Some Neb. residents won’t pay property taxes
July 26, 2010
LINCOLN, Neb. (AP) – Payback is coming to residents across a large part of southwest and south central Nebraska who paid a property tax nearly three years ago that was later found to be illegal.
Officials with both the Upper and Middle Republican Natural Resources Districts say they won’t be asking residents to pay any property taxes this year.
The unusual move, they say, is the only remaining solution to fairly treat people who paid the additional property tax authorized in a 2007 state law. It was designed to keep the state in compliance with a compact that splits use of Republican River water between Nebraska, Kansas and Colorado.
Some proposals were floated in the Legislature to return the roughly $2.6 million in taxes residents of the river basin paid because of the 2007 law, but they fizzled out.
“This is the default solution,” said Jasper Fanning, manager of the Imperial-based Upper Republican Natural Resources District.
Because it won’t levy a property tax, the district will use the roughly $1.1 million it collected with the special property tax later found to be illegal for operations this year. The same practice will be used by the Curtis-based Middle Republican Natural Resources District, which collected about $770,00 from the now-defunct tax.
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Dan Smith, manager of the Middle Republican NRD, said officials in all five counties where the special tax was levied agreed that levying no property taxes this year was the cheapest and easiest way of repaying residents. Officials had pondered sending checks to residents.
“This essentially costs the counties nothing,” Smith said.
It is less certain what might be done in the Lower Republican Natural Resources District. Mike Clements, manager of the Alma-based district, said not setting a property tax levy or setting a lower levy is one of a couple options the district’s board is considering.
The special property tax authorized by the 2007 law and later found to be illegal was levied in addition to normal property taxes the districts have long had the authority to set. The tax authorized by the Legislature in 2007 was meant to help the districts in the basin finance measures, such as buying water from farmers, to send Kansas the water it is owed in future years under the Republican River compact.
But early last year, the Nebraska Supreme Court ruled that the additional property taxing authority was primarily for state, not local, purposes and was therefore unconstitutional.
Still standing is a per-acre tax on irrigated land also authorized in the 2007 law. In March, a Lancaster County District Court judge has upheld that tax. The ruling was appealed and a decision is pending.
Nebraska Natural Resources Districts: http://www.nrdnet.org/