LINCOLN, Neb. It was a packed room in a rare triple committee hearing Wednesday. With senators on the revenue, education and retirement committees present for testimony.
State Senator Lou Ann Linehan started it all off, she chairs the revenue committee.
"The proposal reduces the taxable valuation for residential, commercial and industrial to 90% of its market value. The proposal reduces the taxable value to agricultural to 65% of its market value," said Linehan.
The topic brought out over 60 people to share their opinions. Only four actually showed up at the capitol in favor of the bill. They're behind it because it benefits rural school districts. State aid to education would be bumped up $500 million dollars.
"This would help to slow the flow of state funds from the rural areas, which has caused such a high reliance on property taxes," said Jake Moles, Executive Director of the Nebraska Rural Schools Association.
A large chunk of opponents were part of industries who would now be subject to new taxes. Currently plumbers, self-storage owners. and items like water, soda and candy are tax exempt. That would all change under the bill.
"For Nebraskans that would be up to eight and a quarter sales tax on basic necessities. This will undermine the affordability on housing and home ownership,” said Mark Innis who is an electrical and cabling contractor.
Urban school districts are also against it. Lincoln Public Schools says it could lose millions a year if the proposal were to pass.
"I believe that we could be growing, our city could be growing and our revenue per student could be shrinking under this proposal," said Liz Standish, LPS Superintendent for Business Affairs.
Governor Pete Ricketts agrees - this is not the answer.
"They cut my recommendation for property tax relief in half, that is tone deaf, to not understand that Nebraskans what property tax relief, i hope the appropriations committee will reconsider in their final recommendations," said Ricketts.
Right now the state sales tax rate is 5.5% this would take it up to 6.25%.
Remember - this is just a hearing, it still has a long ways to go before it could pass.