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Now that Gov. Jim Pillen appears to be on the road to recovery after a wild ride aboard a bucking bronco, his next rodeo act will be roping up enough votes to lower property taxes, cut government spending and return Nebraska to a “winner-take-all” system of doling out the state’s electoral college votes.
Those are among the top priorities laid out by the governor – before he was bucked off a reportedly new horse – for the 2025 session of the Nebraska Legislature, which begins on January 8.
At the top of the list is something that is at the top of the list every year, by every governor: reduce property taxes.
Nebraska is a state with a lot of land but not a lot of people, and a place where special interests, if they threaten loudly enough to move their companies away, get generous sales and income tax breaks from our lawmakers. Thus property taxes, one of the alternatives, have remained high.
But the odds of Pillen riding a plan to victory that reduces property taxes seem pretty long, about as long as getting back up on that wild horse.
State lawmakers spent several days in Lincoln this summer trying to hash out a property tax relief plan without much success, and you wonder if there’s a little tax-relief fatigue after pounding their heads against the wall for several weeks.
Taxation is a complicated subject with lots and lots of proposals to reduce property tax and not enough agreement on how to do it. Thus, it’s hard to get much done.
Secondly, the November elections are bringing in a new wave of legislators – 18 in all – so it will take some time for them to get acclimated to the ins and outs of tax reform, and come together on a plan.
And among the departing senators, due to term limits, is State Sen. Lou Ann Linehan, who chaired the Revenue Committee, which deals with tax policies.
She was a pro at lining up support for plans advanced by the governor’s office and crafting compromises, a skill honed in the halls of the U.S. Senate as an aide to then Sen. Chuck Hagel.
Like a big fullback, you need someone with some muscle to get proposals over the political goal line at crunch time. Linehan was that person — her departure leaves a void.
Plus, there’s a minor matter about the state budget, which has a projected $432 million shortfall over the next two years.
(That shortfall would have been $200 million larger had not the Legislature, during its special session, allocated $200 million to reduce the budget hole, reported Martha Stoddard of the Omaha World-Herald.)
So paring the budget or, gulp, finding new tax revenue will be a huge issue in 2025.
Already, one influential senator, Rob Clements, who chairs the budget-writing Appropriations Committee, said he doesn’t see how lawmakers can enact more property tax relief measures – which typically reduce state tax revenue – when facing such a deficit.
The Legislature can utilize cash reserve funds – the so-called “rainy day fund” of the state – to handle some of the shortfall, but Clements said he expects that some budget cuts will also be necessary to balance the budget.
Pillen has also said he wants to reduce state spending in the next budget, a goal often voiced but rarely achieved due to inflation and the annual demand for more – not less – state services.
So saddle up Nebraskans, and keep a tight rein, as the governor, and state lawmakers seek to tame an ever bucking bronco named “High Property Tax.”
Paul Hammel has covered state government and the state for decades. He retired in April from the Nebraska Examiner. He was previously with the Omaha World-Herald, Lincoln Journal Star and Omaha Sun.
