Property tax breaks for flood victims advance as Chambers relents

Nebraska senators debate Tuesday (Photo by Fred Knapp, NET News)
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April 9, 2019 - 4:43pm

Nebraskans whose houses were destroyed in recent flooding moved a step closer to getting a break on their property taxes Tuesday, as Sen. Ernie Chambers relented in his filibuster against the legislation.


Currently, Nebraskans pay property taxes on the value of their property as of January 1 of every year. If someone owns a house that’s washed away by a flood on January 2, they still have to pay on its value the day before.

Sen. Mike Moser was among those supporting a change, arguing that’s unfair to property tax payers. “They’ve lost property. The property’s not there. And because of a technicality in the law, we’re making them pay property tax on property that’s not there. The value is not there. It may be legal to do – a couple of the attorneys I asked, ‘cause it didn’t seem fair – but they said it’s legal. And again, I think we’re kicking people when they’re down,” he said.

Moser was supporting a proposal by Sen. Steve Erdman that would pro-rate taxes, so that people would pay on only the value of the land underneath their house if it were destroyed in a flood or other disaster.

When the same proposal was debated last week, Sen. Ernie Chambers held it up with a filibuster. At that time, he argued many of the same senators who wanted relief for flood victims had opposed proposals to help others, including people who work for tipped wages, people convicted of drug crimes when they’re released from prison, and LGBT Nebraskans.

Tuesday, Chambers signaled he was relenting. He acknowledged strong support for the proposal, although he still had problems with it. “I’m not in favor of stepping on somebody who’s already down. And that is not what I’m going to do on this bill. There are probably more than 33 votes,” (enough to overcome a filibuster) he said.

“There are also some problems with the bill itself, but you all have all the geniuses working on it, so I’m not going to deal with that. I’m going to let you all deal with it,” Chambers added.

Among those problems, Erdman acknowledged, is the need to define what it means for a house to be “destroyed.”

“I think it’s important that we come up with a definition that makes some sense, because if you just need a new furnace or you need to change the drywall or whatever it is, that’s not a significant distraction from you being able to live there. And so we have to make sure that this is applied to the people who actually have suffered a loss – a significant loss,” Erdman said.

And Sen. Steve Lathrop questioned the practical effect of the proposal on, for example, a town hit by a tornado. “If it comes through and wipes out half the houses in town, the following year, because we pay in arears, half the town won’t be paying any taxes or they’ll be paying very little taxes based upon the land and not the structure, ‘cause that had been wiped out. And the other half of the town would have their levy raised because the half of the town that was wiped out was having their taxes forgiven or significantly diminished,” Lathrop said.

Sen. Lou Ann Linehan said the outcome would be up to the local community. “We could do a thing where they can raise the levies up, because the land is still there, right? So they still own property. So we could have a fix for that particular – we’d have to define it well -- situation where you would allow the city, allow them to raise their levies above the maximum levy if the people in the town agreed that’s what they were going to do,” he said.

Even though he didn’t try to stop the bill Tuesday, Chambers said he would still advocate for the other measures whose rejection had triggered his filibuster last week. In particular, he went after the arguments against a bill that would have allowed people convicted of drug-related felonies to get food stamps, or SNAP benefits, once they got out of prison.

Opponents of that bill said such people were responsible for their own actions and should not get government benefits. That led Chambers to ask “What about alcoholics?  Should any public money be spent to provide treatment for people who get cirrhosis of the liver from too much alcohol? How about cancer treatment? Should there be any public money going for the treatment of cancer if the ones who got it got it from smoking? They chose to do that. They chose to drink.”

“You all’s so-called values are so skewed, it is impossible to find any logic to it,” Chambers told his fellow senators.

Regardless, senators gave first-round approval to the bill offering tax breaks to people whose houses were destroyed, on a vote of 42-0, with Chambers abstaining.

Lawmakers also discussed replenishing the governor’s emergency fund. That fund used to contain $5 million, but now has only $400,000. Sen. Linehan proposed taking $4 million each of the next two years from money that had been devoted to a so-called “angel investment” tax credit for startup businesses. Sen. John Stinner said the funds should be redirected to other business development programs.

Linehan and Stinner agreed in principle $4 million should go to the governor’s emergency fund for one year, in an amendment that will be offered at the next stage of debate.

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