One-by-one farmers and ranchers from across the state, young and old, spoke with conviction to members of the Legislature’s Revenue Committee about the importance of Sen. Curt Friesen’s school funding/property tax bill LB 497. The comments were made as part of the Committee’s Feb. 14 public hearing on the bill. In both verbal and written testimony, Farm Bureau members repeatedly offered support for the measure. LB 497 would broaden the sources used to fund K-12 schools, reduce the state’s overreliance on property taxes, and replace parts of the system that has created inequities in how the state of Nebraska treats students and taxpayers in funding schools.
“Education and rural schools are important to me and my family. The state has a responsibility to help fund basic K–12 education for all students,” noted Andy Schmidt, a fifth-generation farmer, who grows crops and raises cattle near Deshler. Schmidt, a Thayer County Farm Bureau member, has children who attend school in Deshler, where he serves on the School Board. In providing information to the Committee, Schmidt shared that only 11 percent of Deshler’s basic education funding comes from the state.
“I know there are other districts where the state has taken on a much greater role in providing dollars to cover basic education. LB 497 ensures that every public school in Nebraska would receive state support equal to at least 50 percent of the basic education funding needs. LB 497 isn’t perfect, but it combines the best that any of the property tax relief bills introduced have to offer and has the best chance at delivering property tax relief,” Schmidt noted.
Dave Nielsen, a fourth-generation family farmer, who raises crops near Lincoln and is a member of the Lancaster County Farm Bureau, testified before the Revenue Committee and shared an example of the disparity between two different taxpayers in the Waverly School District.
“The first taxpayer is someone you’ll likely know, his name is Dan Whittney, AKA, Larry the Cable Guy,” Nielsen said. “I’m not picking on Larry with this example, I enjoy his work, but it illustrates my point. Larry is a homeowner and landowner in the Waverly School District. He pays about $23,000 a year in property taxes. It costs roughly $8,759 to educate a student in the district. That means Larry is paying for the education of about 2.6 kids in the Waverly district. Keep in mind that Larry’s net worth is about $80 million, and he makes roughly $20 million a year,” Nielsen explained.
The other taxpayer in this scenario was Nielsen himself and his wife Vicki, who have two children in school in the Waverly School District.
“My home and farm are in the district, so I also pay taxes there. The property taxes on my farm alone pay for the education of roughly 14 students in the District; my two kids – plus 12 others. My net worth and annual income are not in any way comparable to Larry the Cable Guy’s. Larry pays for 2.6 students’ education and my farm pays for 14 students’ education. That doesn’t seem like equality,” Nielsen told the committee.
Lance Atwater from Ayr is a young second-generation row crop and cow/calf farmer. He and his wife Krystal recently married, are members of the Adams County Farm Bureau, and just purchased a farm in Nebraska. His father is a first-generation farmer, who was born and raised in Santa Monica, California. He left California to come to Nebraska to pursue his dream of farming. Atwater calls Nebraska’s farmer and rancher frustrations over property taxes, a crisis.
“The school district where my land resides has seen a 68 percent decline in state aid since 2006-2007. Yet, our general fund property taxes have increased by 122 percent over the same period. In dollars, state aid has declined by $1,038,574 and general fund property taxes have increased by $1,614,744. State aid as a share in basic funding for 2008-2009 was 59 percent. Today, it is only 12 percent. This is unsustainable, and something must be done,” he told the committee.
Henry Beel, a member of the Brown County Farm Bureau, is a landowner and taxpayer in Brown and Cherry counties. He along with his two brothers, operate the family cow/calf ranch. In his testimony he wrote of his concerns that property taxes will prevent some family businesses from not being able to continue what they are doing, due to out of control property taxes.
“Property taxes on our ranch for 2018 were $158,518.24. This is the second highest expense on our ranch except for the feed cost for the cattle. At the present time, our family’s share of property taxes going to Ainsworth Community Schools (ACS) is $98,731.07; this is more than what the state of Nebraska is giving to ACS for state aid. Do you suppose there is a problem with funding our schools if my family is giving more money to the school than the state?” Beel said.
The future of LB 497 will depend on the actions of the Legislature’s Revenue Committee which will determine whether the bill, or parts of it, advance to the full legislature for debate. Sen. Lou Ann Linehan of Elkhorn, chairwoman of the Revenue Committee sees the possibility of one property tax package coming out of the committee, not just one bill.