Scottsbluff Star-Herald. Feb. 16, 2014.
Tax cuts: Realities make them easier to promise than to deliver
Since nobody likes taxes, the obvious solution is to do away with them. The only obstacle to doing so immediately is, well … it would be an economic disaster.
Politicians who clamor endlessly about taxes seem to forget that representative government is expected to get a few things done, such as building roads and educating children. Unlike the federal government, which can cut taxes without regard to spending, Nebraska requires a balanced state budget, which means weighing the value of government-financed services against the benefit of tax cuts.
In traditional fashion, some politicians proclaim that tax cuts for wealthy citizens and corporations will conjure up new jobs, although evidence that it works is hard to come by. Recently, Gov. Dave Heineman stepped around that challenge by saying that any job growth resulting from income tax cuts is worthwhile.
“Every time we can put even one person to work, I think it’s helpful,” Heineman told the Omaha World-Herald, in response to a question about a University of Nebraska Bureau of Business Research report released last week. The report recommended steps to “modernize” the state’s tax system, including lowering the state’s top income tax rate to below 6 percent. It estimated that the cuts would create 120 to 130 new jobs a year.
The same report also recommended taxing groceries.
With an eye on the state’s $700 million cash reserves, which has swelled because of a rebounding economy, business groups want individual and corporate income tax rates cut. The Legislature is looking at a tax cut proposal, LB 1097, backed by the Omaha and Lincoln chambers of commerce.
The top income rate in Nebraska is 6.84 percent. If you’re a single person making more than $27,000 a year, you’re already paying at that rate, right alongside the state’s millionaires. But tax-cut supporters note that’s higher than the rate of any neighboring state except Iowa. They’d lower the rate to 5.9 percent after three years and have it kick in at $36,000 for an individual and $72,000 for a couple.
Once lawmakers got a look at the potential consequences, it didn’t look like such a great idea. The estimated impact of the tax cuts came in at $645 million annually, about 16 percent of current state spending. That would lead to deep cuts in spending on public schools, higher education and social services, and shifting costs to cities and counties.
“The required annual budget cuts would be equivalent to the salaries of more than 11,000 teachers,” said Renee Fry of the Lincoln-based Open Sky Policy Institute, which has done studies of its own that found no proof that income tax cuts spark economic growth. Fry said 61 percent of the tax cut benefits would go to the top 20 percent of income earners. The bottom 40 percent of wage earners would get 7 percent of the benefits. She didn’t indicate whether that would be enough to cover grocery taxes, perhaps because that idea’s a non-starter, too.
A couple of our neighboring states have no income tax at all. At one point Heineman suggested eliminating the income tax entirely and replacing it with revenue earned by eliminating a smorgasbord of exemptions from the state’s sales tax. The same business groups blanched. What they had in mind was lower income taxes AND sales tax exemptions.
The fact is, Nebraskans pay high property taxes compared with the rest of America. When a Tax Modernization Committee went around the state asking for ideas about tax relief, members got an earful about that, said Sen. Galen Hadley of Kearney, chairman of the Tax Modernization Committee as well as the Revenue Committee.
“We did not hear from common citizens that they were paying too much income tax,” he said, “but we did hear that they’re paying too much in property taxes.”
The state could ease that burden by picking up more of the tab for K-12 education. This week, the Appropriations Committee plans a hearing on raising the property tax credit to landowners, a direct way for the state to deliver property tax relief. Money for that won’t be available if the state guts the cash reserve or lowers future income tax rates.
And for the record, tax cuts that require laying off hundreds or thousands of public sector workers, who are taxpayers (and voters) too, would be a lousy trade for a few dozen private sector jobs. Nebraskans, including those who won’t see any relief from the income-tax schemes, still rely on them to staff offices that provide many government services.
That explains why lawmakers are eager to promise tax cuts but reluctant to cut programs until they know who will benefit and who’ll be hurt.
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Fremont Tribune. Feb. 15, 2014.
Time to get the 9,000 in the game
In the days after Tuesday’s special election, there have been calls for healing.
It’s true, a certain amount of healing needs to take place. The debate about the future of Fremont’s illegal immigrant ordinance was highly emotional and passionate. At times, the rhetoric was mean-spirited and some of the most uncivil we’ve seen in quite some time. People don’t forget those comments and move on easily.
However, we believe all those voices - whether for or against the proposal to repeal the housing portions of the ordinance - wanted what is best for Fremont’s future.
But if Fremont is to grow, prosper and, yes, heal, it will take more than the 40 percent of the people who voted on Tuesday to take part. We must find a way to engage the approximately 9,000 people who did not vote.
Nine thousand.
That is a lot of people who are so disengaged that they did not even bother to vote in what some said was for the future of our city. The 9,000 represent a majority of registered voters and is more than everyone who voted on Tuesday. It seems they all said, “Who cares?”
