Revenue Committee
February 27, 2025
Committee Chair: Sen. Brad von Gillern | Bills Heard: 2 | Full Transcript (PDF)
LB424: Capping Annual Property Tax Increase for Taxpayers (CAP IT Act)
Introduced by: Sen. Bob Andersen | Testimony: 2 proponents, 5 opponents, 0 neutral | Read bill text (PDF)
Sen. Andersen's property tax cap bill faces constitutional and fiscal hurdles in committee hearing. LB424 would limit annual increases in property tax bills to the lesser of inflation or 3%, aiming to provide predictability for homeowners facing rapid valuation increases. The bill drew support from taxpayer advocates but significant opposition from county officials, municipalities, schools, and resource districts.
Why it matters: Nebraska homeowners have cited property taxes as their top legislative priority, with some facing 20-40% valuation increases. But the bill's mechanics create complex problems: it could violate the state constitution's uniformity clause, reduce state aid to schools, and force political subdivisions to cut services or find alternative revenue sources.
What they're saying: - Proponents: "This breaks the automatic link between valuations and taxes, making bills predictable. Other states like Florida and Iowa have proven this works." (Doug Kagan, Nebraska Taxpayers for Freedom) - Opponents: "A 3% cap on individual parcels forces levy rates based on the highest-valued property, eventually driving revenue toward zero and violating constitutional uniformity requirements." (Jon Cannon, Nebraska Association of County Officials). Schools warned the bill lacks companion changes to the state aid formula, potentially cutting funding when valuations rise faster than 3%.
By the numbers: 39 proponent letters, 9 opponent letters, zero neutral comments. School districts report personnel costs typically exceed 3% annually; CPI has been below 3% in 14 of the last 20 years.
What's next: No vote was taken. The bill remains in committee with significant unresolved questions about constitutional compliance, state aid impacts, and implementation mechanics.
Committee sentiment: Supportive: Sen. Kathleen Kauth Skeptical: Sen. Mike Jacobson Unclear: Sen. Brad von Gillern
Sentiment estimated from questions and comments — not stated positions.
LB131: Expansion of 529 Education Savings Plans to K-12 Private School Tuition
Introduced by: Sen. Tony Sorrentino | Testimony: 5 proponents, 3 opponents, 0 neutral | Read bill text (PDF)
Sorrentino's 529 expansion bill splits committee along education choice lines. LB131 would allow Nebraska families to withdraw up to $10,000 annually from NEST 529 accounts tax-free for K-12 private school tuition, bringing Nebraska in line with 40 other states that adopted the federal provision in 2017. Proponents framed it as education freedom; opponents called it a tax break for the wealthy.
Why it matters: Nebraska is losing NEST participants to out-of-state plans that offer K-12 eligibility, and the bill could affect state revenue during a period of projected budget deficits. The debate reflects broader tensions over education choice and tax policy in Nebraska.
What they're saying: - Proponents: "This conforms Nebraska to federal law and supports parental choice. NEST has $7.26 billion in assets with 21.52% in-state participation—among the highest in the country. The average account balance is $19,724, not a wealthy-only program." (Rachel Biar, Deputy State Treasurer) - Opponents: "84% of filers using the current plan have incomes over $100,000. Families would need to contribute $2,000/month to cover $10,000/year in tuition over just 5 years, making this inaccessible to most families." (Tim Royers, Nebraska State Education Association)
By the numbers: 2 proponent letters, 60 opponent letters, zero neutral. NEST currently has 301,000 accounts ($7.26 billion in assets); 103,000 are Nebraska residents. In 2024, only 9.24% of Nebraska account owners contributed the full $10,000.
What's next: No vote was taken. The bill remains in committee with unresolved questions about income distribution of benefits and fiscal impact.
Committee sentiment: Supportive: Sen. Brad von Gillern Unclear: Sen. Kathleen Kauth, Sen. Dave Murman
Sentiment estimated from questions and comments — not stated positions.
Session Notes
Committee Chair von Gillern opened the hearing with procedural instructions regarding testifier sheets, time limits (3-minute green light system), and written position submission deadlines (8 a.m. day of hearing via Legislature website). Committee members present: Sen. Tony Sorrentino (LD39), Sen. Kathleen Kauth (LD31), Sen. Mike Jacobson (LD42), Sen. Dave Murman (LD8). Legal counsel: Sovida Tran and Charles Hamilton. Committee clerk: Linda Schmidt. Pages: Lauren Nittler (University of Nebraska-Lincoln, agricultural economics) and Jessica Vihstadt (University of Nebraska-Lincoln, political science and criminal justice). No votes were taken on either bill during the hearing.
Generated by NE Wire Service | Source: Nebraska Legislature Transcribers Office This is an AI-generated summary. Verify all claims against the official transcript.