real property taxes or is it also on personal property taxes.
[00:57:39.630]dave aiken: Just real property.
[00:57:41.820]Brad Lubben: Real property.
[00:57:42.990]Brad Lubben: And then they probably
[00:57:44.790]Written
[00:57:46.260]dave aiken: Real Property page schools.
[00:57:48.390]Brad Lubben: And real proper Texas page of schools and and then an add on to that we're talking about.
[00:57:55.980]Brad Lubben: Property taxes paid to K 12 schools or does it also include educational service units and community colleges.
[00:58:03.900]dave aiken: I'm pretty sure it's K 12
[00:58:07.050]Brad Lubben: K 12
[00:58:08.040]dave aiken: I would not. I couldn't sort on a stack of
[00:58:11.880]Brad Lubben: All right, all right. I'm a another question that has come in and and you did discuss prospects ahead but fundamental. My question is, where do we go from here for property tax relief.
[00:58:25.260]Brad Lubben: If a 6% that might become an 18% refund translates into something like a three to 9% decrease in current property tax bills.
[00:58:35.820]Brad Lubben: Is that it is this sort of the grand bargain that that are the grand compromise that has put property tax relief to bed, or is there still
[00:58:47.790]Brad Lubben: You described the possible scenarios ahead. Do you see any of those as possible scenarios.
[00:58:53.340]dave aiken: Well, I think the the tone.
[00:58:57.660]dave aiken: I what I should have made this part of the top
[00:59:02.430]dave aiken: Schools get more than half of the property taxes. Right.
[00:59:07.200]dave aiken: So let's let's
[00:59:10.290]dave aiken: And I should know that number. I got, let's say SAP so 5,018% reduction in school taxes paid. That's a 9% property tax reduction. I think it's I think it's 60% of property taxes going for school. So it's a
[00:59:25.710]dave aiken: Little more than that. It's more than two or 3% you know it's it's close to eight or 9% but yeah if you want big then you've got to get for once. For one, a governor who was receptive to looking at going into
[00:59:43.320]dave aiken: Sales tax. I mean, sales tax looks like the most likely source of additional tax revenue broadening the sales tax base coaching exemptions.
[00:59:53.340]dave aiken: And just, you know, trying to muscle that through. I will note.
[00:59:58.860]dave aiken: You know that you want to do that while senator chambers as out of the legislature. If he comes back you know he he is term limited now.
[01:00:10.620]dave aiken: He could come back and four years. So I would say there may be a four year window in which to do that, you know, there may be other
[01:00:19.500]dave aiken: Centers logistical slusher who would take up the charge of, you know, trying to protect consumers from sales tax increases.
[01:00:27.600]dave aiken: But you know Senator chambers's Little League of his own in terms of visibility to to stop those sorts of things, dead in their tracks. But yeah, it's, it's, it's going to be a challenge. Anyway, look at it.
[01:00:43.380]Brad Lubben: Dave, I have one more technical question one more sort of philosophical question technical question first.
[01:00:52.350]Brad Lubben: When you talk about the refundable tax credit, being on your
[01:00:58.530]Brad Lubben: Return.
[01:01:00.390]Brad Lubben: Payable and 2021 is that on Texas paid in 2020 or is that on the 2020 taxes that would be paid in 2021
[01:01:10.410]Brad Lubben: Is it is it based on the taxes that are paid in tax year or is it based on the property tax here itself.
[01:01:18.450]dave aiken: No it's, it's based on the well. Well, my understanding is that it is the property taxes that you pay during the calendar. The 2020 calendar year. Right.
[01:01:31.680]dave aiken: Okay, so, you know,
[01:01:33.960]Brad Lubben: It's the 2019 tax year
[01:01:36.510]Brad Lubben: Right taxes paid in 2020 that are refundable on the
[01:01:42.480]Brad Lubben: Income Tax Return do in 2021 way.
[01:01:46.650]dave aiken: And I am
[01:01:50.340]dave aiken: I'm gonna throw something out. Just, just, you know, just, just for fun, but you know, I'm hoping that that we can get
[01:01:59.130]dave aiken: You know, Tina or Austin or someone to do it to take a look at this, you know, kind of from the more technical tax standpoint and and and let people know kind of what their options are stuff but
[01:02:12.780]dave aiken: I've always assumed that people could pay some property taxes early in 2020 and and then. So get a little bit refund in 21
[01:02:26.220]dave aiken: Obviously, talk to your tax advisor, don't do it because they can sell it, it might be a good idea, he can, you know, as far as your taxes are concerned, they can that nobody's talking about so
[01:02:38.160]dave aiken: But I just throw that out as possibility.
