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Tax relief top issue for Ricketts
January 22, 2016 Jerry Purvis   

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Jerry Purvis/Gering Citizen Gov. Pete Ricketts visits with Fred Lockwood and other local leaders after making remarks at the Scottsbluff Airport on Friday morning. Scottsbluff was one of 10 stops made by the governor during his two-day fly around trip across Nebraska, giving updates on the latest legislative session.

Property tax relief topped issues most concerning for Nebraska Gov. Pete Ricketts, who stopped at the Western Nebraska Regional Airport Jan. 15 as part of his annual fly-around of the state.

Starting his second year in office, Ricketts said the state has a lot going for it. Nebraska boasts the second lowest unemployment rate in the nation. It also has a AAA credit rating, and is among the top 10 states in both health and volunteerism.

“The number one thing people across the state have talked about over the past two-and-a-half years is property taxes,” he said. “The Tax Foundation ranks Nebraska as the 12th highest in the country.”
Ricketts said the state also made progress in his first year as governor. Under his watch, it has cut the growth of government in the last budget from 6.5 percent to 3.5 percent in the current one.

“The only way we can have sustainable tax relief is to control spending,” he said. “Last year we were able to increase the property tax credit relief fund by more than 45 percent. That means in this budget, we will deliver $408 million of direct dollar-for-dollar tax relief from the state to all property owners. That’s a great win for taxpayers.”

Legislation introduced this session would change property tax structurally, getting back to the idea that sustainable tax relief is only obtainable by controlled spending.

The governor’s proposal would look at all government entities with the aim of tightening some of the spending controls, including on local spending. The proposal would also look to remove exceptions to levy limits.

The legislature’s school-aid formula would also come under the microscope to address whether tightening the rate of growth in local school districts would help.

That would include limits on what schools could transfer into its reserve funds in any given year.

Ricketts said agricultural land values are a big part in reducing property taxes. In the past several years, farm land values have gone up dramatically, which has had a big impact on farmers and ranchers when commodity prices are flat or headed downward.

Ricketts proposes a limit on aggregate agricultural land valuations to three percent a year. “That’s not a cap on taxes for individual property owners, but on an average across the state,” he said.

The Department of Revenue has projected that if nothing is done, farm land valuations will go up more than eight percent in 2016 alone.

Ricketts also proposed the creation of a transportation infrastructure bank which would benefit the state’s top three industries: agriculture, manufacturing and tourism

“All those industries rely on a strong transportation system to be able to expand,” Ricketts said. “This bank would help accelerate that work.”

The state would move up to $150 million from cash reserves into the infrastructure bank to fund capital projects like expressways. Funds would be replaced by allocated funds from the Department of Roads, including federal funds, savings and fuel taxes.

There are three major components to the transportation infrastructure bank. Approximately $100 million would go to the Accelerated State Highway Capital Improvement Program to fast-track highway construction projects and get them completed as soon as possible.

The County Bridge Match Program would provide about $25 million in matching funds. Counties could tap into these funds to repair or replace aging county bridges.

Another $25 million would go into the Economic Opportunity Program to support new and expanding businesses by connecting these businesses to Nebraska’s transportation network.

That might include the construction of rail spurs or roads.

With the dropping price of oil and its by-products, there’s concern the state wouldn’t be able to reimburse the infrastructure bank through fuel taxes alone and might have to consider a gas tax hike. Such a move could burden rural Nebraskans who regularly drive long distances for work.

“I would oppose any tax increase; we’re already taxed enough, and we have to live within our means,” Ricketts said. “We’ll only fund projects from the infrastructure bank which fit into the budget and can be repaid with available funding.”

He added Nebraska, as the nation’s second largest ethanol producer, has a great opportunity to further explore the science behind production of biofuels, educate the public, and promote the benefits of ethanol.

Ricketts also touched on needed reforms in the state’s corrections system. One of those reforms would use an automated system to calculate prison sentences, eliminating human error when it considers the early release of some prisoners.

Another proposed change would increase the number and scope of community based corrections, which means offenders could stay closer to their homes. In doing so, they could more ably obtain counseling, job training, education and work release with the possibility of reintegrating into mainstream society.

“This is a business where we don’t want repeat customers,” Ricketts said. “We want to help offenders get the help they need,

Jerry Purvis/Gering Citizen Gov. Pete Ricketts speaks to local leaders at the Scottsbluff Airport last Friday morning.
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