Nebraska Legislature passes tax relief, school funding bills

'Today is a huge win for everyday Nebraskans,' Sen Tom Briese says

LINCOLN, Neb. (KLKN) – The Nebraska Legislature passed three bills on Thursday that provide tax relief while adjusting funding for schools.

The first was LB 243, which would change the property tax rates for school districts and set a 3% annual revenue growth cap.

Sen. Tom Briese of Albion, who introduced the bill, said that means landowners would pay less property taxes for schools in their area.

“These bills really represent a measure of historic tax relief and transformational education funding reform,” he said. “Today is a huge win for everyday Nebraskans.”

But LB 243 would leave schools with less funding.

To help make up for that, legislators also passed LB 583, which would increase state funding for individual students and provide more reimbursement for special education expenses.

LB 243 would also allow school districts, with voters’ approval, to override the revenue cap.

Briese said the two bills work in tandem to change the way we fund schools, while lowering Nebraska’s reliance on property taxes.

“No one in this body wants to choke off or do harm to public education,” he said. “We just want to try to ensure that the dollars we put into public education yield property tax relief.”

The final bill, LB 754, sparked more controversy than the others.

The bill would lower the income tax rate for the state’s top earners and businesses to 3.99% by 2027.

The top bracket starts at $29,000 for individual filers and $58,000 for married filers.

“I understand and appreciate that we should have a discussion about updating our tax code,” Sen. Danielle Conrad of Lincoln said. “But I felt like this measure really fell short and didn’t do enough to ensure that hardworking middle-class families are getting the relief they deserve.”

Sen. Wendy DeBoer of Bennington argued that the bill is a tax cut for the rich and doesn’t help the lower or middle classes.

Rebecca Firestone of the OpenSky Policy Institute said this bill will only provide relief for the wealthiest Nebraskans and out of state corporations.

“About 75% of these tax cuts are going to the wealthiest top 20% of Nebraskans,” she said. “That is people making more than $138,000 a year.”

Supporters say bringing down that tax rate would help to draw more businesses into Nebraska and make it more appealing to move here.

Despite being the most contentious bill of the day, it passed 39-2, with four senators not voting.