Truth in Taxation Law Postcards to Hit Mailboxes
As a famous quote from the movie “A Few Good Men” goes “You want answers? I want the truth! YOU CAN’T HANDLE THE TRUTH!”
Nebraskans have been asking for truth and transparency in how our property taxes are set. A new law now provides that truth and gives taxpayers a well-defined time and place to let their elected officials know how they feel about plans to raise their property taxes.
With the passage of Sen. Ben Hansen’s bill (LB 644), cities, counties, school boards, and community colleges are now required to engage directly with taxpayers when they decide to seek an annual property tax increase greater than 2 percent, plus the real growth within the political subdivision. That includes funding for projects like new construction, improvements and additions to existing buildings, annexation, and other tax increment financing projects.
Nebraska recently became the third state to adopt a “Truth in Taxation” law following Kansas and Utah. LB 644 adds teeth to LB 103 which the Legislature passed in 2019. That bill modified the hearing and resolution process for political subdivisions to protect Nebraskans from automatic tax increases when property values increase. As a result, local taxing authorities are required to hold both a hearing and vote to collect more in property taxes before taking advantage of increased valuations. However, not all political subdivisions in Nebraska were complying with LB 103 and members of the public did not notice the legally required public announcement hearings were supposed to be published in a local paper. Now, taxpayers will receive a postcard in the mail.
A special public hearing is now required, and taxpayers will be notified by postcard at least seven days before the public hearing. Public hearings will be held between September 17 and 28. Entities will present specific information about the additional need for funds and the public will be allowed time to comment. Nebraska Resource Districts are exempt from participating in the joint public hearings.
To achieve true property tax relief local government spending must be addressed. Property taxes paid by agricultural landowners have risen dramatically across Nebraska over the past decade. Budgets and levies set by local governing boards drive the amount of property taxes collected each year. The single most effective way to control spending and/or levy increases is for local taxpayers to attend and participate in open meetingsheld by local political subdivisions such as schools, counties, community colleges, and NRDs.
NEFB’s Take: Slimmed Down Build Back Better or “Inflation Reduction Act” Moves Forward
By Jordan D. Dux, Sr. Director of National Affairs
As I’m sure you all have seen, West Virginia Senator Joe Manchin and Senate Majority Leader Chuck Schumer (D-NY) announced a deal on a smaller but still substantial tax/climate package. The long and short of it is that this isn’t exactly Build Back Better (BBB), but it’s close. The really bad ideas that NEFB strongly pushed back on like the elimination of stepped-up basis weren’t included. There is even some good stuff in there like $40 billion for agriculture, forestry, and rural development programs. However, despite the fluffy “Inflation Reduction Act” name, the bill spends over $700 billion, raises taxes by over $700 billion, and will likely have little to no impact on inflation. As we always do, Nebraska Farm Bureau (NEFB) weighted the good with the bad, and ultimately came out opposed to the bill, sending letters of opposition to Nebraska’s congressional delegation.
To risk getting in the weeds, from an agriculture standpoint, again, the final bill includes nearly $40 billion for agriculture, forestry, and rural development. This includes $20 billion dollars in funding for Agricultural Conservation Easement Program (ACEP), Conservation Stewardship Program (CSP), Environmental Quality Incentives Program (EQIP), and Regional Conservation Partnership Program (RCPP). In addition, it includes $14 billion for rural development to support the development of renewable energy and investments in biofuels infrastructure. The bill also provides $4 billion to mitigate the impacts of drought in the western Reclamation states, with priority given to the Colorado River Basin and other basins experiencing comparable levels of long-term drought. If you want to see a full breakdown of all of the different “ag/biofuel provisions, you can view this helpful report here. Overall, this is a pretty similar breakdown to what existed in the original BBB.
While the bulk of the spending portions of the bill are “climate” related, the bill also extends the previous doubling of the Affordable Care Act (ACA) subsidies that were first included in past COVID-19 funding bills. Those increased subsidies do provide additional federal assistance to those who qualify for ACA subsidies, but that also come at a specific cost for us. Several years ago, NEFB spent considerable time and money developing from a group health insurance product through Medica that helped group farmers, ranchers, and agribusiness employers together to help reduce health insurance costs. However, our market-based approach can’t compete when the federal government drops in billions of tax-payer dollars. As an aside and more on all of this in the future, NEFB is continuing to work on other ideas to help bring down health insurance costs for our farm and ranch member families.
