Media Roundup: Nebraskans Back Gov. Ricketts’ Tax Reform Plans
York News-Times: Governor brings property tax proposal to York
Nebraska Radio Network: Business owners rally behind Gov. Ricketts’ call for tax cut (AUDIO)
Some business owners say Nebraska taxes too much. They have lined up behind Gov. Pete Ricketts’ call to cut the top individual income tax rate.
A number of business owners joined the governor in a news conference in his public hearing room Monday to support his call to cut the top rate from nearly 7% to just under 6% over a number of years.
President Mike Mapes with The Alliance Group of Omaha, a professional employer organization, said he hears two main complaints from business owners: they cannot find enough workers and taxes are too high.
“In the United States, you’re allowed to vote with your feet and you go to where you believe that you have the highest economic opportunity for yourself,” according to Mapes. “So, the best and the brightest graduate from our universities and they end up going elsewhere. I think taxes are a major reason why they decide to go elsewhere.”
A push is being made at the Capitol to change the way farmland is assessed for property tax purposes.
Gov. Pete Ricketts has enlisted the help of a number of agricultural producers to back his structural change on how agricultural land is assessed, a move he calls, “a big deal.”
During a news conference held in the governor’s Capitol office, Ricketts made his case for changing the method of assessment from the current market-based assessment to an assessment based on the income potential of the land.
Loup City rancher Trent Loos insisted the change would send a positive signal to rural Nebraska youth about the future of farming.
“We’re not just talking about some industry that produces widgets,” Loos stated. “We convert the God-given natural resources into the essentials of life: food, fiber, pharmaceuticals, and fuel.”
Associated Press: Ricketts rallies Nebraska business owners behind tax plan
Small business owners from around the state gathered with Ricketts at the Capitol to tout the measure, which would lower the top rate from 6.84 percent to 5.99 percent over eight years.
Ricketts argues that lowering the top tax rate would stimulate the economy by encouraging businesses to hire more people and invest more in their operations.
"If we want families to move here, if we want companies to expand here, if we want small businesses to grow, we have to be more competitive when it comes to taxes," Ricketts said at a news conference.
Omaha World-Herald: Small businesses join Ricketts to urge cuts in top state income tax rate
A dozen small-business representatives joined Gov. Pete Ricketts on Monday to call for cuts in the state’s top income tax rate.
The governor also touted support for his proposed cuts from key business organizations and conservative advocacy groups.
Mike Mapes, president of a professional employer company from Omaha, agreed. He said Nebraska’s income taxes drive away college graduates and discourage potential employees from other states.
He called on lawmakers, “if they really care about what’s best for Nebraska and Nebraska’s future,” to support Legislative Bill 337.
Jack Schreiner, owner of Bruckman Rubber of Hastings, praised the incremental nature of the plan and the trigger mechanism.
He said those would ensure that the state still has enough money to fund education while providing a boost to small businesses.
Lincoln Journal Star: Ricketts touts tax plan with business leaders
"I like this plan a lot, and I like where this governor's trying to take us," said Jack Schreiner, owner of Bruckman Rubber in Hastings, during a news conference in Ricketts' state Capitol office.
The proposal, which is before the state Legislature, would gradually reduce the state's top individual income tax rate from 6.84 percent to 5.99 percent over the next 10 years, or longer depending on state revenue growth.
"It's not a huge decrease," he said. "I would have liked to have seen much bigger, but it wasn't going to happen this year. This is practical."
Ricketts said the plan will boost small businesses and make Nebraska more competitive with surrounding states. He described small businesses as employing anywhere from a couple to 250 or 500 people.
Speaking from the Chapman office of farmer-owned distributor Preferred Popcorn, Ricketts said changing how Nebraska calculates valuations from being based on land sales to reflecting lands’ income potential will make the process fairer and more predictable, as well as put Nebraska farmers and ranchers on equal footing with their counterparts in neighboring states already using a market-based method, including Iowa, Kansas and South Dakota.
“This will be long-term property tax reform by structurally changing how we value ag land,” he said.
Agriculture groups have been supportive of the effort but said it won’t relieve the pressure tax bills are placing on their pocketbooks.
Ricketts said LB338 is a bill that he and state Sen. Lydia Brasch of Bancroft are working on. Titled The Agricultural Valuation Fairness Act, the bill would change the method for assessing property value from a market-based system to an income potential assessment, which would slow the growth of ag land valuation increases.
Brasch is chairwoman of the Legislature’s Agriculture Committee.
Ricketts said during his travel around Nebraska the last 3.5 years, “The one thing I consistently heard is the need for property tax reform and the need for property tax relief.”
On Monday, Gov. Pete Ricketts called a press conference to promote a bill that would change how Nebraska values farm and ranch land, with the ultimate goal of reducing how much landowners pay in property taxes. Switching to a system that calculates the land’s income-producing ability, rather than its market value, is a method that also has been embraced by states such as Kansas and South Dakota.
From the audience of the press conference, Olson asked how much northeast Nebraska farmers such as himself could expect to see their land valuations decrease under the bill. About 5 percent, the governor estimated.
How much that might trim from his $80 per-acre tax bill remains unclear, but it would be modest at best.
“It helps,” Olson said afterward. “It’s better than nothing.”
“I tend to think of the ag economy as wounded,” said Deb Gangwish, who farms near Shelton. “Nebraska’s high property taxes are like pouring salt into that wound.”
Nebraska Gov. Pete Ricketts touted his property tax proposal Monday as a major change to the way agricultural land is valued, even though the state's largest farm groups say it doesn't do enough to help them.
"This is a way to allow our producers to be more competitive," Ricketts said.
Supporters say using a land's income potential is a fairer and more predictable way to assess land values because it would soften the sharp increases property owners have seen in recent years.
Groups such as the Nebraska Farm Bureau and the Nebraska Farmers Union have said the proposal could help but doesn't deliver the reforms sought by rural and urban residents. The Farm Bureau has called on lawmakers to "rebalance" the combination of property, income and sales taxes that finance government operations by eliminating sales tax exemptions or increasing the sales tax rate.
Gov. Pete Ricketts' income and property tax package drew cheers from Nebraska's business community when he announced it last month, but leading farm groups say it doesn't do enough to address their concerns about rising property taxes.
Although farm groups support the governor's proposal to change how agricultural land is valued, they are disappointed the package doesn't offer more to landowners. Property taxes on agricultural has soared by nearly 164 percent over the last decade, according to the Nebraska Department of Revenue.
Nebraska faces a nearly $900 million projected revenue shortfall largely because commodity prices and farm incomes have fallen sharply even as agricultural property values have continued to rise.