Nebraska Association of County Officials
Revenue Committee Hears Bill to Cut Inheritance Taxes
On Thursday, county officials testified in person and submitted position letters to show their opposition to LB310
, a bill that would sharply reduce inheritance taxes collected by counties. Counties use inheritance taxes to buy down levies and as a cash reserve for emergencies and special projects that would otherwise be paid for by property taxes.
Under current law, close relatives, such as parents, children and siblings, pay a 1 percent tax on inherited amounts in excess of $40,000. Nieces, nephews and other extended relatives are taxed at 13 percent with a $15,000 exemption. Non-relatives are taxed at 18 percent with a $10,000 exemption.
LB310 would lower tax rates and increase exemption amounts. Douglas County, which typically collects more than $12 million annually, estimates a loss of $8 to $10 million per year under the bill. Although the total amount collected fluctuates each year, all counties would experience similar significant reductions. Without a sustainable, ongoing source of replacement revenue, counties would be forced to increase property taxes to continue to provide state-mandated services. Some solutions, such as voter-approved county-wide sales taxes, were suggested by proponents at the hearing, but do not provide an adequate income stream, especially in counties with few businesses.
Other suggestions included removing inheritance taxes from the probate code and shifting collection to county treasurers, as well as exempting minors from inheritance tax if their parent or direct guardian dies.
The bill, which was introduced by Elmwood senator Robert Clements, follows an interim study
of inheritance taxes last fall.
The committee also heard LB377 which would amend the definition of relatives to include step-relatives so that they would fall within the lower inheritance tax rates. The committee has not reported any action on these bills.
Government Committee Hears Bill to Appoint Assessors
County assessors would not be elected officials after January 1, 2023 under LB179
that was heard by the Government, Military and Veterans Affairs Committee on Friday. LB179 would replace the elected office with a position appointed by the county board in counties with a population over 3,500 and more than 1,200 tax returns in a given year. In smaller counties, the county clerk would serve as county assessor.
Revenue Committee Chair Lou Ann Linehan said she introduced the bill to express her frustration over taxpayer stories that she has heard in the Revenue Committee. Discussion focused on the inter-related roles of the assessor, Tax Equalization and Review Commission (TERC), county board of equalization, and Department of Revenue in the valuation, equalization, and levy process.
NACO and a county assessor testified in opposition to the bill, addressing certification and education requirements for assessors, differences between mass appraisal and fee appraisal, and accountability of elected officials.
The committee took no immediate action on the bill.
Clerks of the District Court Elimination
Next Thursday, February 25, the Judiciary Committee will hear a bill to eliminate the position of ex officio clerk of the district court. The duties, which are now performed by the county clerk, would be transferred to the clerk magistrate, a state position. Under LB102
, if the office of elected clerk of the district court becomes vacant or the incumbent does not run again, county boards could choose to eliminate the office and transfer duties to the clerk magistrate. NACO opposes LB102.
Senators Advance Bills During Half-Day of Floor Debate
Senators spent Tuesday morning in General File (first round) debate of bills that were sent to the full body by committees. Next week, the bills that advanced will be debated on Select File (second round) during the Legislature’s condensed morning schedule before 9:30 a.m. committee hearings. Following are some of the bills advanced from General File:
would make technical cleanups to laws passed in 2019 to allow financial institutions to use a single-bank pooled collateral system to provide security for deposits of public funds in excess of FDIC coverage. Senator Matt Williams, Banking Committee Chair, has offered an amendment for Select File that would add an emergency clause to the bill.
would begin to generate funds to pay for an updated drivers’ license issuance system. The existing $3 fee for insurance companies, banks, and others who access drivers’ license records would be increased by $4.50. The new system would be implemented by 2032. Senators discussed whether the fees should sunset after that time but no amendments were offered to set an ending date for the proposed fee increase.
would modernize Department of Transportation laws and make more substantive changes to licensing laws for county highway superintendents and city street superintendents, such as combining licenses for persons holding multiple licenses of various classes.
would implement Amendment 2, which was approved by voters last year. It would extend the maximum duration of tax increment financing (TIF) projects from 15 years to 20 years if more than half of the property is designated as extremely blighted.