[01:02:40.890]Brad Lubben: Well, we have to acknowledge that you like. I am a public servant, that gets paid with state funds. So we appreciate the test point of as does come with that.
[01:02:51.930]Brad Lubben: The philosophical question or the prospective question. You mentioned possible developments that could all contribute to economic development.
[01:03:02.880]Brad Lubben: New revenues tax relief. The question is if wind and solar are really a potential source of new development and property tax base and property tax revenue.
[01:03:14.400]Brad Lubben: Then why is it that rural senators. This is the question, why is that the rural senators are the biggest opponents.
[01:03:21.630]dave aiken: Well,
[01:03:25.380]dave aiken: It's it's politics and it is
[01:03:32.310]dave aiken: Like power districts in Nebraska. I don't want to say the names part mystics from Nebraska that have major coal facilities that want to run those facilities as much as they can for as long as they can. They know that
[01:03:49.680]dave aiken: Time is not on their side. They know that as we get more concerned about climate change and clean energy and all that.
[01:03:59.040]dave aiken: That that is going to throw a monkey wrench into their plans of, you know, how much total revenues will they get from this facility from when they opened it up to, you know, when they put it in mothballs
[01:04:14.790]dave aiken: So that, that is, again, I'm not. I don't want to point fingers, but that's that's been the constraint and the power districts have been very effective in terms of
[01:04:30.870]dave aiken: Persuading roll legislators that, you know, you know, these, these power districts have helped build rural Nebraska and they, you know, they provide reliable electricity that's
[01:04:44.730]dave aiken: highly reliable and for years and years, not as not as much anymore, but for years and years were provided relatively low
[01:04:53.670]dave aiken: Rates.
[01:04:55.260]dave aiken: electricity rates so
[01:04:58.380]dave aiken: You know you don't stab a friend like that in the back is
[01:05:02.730]dave aiken: Kind of their message, but that's
[01:05:05.910]dave aiken: There's no question in my mind that that's the, that's why we have not tried to cash in on our
[01:05:15.030]dave aiken: Clean energy potential in Nebraska, because that the potential is there and it's real. And it'll be at some some point
[01:05:25.230]dave aiken: If it's, you know, whether it's in the next five years. The next 10 or 15 years it's going to be millions and millions of dollars, no investment in Nebraska millions and millions and millions
[01:05:36.300]Brad Lubben: Davis, then as a not to make a political comment, but as a as a note, sort of a follow up to that is the recognition that all of these issues are always going to be complex.
[01:05:49.770]Brad Lubben: Renewable energy might offer new economic opportunities might offer new tech space, the same citizens that would benefit from
[01:05:57.480]Brad Lubben: Expanding tech space or also ratepayers into a current public power system that might end up competing against her have to compete against that, that new generation. So
[01:06:08.790]Brad Lubben: One final question for the day and we appreciate your participation. But the last question for the day.
[01:06:14.670]Brad Lubben: Relates to the prospects of a potential constitutional amendment if other issues like really for growth or so forth or difficult. Ultimately, it might still be a constitutional amendment that seems to be the biggest hammer
[01:06:31.770]Brad Lubben: What are the prospects for that either through ballot or through a legislative resolution. What What prospects do you see for an introduction of the constitutional amendment and the kind of in the coming year or years
[01:06:47.130]dave aiken: I have
[01:06:49.830]dave aiken: I have always
[01:06:53.400]dave aiken: Been amazed that
[01:06:57.090]dave aiken: The original 30% solution and then the subsequent 35% solution.
[01:07:05.790]dave aiken: Did not get on the ballot.
[01:07:08.250]dave aiken: And
[01:07:10.440]dave aiken: I understand that some groups and some groups who might be expected to support something like that.
[01:07:20.670]dave aiken: Would say
[01:07:22.380]dave aiken: Yeah, that would provide meaningful property to actually no two ways about that.
[01:07:30.060]dave aiken: But it would also provide recall I have it in terms of
[01:07:35.580]dave aiken: You know, state government, state institutions.
[01:07:39.360]dave aiken: University, Nebraska, you know,
[01:07:42.210]dave aiken: Whatever the, the higher ed, the Nebraska higher ed system throughout the state, you know,
[01:07:51.990]dave aiken: Because from what from a purely political standpoint if if
[01:07:58.590]dave aiken: Some, some of the groups said we're gonna we're going to take this up and support it, you know, we're giving up on the political process. We're going to support this.