Are the 9,000 happy with how things are going in Fremont? Are they so unhappy they don’t think anything can be done? Are they so busy with work and life there is no time left for anything else?
We don’t know the answers to those questions. We doubt there are many who do.
But we need to find a way to reach these 9,000 people.
Through its wide variety of civic organizations and governmental leadership, Fremont has been working to improve its recreational opportunities, its public infrastructure and other amenities in hopes of making this a better place to live, work and raise a family. We would argue that having a majority of the adult population engaged in the community would also make Fremont more attractive to potential residents.
It is time to find a way to get the 9,000 off the sidelines and actively involved in our community.
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McCook Daily Gazette. Feb. 13, 2014.
We’re learning to live off the land once again
We live in a political world, where everything seems to come down to a question of left or right.
Even the most innocuous of subjects can deteriorate into a liberal vs. conservative debate - the weather.
Mention “climate change,” let alone “global warming” in these parts, and you’ll likely touch off a heated discussion mentioning people like Obama, Hillary Clinton and Al Gore.
Depending on your audience, you may hear about big oil, “tree huggers” or even “chemtrail” conspiracies.
But are “green,” and politically, socially or fiscally conservative viewpoints necessarily in conflict?
We don’t think so.
Take the aptly named Greensburg, Kansas.
We remember weatherman Dave Freeman of KSN TV in Wichita, Kansas, reacting when he heard the news of the town’s destruction by an F5 tornado on May 4, 2007.
Even a veteran Kansas meteorologist was nearly speechless in face of the worst twister of the worst tornado season in 50 years.
“Oh, my.”
Bob Dixson and his wife huddled in the basement while the rest of his home and all of their belongings were carried off in the storm.
Rather than despairing at the loss, Dixson was inspired to run for mayor and oversaw rebuilding of an entirely new town, including a new hospital and school with “sustainable” architecture, wind turbines and solar panels all over town.
He told NPR that he had to get past the idea that being “green” was a liberal principle.
“When we drilled down closer to it … we realized our heritage and ancestors were based on those sustainable, green principles,” he said. “If you take care of the land, it will take care of you.”
That wouldn’t be news to our ancestors who settled in Southwest Nebraska and Northwest Kansas. They used what they had, and, it usually wasn’t something bought in the general store.
On the treeless plains, snug shelters built from strips of native sod plowed out the prairie served as housing for the earliest European settlers.
“Wind chargers” provided the earliest, direct-current electricity, stored in wet-cell batteries, and diets were strictly organic, grown in the garden out back or traded from the neighbors. Raw, unpasteurized milk and cream were consumed on the farm, or left on the station cart for a train on an actual “milk run” to collect.
Our region is playing an important role in the energy industry now - both in traditional oil, and ethanol biofuel - and there’s no reason wind and solar can’t come here in a big way in the near future.
If Toyota’s hydrogen fuel-cell vehicle turns out to be a success, and other manufacturers follow suit, there’s also no reason some of our alternative energy sources can’t go toward hydrogen production.
The earliest inhabitants of Southwest Nebraska and Northwest Kansas knew how to live off the land. As we work our way through the 21st century, it’s a lesson we’re learning again.
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The Grand Island Independent. Feb. 16, 2014.
Grand Island makes strong case for LB935
The territorial dispute over the fate of the Grand Island Veterans Home took center stage before the Government, Military and Veterans Affairs Committee in the state Capitol on Thursday. As committee chairman Sen. Bill Avery spelled out the rules of decorum it was clear that he anticipated fireworks and a long afternoon as proponents and opponents of LB935 packed the gallery.
Although LB935 doesn’t mention the words “Grand Island” or “veterans” the three-hour hearing mainly focused on Grand Island and veterans. Gov. Dave Heineman’s decision to relocate the home to Kearney deeply polarized the neighboring cities. Strong opinions about the rightful place for the long-needed replacement facility have dominated conversations and headlines since last July.
The showdown in committee room 1507 was the first time the opposing sides have met face to face since the competition between Kearney and Grand Island surfaced in fall of 2012. Kearney officials secretly visited the Grand Island Veterans Home then to lay the groundwork for their bid. The problem with this visit was that it took place some seven months before the state Department of Health and Human Services released the official request for bids. Discussions between Kearney and state officials began long before that. To our knowledge, community leaders from Hastings and North Platte weren’t afforded the same advance accommodation.
So much for setting the stage for a fair and open process.
Two key questions puzzled committee members. Why was the home being moved? Why wasn’t the process conducted in the same open manner as the relocation of Nebraska State Fair?
Our Thursday editorial clearly outlined the flaws with a process that was devised to achieve a specific political end.
Veterans groups have also been caught up in this controversy. They have been forced to take sides and have been used to an extent as political pawns. It’s unfortunate that the veterans who served a united nation are caught up in the politics of division.
