At Beatrice town hall, Nebraska Gov. Pillen seeks public's support for stalled tax plan (2024)

A month after his plan to reduce property taxes stalled in the Legislature, Nebraska Gov. Jim Pillen sought allies 40 miles south of the state's Capitol building Friday, taking his pitch to Gage County as part of a town hall series focused on the state's mounting property tax burden.

In a meeting space at the Beatrice Public Library,Pillen seemed to find who he was looking for: a few dozen Nebraskans who broadly voiced support for the governor's plan to reduce the state's collective annual property tax by $2 billion, slashing spending and replacing revenue through the elimination of certain sales tax exemptions.

In the meantime, Pillen is doubling down on the same fundamental plan that failed to garner the support of enough lawmakers to reach his desk last month— and using his town hall series to rally support for the proposal among everyday Nebraskans.

"Honestly, what the deal is— and why we're out— we need everybody here to get engaged," the governor told attendees at Beatrice's library Friday morning, imploring them to call their own legislators and "other senators across the state so they hear from the people," rather than lobbyists who are "paid to protect special interests."

"We have to make sure that our elected representatives hear from everybody in this room and they hear multiple times," Pillen said. "Not just one call. Multiple times."

Pillen's campaign to take his property tax plan directly to Nebraskans this summer reflects thedicey politics that surrounded the proposal in the Legislature, where lawmakers of all political stripes proved too leery of the plan toadd taxes on a variety of goods and services in an election year.

The latest version of LB388 combined with tax relief measures passed last year would have reduced property taxes by an estimated 22%, Pillen's staff had said — but would have offered no net savings to property owners who were already taking advantage of income tax credits offered to property taxpayers through a program that would have been eliminated by the bill.

Under the bill, vaping products would be taxed at 20%, consumable hemp products would be taxed at a 25% rate and the tax on a pack of cigarettes would be increased by 36 cents.

The bill, too, would have imposed sales taxes on soda and candy, veterinary care and other services for pets, dry cleaning and lottery tickets, among other things. Some senators, amid final-round debate on the bill, called it the largest tax increase in state history.

The proposed sales tax hike, in particular, prompted ire from lobbyists and skepticism from lawmakers.

And even the final version of LB388 — which did not include a broad sales tax hike but did include a 7.5% excise tax on ads that run on some state broadcasting outlets and social media websites — faced a last-minute advertising blitz on state radio and TV stations and in newspapers across Nebraska, warning that the tax would “destroy many small businesses."

Sen. Tom Brandt of Plymouth — the only lawmaker who attended Friday's town hall — said the governor is "on the right track" and told attendees that "seven senators from Omaha" consistently oppose property tax relief, but noted, too, that conservative Republicans had ultimately killed the bill that carried Pillen's property tax plan.

He pointed to the proposed tax onsoda and candyas an example of the seemingly reasonable ideas that nonetheless facedintense lobbying efforts.

"If I go and get a glass of pop and fill it with Dr. Pepper and go up front, I pay sales tax on that, because it's prepared food," he said. "Tomorrow, I don't have time, I go get a can of Dr. Pepper. I don't pay a sales tax on that. So the sky is not gonna fall if we tax this stuff— unlike what (lobbyists) might say back there."

Despite the opposition campaign that sank the proposal last month, Pillen indicated Friday that his plan has not changed.

He said he would push caps on local spending and aim to "broaden the tax base," railing against the 120 sales tax exemptions that exist in Nebraska and pledging to deliver "transformative change" yet this year.

"There was too much noise, there were too many other things," Pillen said, referring to the 60-day session that ended last month without delivering property tax relief. "In our special session, we'll be zeroed in like a laser focus on high value.

"I call this game 33-17," he said, referring to the 33 "yes" votes a bill would need to overcome a filibuster in the Legislature or the 17 "no" votes that would sustain one. "Will we get everything Pillen wants? Probably not. But there will be transformative change."

One attendee— Ken Pralle of Wymore— asked the governor if he believed lawmakers in Lincoln would have the political will to deliver on Pillen's pledge.

"Yeah, I wouldn't be here if I didn't think there was," Pillen said.

"Because what it takes is a lot of hard decisions,"Pralle said, telling the governor he routinely watched the Legislature's live debates on TV this spring. "I look at that and I thought, 'These guys don't get it.'"

But Pillen does get it, Pralle said after Friday's town hall, calling Pillen "the first governor in my lifetime that is actually saying, 'We've got to change what we're doing.'"

Pralle, like Pillen, hopes the looming special session brings that promised change.

"Oh Lord," he said. "I hope something happens. I'm crossing my fingers that something will happen."