Property tax relief proposal questioned; lawmakers debate liability in police chases
February 5th, 2016
Gov. Pete Ricketts proposal to relieve property taxes by holding down local spending and limiting ag-land valuation increases ran into questions in a public hearing Thursday. And lawmakers debated who counts as an innocent third party during police chases in Nebraska.
Ricketts’ plan for property tax relief, introduced by Sen. Mike Gloor of Grand Island, calls for limiting tax valuation increase on ag land to a statewide average of 3 percent a year.
It would also tighten existing limits on how much property tax money local governments can raise and spend – for example, by saying they could carry over only 3 percent of their budget from one year to the next.
Ricketts said reaction to his plan makes him think it’s aiming in the right direction. “I’ve talked to farmers and ranchers who’ve said ‘Well, it doesn’t do enough.’ And as I’m sure you’re going to hear a little bit later today, I’ve talked to city and county officials. They say ‘Well, this goes too far.’ To me, that says we’ve kind of hit the right balance here,” Ricketts said.
And Ricketts said because there are so many layers of local government in Nebraska, it’s important for state lawmakers to set limits on them, not simply relying on local citizens to show up at budget meetings. “Think about the person who is trying, to say to run their farm or run their business, take their kids to school, pay their bills, all that sort of thing – just living life. And then they’re supposed to go to a school board meeting, a county board meeting, an NRD meeting, a community college meeting, maybe a city council meeting. I mean, how many meetings can we expect people to go to?” he asked.
Sen. Al Davis of Hyannis said the proposed 3 percent annual limit on the increase in ag land taxable value would be confusing. “I don’t know how we as senators go out and explain that to our constituents who I think are of a mind that the valuations will be at 3 percent. How do you intend to get that explanation out to people so that they don’t expect that their valuation’s only going to go up only three percent, only to see it vary more than that?” Davis asked.
Property Tax Administrator Ruth Sorensen said it will be important to explain the limit is a statewide average, not a cap on the valuation growth of individual properties. Even if the bill passes, the Department of Revenue has projected ag land values in the Sandhills could still go up nearly 14 percent this year, while those in south central Nebraska could go down 2 percent.
Lincoln Mayor Chris Beutler opposed the proposed limits on local government’s ability to raise and spend property taxes, which he said would be “devastating.” He said instead of limiting local governments, the state, which relies mostly on sales and income tax revenues, should contribute more.
“The fair thing to do would be to figure out a way to substitute revenue so that you weren’t destroying the political subdivisions in the process of correcting the property tax situation, if you think it should be corrected. Because I don’t think the underlying evidence is there to make the argument that Nebraska political subdivisions are wasting your money,” Beutler said.
Lawmakers are expected to be weighing the pros and cons of various approaches to property tax relief and shaping a package before the Legislature finishes its session in mid-April.
And in floor debate Thursday morning, lawmakers considered liability in police chases. Under current law, if the police are chasing a driver, and an innocent third party gets hurt or killed, the city or whatever government entity the police work for is liable. But Sen. Dan Watermeier of Syracuse wants to create exceptions to that rule. Watermeier says because Nebraska doesn’t define “innocent third party,” that leaves it up to the courts.
“The Nebraska Supreme Court has even held that a passenger in a fleeing vehicle, who was drinking from an open container of beer in the vehicle, and was ultimately found with methamphetamine and two methamphetamine pipes on him, for which he had charged and pled guilty to a felony drug offense, was nonetheless still an innocent third party. As a result NIRMA, (The Nebraska Intergovernmental Risk Management Association, which handles insurance for counties.) on behalf of Platte County, was ordered to pay this individual $1 million,” Watermeier said.
Watermeier’s bill would exclude passengers if they got in a vehicle knowing the driver was drunk or on drugs; if they didn’t try to get him to stop, if they encouraged the driver to flee, if they were wanted for arrest, or if they’d committed a felony.
Sen. Ernie Chambers of Omaha opposed the bill, saying someone’s condition shouldn’t matter if they’re a third party injured in a chase. “If somebody is falling down drunk in a car that’s being chased, and the driver loses control, and that person is hurt, that person for the purposes of that chase is an innocent individual and society should pay,” Chambers said.
Chambers vowed to filibuster against the bill, which could mean it’ll be next week before a vote is reached.
Editor’s note: for a panel discussion on the link between property taxes and school funding, click here.
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