[01:08:08.280]dave aiken: They could get the they could get the thing on the ballot and once it was on the ballot, you would not have to have a very big budget to run these
[01:08:21.750]dave aiken: Half page ads, maybe full page ads in in newspapers never kind of Nebraska saying if you're a homeowner, you know, this is how much of a refund, you would get
[01:08:34.620]dave aiken: You know, you're going to get 35% of your property taxes that you paid on your house, you're going to get that back as a check from the state. If you're a farmer.
[01:08:44.010]dave aiken: You know, here's the same calculations for you if you're a rancher. Here's the same calculation for you do sample ones and then show them how to do it, you know, say, Here's how you can find out what it would be for yourself, you know,
[01:08:55.260]dave aiken: Show form and stuff like that as a look at this line and then multiply this by 35 port 35 and and that's how much your refund check would be if you vote for this.
[01:09:06.240]dave aiken: And I, you know,
[01:09:09.360]dave aiken: It would, you know, the people. The people who would lose from at
[01:09:16.170]dave aiken: being adopted.
[01:09:19.050]dave aiken: What have a lot of political headwind I think in terms of trying to convince people that yeah it's better to pay the taxes than to get the money back. You know that's that's an uphill battle and so
[01:09:34.260]dave aiken: I think it has been the lack of
[01:09:37.410]dave aiken: political support, excuse me, financial support from, you know, from groups who could put resources, both human and financial into the effort to get that on the ballot. If the major if the two or three
[01:09:54.480]dave aiken: Major ad groups in Nebraska said, you know, let's do this, let's do this. Let's I'm tired. I'm tired of the so called nickel and dime stuff for property tax relief I want
[01:10:06.150]dave aiken: I want it now or I don't want to have to wait for it. And if that means they're going to have to change, you know, change income taxes or sales tax or states reading great you know it will be worth it.
[01:10:21.330]dave aiken: I think, I think those petitions would fly off the shelves, they come back with tons and tons of signatures and
[01:10:31.170]dave aiken: You know, I think I'd get on the ballot and it'd be pretty it'd be
[01:10:36.150]dave aiken: It'd be if if I was going to be a paid political consultant, I guess I'd rather be paid to try to get the thing past than being paid to get the thing to get them to defeat the thing
[01:10:50.490]dave aiken: If you're being paid on a contingency because i think i think the smart money will be on. It's been enacted so i think i think i mean
[01:11:00.810]dave aiken: I think it's been kind of maybe a lack of leadership in terms of why that hasn't made it through, because I think if they could overcome the leadership and the financial thing then they
[01:11:13.590]You know,
[01:11:15.300]dave aiken: But that'd be an interesting discussion. I mean, it'd be great to have a panel, you know, get representatives from some of the ad groups.
[01:11:21.810]dave aiken: Some of the other. Some of the taxpayer groups, you know, maybe some other industry groups. That'd be a fascinating. That would be a fascinating panel discussion to listen to great
[01:11:32.790]Brad Lubben: Day. Thank you very much for the discussion and the perspective, there may be a future topic here to come back to sooner. Now,
[01:11:40.590]Brad Lubben: I want to thank everyone for joining us today on the webinar and thank you for sticking with us a little bit past the one o'clock hour here.
[01:11:47.730]Brad Lubben: But please note are recording this webinar, like all of the other previous webinars will be posted at farm dot you and Ellen died. EDU or you can also find information about our upcoming webinars on that page as well.
[01:12:01.590]Brad Lubben: Check farmed out you know.edu for the schedule. We have a couple
[01:12:06.750]Brad Lubben: Three webinars yet coming up the this month, next week will be a discussion of farming and farm program payments when I in fact I have the privilege of
[01:12:16.350]Brad Lubben: Delivering some information and providing an update on October 22 we'll talk about the farm financial position in Nebraska and Tina Barrett
[01:12:25.770]Brad Lubben: Will be there and then on October 29 day will be back on the agenda to talk about ballot issues he mentioned some of them today, but
[01:12:35.160]Brad Lubben: An opportunity to review the ballot issues ahead of the early November election so
[01:12:40.830]Brad Lubben: As you leave today, a reminder that you'll be receiving a short 32nd survey in your email. We really appreciate your feedback on today's webinar, your input on future sessions and your overall support of this continued webinar effort. Thanks again for joining us and have a great day.

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2020 Property Tax Changes (Oct. 8, 2020 Webinar)

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