LINCOLN — One of the major co-sponsors of a tax relief petition drive has dropped out, but others involved said the defection won’t have much impact on the 35% Solution initiative.
Doug Kagan of Omaha, the longtime head of Nebraska Taxpayers for Freedom, said he withdrew his sponsorship of the petition because he disagreed with the management of the effort and didn’t think that it would be successful in qualifying for the 2020 ballot.
“It was kind of a constant argument on the right way to proceed,” Kagan said. “We’ve been veterans of many campaigns like this, and we wanted to wait to start collecting signatures until we raised a lot of money and got a lot of people in place.”
Instead, according to him, the initiative “wasted” several months getting organized and has only about $2,000 in its bank account as it faces a July 2020 deadline to collect about 160,000 signatures of registered voters.
“We don’t have any faith in the petition drive,” Kagan said, adding that his organization is now hoping that the Nebraska Legislature takes steps this week to advance a bill offering significant property tax relief.
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Two other co-sponsors of the petition drive disagreed with Kagan.
Paul Von Behren of Ames, Nebraska, disputed the estimated money on hand for the petition drive, saying Kagan wasn’t the treasurer for the group. He said there naturally are going to be some disagreements when an organization, like Taxpayers for Freedom, tries to “take over” a citizen-led initiative.
“It’s actually picked up momentum, and that’s not hyperbole,” Von Behren said.
He declined to say how many signatures the group has collected so far but said that 200 volunteer petition circulators are working across the state, armed with enough petitions to gather 35,000 signatures. Petitions with 20,000 spaces for signatures will go out soon, Von Behren said.
Another co-sponsor of the petition drive, Terry Jessen of Oshkosh, Nebraska, said that the effort now has “a few less players” behind it but that he thinks a determined corps of volunteers can still push it over the finish line.
“I do think it’s the right thing to do and the right time to do it,” he said.
The initiative, if adopted by voters, would require a 35% income tax refund on the property taxes paid by homeowners, farmers and businesses.
Detractors say that would create a fiscal emergency, forcing $1 billion in spending cuts or drastic increases in other taxes to offset the income tax refunds. They also express doubts that a petition drive that doesn’t use paid circulators can be successful in qualifying for the ballot.
The news came as state lawmakers gird for a final debate on whether to advance a property tax relief proposal in the final two weeks of the 2019 session.
One proposal, Legislative Bill 289, has stalled amid opposition from the state’s largest school districts. But another plan, advanced by State Sen. Tom Briese of Albion, is scheduled for debate on Wednesday.
His proposed amendment another measure, to LB 183, would remove tax exemptions on pop, candy, bottled water and several home repair services and return the $100 million in new tax revenue as property tax credits sent to homeowners, farmers and ranchers.
Briese said on Monday that it was unreasonable for lawmakers to go home without addressing what he said were the third-highest property taxes in the nation on agricultural producers.
“It’s only reasonable to try and do something about that,” he said, calling his plan “simple and effective.”
Waiting in the wings is Gov. Pete Ricketts, who has condemned Briese’s plan as a tax increase that won’t, in the end, result in lower property taxes.
Sales tax exemptions on the chopping block in Nebraska
To raise new revenue for a property tax relief plan, a legislative bill proposes to do away with about 20 sales tax exemptions. Here are some of the goods and services that would be taxed under Legislative Bill 289, and the amount of revenue those taxes generate.