When it comes to taxes, the legislation is largely funded through a 15 percent minimum tax on corporations, a new excise tax on stock buybacks, and a provision that would allow Medicare to negotiate drug prices. Again, the elimination of stepped-up basis that was originally included in BBB was left out of the legislation following significant pushback from the agricultural community including Farm Bureau. Unfortunately, BBB’s methane tax on the oil and gas industry is still included in this package. While the tax is only focused on the oil and gas industry, we continue to be worried that this could simply open the door for future regulation of methane from agriculture. That would obviously be a non-starter for us, and we would use all of the tools at our disposal to push back against any methane or carbon tax on agriculture.
At of the time of writing this, the Inflation Reduction Act has yet to be taken up by the House, but the package is expected to pass on Friday, August 12. President Biden would obviously look to sign the bill shortly thereafter. While the full economic consequences of this legislation likely won’t be known for years, Democrats in Washington are hoping the package will provide them an electoral boost going into the November mid-term elections. Unfortunately, rather than working in a bipartisan fashion, Democrats took the partisan road and pushed this through without the support of any Republicans in the Senate and likely few if any in the House (again, we’ll see on Aug. 12). Farm Bureau has over a century of history supporting the development of sound public policy that transcends party politics and campaign slogans. It is always our hope that what happens in Washington, D.C. can go back to the former and move away from the latter.
Act Now to Protect Atrazine
The Environmental Protection Agency (EPA) has released for public comment “Proposed Revisions to the Atrazine Interim Registration Review Decision.”
Atrazine is an important tool for weed mitigation in several crops, including corn, sorghum and sugarcane. The use of atrazine, especially in corn and sorghum production, provides added environmental benefits for farmers seeking to utilize conservation tillage and no-till practices that conserve soil, preserve and increase nutrients, improve water quality, and reduce greenhouse gas emissions.
Without atrazine, many farmers would not be able to utilize these methods, which result in positive environmental outcomes.
Specifically, the EPA is proposing a concentration equivalent level of concern (CE-LOC) for atrazine of 3.4 micrograms per liter (µg/L).
EPA is also recommending a mitigation “pick list” – a combination of application rate reductions and/or runoff control measures when using atrazine in watersheds with atrazine concentrations that exceed the CE-LOC of 3.4 μg/L.
Nebraska Farm Bureau is urging you to tell EPA to use sound science and maintain farmers’ access to atrazine. Proposed mitigations would severely limit how farmers can use this product.
Governor’s Round Table Focuses on Issues Facing Agriculture
This week, Nebraska Farm Bureau (NEFB), along with other ag leaders, participated in a round table discussion with Governor Pete Ricketts. NEFB President Mark McHargue thanked the governor for his leadership on securing tax relief and reminded everyone that more focus is needed on reforming our tax structure and how we pay for K-12 education. He also spoke to the issues of emerging energy sources such as hydrogen and cleaner liquid renewable fuels, as well as the need for agriculture to be at the table whenever efforts to reduce carbon emissions are discussed. He also mentioned the need for agriculture to get a return on its investment and contribution to reducing emissions.
Gov. Ricketts highlighted major achievements over the past eight years of his term as governor, including opening trade markets and making progress on property and income tax relief.
Other ag leaders around the table included representatives of beef, pork, corn, soybeans, wheat, ethanol, hemp, poultry, sorghum, and craft breweries. Additional subjects brought up included supply chain issues, workforce shortages, broadband expansion, biosecurity, and several other issues.
Fischer Introduces Legislation to Protect Nebraska Producers
Sen. Deb Fischer recently joined several of her Senate Republican colleagues in introducing the Food and Energy Security Act. The legislation would prohibit the Biden administration from forcing its environmental, social, and governance (ESG) agenda onto the American economy. Specifically, the bill would require federal financial and securities regulators to estimate the impact of their rules on affected businesses involved in the agriculture or energy supply chains. If any rules are estimated to drive up food, energy, or gas prices, the regulators would then be prohibited from implementing the rules during times of high inflation.
“Nebraska farmers and ranchers are very concerned about the Biden administration’s push to increase climate regulations on our nation’s food producers such as the Securities and Exchange Commission’s proposed greenhouse gas reporting rule released earlier this year. The Food and Energy Security Act is a commonsense approach that will allow for thorough analysis on these types of regulations before they are enacted. We thank Senator Fischer for her continued leadership in pushing back against federal regulations that simply add additional costs, red tape, and legal liability to our nation’s farm and ranch families,” said Mark McHargue, president of Nebraska Farm Bureau.
U.S. Sen. John Thune (R-South Dakota) led the introduction of the bill. Additional cosponsors include U.S. Sens. John Barrasso (R-Wyo.), Mike Braun (R-Ind.), Mike Crapo (R-Idaho), Steve Daines (R-Mont.), Joni Ernst (R-Iowa), Bill Hagerty (R-Tenn.), John Hoeven (R-N.D.), Jim Risch (R-Idaho), and Mike Rounds (R-S.D.).