Nebraska Gov. Jim Pillen issued a proclamation on July 24 calling for a special legislative session to begin the next day to address rising property taxes in the state.
The official proclamation drew the ire of lawmakers, who criticized the governor for giving them only 24 hours’ notice.
Mr. Pillen had informally called for the session in a June letter to Speaker of the Legislature John Arch, stating that he intended to call back the lawmakers on July 25.
Nebraska has a single-chamber Legislature that is officially nonpartisan.
The proclamation outlined a comprehensive agenda aimed at revising current tax structures and reallocating state funds. The governor’s directive focuses on several key areas, primarily targeting property tax relief and adjustments to various state taxes.
One of the primary objectives is to modify appropriations approved by the 108th Legislature, according to the proclamation.
This includes reducing general fund appropriations, lapsing cash fund balances, reallocating cash fund revenue, and modifying fees and assessments.
Numerous Tax Reform Proposals
In addition to those fiscal adjustments, the session will consider modifications to several other state taxes, such as changes to the state cigarette tax, taxes on vaping products, consumable spirit alcohol, and Keno gaming.The agenda also includes the potential establishment of sales or use taxes on currently untaxed services and items and an excise tax on consumable hemp.
Further, the governor’s proclamation seeks to eliminate state sales tax exemptions and the personal property tax liability on agricultural and machinery equipment.
It proposes reforms to credits defined in both the Property Tax Credit Act and the Nebraska Property Tax Incentive Act. Additionally, the session aims to amend the state statutes to allow for the redistribution of local option sales taxes.
A significant component of the session will be the establishment of a property tax relief program. This program may involve modifying state educational aid or establishing tax credits to reduce the property tax revenue collected for schools, the proclamation said.
The governor emphasized the importance of ensuring that any program requiring a constitutional amendment be placed on the November 2024 ballot or as soon as feasible thereafter.
To control local government tax collection, the session will also discuss establishing revenue caps that limit the authority of city and county governments to collect property tax revenue.
Mr. Pillen’s late official call for the special session drew testy responses from lawmakers, who said they had to interrupt summer plans, find day care for children, and put their full-time jobs on hold to head back to the Capitol.
Democrat state Sen. Justin Wayne called on fellow lawmakers to immediately adjourn the session on July 25 and demand a week’s notice from Mr. Pillen before reconvening.
Barring that, the Legislature should at least recess until Aug. 1, Mr. Wayne said in a July 23 letter to his fellow 48 senators.
