Hours after Nebraska lawmakers sent a feeble property tax relief package to his desk Tuesday morning, Gov. Jim Pillen signed it into law as senators adjourned for the summer, marking a disappointing end to the special legislative session he called last month to deliver "transformational" tax reform. Surrounded by more than a dozen lawmakers who helped deliver the package to Pillen's desk after a contentious 17-day session, the governor signed the tax package that will cut various state budgets, place an infl ationary cap on annual budget increases for cities and counties and pour $750 million into a property tax relief fund.
Much of that relief, though, will be funded by front-loading an existing tax credit program that more than half of Nebraska's property taxpayers are already tapping — limiting the aid the plan will actually provide to many homeowners and marking a letdown for both lawmakers and Pillen, who had promised to deliver more than $2 billion in property tax cuts this year. "In terms of how much do we celebrate, I'm not sure we should be getting our hands going across our back and slapping our backs too much," Pillen said at a news conference Tuesday afternoon, moments before he signed the tax package into law. "The people of Nebraska will be the judges.
" At the same time, Pillen called the tax package "a big deal" and promised to seek additional property tax relief when lawmakers reconvene in January, calling the package he signed into law Tuesday a starting point, but indicating he did not plan to call yet another special session this year over the issue. "We're not giving up," he said. "We're not stopping.
We're not satisfied. We've got a win. We've made progress.
But we're sure as heck not satisfied." Pillen's remarks came hours after lawmakers voted 40-3 to send LB 34 — the bill carrying the bulk of the Legislature's property tax plan — to his desk after a small group of term-limited lawmakers made a last-ditch push to broaden the bill, which senators from across the political spectrum have repeatedly cast as lackluster. The Legislature pivoted to the watered-down plan after the sweeping tax cut package championed by Pillen stalled last week in the face of fierce opposition from a bipartisan group of lawmakers over its reliance on increased sales tax revenue.
Lawmakers had rejected a similar tax plan Pillen championed amid the regular legislative session, adjourning for the year on April 18 without taking a final vote on Pillen's previous sales taxbased plan, sinking the proposal. The impasse over how to fund property tax relief — conservatives broadly supported the repeal of numerous sales tax exemptions and hiked sin taxes, while progressives hoped for legalized online sports gambling and recreational marijuana, luxury taxes and a new income tax bracket — forced lawmakers to turn to the front-loaded income tax credits, the only revenue source the two camps could agree on. Lawmakers' decision to pivot to the scaled-down package, which multiple senators called "the very least we could do," was met with resistance from members of the Legislature's senior class, who have repeatedly pushed for the expansion of the tax package or for lawmakers to scrap the plan altogether and return to the drawing board.
Some defended LB 34 even as they agreed that it did not go as far as they hoped it would when Pillen recalled the Legislature to Lincoln last month for an abnormal special session focused on property tax reform. The Legislature — with more than 15 new senators who have yet to be elected — will return to Lincoln in January after Tuesday's adjournment sent the 108th Legislature home for the second time this year. Get local news delivered to your inbox!.
