Chairperson Linehan and members of the Revenue Committee:
My name is Jack Moles. I am the Executive Director for the Nebraska Rural Community Schools Association, also referred to as NRCSA. NRCSA has 216 members, including 199 rural public school districts, 13 Educational Service Units, and 4 colleges, representing the interests of about 86,000 rural school students. Today I am also testifying on behalf of the Nebraska Council of School Administrators (NCSA), Nebraska Association of School Boards (NASB), Schools Taking Action for Nebraska Childrens’ Education (STANCE), the Greater Nebraska Schools Association (GNSA), and the Educational Service Unit Coordinating Council (ESUCC).
On behalf of these organizations, I would like to testify in opposition to LB 1242. It is our belief that the bill would cause havoc in school funding that would be difficult for the State to overcome. By my count, 186 school districts would lose 50% or more of their taxable valuations as a result of this bill, with 75 losing over 75% of their taxable valuations. If LB 1242 were to be enacted, we believe the Revenue Committee would likely be forced to move on bills that would drastically raise income taxes and/or sales taxes.
Interestingly, as a result of the way the bill currently stands, the Department of Education’s analysis does not show an impact on state aid to schools. Their analysis does show, however, that about $1.2 billion in funding would be lost to schools. Thus, the vast majority of schools would be devoid of a large part of their revenues.
In closing, the education organizations named above are opposed to LB 1242. We are certainly sympathetic to the over-reliance on ag land property taxes in the current school funding structure, but do not see this as a realistic remedy. We encourage you to not advance LB 1242.