Helmet repeal fails; property, income tax changes discussed

Sen. Robert Hilkemann led a successful filibuster against helmet law repeal (Photo by Fred Knapp, NET News)
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March 14, 2017 - 4:24pm

A bid to repeal Nebraska’s motorcycle helmet law is dead for the year, and property and income tax changes were discussed Tuesday in the Legislature.


After three days of debate pitting personal freedom against social costs, the question of repealing Nebraska’s motorcycle helmet law came down to a single vote. Sen. John Lowe, chief sponsor of the repeal, outlined the choice. “Fellow senators, this debate is over helmet laws, (and) has been going on for a long time. And yet the opponents of this bill have fought every time to prevent a simple up or down vote. I urge you all to allow this vote to go to a simple up or down vote,” Lowe said.

Standing in the way of that up and down vote, which would require 25 yes votes among the 49 senators to advance the bill, were Sen. Robert Hilkemann and his allies. To defeat their filibuster against the bill would have required approval of a cloture motion, which takes 33 votes, to cut off debate and vote on the bill itself.

Hilkemann asked his colleagues not to do that. “If we don’t give the cloture vote, this bill is over. The debate is done,” Hilkemann said.

On the cloture vote, Lowe got 32 votes – one short of what he needed. Speaker of the Legislature Jim Scheer, who voted for cloture but who’s job includes managing the Legislature’s time, then confirmed that the issue would not come up again this year.

Meanwhile, the Legislature’s Revenue Committee met in executive session to hash out what changes to the state’s tax system it will propose to the full Legislature. Committee Chairman Sen. Jim Smith said if the state took all the money currently going to the property tax credit fund, plus certain other tax credits, that would yield approximately $260 million that could be redirected to other forms of tax relief.

About $165 million of that could go to a proposal by Sen. Mike Groene to increase state aid to schools, Smith said. “So the property tax credit fund -- relief fund -- those dollars are going to property tax today, would be applied to education, which is driving property tax. So in my opinion, this is being applied to where the problem is and fixing the underlying problem that we have in property taxes, particularly in our rural areas,” Smith said.

This idea has been tried before, in the 1990s, with limited success. In his State of the State speech in 1999, then newly-installed Gov. Mike Johanns applauded legislative efforts to increase state aid to schools in order to hold down property taxes. But he added “I believe there is a better way to fund property tax relief than increasing state aid to local school districts.”

Johanns went on to propose the property tax credit fund – the same one that would be emptied out in favor of increased school aid under the idea being discussed by the Revenue Committee. At the time, critics of increased school aid argued that schools would spend the increased funding rather than decrease property taxes.

Tuesday, Smith acknowledged that history, but suggested this time, under Groene’s proposal, LB640, it could be different. “You don’t want to have this without constraining and reducing spending. And I believe that’s part of the package that we’re looking at. LB640 in my opinion does help to reduce spending of schools -- makes them more accountable for what they are spending,” Smith said.

Groene’s proposal would limit property taxes to 60 percent of school budgets, and use state aid make up three-quarters of the difference between that limit and current spending. School districts would have to cut the other 25 percent, unless the school board voted to override the reduction by a two-thirds vote.

Smith said funds from the property tax credit fund that aren’t used for increased school aid could be used to reduce income taxes. A bill by Sen. Brett Lindstrom would reduce the top income tax rate from 6.84 to 5.99 percent  by 2025, if state revenue growth permits, and would also reduce corporate tax rates.

Smith predicted there will be objections, but said something needs to be done. “Nothing that we come up with is going to be without some concern somewhere. But I believe the greatest concern will exist if we do nothing. And the general public and the business community and the farmers and the cattlemen will say ‘Once again, nothing,’” Smith said. “The path forward is a compromise. It’s far from perfect. It’s far from everything that I want and it’s far from everything that others want.  But it is relief and I believe it will have a positive impact on creating economic activity in our state.”

The committee has taken no votes on any package, and has scheduled a series of meetings over the next week and a half to discuss its plans.

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