LB532 would revise unclaimed property laws to allow aggregated reporting and allow unclaimed property holders to accumulate property until the value exceeds $50 before submitting it to the State Treasurer. Currently the amount is $25.
Bills Reported Out of Committees
This week the Government, Military and Veterans Affairs Committee reported the following bills of interest to counties out of committee:
(Dorn) Provide for automatic property tax distributions to townships in the same manner as schools, cities, and other entities
(Friesen) Clean up a deadline for reporting data included in semiannual statements
(Aguilar) Strike a requirement to appoint county surveyor from “any other” county
(Brandt) Allow counties to build bridges using design-build and create a new bridge incentive program
(Wishart) Allow political subdivisions to use design-build for water, utility and sewer projects
(Brewer) Require petition signatures to be submitted together
Among the bills sent to the full legislature by the Transportation and Telecommunications Committee are:
(Hughes) Require expanded notification to lienholders of abandoned vehicles
(Gragert) Require registration with Department of Veterans Affairs to receive Gold Star and other military family license plates
(Friesen) Expand eligibility for expedited motor vehicle inspection to independent car dealers
Summaries of Bills Heard This Week
24/7 Sobriety Program
Lancaster County officials led the testimony on LB271
, to enact the 24/7 Sobriety Program. Counties would be allowed to create and implement twice-daily testing programs as an option to incarceration. As a condition of their bond, participants would be allowed to continue to drive to school, work and the testing facility while their DUI case was pending.
If there are three or more candidates for Congress, Senate, Legislature or Governor, voters could rank their preference of candidates as part of LB125
. An algorithm would tabulate the votes for each round until a clear winner was achieved. NACO testified in opposition, citing costs for software, delayed election results, and voter education. NACO also testified in opposition to LB590
which would shorten the time frame for early voting.
The Government, Military and Veterans Affairs Committee also heard measures to make primary elections for certain statewide and congressional offices nonpartisan (LB625
), change the apportionment of electoral college votes (LB76
), and require verification of identity before voting (LR3CA
County Liability for COVID-19 Exposure, Pursuits, and Other Torts
The Judiciary Committee heard two bills that would shield counties from suits related to COVID-19. LB52
would minimize county costs for lawsuits arising from injury or death resulting from an alleged exposure. NACO supported both bills.
would change the standard of liability for police pursuits when the fleeing vehicle causes injury to an innocent third party. Political subdivisions would have to create procedures and train officers in such measures. NACO supported the bill as a measure to minimize risks to the public in pursuits.
NACO opposed LB54
that would expand the scope of county liability by removing exemptions from the Political Subdivisions Tort Claims Act and LB71
that would place liability on governmental entities for acts of a third party, such as an active shooter in the courthouse, and permit the refiling of claims from prior years.
Utility Coordinator for Projects Over $50,000
The Transportation and Telecommunications Committee heard a proposal brought by road contractors that would require counties over 25,000, larger cities, and the Department of Transportation to develop utility coordination plans for roadwork with contracts exceeding $50,000. The plan would identify utility operators whose facilities would be affected and the facilities in the area, the elevation, and the dates the facilities would need to be removed or relocated. Damage caused by contractors relying upon the plan would be the responsibility of the respective county, city or Department. Contractors brought LB339
in response to delays by utilities in removing or relocating facilities. Counties, cities, and the Department opposed the bill, citing the expense and the lack of authority over the utilities.
The committee also heard LB670
, a bill to allow family members of persons killed on Nebraska roadways to request a memorial sign with a religious symbol and safety message.
