When the controversial tax reform plan pushed by Gov. Pete Ricketts failed to garner enough votes this week to break a filibuster, the measure was declared dead for the year.
While reductions in taxes are certainly appealing, such acts can’t be done irresponsibly — particularly in light of the deficits that preceded steep spending cuts in this first year of the biennial budget.
Lawmakers convened in January, with Nebraska needing to trim $900 million from the state budget. Even at first glance, a plan that would increase that deficit by millions deserved skepticism. And, as the session wore on, it became clear Ricketts’ goals weren’t compatible with the grim reality of tax revenue forecasts that fell by tens — or hundreds — of millions of dollars at seemingly every update.
Critics often pointed to the grim financial picture faced by Kansas after its lawmakers cut taxes too much, too soon. The state dropped income tax rates so dramatically in 2012 that government revenues have fallen sharply while expenses have increased — leaving a forecast $1.1 billion shortfall by 2019.
The aftermath has been messy, with a shutdown of all public schools a real possibility last summer. In response, some taxes, including Kansas’ sales tax, have been raised to meet fiduciary responsibilities. Other proposed increases loom on the horizon.
Nebraska doesn’t need — or want — that mess. Instead, citizens deserve a Legislature that is responsible with its finances for their sake.
The passion about what’s best for Nebraska taxpayers is good. However, the bitter postmortem that followed this measure’s defeat was not.
Proponents of the bill argued that a minority of the Legislature voted against taxpayers’ best interest in killing it, while groups like Americans for Prosperity vowed senators responsible for the legislation’s demise would “be held accountable.”
The bill’s opponents, such as Sen. Burke Harr of Omaha, told reporters they instead said “no to a bad bill.”
A robust debate on the state’s tax situation is good, but the sniping afterward was disappointing. The Legislature will likely debate a similar measure in 2018, and we hope it’s accompanied by a rosier outlook on the state’s finances. At that time, a more modest version of the reform sought by the governor may enter the realm of possibility.
But, in the end, the reason for the tax reform bill’s demise this week was simple: Nebraska simply couldn’t afford this legislation at this time.