Letter to the editor: Inheritance tax

Dear fellow citizens of Holt County,

For the past months, the Nebraska Association of County Officials has been an integral part of Gov. Pillen’s tax working group, along with many other entities, state senators, Pillen and his key staff, and other stakeholders such as the cities, Farm Bureau and the realtors.. We have had many meetings striving to craft Nebraska tax policy, to cut taxes, to more equitably define policy and to ensure we have the revenue necessary to provide essential services to our citizens.

LB 1067, introduced by State Sen. Robert Clements, is an integral part of this discussion. It seeks to eliminate inheritance tax. So you understand the importance of this issue to county government, I would like to provide inheritance tax experience and data for Holt County.

Over the past five years, average annual inheritance tax revenue for Holt County has been $1,054,753.

Our average county valuation has been $3,080,428,027.

One cent on our levy would average $308,047.

Dividing our average annual inheritance tax revenue of $1,504,753.00 by the average levy equals 3.42 cents on our levy for which we, as county supervisors, did not have to levy for property tax or to cut services. We have also used inheritance tax revenue as a rainy-day fund for unexpected county expenses. As in our personal budgets, it is always good to have some reserve.

If we do not have inheritance tax revenue, we are either going to have to cut services, raise the property tax levy or find another revenue source to equal that amount:

• Cut services to the tune of .03 cents on our levy.

• Raise our property tax levy.

• Maintain the same level of services but have the state provide a revenue stream that would equal the last five-year average of inheritance tax.

I hear from constituents all the time: although they want to see taxes reduced or eliminated, they do not want essential services provided by county government reduced or eliminated. Road and infrastructure maintenance, law enforcement, ambulance service and many other essential services provided by county government are of vital importance to our citizens and they do not want them cut.

I discuss this issue with many county officials from across Nebraska and I believe that our experience in Holt County is fairly representative across the state.

We are the level of government where the rubber meets the road and we see and talk with our constituents every single day. We strive to maintain efficient operations and I believe that there is little, if any, inefficiency to cut.

The cost of our equipment, parts, fuel, supplies, personnel and benefit packages have increased significantly, especially in the past three years. We strive to do a good job in trying to manage all of that while delivering top-quality service to our constituents prudently and efficiently.

Although LB 1067 would also provide for reimbursement for state prisoners lodged in a county jail and allow county boards to use the County Visitors Promotion Fund, which comes from any county lodging tax imposed, neither jail reimbursement nor county lodging tax comes anywhere near replacing the revenue county government would lose from the elimination of the inheritance tax.

Not all have jails; therefore, no state prisoners being lodged there to be reimbursed by the state. Not all counties have lodging facilities, let alone a lodging tax, in place.

Therefore, no state prisoners being lodged there to be reimbursed by the state. Not all counties have lodging facilities, let alone a lodging tax, in place.

If the inheritance tax is eliminated, there must be replacement revenue for counties or we will be forced to raise our levies or eliminate/reduce vital services. Neither of those is an attractive option. We cannot print money - nor would we want to - as the federal government does to make up the difference. We have to balance our budget every year. LR287CA would require the state to make up a revenue loss to a local political subdivision if a locally-imposed revenue source were ever eliminated or reduced. This is aimed primarily at the inheritance tax but could also replace the local option sales taxes cities collect if those were ever eliminated or reduced.

We all want a lower tax burden in Nebraska, but it is also clear that our citizens expect many essential services form local and county government and there must be a revenue source to provide those services. Additionally, we, as county supervisors serve in leadership capacities on many other boards that provide essential services to our citizens, such as the Area Agency on Aging, North Central District Health Department and Region IV Behavioral Health, among others. All of these and other non-profit organizations receive funding from county government as well. If the inheritance tax is eliminated, it is critical that LR287CA is passed. It is a critical need for guaranteed and sustainable replacement revenue for elected officials in county government to ensure these critical services are provided to our citizens.

Bill Tielke

Holt County Supervisors