Letter to the Editor

Some water taxes returned - maybe

Thursday, June 19, 2008

Dear Editor:

The District Court has ruled the property tax portion of the Republican River Basin water tax to be unconstitutional. The mechanism that permits the property tax also permits the occupation tax, which is the per irrigated acre tax. If the Nebraska Supreme Court upholds the District Court ruling, then the LB701 taxes would be illegal.

The lawyers tell us that if you pay the occupation tax, then even if the Courts find that it is unconstitutional, you don't get your money back unless you sue within one year of paying the tax. Otherwise, the unconstitutional tax paid is considered a "voluntary contribution" to the NRD. You would think that if the tax was unconstitutional, it would have to be returned without your taking action; but it doesn't work that way on the occupation tax.

This creates the very real potential that some people will be paying thousands of dollars in "illegal" taxes while others will pay nothing. While most people are willing to pay something toward the solution, do you want to pay when your neighbor does not?

There is likely to be a group that decides that the only fair way to do this is to ask for their tax money back while the Courts and lawmakers get things sorted out. If their effort succeeds, then they would get their money back while everyone else pays.

This would delay when the NRDs will have the funds to repay the State for the loan they were forced to take out to pay for surface water they were forced by the State to buy in order to meet the State's obligation to comply with the Compact (otherwise, the State threatens we lose access to water). However, the State loaned the NRDs the money; so whether the tax is collected or not, it is not a make--or--break situation. The loan from the State is not due until the Supreme Court rules. And, Senator Mark Christensen has assured the Legislature that, even if the Court rules against the tax, he will introduce legislation to make sure that there is money for repaying the State.

There needs to be money for a solution. But, that solution should be fair.

The occupation tax per certified irrigated acre for the: URNRD is $6.96, MRNRD is $7.13, LRNRD is $5.20

For more information about how to potentially get your occupation taxes refunded, visit the web site of the attorneys that will be challenging the occupation tax: http://www.knudsenlaw.com - 402 475 7011

The Nebraska Attorney General's office is handling the defense for the State and the NRDs and is arguing that the District Court Judge got it wrong, that the Supreme Court will overturn the ruling. However, that ruling probably won't happen until a year has lapsed from the time you have paid your tax. And, if you prefer not to make a multi-thousand dollar, potentially involuntary donation to the State's solution for the water issue, you must file your claim prior to knowing how the Court will rule.

I believe that there needs to be a solution. I think it is in the best interest of the area to help pay for that solution, even if it means we pay all of it and even if it is unfair. We could stand on principle and refuse to pay more than our fair share, but it isn't wise to sacrifice the economy of the Basin to make the point. However, individual landowners have little incentive to pay for a solution when they may not have to and when their neighbors don't. If you want a fair solution, then the only way to cause that is to elect Legislators and NRD board members who will cause it to be fair instead of easy.

Until then, you need to decide if it is in your best interest to contribute to the loan repayment the NRDs must make to the State or if you prefer to perhaps push off that contribution to the future.

Steve Smith


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  • So what you're saying is...the money that I had to pay "involuntarily" in my yearly property tax statement towards the NRD, I could get back IF I "voluntarily" sue them? Doesn't seem right. Why can't the NRD/State just refund us. They've got all the records of the people who paid. Why should we have to put out money just to get our money back? Great government action!!!!

    -- Posted by Rural Citizen on Thu, Jun 19, 2008, at 8:59 AM
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