Legislature adjourns as Revenue Committee refines LB9 amendment capping property-tax requests

The state legislature adjourned on Thursday without a property-tax bill on the floor for debate after Revenue Committee members circulated a draft amendment to LB9 and met in executive session but were unable to finalize language in time, a reporter said.

The draft amendment circulated Wednesday would cap property-tax requests for counties and cities at either 0% or the percentage change in the Consumer Price Index, whichever is greater, though the transcript notes committee members considered using a different inflation measure and did not include that alternate measure in the circulated language. "Much of the amendment to LB9 would affect counties; it would cap property-tax requests for counties and cities at 0% or the percentage change in the Consumer Price Index whichever is greater," the reporter said.

The amendment would create an exception to the cap for "Public Safety," which the record defines to include police, fire, crime prevention, offender detention, medical ambulance or emergency services, county attorneys and public defenders. The reporter summarized the provision: "An exception to the cap would be created for Public Safety, which is defined to include police, fire, crime prevention, offender detention, medical ambulance or Emergency Services County attorneys and public defenders." The details of how those categories would be funded or limited were not specified in the transcript.

Other provisions discussed in the package include language from L45 that would transfer the duties of ex officio clerks of the district court to the state clerk; magistrates from county court would assume those responsibilities starting in 2026, and elected district court clerks would not be transferred unless voters opted not to retain the office. The reporter noted these items as: "language from L45 would transfer the duties of EX officio Clerks of the district court to the state clerk; magistrates from County Court would assume those responsibilities starting in 2026; elected Clerks of the district court would not be transferred to the state unless voters opted not to retain the office."

Concepts presented in LB53 would change how counties with jails report costs and how replacement revenue is provided. Under those concepts, counties would report jail operating and maintenance costs to the Jail Standards Board rather than through an "inmate pum process" named in the transcript, and counties would be reimbursed for 25% of such costs in 2025 and 50% thereafter. The transcript does not define the "pum process" term or the mechanics of the reimbursement.

The broader package as described in the report would reduce the maximum school levy (the transcript text about the exact levy change is unclear) and offset the reduction with nearly $2 billion in state aid, in part generated by removing exemptions and expanding the sales tax base. The report also said new machinery and equipment would be exempt from personal property tax while a 2% estate tax would apply, and a property-tax credit would be provided for Natural Resources Districts. The transcript phrased the school-levy change as "the maximum school levy would drop from a15 to 25 C"; that phrase is unclear and not specified in the record.

Senator Lan linahan introduced LB1 on behalf of Governor Pan but the reporter said LB1 met with much opposition at last week’s Revenue Committee hearing; the committee instead pivoted to use LB9 as the working vehicle. At Senator Lan's request the full body adjourned until Monday at 1 p.m. so the Revenue Committee could continue negotiating and finalize amendment language in advance of debate, which the reporter said was scheduled to begin Tuesday.

Next steps: the Revenue Committee is expected to continue work on the LB9 amendment in the coming days and to present finalized language when the legislature reconvenes on Monday; debate on the floor was scheduled to begin Tuesday.