This week NACO testified in support of bills to require property tax protest forms to include the requested valuation (LB291
) and provide for denial of tax exemptions if the application form lacks any required information, including the value of the exempt property (LB521
). There was no opposition to either bill. In addition, NACO supported LB524
, a bill to change the calculation of a refundable tax credit that was created in last session’s property tax relief package. If the bill advances from committee, it is likely to be amended to include an emergency clause and exclude taxes paid prior to 2019 and prepayments of taxes in the future.
NACO opposed bills to require all counties to accept partial payments of property taxes (LB292
) and limit valuation growth to 3 percent annually (LB622
). NACO opposed LB613
that would require the Tax Equalization and Review Commission to hold hearings on appeals within six months following the date of the appeal. If the commission fails to reach a decision within nine months after the date of the appeal, it would be decided in favor of the property owner.
Committee Hearings Scheduled
Legislative standing committees are holding public hearings on bills. Please note that some hearings will begin at 9:30 a.m. and others will begin at 1:30 p.m.
Monday, February 22 -- Legislature in Recess
Tuesday, February 23
Banking, Commerce and Insurance Committee -- Room 1507, 9:30 a.m.
(Wayne) Adopt the Public Entities Investment Trust Act
Transportation and Telecommunications Committee -- Room 1113, 1:30 p.m.
(Hughes) Change 911 service surcharge provisions
Wednesday, February 24
Government, Military and Veterans Affairs Committee - Room 1507, 1:30 p.m.
(Brewer) Permit counties to authorize carrying concealed weapons as prescribed
Thursday, February 25
Judiciary Committee -- Room 1113, 1:30 p.m.
(Dorn) Provide for transfer of duties of clerks of the district court to clerk magistrates
Appropriations Committee -- Room 1525, 1:30 p.m.
(Brewer) Appropriate funds to the Department of Health and Human Services for public health aid
(Vargas) Appropriate funds for local public health departments
Executive Board -- Room 1525, 12:00 p.m.
(Cavanaugh, M.) Prohibit charging members of the Legislature fees for public record requests
Government, Military and Veterans Affairs Committee -- Room 1507, 9:30 a.m.
(Hansen, M.) Change provisions relating to public records and include body-worn camera recordings in certain circumstances
Friday, February 26
Judiciary Committee -- Room 1113, 9:30 a.m.
(Geist) Protect religious freedoms as prescribed and provide for certain tort claims
Government, Military and Veterans Affairs Committee -- Room 1507, 1:30 p.m.
(Brewer) Provide and change zoning requirements for wind energy generation projects
Wednesday, March 3
Judiciary Committee -- Room 1113, 9:30 a.m.
(Bostelman) Require Nebraska State Patrol to provide notice of expiration of concealed handgun permits
(Clements) Change permit renewal provisions of the Concealed Handgun Permit Act
Judiciary Committee -- Room 1113, 1:30 p.m.
(McCollister) Change provisions relating to handgun transfer certificates and require suicide prevention training and informational materials
(Hansen, B.) Change provisions relating to carrying a concealed weapon
(Slama) Change provisions relating to justification for the use of force
(Lowe) Change permit and renewal time periods under the Concealed Handgun Permit Act
(Halloran) Authorize possession of a firearm on school grounds by a full-time, off-duty law enforcement officer
Revenue Committee -- Room 1524, 9:30 a.m.
(Revenue Committee) Change taxation provisions relating to improvements on leased lands, the assessment of undervalued and overvalued property, methods for giving notice, and the collection of certain taxes and fees
(Walz) Authorize the issuance of highway bonds under the Nebraska Highway Bond Act
Thursday, March 4
Judiciary Committee -- Room 1113, 1:30 p.m.
(Wayne) Change provisions relating to grand juries in cases of death during apprehension or custody
(Cavanaugh, J.) Eliminate cash bail bonds, appearance bonds, and related provisions
Revenue Committee -- Room 1524, 1:30 p.m.
(Wayne) Change provisions relating to taxes imposed on the average wholesale price of gasoline
(Revenue Committee) Change tax provisions relating to net book value
(Linehan) Require the Tax Commissioner to collect lodging taxes as prescribed