Kearney Sen. Galen Hadley made an impassioned defense of the fairness and openness of the governor’s process. His testimony included a particularly telling remark.
“I know for a fact if the scores for Kearney and Grand Island were close, Grand Island would have won.” He then went on to point out all the ways Grand Island scored poorly and finished closer to last rather than first. Interesting how the scoring results ensured that Grand Island and Kearney weren’t close. The ranking is even more surprising considering all the laudatory remarks that the governor has made about Grand Island over the prior eight years. What could have happened to drop Grand Island’s stock so far in a year’s time? This is a good question for the committee to ponder.
Also revealing was how John Hilgert, the director of Nebraska’s Department of Veterans’ Affairs, floundered to come up with coherent answers when asked to clarify how the categories for “workforce” and “culture” were scored. If the committee looks deeper into the process they will find much more to question the legitimacy of the survey. An examination of the timeline for early conversations about moving the home would be most revealing as would questions posed to all three of the site selection committee members on the specifics of the criteria and scoring. Grand Island officials asked for that opportunity and were stonewalled.
Key factors that would have gone in Grand Island’s favor were purposely ignored in the scoring process and other negatives were manufactured by Hilgert and the site selection committee. No consideration was given for the proximity and usage of the Grand Island VA Medical Center. No value was considered for the 640 acres of land already given to the state of Nebraska for the home or for the hundreds of thousands of local dollars donated to the home over the years. A bogus demerit was given for the home site being in a flood plain - a claim that was refuted by state and federal authorities.
We applaud Sen. Avery and the committee for asking probing questions. The hearing was an example that good government happens when the public is engaged. The truth has nowhere to hide in such proceedings.
We hope that Sen. Mike Gloor’s bill will advance out of committee with the “look back” clause intact because the decision to move such a valued state service was made with bias, virtually no accountability, and a gaping lack of public process. While the governor has proven he doesn’t always do the right thing, we trust that 49 representatives of the people working together will.
George Norris, the father of the Nebraska’s unicameral government, offered these wise words regarding the importance of open government: “Every act of the legislature and every act of each individual must be transacted in the spotlight of publicity.”
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Kearney Hub. Feb. 15, 2014.
Facts easy to digest on vets home selection
The simple, easy route for the Government, Military and Veterans Affairs Committee would be to advance LB935 to the full Legislature, as its sponsor, Grand Island Sen. Mike Gloor would prefer, and allow the body of lawmakers to decide whether Grand Island ought to get a do-over on the veterans home.
That would be the simple, easy thing to do, but if members of the Government Committee take their responsibilities seriously, they’ll do their homework and determine whether there really were serious flaws in the competitive process, as Gloor alleges, or whether there were sufficient checks and balances employed in Kearney’s selection for the new Central Nebraska Veterans Home.
We believe the process was open and fair, and that all of the four competing cities, as well as members of the Legislature, were afforded multiple opportunities to review and comment on the process. The selection committee met several times with city representatives. All questions or concerns expressed by one city were shared with the others, along with answers to the questions and responses to the concerns.
It’s easy to believe, then, that Grand Island Mayor Jay Vavricek added his signature, without reservation, to those of five other central Nebraska mayors on a March 25, 2013 letter to Gov. Dave Heineman in support of the competition. Later, the Legislature’s Appropriation Committee approved criteria to evaluate proposals, and the full Legislature approved the state’s $47 million share for the project with the full knowledge that several cities were competing.
These are easily understood facts the Government Committee must consider. A bit more challenging - but still logical and understandable - is the method by which the governor’s three-person selection committee evaluated proposals to determine Kearney’s bid was best, overall, with 1,033 out of a possible 1,300 points.
Kearney scored well in each category because the committee that prepared the proposal evaluated the city’s strengths and vulnerabilities, and adjusted the proposal accordingly. For example, Kearney has occasional labor shortages, so the city’s bid includes extra funding to help current veterans home staffers transition to Kearney. There’s also money for medical training at UNK and the new UNMC allied health careers training center in Kearney to create a staffing pipeline.
Kearney prepared the strongest proposal because its leaders had gone through the meat grinder bidding for the $1.5 billion Facebook data center project. Ultimately, Altoona, Iowa, won over Kearney, but the grueling process left leaders with a clear view of Kearney’s advantages and vulnerabilities, and so they meticulously addressed each category in the veterans home bid.
Kearney promised a very good site, offered reduced utility rates, drafted a plan to welcome veterans to town, and pledged $10 million to help the state reduce initial and long-term expenses.
When the Government Committee finishes its homework, it will clearly understand why veterans groups across the state are ready to build in Kearney. Lawmakers will agree it’s time to do what’s right for our veterans and move forward, without delay.
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