LINCOLN — The first piece of Gov. Pete Ricketts’ property tax relief package cleared second-round debate Wednesday in the Legislature.

Legislative Bill 959 advanced 45-1. State Sen. Kate Sullivan, the Education Committee chairwoman, introduced the bill on the governor’s behalf.

The measure is projected to reduce property taxes by increasing state aid to schools more than $8 million. That figure represents a small percentage of total annual property tax collections by local governments — nearly $3.8 billion in 2015.

The original bill would have tightened a number of budget and levy limits on schools.

The version advanced out of the Education Committee would eliminate a law that takes away state funding from schools unless they set their levies at least at 95 cents. The change would allow schools to qualify for state aid if their levies are set below 95 cents.

Sullivan said the change largely benefits rural schools, which have been able to reduce their levies as the taxable valuation of agricultural land rose.

Under LB 959, those schools could qualify for about $8.5 million in school aid.

Another change in the bill would tighten limits on a special tax levy that school districts can use to address health, safety and accessibility problems in school buildings.

The bill would cap the special levy at 3 cents, down from the 5.2 cents allowed now, and would prohibit the revenue from being used for new construction.

The second piece of the governor’s property tax package is scheduled for second-round debate today. LB 958 would put $20 million more into the state’s Property Tax Credit Fund to boost tax credits available to owners of farm and ranch land.

Contact the writer: 402-473-9583, martha.stoddard@owh.com

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