Last week, Governor Pete Ricketts hosted a ceremonial bill signing for LB 1107 on the north steps of the State Capitol.
LB 1107 delivers property tax relief to Nebraskans through refundable income tax credits. The Governor was joined at the ceremony by State Senators including District #41 State Senator Tom Briese, as well as leaders from Nebraska agriculture, business, and education.
“LB 1107 is a giant step forward in cutting property taxes on our hardworking families,” said Gov. Ricketts. “I commend the Legislature for delivering on the people’s top priority this session. I also thank the farmers, ranchers, and homeowners who persisted in voicing the urgent need for action on property taxes. LB 1107 delivers real, significant property tax relief and will help grow Nebraska for years to come.”
Property tax relief has been a top priority for Governor Ricketts’ since taking office in 2015. In previous years, he worked with the Legislature to nearly double the property tax credit relief fund from $140 million to $275 million. LB 1107 protects the property tax credit relief fund in its entirety. It also adds an additional $375 million, phased in over the next few years, to provide income tax credits. These tax credits will offset the amount of property taxes Nebraskans pay to fund their local school districts. With the passage of LB 1107, direct property tax relief from the state to property taxpayers will increase to $650 million annually, a four-fold increase during Governor Ricketts’ time in office.
LB 1107 also reforms and renews Nebraska’s business tax incentives. Unlike other state incentive programs, Nebraska’s tax incentives are performance-based. Tax benefits aren’t given in the hopes of future investment. They’re only earned by businesses that have already created verifiable jobs in the Cornhusker State. This feature ensures that incentives reward actual job creation in Nebraska. The incentives are part of the reason why Nebraska has ranked among the top three states in the nation for most new economic development projects per capita for five consecutive years.
Additionally, LB 1107 supports Nebraska’s bid for a major federal investment in the University of Nebraska Medical Center (UNMC). The proposed investment at UNMC would support an academic medical facility to help the United States address future pandemics and other disasters. The project would enhance UNMC’s position as a national leader in medical research and hazard response, and it has the potential to create 8,700 great-paying jobs.
After the Legislature reconvened in late July, following a multi-month recess due to the pandemic, State Senators successfully reached agreement on LB 1107. The Unicameral passed LB 1107 on August 13, 2020 by an overwhelming majority.
Senator Lou Ann Linehan, Chair of the Legislature’s Revenue Committee, played a central role in bringing Senators together in support of LB 1107.
“In these uncertain times, we must have a tax policy that encourages economic growth across Nebraska and reduces the property tax burden on Nebraska’s retirees, young families, agriculture producers, and small businesses. LB 1107 does both,” Senator Linehan said.
“More important than any individual piece of this package is the fact that a group of individual Senators from across our entire state with different backgrounds, thoughts, and political philosophies were able to come together and find enough common ground to move forward a bill that serves our entire state,” said Senator Mark Kolterman of Seward. “I’m proud to have been a part of it.”
Among the supporters from the ag sector was Steve Nelson, president of the Nebraska Farm Bureau.
“We greatly appreciate the work of the Legislature in passing LB 1107 and our thanks extends to Governor Ricketts for signing this critical piece of legislation.
“LB 1107 takes a major step forward to provide meaningful and much-needed property tax relief for Nebraskans, who can expect to see a 15 percent reduction in the property taxes paid to schools when provisions are fully implemented.
“We look forward to continuing to work with our elected leaders to build on this important win for Nebraska taxpayers,” he said.
